Quotation of the Day…

by Don Boudreaux on December 29, 2017

in Reality Is Not Optional, Seen and Unseen, Trade

… is from page 152 of the 1992 collection of some of William Graham Sumner’s finest essays, On Liberty, Society, and Politics (Roger C. Bannister, ed.); specifically, this quotation is from Sumner’s April-June 1902 Independent essay, “The Concentration of Wealth: Its Economic Justification” (available here, free of charge, by scrolling down):

I do not say that “he who desires the end desires the means,” because I do not believe that that dictum is true; but he who will not forego the end must be patient with the incidental ills which attend the means.  It is ridiculous to attempt to reach the end while making war on the means.

DBx: Desired ends – desired outcomes – are, by definition, desirable.  But in our world of scarcity – including scarcity of information and of knowledge – almost no desired end is achievable without cost.

One widely desired end is material prosperity.  (Some people who marinate in material prosperity assert that they are uninterested in material prosperity.  Perhaps these people are sincere, but nearly all of them are uninformed about just what it is they say they desire.  Only prosperous people – people who are well-fed, well-housed, well-vaccinated, and well-provisioned in the countless other ways that nearly everyone in modernity is well-provisioned – have the luxury to appreciate the beauty of the wilderness or to ponder philosophically upon bear scat.)  Yet material prosperity doesn’t occur without human effort.  Material prosperity requires work, risk-taking, trial-and-error, savings and investment, patience, creativity, and willingness both to accept the unavoidability of trade-offs and to adjust to market signals.

To the extent that markets are stymied in ways designed to protect producers from having to respond to changes in the spending patterns of consumers, markets produce no additional material prosperity.  In such cases, state intervention at best transfers wealth from some people to other people.  But transferring wealth – say, from consumers of steel to producers of steel – produces nothing.  The greater prosperity of the steel producers is mistaken for being greater prosperity for the country as a whole.  This illusion is what causes so many people to mistakenly believe that tariffs and other forms of protectionism – what Jon Murphy calls “scarcityism” – create rather than destroy wealth.

The extraordinary material prosperity that almost everyone today in modern society enjoys is possible only because and insofar as producers serve consumers rather than the other way ’round.  Fortunately, in most economic affairs, producers are obliged to serve consumers.  But for those economic affairs that cross political borders, too many of them are ‘reversed’ by the state in order to prevent producers from having to serve consumers.  Such protectionism, at root, is an attempt to allow some producers – in practice, those with great political clout – to escape what Sumner calls “the incidental ills” of the means necessary for mass flourishing.

Protectionism is a political program that excuses domestic producers who profit from it an escape from the necessity of playing by the rules of a market economy.  It’s cheating.  Protectionism is cheating, plain and simple – cheating costumed in the fancy yet phony dress of ‘trade policy.’


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