Bonus Quotation of the Day…

by Don Boudreaux on November 3, 2022

in Seen and Unseen, Trade

… is from pages 360-361 of the 1978 collection, edited by Eric Mack, of Auberon Herbert’s writings, The Right and Wrong of Compulsion by the State; specifically, it’s from Herbert’s 1908 essay, “A Plea for Voluntaryism”:

The high prices and dear living, the harassing interferences with trade, the rings and corners, the trickeries and corruption, that all tread so close on the heels of protection, the wild extravagance, the domineering insolent attitude of the state-made monopolists, the ever-growing power of the governments to go their own way, where they can gather vast sums of money so easily through their unseen tax collectors, the ever-spreading socialism, that is only protection made universal—all these things are preaching their eloquent lesson, and slowly preparing the way in other countries for free trade. Sooner or later the world after years of bitter experience learns to unmask all the impostor systems that have traded in its hopes and passions and fears. The thin coating wears off, and the baser metal betrays itself underneath. So it will fare with the protection, that asks you to be credulous enough to tie up your left hand in order that your right hand may work more profitably. It is true that in protected countries the wages of the workers may be pushed up higher than in the case of free trade countries, but life will remain harder and more difficult. Why? Because, as we have said, prices rule so high; corners and combinations flourish; trickery and corruption find their opportunity; more vultures of every kind flock to the feast; and with the feast of the vultures the burden of rates and taxes becomes intolerable. The whole thing hangs together. Establish freedom and open competition in everything, and all forms of trade and enterprise, all relations of men to each other, tend to become healthy and vigorous, pure and clean.

DBx: Herbert correctly understood that in practice protectionism is not only inevitably economically inefficient, it is also inevitably and grotesquely unjust. Protectionists miss this inefficiency and injustice because they see only the relatively small handful of concrete firms and flesh-and-blood individuals that benefit from protection. Only by ignoring protectionism’s inescapable economic damage and its unavoidable encouragement of special-interest-group rent-seeking can protectionists convince themselves and others that their restrictive schemes are good for the country as a whole.

Herbert, however, was unfortunately incorrect in his optimistic prediction that the damage and injustice that are inseparable from protectionism will eventually reveal themselves to enough people to prompt people to reject protectionism. The human mind is too easily fooled.

Both sincere and venal protectionists are remarkably able to convince most people that a regime of free trade will harm the country. Right-wingers today in America, such as those at American Compass, along with left-wingers, such as Bernie Bros, confident that they understand the case for free trade, remain ignorant of this case. (Why bother learning the case for free trade if you’re convinced that you already understand it sufficiently?) This ignorance of the case for free trade would embarrass a competent economics undergraduate, but it only further motivates protectionist pundits and politicians to push their proposals for commercial restrictions.

Competent economists can do nothing more than continue to refute, for the trillion-and-oneth time, each and every fallacy peddled daily by protectionists. Ideally, this effort of competent economists would pave a path to a future of free trade. But our world isn’t and won’t ever be ideal. So the best that competent economists can do is, through their education efforts, to reduce the damage done by protectionism as they shake their heads in wonder that people continue to be so daft as to fall for the comical idiocy of protectionist arguments and propaganda.

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