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Quotation of the Day…

is from pages 21-22 of The Fiscal Policy of International Trade: Being a Summary of the Memorandum by Prof. Alfred Marshall, Published as a Parliamentary Paper in 1908, J.M Robertson, ed. (1910) (original emphasis):

Other countries have not found, on the other hand, that a policy of Protection yields the results which the protectionist theory promises. Professor Marshall, taking a favourable view of a protectionist policy for “new ” countries, did not find the facts square with his forecast.

“I for one was so much impressed by those arguments of [Henry] Carey and his followers, which had found scarcely any echo in English literature, that I went to the United States in 1875 to study the problems of national industry and international trade from the American point of view; and I was quite prepared to learn, not indeed that the American system was applicable to England, but that it might contain ideas capable of adaptation to English conditions.

“I came back convinced that a protective policy in fact was a very different thing from a protective policy as painted by sanguine economists, such as Carey and his followers, who assumed that all other people would be as upright as they knew themselves to be, and as clear-sighted as they believed themselves to be. I found that, however simple the plan on which a protective policy started, it was drawn on irresistibly to become intricate; and to lend its chief aid to those industries which were already strong enough to do without it. In becoming intricate it became corrupt, and tended to corrupt general politics. On the whole, I thought that this moral harm far outweighed any small net benefit which it might be capable of conferring on American industry in the stage in which it was then.

“Subsequent observation of the course of politics in America and elsewhere has strengthened this conviction. It seems to me that the policy adopted in England sixty years ago remains the best, and may probably remain the best, in spite of increasingly rapid economic change, because it is not a device, but the absence of any device. A device contrived to deal with any set of conditions must become obsolete when they change.”

DBx: Please keep this passage in mind the next time someone such as Oren Cass asserts that Alfred Marshall would dissent from modern economists’ strong support for a policy of unilateral free trade.

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