The socialists are merely being ridiculous when they rant against the middleman. Does he impose his services by force?
After a break of about a year, I am back to my blog with a chapter, Wages, that is not easy in its construction (more than 40 pages on a topic that has evolved substantially) but that is dotted with profound thoughts that will allow me to note seven quotes in the coming two weeks despite lacking an attempt to structure the chapter in its logical progress.
A first interesting aspect is the core of the debate at the time. Frédéric Bastiat is arguing in favour of wages against the socialists of this era, who seemed to blame wages then. As a consequence, a substantial part of the reasoning compares wages with insurance to the extent that both aim at offering a particular level of stability and peace of mind, be it to the salaryman or the insured person.
It is in such a context that today’s quote is inscribed – the advantages and drawbacks of association are looked into, leading to the emergence of middlemen who are disparaged by those who are not capable of seeing that the source of value is not as simple as what they can conceive. The question asked here by Frédéric Bastiat allows to understand that exchange creates value – if I am paying a middleman, it is because the service rendered costs less (financially or else) than if I had to render it myself. The simple fact that the exchange occurs is proof that there is value creation.
Of course, this kind of reasoning is not valid when the services offered by the middleman are indeed imposed by force, which is more and more frequent nowadays when governments pass legislation on everything and anything, not only to forbid but also to prescribe.