TO THE EDITOR OF LE NATIONAL – II

There is no want of an example of a people who would have paid to be oppressed, from whom money has been snatched in order to bereave its freedom.

Frédéric Bastiat
Complete Works, Volume 7, pages 159 to 166 (in French)
Courrier français, November 11th, 1846

In this second letter to the editor of the National, Frédéric Bastiat responds to the argument consisting in implementing a protectionist regime in order to fight the competitive advantage that foreigners would have because they do not suffer from the restrictions in place in the importing country, which is shooting itself in the foot. He shows how injustice is introduced between the various producers and consumers when implementing tariffs. He also touches upon what Ludwig von Mises will call “malinvestment” when the injustice created between the different producers leads to a suboptimal allocation of capital, the consequence of which will be to revive the competitiveness issue down the line. If a “solution” postpones the issue instead of solving it, one enters a vicious circle that will lead to do more of what is not functioning.

If legislation and taxes in a country are such that producers lack competitiveness, one must act on that legislation and those taxes – an issue cannot be solved through the creation of a new issue.

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