Tuesday, April 17, 2012

Competition - Frédéric Bastiat - Pt 1


There is no word in all the vocabulary of political economy that has so aroused the angry denunciations of the modern reformers as the word “competition,” to which, to add to the insult, they unfailingly apply the epithet “anarchistic.”

What does “anarchistic competition" mean? I do not know. What can replace it? I do not know that either.

Of course, I hear the cries of “Organization! Association!” But what does that mean? Once and for all we must come to an understanding. I really must know what kind of authority these authors propose to exert over me and over all men living on this earth of ours; for, in truth, the only authority I can grant them is the authority of reason, provided they can enlist reason on their side. Do they really propose to deprive me of the right to use my own judgment in a matter where my very existence is at stake? Do they hope to take from me my power to compare the services that I render with those that I receive? Do they mean that I should act under restraints that they will impose rather than according to the dictates of my own intelligence? If they leave me my liberty, competition also remains. If they wrest it from me, I become only their slave. The association will be free and voluntary, they say. Very well! But in that case every group with its associated members will be pitted against every other group, just as individuals are pitted against one another today, and we shall have competition. The association will be all-embracing, it is replied. This ceases to be a joking matter. Do you mean to say that anarchistic competition is wrecking our society right now, and to cure this malady we shall have to wait until all mankind, the French, the English, the Chinese, the Japanese, the Kafirs, the Hottentots, the Lapps, the Cossacks, the Patagonians, persuaded by your arguments, agree to unite for all time to come in one of the forms of association that you have contrived? But beware! This is simply to acknowledge that competition is indestructible; and do you have the presumption to claim that an indestructible, and therefore providential, phenomenon of society can be mischievous?

After all, what is competition? Is it something that exists and has a life of its own, like cholera? No. Competition is merely the absence of oppression. In things that concern me, I want to make my own choice, and I do not want another to make it for me without regard for my wishes; that is all. And if someone proposes to substitute his judgment for mine in matters that concern me, I shall demand to substitute my judgment for his in matters that concern him. What guarantee is there that this will make things go any better? It is evident that competition is freedom. To destroy freedom of action is to destroy the possibility, and consequently the power, of choosing, of judging, of comparing; it amounts to destroying reason, to destroying thought, to destroying man himself. Whatever their starting point, this is the ultimate conclusion our modern reformers always reach; for the sake of improving society they begin by destroying the individual, on the pretext that all evils come from him, as if all good things did not likewise come from him.

We have seen that services are exchanged for services. In the last analysis, each one of us comes into the world with the responsibility of providing his own satisfactions through his own efforts. Hence, if a man spares us pains, we are obligated to save him pains in return. His effort brings us a satisfaction; we must do as much for him.

But who is to make the comparison? For it is absolutely necessary that these efforts, these pains, these services that are to be exchanged, be compared so that an equivalence, a just rate, may be arrived at, unless injustice, inequality, chance, is to be our norm—which is another way of throwing the testimony of human reason out of court. There must be, therefore, one or more judges. Who will it be? Is it not natural that, in every particular case, wants should be judged by those who experience them, satisfactions by those who seek them, efforts by those who exchange them? Is it proposed in all seriousness to substitute for this eternal vigilance by the interested parties a social authority (even if it should be the reformer himself) charged with determining the intricate conditions affecting countless acts of exchange in all parts of the world? Is it not obvious that this would mean the establishment of the most fallible, the most far-reaching, the most arbitrary, the most inquisitorial, the most unbearable, the most short-sighted, and, fortunately, let us add, the most impossible of all despotisms ever conceived in the brain of an Oriental potentate?

We need only know that competition is merely the absence of any arbitrary authority set up as a judge over exchange, to realize that it cannot be eliminated. Illegitimate coercion can indeed restrain, counteract, impede the freedom of exchange, as it can the freedom of walking; but it cannot eliminate either of them without eliminating man himself. This being so, the only question that remains is whether competition tends toward the happiness or the misery of mankind—a question that amounts to this: Is mankind naturally inclined toward progress or fatally marked for decadence?

I do not hesitate to say that competition, which, indeed, we could call freedom—despite the aversion it inspires and the tirades directed against it—is essentially the law of democracy. It is the most progressive, the most egalitarian, the most universally leveling of all the laws to which Providence has entrusted the progress of human society. It is this law of competition that brings one by one within common reach the enjoyment of all those advantages that Nature seemed to have bestowed gratis on certain countries only. It is this law, also, that brings within common reach all the conquests of Nature that men of genius in every century pass on as a heritage to succeeding generations, leaving still to be performed only supplementary labors, which they exchange without succeeding in being remunerated, as they would like to be, for the co-operation of natural resources. And if, as always happens at the beginning, the value of this labor is not proportional to its intensity, it is once again competition that, by its imperceptible but constant action, restores a fairer and more accurate balance than could be arrived at by the fallible wisdom of any human officialdom. The accusation that competition tends toward inequality is far from true. On the contrary, all artificial inequality is due to the absence of competition; and if the distance separating a Grand Lama from a pariah is greater than that between the President and an artisan in the United States, the reason is that competition (or liberty) is suppressed in Asia, and not in America. Therefore, while the socialists find in competition the source of all evil, it is actually the attacks upon competition that are the disruptive elements working against all that is good. Although this great law has been misunderstood by the socialists and their partisans, although it is often harsh in its operation, there is no law that is richer in social harmonies, more beneficial in its general results; no law attests more strikingly to the immeasurable superiority of God's plans over man's futile contrivances.

I must at this point remind the reader of that curious but indisputable effect of the social order to which I have already called his attention,1 for too frequently the force of habit causes us to overlook it. It may be characterized thus: The total number of satisfactions that each member of society enjoys is far greater than the number that he could secure by his own efforts. In other words, there is an obvious disproportion between our consumption and our labor. This phenomenon, which we can all easily observe, if we merely look at our own situation for an instant, should, it seems to me, inspire in us some sense of gratitude toward the society to which we owe it.

We come into the world destitute in every way, tormented by countless wants, and provided with only our faculties to satisfy them. It would appear, a priori, that the most we could hope for would be to obtain satisfactions equal to our labors. If we possess more, infinitely more, to what do we owe the excess? Precisely to that natural order of society against which we are constantly railing, when we are not actually trying to destroy it.

The phenomenon, in itself, is truly extraordinary. It is quite understandable that certain men should consume more than they produce, if, in one way or another, they usurp the rights of others and receive services without rendering any in return. But how can this be true of all men simultaneously? How can it be that, after exchanging their services without coercion or plunder, on a footing of value for value, every man can truly say to himself: I use up in one day more than I could produce in a hundred years?

The reader realizes that the additional element that solves the problem is the increasingly effective participation of the forces of Nature in the work of production; it is the fact of more and more gratuitous utility coming within the common reach of all; it is the work of heat, of cold, of light, of gravitation, of natural affinity, of elasticity, progressively supplementing the labor of man and reducing the value of his services by making them easier to perform.

Certainly I must have explained the theory of value very badly indeed if the reader thinks that value declines immediately and automatically through the mere act of harnessing the forces of Nature and releasing the labor of man. No, such is not the case; for then we could say, as the English economists do: Value is in direct proportion to labor. The man who uses the help of a gratuitous force of Nature performs his services more easily; but he does not on that account voluntarily surrender any part whatsoever of what he has been accustomed to receive. To induce him to do so, some pressure from without—heavy, but not unjust—is necessary. This pressure is competition. As long as it does not intervene, as long as the man using a force of Nature remains master of his secret, that force of Nature is gratuitous, undoubtedly, but it is not yet common to all; the conquest of Nature has been achieved, but to the profit of only one man or one class. It is not yet of benefit to all mankind. Nothing has been changed in the world, except that one type of services, although partially relieved of its burden of pains, still brings the full price. We have, on the one hand, a man who asks the same amount of labor as before from his fellow men, while he offers them a reduced amount of his own labor; and, on the other, all mankind, still obliged to make the same sacrifices in time and toil to obtain a commodity that is now produced in part by Nature.

If things were to remain in this state, every new invention would bring into the world a further source of ever spreading inequality. Not only could we not say that value is proportional to labor, but we could not even say that value tends to become proportional to labor. All that we have said in earlier chapters concerning gratuitous utility and the trend toward the enlargement of the communal domain would be illusory. It would not be true that services are exchanged for services in such a way that God's gifts are transmitted, free of charge, from person to person until they reach the ultimate consumer. Everyone who had once managed to exploit any part of the forces of Nature would for all time to come charge for it along with the cost of his labor; in a word, mankind would be organized on the principle of universal monopoly, instead of the principle of an expanding domain of gratuitous and common utilities.

But such is not the case. God has lavished on His creatures the gifts of heat, light, gravitation, air, water, the soil, the marvels of plant life, electricity, and many other blessings too numerous to mention. And even as He has implanted in each man's heart a feeling of self-interest, which, like a magnet draws all things to it; so has He, in the social order, provided another mainspring whose function it is to preserve His gifts as they were originally intended to be: gratis and common to all. This mainspring is competition.

Thus, self-interest is that indomitable individualistic force within us that urges us on to progress and discovery, but at the same time disposes us to monopolize our discoveries. Competition is that no less indomitable humanitarian force that wrests progress, as fast as it is made, from the hands of the individual and places it at the disposal of all mankind. These two forces, which may well be deplored when considered individually, work together to create our social harmony.

And, we may remark in passing, it is not surprising that individualism, as it finds expression in a man's self-interest when he is a producer, has always revolted against the idea of competition, has decried it, and sought to destroy it, calling to its aid force, guile, privilege, sophistry, monopoly, restriction, government controls, etc. The immorality of its means discloses clearly enough the immorality of its end. But the amazing, and unfortunate, thing is that political economy—that is, false political economy—propagated with such ardor by the socialist schools, has, in the name of love of humanity, equality, and fraternity, espoused the cause of individualism in its narrowest form and has abandoned the cause of humanity.

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