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Third Letter - Frédéric Bastiat, Collected Works of Bastiat. Vol. 2: The Law, The State, and Other Political Writings, 1843-1850 
The Collected Works of Frédéric Bastiat. Vol. 2: The Law, The State, and Other Political Writings, 1843-1850, Jacques de Guenin, General Editor. Translated from the French by Jane Willems and Michel Willems, with an introduction by Pascal Salin. Annotations and Glossaries by Jacques de Guenin, Jean-Claude Paul-Dejean, and David M. Hart. Translation Editor Dennis O’Keeffe. Academic Editor, David M. Hart (Indianapolis: Liberty Fund, 2012).
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Services are traded for other services. I am obliged to make a heroic effort to resist the temptation of showing how simple, true, and fertile this axiom is.
Faced with it, what are all these subtle notions, use-value and exchange-value, material and immaterial products, or the productive and unproductive classes? Industrialists, lawyers, doctors, civil servants, bankers, merchants, seamen, soldiers, artists, workers, whichever of these we are, with the exception of rapacious men, we provide and receive services. However, as these mutual services are commensurate only with each other, it is in them alone that value resides and not in the free material and the free agents of nature they set in motion. Let nobody say, therefore, as is currently fashionable, that merchants are parasitical intermediaries. Does he or does he not have to make an effort? Does he or does he not save us work? Does he or does he not provide us with services? If he provides services, he creates value just as much as the manufacturer does.11
Just as the manufacturer by means of his steam engine uses the weight of the atmosphere and the expansion of gas to turn his thousand spindles, the merchant uses the direction of the wind and the fluidity of water to transport his products. But neither of these makes us pay for the forces of nature since the more they are assisted the more they are obliged to lower their prices. These things therefore remain what God wanted them to be, a free gift for the whole of humanity, except for the work put in.
Is this not equally true for farming? This is what I have to examine.
Let us suppose that there is a huge island inhabited by a few savages. One of these has the bright idea of concentrating on growing crops. He prepares for this at length as he knows that the enterprise will take up a great many days of work before it shows the slightest yield. He gathers provisions and manufactures crude instruments. At last he is ready and fences and clears a tract of land.
Two questions arise:
Does this savage contravene community rights?
Does he contravene his own interests?
Since there is a hundred thousand times more land than the community is capable of cultivating, he no more contravenes its interests than I contravene those of my fellow countrymen when I take a glass of water from the Seine to drink or a cubic foot of air from the atmosphere to breathe.
He does not contravene his own interests either. On the contrary, since he no longer hunts or hunts less, his companions have proportionally more space. What is more, if he produces more crops than he can consume, he will have a surplus to trade.
In trading, will he be exercising the slightest pressure on his fellow men? No, because they will be free to accept or refuse.
Will he be charging for the contribution of the earth, sun, and rain? No, because everyone, like him, has recourse to these agents of production.
Should he wish to sell his tract of land, what could he obtain for it? The equivalent of his work, that is all. If he said, “First of all, give me as much of your time as I have devoted to the operation and then another amount of your time for the value of the land in its natural state,” people would answer, “There is land in its natural state next to yours; I can only repay you for your time, since, for an equal amount of time, nothing stops me from putting myself in a position similar to yours.” This is exactly the reply we would give to the water carrier who asks us for two sous for the value of his service and two for the value of the water, from which we can see that the earth and water have this in common: both are very useful but neither has any value.
If our savage wished to rent out his land, he would never obtain anything other than payment for his work in another form. The more exaggerated of his demands would always meet this inexorable reply, “There is more land on the island,” a reply more decisive than that of the miller of Sans-Souci,12 “There are judges in Berlin.”13
Thus, at least at the beginning, the landowner who either sells the products of his land or his land itself or leases it is doing nothing more than provide and receive services on an equal footing. It is the services that are compared, and consequently have value, the value being attributed to the land only by abbreviation or metonymy.
Let us see what happens as the island becomes increasingly populated and farmed.
It is quite clear that the ease of procuring raw materials, subsistence, and work is increasing for everyone, without privileged advantage for anyone, as we can see in the United States. There, it is absolutely impossible for landowners to put themselves in a position that is more favorable than that of other workers since, because of the abundance of land, each person has the choice of taking up agriculture if it becomes more lucrative than other jobs. This freedom is enough to maintain the balance between services. It is also enough to ensure that the agents of nature, used in a great many industries as well as in agriculture, do not benefit producers as such but the general public who are the consumers.
Two brothers take leave of each other; one is going whaling, the other to clear land in the far west. They then trade oil for wheat. Does one take the value of the land more into account than the value of the whale? Comparison can be made only between services received and given. These services therefore are the only ones to have value.
This is so true that, when nature has been very generous with regard to the soil, that is to say, when the harvest is plentiful, the price of wheat decreases and it is the fisherman who benefits from this. When nature is generous with produce from the ocean, in other words, when catches are large, oil is cheap and farmers benefit from this. Nothing proves better that the free gift s of nature remain free for the masses than the fact that producers who bring goods to market are paid solely for the service they provide in doing so.
Therefore, for as long as there is an abundance of uncultivated land in the country, the balance will be maintained between mutual services; and any exceptional advantage to the landowner will be refused.
This would not be so if landowners succeeded in prohibiting any new land clearance. In this case, it is perfectly clear that they would be laying down the law to the rest of the community. As the population is growing, the need for subsistence is increasingly being felt and it is clear that they would be in a position to have their services remunerated at a higher price, which in normal speech would be expressed by the metonymy, land has increased in value. However, the proof that this iniquitous privilege would be conferring an artificial value, not to the matter but to the services, is the situation we are witnessing in France and in Paris itself. Through a procedure similar to the one we have just described, the law limits the number of brokers, currency exchange agents, notaries, and butchers, and what is the result? By enabling them to put a high price on their services, it creates for their benefit a capital that is not included in any material. The need for brevity produces the following statement, “This project, this practice, or this patent is worth so much,” and the metonymy is obvious. The same applies to the land.
We have reached the final hypothesis, that in which the land in the entire island is subject to individual appropriation and farming.
In this case, it appears that the relative position of the two sectors will change.
In effect, the population continues to grow. It will take up all the occupations except for the one that has been filled. The latter’s owner will then operate the law of trade! What limits the value of a service is never the goodwill of the person supplying it; it is when the person to whom it is being offered can either do without it, supply it himself, or ask for it from others. The propertyless man no longer has any of these alternatives. In former times, he would say to a landowner, “If you ask me for more than the payment for your work, I will grow my own crops!” and the landowner would be forced to give way. These days, a landowner would reply, “There is no more land in the country.” Thus, whether we see value in things or in services, farmers will take advantage of the lack of any competition and, like landowners, will lay down the law to sharecroppers and farm laborers and in the long run to everyone.
This new situation has obviously one single cause, the fact that those who do not own land can no longer stem the demands of those that do by stating, “There is still land left to clear.”
What, therefore, is needed to ensure that the balance between services is maintained and that the situation according to the current hypothesis immediately concurs with that of the previous one? One single thing: that another island rises up next to our island, or even better new continents that are not totally covered by agriculture.
If this happened, production would continue to develop and be distributed in fair proportions between agriculture and other industries without any possible oppression on either side, since if landowners said to craftsmen, “I will sell you my wheat at a price that exceeds the normal payment for the work,” craftsmen would be quick to reply, “I will work for the landowners on the continent who are unable to make such demands.”
Once this situation has happened, the proper guarantee for the masses lies in free exchange, that is, in the right of labor.14
The right of labor constitutes freedom and property. Craftsmen are the owners of their labor, their services, or the price they earn from them in the same way that landowners own the soil. So true is this that, by virtue of this right, craftsmen can exchange their labor and services around the world for agricultural products and are bound to keep landowners in the position of equality I have previously described in which services are exchanged for other services, without the possession of the land itself conferring any more of a benefit independently of the land’s being put to work than does the ownership of a steam engine or the simplest tool.
However, if by usurping legislative power, landowners prohibit the landless farm laborers15 from working away from the land in return for subsistence, the equilibrium between services is broken. Out of respect for accuracy in political economy, I will not say that in this way they are artificially increasing the value of the land or agents of nature, but I will say that that they are artificially increasing the value of their services. With less work themselves, they are buying more work. They are committing oppression. They are behaving like all the monopolists with patents. They are behaving like all the landowners in the earlier period who prohibited land clearance. They are introducing into society a cause of inequality and poverty. They are changing the notions of justice and property and are digging an abyss under their feet.16
But what relief can nonlandowners draw from the proclamation of the right to work? How does this new right increase subsistence or the work distributed to the masses? Are not all forms of capital devoted to making work for people? Do they increase by passing through the coffers of the state? When it purloins capital from the people through taxes, does the state not eliminate as many sources of work on the one hand as it opens up on the other?
Furthermore, in whose favor are you claiming this right? According to the theory that revealed it to you, it would be to the advantage of anyone who no longer has a share in the usufruct of the land in its original state. But bankers, merchants, manufacturers, lawyers, doctors, civil servants, artists, and craftsmen are not landowners. Do you mean that those who own the land will all be required to provide work for all these citizens? But all participants create openings for one another. Is it your view that only the rich, whether landowners or not, have to come to the assistance of the poor? In this case, what you are talking about is assistance and not a right that takes its source from an appropriation of the land.
With regard to rights, the one that has to be insisted on, because it is incontestable, rigorous, and sacred, is the right to work. It is freedom and ownership, not only of the land but also of bodily strength, intelligent minds, faculties, and personality, that are violated if one class can forbid to others the free exchange of services, both domestic and foreign. As long as this freedom exists, landownership is not a privilege; like all the others, it is just the ownership of a form of work.
I need only to deduce a few consequences of this doctrine.
[11. ](Paillottet’s note) On the question of intermediaries, see, in vol. 5, chapter 6 of the pamphlet What Is Seen and What Is Not Seen, and, in vol. 6, the beginning of chapter 16. (OC, vol. 5, “Ce qu’on voit et ce qu’on ne voit pas,” chap. 6, p. 356, “Les Intermédiaires”; and vol. 6, p. 497, “De la population.”)
[12. ]See “Bastiat’s Political Writings: Anecdotes and Reflections,” pp. 414–15 in this volume.
[13. ](Bastiat’s note) We have heard not so long ago a denial of the legitimacy of leasing land. Without going so far, many people find it hard to understand the durable nature of income from capital. “How,” they say, “does capital once formed produce a never-ending income?” Here is an explanation of its legitimacy and durability using this example:
[14. ](Paillottet’s note) This theoretical situation has been examined again by the author in the final part of his letter to M. Thiers. See the last twelve pages of “Protectionism and Communism.” (OC, vol. 4, p. 504, “Protectionisme et communisme,” pp. 534–45 [the last twelve pages].)[See also “Protectionism and Communism,” pp. 257–65, and “Anecdotes and Reflections,” p. 410, in this volume.]
[15. ]Bastiat uses the word prolétaires, which we have translated as “landless farm laborers.”
[16. ](Paillottet’s note) See chapters 9 and 13 of Economic Harmonies on land ownership. See also, in vol. 2, the second parable in the speech given on 29 September 1846 in Montesquieu Hall. (OC, vol. 6, p. 297, “Propriété foncière,” and p. 430, “De la rente”; also see vol. 2, p. 238, “Second discours.”)