The Online Library of Liberty

A project of Liberty Fund, Inc.

• The Collected Works of Frédéric Bastiat
• General Editor’s Note
• Note On the Translation
• Note On the Editions of the Œuvres Complètes
• Acknowledgments
• Introduction
• The Political Pamphlets As Models of Applied Economics
• Eyewitness to Political and Economic Upheavals (1848–50)
• Republicanism and Universal Suffrage
• State Education
• Hayek and Spontaneous Order
• Peace, Liberty, and Taxes
• The Left, Taxes, and Trade Unions
• The Economists, the Socialists, and Legal Plunder
• Freedom to Exchange
• Conclusion
• Frédéric Bastiat Chronology
• “the Law,” “the State,” and Other Political Writings, 1843–1850
• 1: Reflections On the Petitions From Bordeaux, Le Havre, and Lyons Relating to the Customs Service 1
• 2: The Tax Authorities and Wine 1
• 3: On the Wine-growing Question
• 4: Property and Law
• 5: Justice and Fraternity 1
• 6: Individualism and Fraternity
• 7: The State
• 8: The State (draft)
• 9: The Law
• 10: Property and Plunder 1
• First Letter
• Second Letter
• Third Letter
• Fourth Letter
• Fifth Letter
• Claim Made By M. Considérant and F. Bastiat’s Reply
• 11: Baccalaureate and Socialism 1
• 12: Protectionism and Communism
• 13: Plunder and Law 1
• 14: The War Against Chairs of Political Economy 1 , 2
• 15: Peace and Freedom Or the Republican Budget 1
• 16: Discourse On the Tax On Wines and Spirits 1 , 2
• 17: The Repression of Industrial Unions 1
• 18: Reflections On the Amendment of M. Mortimer-ternaux 1
• 19: Parliamentary Conflicts of Interest 1 , 2
• Bastiat’s Political Writings: Anecdotes and Reflections
• The Law-abiding Revolutionary
• The State As the “great Fiction”
• Bastiat’s Publisher, the Librairie De Guillaumin
• Bastiat’s Editor and Executor, Prosper Paillottet (1804–78)
• The Concept of Individualism
• The Idea of Laissez-faire
• The Concepts of “industry” and “plunder” (spoliation)
• The Right to Work Vs the Right Or Freedom of Working
• Classical Liberal Vs Socialist Utopias
• The Cause of Bastiat’s Untimely Death
• Speaking Truth to Power: “the Miller of Sans-souci”
• Glossary of Persons
• Glossary of Places
• Glossary of Subjects and Terms
• Bibliographical Note On the Works Cited In This Volume
• Bibliography
• Primary Sources
• Works By Bastiat
• Works By Other Authors Cited In the Text, Notes, and Glossaries
• Secondary Sources

16

Discourse on the Tax on Wines and Spirits1 ,2

Citizen Representatives,

I wanted to discuss the question of the tax on wines and spirits as it appears to me to exist in the understandings of all of you, that is to say, from the point of view of financial and political necessity. I thought, in effect, that necessity was the only reason invoked to support the retention of this tax; I believed that in your eyes it brought together all the features by which economic science teaches us to recognize bad taxes. I believed that it had been accepted that this tax is unjust and inequitable and that its collection involved extremely tedious and annoying formalities. However, since the reproaches directed against this tax by all statesmen since its inception are now being disputed, I will say a few quick words about it.

First of all, we claim that the tax is unjust and base our claim on the following: Here are parcels of land that are side by side and subject to a land tax, a direct tax. These parcels are classified and compared with each other and taxed in accordance with their value. Subsequently, each person may grow anything he wants on them; some grow wheat, others pasture, yet others carnations and roses, and others vines.

Well then, of all these products, there is one and only one that, once it has entered into circulation, is subject to a tax that yields 106 million to the treasury. All the other agricultural products are free from this tax.

It might be said that the tax is useful and necessary, and this is not the subject with which I wish to deal, but it cannot be said that it is not unjust from the owner’s point of view.

It is true that it is said that the tax does not fall on the producer. I will examine this later.

We then say that the tax is badly distributed.

In fact, I was very surprised that this has been disputed, since . . . (interruption)

A member on the right:

Speak a little louder!

The president:

Will the Assembly be silent please?

M. F. Bastiat:

I am even ready to abandon this argument in the interest of speed.

Various voices:

Speak! Speak!

M. F. Bastiat:

The matter seems to me to be so clear, it is so obvious that the tax is badly distributed that, truly, it is embarrassing to demonstrate this.

When we see, for example, that a man who, in an orgy, drinks six francs’ worth of champagne pays the same tax as a worker who needs to restore his strength for work and drinks six sous’ worth of ordinary wine, it is impossible to say that there is no inequality, no monstrousness in the distribution of the tax on wines and spirits. (Hear! Hear!)

Calculus has almost been used to establish that the tax is negligible, that these are fractions of a centime and ought not to be taken into account. In this way, a class of citizens has been burdened with 106 million of an iniquitous tax by being told: “This is nothing. You should consider yourselves fortunate!” The men who invoke this argument ought to be telling you: “We are operating such and such an industry, and we are so convinced that the tax, by being split up, cannot be felt by the consumer on whom it falls that we are subjecting ourselves to the indirect tax and to the “exercise”3 in the case of the industry we are involved with. The day when these men come to the rostrum to say this, I will say: “They are sincere in their defense of the tax on wines and spirits.”

But anyhow here are some figures. In the Department of the Ain, the average wholesale price of wine is eleven francs, and the average retail sales price in forty-one francs. This is a considerable difference; it is obvious that he who is able to buy wine wholesale pays eleven francs and that he who is obliged to purchase it retail pays forty-one francs. Between eleven and forty-one francs the difference is thirty francs. (Interruption.)

A member on the right:

It is not the tax that causes this difference; this is the same for all goods.

The president:

M. de Charencey has done his calculations; allow the speaker to do his own.

M. F. Bastiat:

I could quote other départements, but I have taken the first on the list. Doubtless, there is profit to the salesman, but the tax is a considerable proportion of this difference.

In the last two days, efforts have been made to prove such extraordinary things that I really would not be surprised if efforts were made to prove that the tax harmed no one, neither the producer nor the consumer. But if this is so, let us tax everything, not just wines but all products!

I then say that the tax is very costly to collect. I will not quote figures to prove this; figures can be used to prove a great many things. When figures are quoted on this rostrum, people think they are giving them great authority by saying: “These are official figures.” However, official figures mislead just like the others; it all depends on the use made of them.

The fact is that when we see functionaries, and well-paid ones, operating across the entire territory of France in order to collect this tax, we are quite justified in our belief that its collection is very expensive.

Last, let us note that the collection of this tax is accompanied by tedious and annoying formalities. This is a point that the speakers who preceded me on this rostrum have not dealt with. This does not surprise me since all or nearly all of them come from départements that do not grow vines. If they lived in our départements, they would know that the complaints of vineyard owners against the tax on wines and spirits are directed less against the tax itself, its magnitude, than against these annoying, anger-provoking, and dangerous formalities, which are seen as so many traps set at every stage under their feet. (Approval from the left.)

Everyone understands that when this extraordinary thought, this immense utopia—for it was immense then—was conceived, namely, establishing a duty on the circulation of wines without a prior inventory being carried out, everyone, I say, understands that, in order to ensure its collection, it was necessary to conceive a code of the most severely preventive kind, even to the point of harassment, since otherwise how would they have done it? It was necessary that, for a cask of wine to circulate openly in a commune there had to be an employee to determine whether it was in accordance with the rules or not. That cannot be done without an army of employees and a host of irritating interventions against which, I repeat, the taxpayers complain even more than against the tax itself.

The tax on wines and spirits has another very serious consequence, which I have not heard pointed out on this rostrum.

The tax on wines and spirits has caused a disturbance in that great economic phenomenon that is known as the division of labor. In former times, vines were grown in soils that were suited to them, on the slopes of hills and on gravel. Wheat was grown on the plateaus and flat open fields and on alluvial soil. In the beginning an inventory4 was devised, but this method of tax collection caused an uprising among all the landowners. They invoked the rights of property and, as there were three million of them, they were listened to. The burden was then cast onto the café owners and, as there were only three hundred thousand of them, it was declared that, in principle, the property of three hundred thousand men was not property to the same extent as that of three million men although, as it happens, property has always had only the one basis, in my opinion.

But what was the result for the landowners? I believe that the landowners themselves bear the weight of the fault and injustice they then committed. Since they enjoyed the privilege of consuming their products without paying tax, it transpired that, either to avoid the tax or to avoid in particular and above all the formalities and risks to which its collection subjects people, the owners of flat, open fields and alluvial soils all wanted to have vines on their property for their own consumption. In the département that I represent here, or at least in the major part of this département, I can state positively that there is not one sharecropping farm on which there are not sufficient vines planted for the family’s consumption. These vines produce very bad wine, but this offers the immense advantage of being free from the intervention of indirect taxes and all the risks attached to inspections.

This fact explains to a certain extent the increase in the numbers of vines planted that has been pointed out. This increase is oft en set against the complaints of the landowners, who claim to be the victims of injustice; and the landowners appear to be told: “This injustice does not count; it is nothing, since vines are being planted in France.”

First of all, I would like someone to quote me an industry that, in the period from 1788 to 1850, the space of sixty-two years, has not expanded in this proportion. I would like to know, for example, if the coal, iron, and cloth industries have not expanded in this proportion. I would like to know if there is any industry of which it can be said that it has not grown by a quarter in the space of sixty years. Would it be so very surprising that, following its natural development, the industry most firmly rooted in our soil, the industry that is able to provide the entire universe with its products, should increase by this amount? However, this increase, sirs, is provoked by the law itself. It is the law that causes people to dig up vines on the hill slopes and plant them in the flat fields to avoid the vexations of indirect taxation. That is a huge and obvious disturbance.

I ask you to allow me to draw your entire attention to a fact that is almost local in character, since it concerns only a single district, but is of major importance, at least in my eyes, since it is linked to a general law.

This fact, sirs, will also be useful in replying to the argument brought to this rostrum when, invoking the authority of Adam Smith, it was said that the tax always falls on the consumer, with the implication that, for the last forty years, all the owners of vineyards in France have been wrong to complain and ignorant of what they have been talking about. Yes, I am one of those who believe that tax falls on the consumer, but I also add this aside: it is in the long term, with the passage of time, when all the properties have changed hands following economic arrangements that take a long time to be concluded, that this great result is achieved, and for all the time that this revolution lasts, suffering may be great, enormous. I will give you an example.

In my district,5 which is a vine-growing one, there used to be great prosperity. There was general well-being. Vines were grown and the wine was consumed in the local area, in the surrounding plains where vines were not grown, or abroad in northern Europe.

Suddenly, the customs war on the one hand, the war of city tolls on the other, and the amalgamation taxes6 came along and depreciated the value of this wine.

The region of which I am speaking was cultivated in its entirety, especially with regard to vines, by sharecroppers. Sharecroppers retained one half and the landowner the other half of the product. The areas of the sharecropper farms were cultivated in such a way that a sharecropper and his family were able to live on the value of the half quantity of wine that remained to them, but when the value of the wine depreciated, the sharecropper was no longer able to live on his share. He then went to his landowner and told him: “I can no longer cultivate your vines if you do not feed me.” The landowner gave him corn to live on and then, at the end of the year, he took the entire harvest to reimburse himself for his advance. Since the harvest was not enough to cover the advance, the contract was modified, not before the notary but in practice; the landowner had workers to whom he gave their food only in corn, as a total payment for their work.

However, a way out of this situation had to be found, and this is how the revolution was carried out. The sharecropping farms were expanded; that is to say, two were formed out of three or one out of two. Then, by grubbing up a few fields of vines and by growing corn in their place, it was said: “The sharecropper can live on this corn and the landowner will no longer be obliged to give him extra corn to ensure his subsistence.”

Over all the communes, people thus saw houses being torn down and sharecropping farms destroyed. Consequently, as many families as share-cropping farms were destroyed; depopulation became rife, and in the last twenty-five years the number of deaths has exceeded that of births.

Doubtless, when the revolution is fully completed, when the landowners have bought for ten thousand francs what used to cost them thirty thousand francs, when the number of sharecroppers is reduced to the level of the means of subsistence that the region is able to provide, then I believe that the population will no longer be able to blame the tax on wines and spirits. The revolution will be complete, and the tax will fall on the consumer; however, this revolution will be achieved at the price of suffering that will have endured for one or two centuries.

I ask whether it is for this that we are making laws. I ask whether we raise taxes to torment the population, to oblige them to shift work from the hill slopes to the flat fields and from the flat fields to the hill slopes. I ask whether this is the aim of legislation. For my part, I do not think so.

Sirs, however much we attack the tax and say that it is inequitable, vexatious, costly, and unjust, there is one reason before which everyone bows his head; that reason is necessity. It is necessity that is invoked. It is necessity that obliges you to bring to this rostrum words that justify the tax. It is necessity and only necessity that determines your action. Financial problems are feared, as are the results of a reform (for I may properly call it a reform) whose immediate consequence would be to withhold one hundred million from the public treasury; it is therefore about necessity that I wish to speak.

Sirs, I admit that necessity exists and is very insistent. Yes, the balance sheet, not of France but of the French government, can be summed up in very few words. For the last twenty or twenty-five years, taxpayers have been supplying the treasury with a sum that, I believe, has doubled in this period. Successive governments have found ways to devour the original sum, the surplus supplied by taxpayers; to add a public debt of one or two billion to it; to reach at the start of the year a deficit of five or six hundred million; and finally to start the next year with an assured overdraft of three hundred million.

This is the position we are in. I believe that it is well worth the trouble to ask what the cause of this situation is and whether it is prudent in the face of this cause to tell us that the best thing to do is to restore things to the state they were in before, to change nothing or hardly anything in our financial system, or else to change imperceptibly, either with regard to revenue or to expenditure. I seem to see an engineer who has started a locomotive and caused a catastrophe, who then discovers where the fault lay and, without taking any other action, puts it back on the same rails and runs the same risk a second time. (Approval from the left.)

Yes, necessity exists but it is double. There are two necessities.

Finance minister, you mention only one necessity, but I will point out another, one that is extremely serious. I consider that it is even more serious than the one about which you are talking. This necessity is encapsulated in a single phrase: the February revolution.

There occurred, following abuses (since I call abuses everything that has led our finances into the state they are in now), an event; this event is sometimes said by people to have been a surprise. I do not think it was a surprise. It is possible that the external event was the result of an accident that would have been stopped. . . . M. Barthélemy Saint-Hilaire: Delayed!

Several other members on the left:

Yes! Yes! Delayed!

M. Bastiat:

But the general causes are not at all fortuitous. It is just as though you were saying to me, when a passing breeze causes fruit to fall from its tree, that if we could have prevented the breeze from blowing, the fruit would not have fallen. Yes, but on one condition and that is that the fruit was not rotten and gnawed. (Approval from the left.) This event happened, this event has given political power to the entire mass of the population; that is a serious event.

M. Fould, minister of finance:

Why did the provisional government not abolish the tax on wines and spirits?

M. Bastiat:

It did not consult me, it did not submit a draft law to me and I was not called upon to give it advice; however, we have a draft here, and in rejecting your draft I am in a good position to tell you the reasons on which I base my reasoning. I base my reasoning on this: not one but two necessities weigh upon you. The second necessity, as imperious as the first, is to do justice to all citizens. (Agreement from the left.)

Well then! I say that following the revolution that has occurred, you ought to be concerned with the political state in which France finds itself and the fact that this political state is deplorable; allow me the word. I do not attribute this to the men governing it now; it goes back a long way.

Do you not see that in France a bureaucracy that has become an aristocracy is devouring the country? Industry is dying out and the people are suffering. I am fully aware that the people are seeking a remedy in wild utopias, but this is no reason for opening the door to these by leaving flagrant injustices to exist such as those I have been pointing out on this rostrum.

I believe that not enough attention is being paid to the state of suffering that exists in this country and to the causes of this suffering. These causes are rooted in the 1.5 billion raised in a country that cannot pay this sum.

I would ask you to have a very mundane thought, but for goodness’ sake, I oft en indulge in one. I ask myself what has happened to my childhood and school friends. And do you know what the answer is? Out of twenty, there are fifteen who are civil servants, and I am convinced that if you do the calculation, you will reach the same result. (Approving laughter from the left.)

M. Bérard:

That is what causes revolutions.

M. Bastiat:

I also ask myself another question and it is this: taking them one by one, in all honesty, are they giving the country a genuine service worth what the country is paying them? And almost always I am obliged to reply: that is not the case.

Is it not deplorable that this huge amount of labor and intelligence has been withdrawn from the genuine production of the country to supply civil servants who are useless and almost always harmful? For when it comes to civil servants, there is no halfway house: if they are not very useful indeed, they are harmful; if they do not uphold the freedom of citizens, they stifle it. (Approval from the left.)

I say that this calls for necessary, nay absolutely imperative action by the government. What is the plan being proposed to us? I say frankly, if the minister had come and said: “The tax must be maintained for a short while, but here is a financial reform that I am putting forward. This is the plan in its entirety, but a certain period is needed for it to be accomplished. We need four or five years; we cannot do everything at once,” I would have understood this necessity and I might have acceded to it.

But nothing of the sort has happened. We are being told: “Let us reestablish the tax on wines and spirits.” I do not even know whether we are not being made to feel that the salt tax and the postal tax will be reestablished.

As for your reductions in expenditure, they are derisory: three thousand or four thousand soldiers more or less; however, it will be the very same financial system which in my view cannot last much longer in this country without ruining it. (New burst of approval from the left.)

Sirs, it is impossible to discuss this subject without doing so from this point of view: will France be ruined within a very short space of time? For I will be so bold as to ask the minister of finance how long he thinks he can prolong this system. It is not enough to reach the end of the year with an approximate balance between revenue and expenditure; we have to know if this can continue.

However, with this in mind, I really do have to discuss the question of tax in general. (Signs of impatience from the right.)

A number of voices:

Speak! Speak!

The president:

You have the floor.

M. Bastiat:

I believe, sirs, that I have the right to come here on my own authority to express ideas, even absurd ones. Other speakers have come here to put forward their ideas and I make so bold as to believe that their ideas were no clearer than mine. You heard them patiently; you did not welcome M. Proudhon’s plan for general liquidation any more than M. Considérant’s phalanstery, but you listened to them. You went even further; M. Thiers spoke for you all to say that whoever thought he had an idea of any use was under an obligation to bring it to this rostrum. Well then! When people say: “Speak!” when something of a challenge is thrown down, it must at least be listened to. (Hear! Hear!)

Sirs, we have lately spent a great deal of time on the tax question. Should taxes be direct or indirect?

A short time ago we heard indirect taxes being praised.

Well! For my part, I am raising my voice against indirect taxes in general.

I believe that there is a law of taxation which dominates the entire question, and which I encapsulate in this formula: the inequality of taxation lies in its mass. By that I mean that the lighter a tax is, the easier it is to spread it equitably. On the other hand, the heavier it is, the more likely it is, in spite of the good intentions of the legislator, to be spread inequitably and, as may be said, the more it tends to become regressive, that is to say, to burden citizens in inverse proportion to their ability to pay. I believe that this is a serious and inevitable law, and its consequences are of such importance that I ask your permission to clarify it.

I will suppose for the sake of argument that France has been governed for a long time according to my proposals, which would consist in the government’s keeping each citizen within the limits of his rights and of justice and abandoning everything else to the responsibility of each person. This is my starting point. It is easy to see that in this case France could be governed with two hundred or three hundred million. It is clear that if France were governed with two hundred million, it would be easy to establish a single, proportional tax. (Murmurs.)

This hypothesis of mine will become reality. The only question is whether it will do so by virtue of the foresight of the legislator or by way of age-old political convulsions. (Approval from the left.)

The idea is not mine; if it was, I would distrust it, but we see that all the peoples of the world are more or less happy depending on whether they approach or distance themselves from the achievement of this idea. It has been achieved more or less totally in the United States.

In Massachusetts there are no taxes other than direct taxes that are unique and proportional. Consequently, if this be so, and it is easy to understand it since I am elucidating only the principle, nothing would be easier than to ask citizens to pay a proportional part of the assets they accumulate. This would be so inconsequential that no one would be tempted, at least to any great extent, to hide his wealth in order to escape it.

This is the first part of my axiom.

However, if you ask citizens to pay, not two hundred million but five hundred, six hundred, or eight hundred million, then as you increase taxes, direct taxes will escape your control and it is clear that you will reach a stage when a citizen would rather take up his gun than pay the state half his wealth, for example.

A member:

As in the Ardèche.

M. Bastiat:

So you will not be paid. What will you do then? You will have to turn to indirect taxes; this is what happens wherever major expenditure is wanted. Everywhere, as soon as the state wants to give citizens all sorts of benefits, such as education, religion, or a moral code, people are obliged to pay that state considerable indirect taxes.

Well then! I say that when you go down this path, you become mired in tax inequality. Inequality always stems from the indirect taxes themselves. The reason for this is simple. If expenditure were kept within certain limits, some indirect taxes which infringe equality but which would not arouse a feeling of injustice might certainly be found, because these would be luxury taxes; however, when the wish is to raise a great deal of money, then the schema I am assuming will operate leads to the articulation of a true principle, to the effect that the best tax is the one that affects the most generally consumed objects. This is a principle that all our financiers and statesmen acknowledge. And in fact, it is very consequent in the case of governments bent on taking as much money as possible from the people, but in this case the price is the most glaring inequality.

What is an object of mass consumption? It is one that the poor consume in the same proportion as the rich. It is an object on which workers spend all their earnings.

Thus, a currency trader earns five hundred francs a day, a worker earns five hundred francs a year, and justice would like the currency trader’s five hundred francs to produce as much for the treasury as the worker’s five hundred francs. But this does not happen, for the currency trader will buy drapes, bronzes, and luxury items with his money, that is to say, objects of limited consumption that are not taxed, whereas the worker buys wine, salt, or tobacco, that is to say, objects of mass consumption that are weighed down by taxes. (Murmurs and various interruptions.)

M. Lacaze:

If the currency trader did not buy these objects, he would not give the worker a living.

M. Bastiat:

Would the abolition of the tax on wines and spirits prevent the currency trader from buying bronzes and drapes? No financier will contradict my argument. Under indirect taxation, a system that I disapprove of, it is all too reasonable to tax only the objects of the greatest mass consumption. In this way you start charging for the air we breathe with a tax on doors and windows, followed by salt, then wines and spirits and tobacco, and finally everything within the reach of everyone.

I say that these arrangements cannot last in the face of universal suffrage. I add that he who does not see necessity from this point of view too, and sees only the necessity to which I have just alluded, is very blind and very imprudent. (Lively approval from the left.)

I have another reproach to make to indirect taxes, and that is that they create precisely the necessities people have been talking to you about, financial ones. Do you think that if each citizen were asked for his part of the contribution directly, if he were sent a tax demand showing not only the figure of what he owed for the year but the details of his contributions (for this is easy to break down: so much for the administration of justice, so much for the maintenance of public order, so much for Algeria, so much for the expedition to Rome, etc.), do you believe that this would mean that the country was not well governed?7 M. Charencey told us not long ago that with indirect taxes the country was sure to be well governed. Well then, I, for my part, say the opposite. With all these taxes misappropriated through guile, the people suffer, complain, and put the blame everywhere—capital, property, the monarchy or the Republic—when it is the tax that is the guilty party. (That is true! That is true!)

This is why the government, forever finding new facilities, has increased expenditure so much. When has it stopped? When has it said: “We have excess revenue; we are going to abolish taxes.” It has never done this. When we have too much, we seek ways of using it up, and this is how the number of civil servants has increased to an enormous figure.

We have been accused of being Malthusian; yes, I am a Malthusian with regard to civil servants. I am fully aware that they have followed perfectly the great law that populations reach the level of the means of subsistence. You have contributed eight hundred million; public civil servants have devoured eight hundred million. If you gave them two billion, there would be enough civil servants to devour this two billion. (Approval from several benches.)

A change in a financial system brings of necessity a similar change in the political system, for a country cannot follow the same policy when the population gives it two billion as when it gives it only two hundred or three hundred million. And here you will perhaps find that I am in profound disagreement with very many members sitting on this side (on the left). For anyone who is serious, the obligatory consequence of the financial theory I am developing here is obviously this: since no one wants to give a great deal to the state, people have to know how to ask very little of it. (Agreement.)

It is clear that you have the profound illusion in your head that there are two factors in society: first, the men who make it up, and second, a fictional being known as the state or the government to which you attribute a cast-iron moral code, a religion, credit, and the ability to spread benefits widely and provide assistance. It is very clear that in this case you are placing yourselves in the ridiculous position of men who say, “Give us something without taking anything from us,” or “Stay in the disastrous system in which we are at the moment.”

We have to learn to renounce these ideas. We have to know how to be men and say to ourselves, “We are responsible for our existence and we will assume it.” (Hear! Hear!) Once again today, I received a petition from inhabitants of my region in which vineyard owners say, “We are not asking any of that from the government; let them leave us alone, let them leave us free to act and work. This is all we ask of them; let them protect our freedom and our security.”

Well then! I believe that there is a lesson there, provided by the poor vineyard owners, which should be listened to in the largest towns. (Hear! Hear!)

The domestic politics that this financial system would oblige us to enter is obviously the politics of freedom, for, and you should note this, freedom is incompatible with overbearing taxation, whatever anyone says.

I have read a saying by a very famous statesman, M. Guizot, and I quote: “Freedom is too precious an asset for a nation to haggle over it.”

You know, when I read this sentence a long time ago now, I said to myself, “If ever this man governs the country, he will ruin not only the finances but also the freedom of France.”

And indeed, I ask you to note, as I said just now, that the public services are never neutral; if they are not essential, they are harmful.

I say that there is radical incompatibility between excessive taxation and freedom.

The maximum of taxation is servitude, for a slave is a man from whom everything has been taken, even the freedom of his arms and faculties. (Hear! Hear!)

I put it to you, if the state did not pay for religion,8 for example, at our expense, would we not have freedom of religious practice? If the state did not pay for university education at our expense, would we not have freedom of public education? If the state did not pay the numerous members of a bureaucracy at our expense, would we not have communal and departmental freedom? If the state did not pay customs officers at our expense, would we not have freedom of trade? (Hear! Hear! A prolonged swell.)

For what have the men in this country lacked the most? A little self-confidence and a feeling of responsibility. It is not very surprising that they have lost this; they have been accustomed to losing it through being governed. This country is overgoverned; that is what is wrong.

The remedy is for the country to learn to govern itself, for it to learn to distinguish between the essential attributions of the state and those it has usurped at our expense from private activity.

This is the nub of the problem.

As for me, I say, “The number of things included in the essential attributions of the government is very limited: to ensure order and security, to keep each person within the limits of justice, that is to say, to repress misdemeanors and crimes, and to carry out a few major public works of national utility. These are, I believe, its essential attributions, and we will have no peace, no financial wherewithal, and we will not destroy the hydra of revolution if we do not regain, little by little if you like, this limited governance toward which we should be aiming. (Hear! Hear!)

The second condition of such governance is that we have to want peace sincerely, for it is obvious that not only war but even the spirit of war or warlike tendencies are incompatible with a system like this. I am fully aware that the word peace sometimes causes an ironic smile to pass along these benches, but truly I do not believe that serious men can treat this word ironically. What! Will we never learn from experience?

Since 1815, for example, we have been maintaining numerous armies, huge armies, and I am able to say that it is precisely these great military forces that have led us in spite of ourselves into adventures and wars, in which we would certainly not have become involved if we had not had these huge forces behind us. We would not have had the war with Spain in 1823;9 we would not have had the expedition to Rome last year; we would have let the pope and citizens of Rome reach an agreement on their own if our military structures had been limited to more modest proportions.10 (A variety of reactions.)

A voice from the right:

In June, you were not upset that we had the army!

M. Bastiat:

You quote the month of June as an answer. I tell you, for my part, that if you had not had these huge armies, you would not have had the month of June. (Prolonged hilarity on the right. Lengthy agitation.)

A voice from the right:

It is as though you were saying that there would have been no thieves if there were no gendarmes.

M. Bérard:

But it was the civil servants in the national workshops who caused the month of June.

M. Bastiat:

My reasoning follows the speculative idea of a well-governed France, a France almost ideally governed, in which case I am free to believe that we would not have had the disastrous days in June, just as we would not have had 24th February 1848, 1830, nor perhaps 1814.

Be that as it may, freedom and peace are the two pillars of the proposals I am developing here. And please note that I am not presenting these only as being good in themselves but as being required by the most pressing necessity.

At present there are people who are concerned, and rightly so, about security. I too am concerned and as much as anyone else; it is an asset that is as precious as the two others. But we are in a country that is accustomed to being governed to such an extent that no one can imagine that there can be a little order and security with less regimentation. I believe that it is precisely in this excessive government that the cause of almost all the troubles, agitations, and revolution lies, of which we are the sorry onlookers and on occasion the victims.

Let us see what this implies.

Society is thus divided into two parts: those who exploit and those who are exploited. (Nonsense! Lengthy interruption.)11

A voice from the right:

A distinction like this will not bring peace back.

M. Bastiat:

Sirs, there must be no misunderstanding. I am not alluding in the slightest either to property or to capital. I am talking only about 1.8 billion that is paid on the one hand and received on the other. I was perhaps mistaken to say those who are exploited since, in this 1.8 billion there is a considerable portion that goes to men who provide very genuine services. I therefore withdraw this expression. (Mutterings at the foot of the rostrum.)

The president:

Silence, sirs! You are there only on condition that you keep silent more than all the others.

M. Bastiat:

I want to have it noted that this state of affairs, this manner of existing, this immense expenditure of the government must always be justified or explained in some way. Consequently, this aspiring of the government to do everything, run everything, and govern everything was naturally bound to give rise to a dangerous thought in the country, with the lowest stratum of the population expecting everything from the government and expecting the impossible from this government. (Hear! Hear!)

We are discussing vineyard owners; I have seen vineyard owners on days when it hails, days on which they are ruined. They weep but do not blame the government. They know that there is no connection between the hail and the government. However, when you lead the population to believe that all the misfortunes that are not as sudden as hail are the fault of the government, when the government itself allows this to be believed since it receives a huge tax revenue only on condition that it does some good for the people, it is clear, when things have reached this stage, that you have constant revolution in the country since, because of the financial system I spoke of just now, the good that the government is able to do is nothing in comparison to the harm it does itself through the contributions it extorts.

The people then, instead of feeling better, are more unfortunate; they suffer and blame the government and there is no lack of men in the opposition to tell them, “Look at the government that has promised you this and that . . ., which should have reduced all taxes and showered you with benefits. See how this government keeps its promises! Put us in its place and you will see how differently we will act!” (General hilarity. Signs of approval.) The government is then overturned. However, the men who gain power find themselves in exactly the same situation as those who preceded them. They are obliged to withdraw all their promises gradually. They tell those who urge them to carry out their promises, “The time has not yet come, but you can count on it that the situation will improve, count on exports, count on future prosperity.” But since in reality they do no better than their predecessors, there are even more complaints against them; they end up being overthrown, and the people go from one revolution to another. I do not believe that a revolution is possible where the only relationship between a government and its citizens is the guarantee of security and freedom for all. (Hear! Hear!) Why do people revolt against a government? Because it breaks its promises. Have you ever seen the people revolt against magistrates, for example? Their mission is to hand down justice and they do this; nobody thinks of asking any more of them. (Hear! Hear!)

You should convince yourselves of one thing, and that is that a love of order, security, and tranquillity is not exclusive to any one person. It exists and is inherent in human nature. Ask all those who are discontented, among whom there are doubtless a few agitators. God knows, there are always exceptions. But ask men from all classes and they will all tell you how terrified they are these days to see order being compromised. They love order; they love it to the extent of making great sacrifices for it, sacrifices of opinion and sacrifices of freedom; we see this every day. Well then! This sentiment would be strong enough to maintain security, especially if contrary opinions were not constantly being encouraged by the incorrect constitution of the government.

I will add just one word with regard to security.

I am not an experienced legal expert, but I truly believe that if the government were contained within the limits I have mentioned, and all the force of its intelligence and capacity were to be directed toward this particular point: to improve citizens’ conditions of security, immense progress might be made in this direction. I do not believe that the art of repressing misdemeanors and vice, restoring morals, and reforming prisoners has made all the progress it might. I do say and do repeat that if the government aroused less jealousy on the one hand and fewer prejudices on the other and concentrated all its force on civil and penal improvements, society would have everything to gain thereby.

I will stop there. I am so profoundly convinced that the ideas I have brought to this rostrum fulfill all the conditions for a government program, that they reconcile so fully freedom, justice, financial necessity, the need for order, and all the great principles that nations and humanity support; this conviction of mine is so firm that I find it hard to believe that this project can be called utopian. On the contrary, I think it likely that if Napoléon, for example, returned to earth (exclamations from the right) and was told, “Here are two systems: one aims to restrict and limit the attributions of the government and as a result, taxes, while the other aims to extend the attributes of government indefinitely and as a result, taxes, following which France will have to be made to accept amalgamation taxes,”12 I am convinced and will indeed assert that Napoléon would say that the true utopia lies on the latter side, since it was much more difficult to establish combined taxes than it would be to enter the system I have just proclaimed from this rostrum.

Now I will be asked why I immediately reject the tax on wines and spirits today. I will tell you. I have just set out the theoretical dispensation that I would like the government to espouse. But since I have never seen a government exercise on itself what it considers to be a sort of semisuicide by cutting back all the attributions not essential to it, I consider myself obliged to compel it to and I can do this only by refusing it the means of continuing down a disastrous path. It is for this reason that I voted for the reduction in the salt tax, it is for this reason that I voted for postal reform, and it is for this reason that I will vote against the tax on wine and spirits. (Agreement on the left.)

It is my profound conviction that if France has faith and confidence in herself, if she is certain that no one will come to attack her once she decides not to attack others, it will be easy to decrease public expenditure to an enormous extent and, even with the abolition of the tax on wines and spirits, there will be enough not only to balance revenue and expenditure but also to reduce public debt. (A host of signs of approval.)

[1. ](Paillottet’s note) This unprepared talk was delivered to the Legislative Assembly on 12 December 1849.

[2. ]Inherited from the First Empire, taxes on alcoholic beverages had three com ponents:

• 1. A “circulation” duty
• 2. A retail tax
• 3. An “entrance duty,” when the drink was introduced into a city of more than four thousand inhabitants.

[3. ]The “exercise” was a control carried out by the tax officials at the wholesalers.

[4. ]The inventory was drawn up in order to check the honesty of producers’ declarations of crops.

[5. ]Saint-Sever.

[6. ]The “amalgamation taxes” were a combination of taxes introduced by Napoléon under the name “droits réunis.”

[7. ](Paillottet’s note) It can be said that taxpayers cry out instinctively against the weight of taxes, for few of them know exactly what it costs them to be governed. We are fully aware of our share of land tax, but not what consumer taxes take from us. I have always thought that nothing would be more favorable to progress in our constitutional knowledge and behavior than a system of individual accounts, through which each person would know the amount and destination of his contribution.

While waiting for the minister of finance to distribute to each of us each year, together with our direct tax demand, our current account with the treasury, I have endeavored to design a form with the 1842 budget to hand.

Here is the account of M. N——, a landowner paying five hundred francs of direct taxes, which implies a revenue of twenty-four hundred to twenty-six hundred francs at the most.

[8. ]Catholic and Protestant priests and Jewish rabbis were paid by the state (until 1905).

[9. ]After the pronunciamento of 1 January 1822, and the ensuing troubles, France, mandated by the Verona Congress (October 1822), conducted a military intervention in Spain.

[10. ]The National Assembly sent troops to restore the pope in Rome while protecting the new republic. Nevertheless, the new Roman republic fell after a month of fighting. Bastiat, however, makes a mistake: this happened in April 1849, not in 1848.

[11. ]See “Note on the Translation,” pp. xi–xiv, and “Bastiat’s Political Writings: Anecdotes and Reflections,” pp. 401–15, both in this volume.

[12. ]See p. 333, note 6.