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Molinari calls the idea of using tariffs to promote a nation’s economy “a monstrosity” (1852)

The Belgian-French economist Gustave de Molinari (1819-1912) thought that since the borders of nation states were usually decided by historical accident or the hazards of war, to erect tariff barriers along their borders was “a monstrosity”:

Why should an attempt he made to establish a national trading system based upon so-called economic necessity, in states whose formation was controlled by no economic views, states of which the hazards of war and of alliances alone decided the boundaries? Is it not the height of absurdity to transform these frontiers, which chance events have alone determined, and which it may enlarge or contract to-morrow, into formal boundaries which limit trade? Is not an economic system which is founded on a political basis and which is politically modifiable, a monstrosity to which good sense objects?

(5.) That nationality should be made the basis of the trading system.

This argument was the basis of Dr. List’s national system of political economy. But in studying the history of the formation of states, and examining the elements which constitute them, one readily perceives that nationality can not serve as a basis for a trading system. States have been formed, for the most part, by conquest, and enlarged either by royal alliances, by wars, or by diplomacy. No economic consideration has controlled their formation. When the map of Europe was made over at the congress of Vienna (1814-15), for example, did any one consult the interests of the industries and the commerce of the peoples whose nationality they were changing? Did any one ask whether the situation of the Rhine provinces and of the other countries which were then separated from the French empire, rendered that separation advantageous or injurious to the countries concerned? No: the question was not even mooted. Political considerations and diplomatic intrigues alone decided the new configuration of the states. Why should an attempt he made to establish a national trading system based upon so-called economic necessity, in states whose formation was controlled by no economic views, states of which the hazards of war and of alliances alone decided the boundaries? Is it not the height of absurdity to transform these frontiers, which chance events have alone determined, and which it may enlarge or contract to-morrow, into formal boundaries which limit trade? Is not an economic system which is founded on a political basis and which is politically modifiable, a monstrosity to which good sense objects?

About this Quotation:

Molinari was responding to the standard defence of using tariffs and subsidies to promote a “nation’s” economy given by the German economist Friedrich List (1789-1846) in The National System of Political Economy (1841). List had been impressed by American efforts along these lines when he visited there in the 1820s, so it is fitting that Molinari’s criticism was translated and published in an American Cyclopedia in 1881 when protectionism was again on the rise there. Molinari identified six common protectionist “fallacies” which he wanted to debunk. This is the 5th. In essence he argues that people should be allowed to choose with whom they prefer to trade, not government bureaucrats, or politicians, or military leaders. Why should the government tell the people of the Rhine river valley they should trade with the citizens of Berlin rather than with the citizens across the border in France?, Or in the American context, the citizens of Vermont be forced to trade with the inhabitants of Texas rather the with the inhabitants of Québec? The borders with both Canada and Mexico had been decided by the fortunes of war not by any rational economic reasons. He called this idea of imposing tariffs along the artificially drawn lines of a military map “une monstruosité” (a monstrosity).

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