Why Frédéric Bastiat Still Matters



the_law_140Yesterday marked the 214th anniversary of Frédéric Bastiat’s birthday on June 30, 1801, in Bayonne, France. One of the seminal thinkers of the classical liberal tradition, Bastiat made great contributions to the field of political economy, laying many of the foundations for the later school of Austrian economics. Both a politician and a writer, Bastiat penned numerous books and essays on political economy and how its principles could be applied to mid-19th century France, writing with his razor-sharp wit and renowned rhetorical flair. While his works pertain to post-Napoleonic France, they carry important lessons for our nation’s leaders, politicians, and economists.

One of Bastiat’s most important lessons appears in That Which is Seen, and That Which is Not Seen, where Bastiat applied his careful method of logical procession to economic questions. In this work, he examines the same topics that are commonly misunderstood by contemporary politicians: military spending, taxes, the economic benefits of saving, and mechanization, among others. In each examination, he demonstrates that the economist or policy maker must look beyond the apparent to understand the true effects of a policy, showing in every case that the arguments for government intervention are inherently flawed. If one were to apply this method to the argument for raising the minimum wage to $15, for example, one would see that the unseen effects, the firing of low-skill workers and increased prices, are damaging. It is this logical method that informed many in the Austrian school of thought and formed the foundation of Henry Hazlitt’s seminal Economics in One Lesson, which is a more thorough investigation of Bastiat’s principle.

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Justices Breyer and Ginsburg Would Hold the Death Penalty Unconstitutional



DeathPenaltyToday, the Supreme Court in an ongoing effort to micromanage state laws and procedures reviewed whether a certain chemical cocktail used by Oklahoma in executions is constitutional. In a 5-4 decision, the Court rejected the challenge to the use of the chemical midazolam.

What is especially of interest is a dissenting opinion in which two justices (Breyer and Ginsburg) stated that they would hold that the death penalty is unconstitutional as cruel and unusual punishment prohibited by the Eighth Amendment. Never mind that the Fifth Amendment provides that “[n]o person shall be held to answer for a capital . . . crime, unless on a presentment or indictment of a Grand Jury,” and that no person shall be “deprived of life . . . without due process of law.” In other words, the Constitution specifically contemplates a punishment—the death penalty—that two justices would hold is inherently unconstitutional.

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41 Percent of Obamacare Silver Plans Have ‘Small’ or ‘Extra Small’ Networks



DoctorObamaI spent the weekend in Denver at the excellent Western Conservative Summit, where I spoke about health reform with Philip Klein of the Washington Examiner. Mr. Klein has written Overcoming Obamacare, in which he describes three schools of free-market reformers: The “reform school,” the “replace school,” and the “restart school.” (I belong to the “replace school.”) The panel was moderated by Dr. Jill Vecchio, a radiologist and Senior Fellow in Health Care Policy at the Centennial Institute.

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Should Gone with the Wind Be Banned?



GoneWithTheWindTragic events provide platforms for political opportunists—remember we can’t let a good crisis go to waste—and the mass shooting of African Americans by a white racist at a Charleston, S.C., church has created a plethora of opportunities. The one on my radar screen today is New York film critic Lou Lumenick’s argument for banning the Academy Awardwinning film Gone with the Wind. It’s a great reminder of why we don’t want film critics in charge of social policy.

Lumenick notes, accurately, that the film, based “on a best seller by die-hard Southerner Margaret Mitchell, ‘Gone with the Wind’ buys heavily into the idea that the Civil War was a noble lost cause and casts Yankees and Yankee sympathizers as the villains, both during the war and during Reconstruction.” Lumenick also says that the movie, and the Confederate flag, represents slavery and a defense of slavery.

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When Thinking about Obergefell We Must Distinguish between Policy and Law



LadyJusticeAmong the friends of liberty, there is much confusion about whether the Supreme Court’s Obergefell opinion is a vindication of liberty or an usurpation of power. When thinking about the opinion we should be aware of two different modes of analysis: policymaker and judge. How we see Obergefell depends on which mode we have switched on. Let me explain.

I was an undergraduate when I first encountered the case of Lochner v. New York, 198 U.S. 405 (1905). Lochner dealt with a New York statute prohibiting bakers from working more than 60 hours per week and/or 10 hours per day. The state argued that the statute was a simple exercise of the police power—the reserved power to pass general legislation for the health, safety, and welfare of the people. The Supreme Court, however, held that the statute deprived bakers of liberty without due process of law contrary to the Fourteenth Amendment. Asserting that bakers were not “wards of the state,” the Court found “no reasonable ground for interfering with the liberty of person or the right of free contract by determining the hours of labor, in the occupation of baker.”

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Libertarians Should Be Cautious in Celebrating Obergefell



SCOTUSTo no one’s surprise, five justices of the U.S. Supreme Court held that “the right to marry is a fundamental right inherent in the liberty of the person, and under the Due Process and Equal Protection Clauses of the Fourteenth Amendment couples of the same sex may not be deprived of that right and that liberty.” The full opinion is here.

For example, Robby Soave over at Reason blasts the dissent from Justice Scalia and observes that he is no friend to libertarians. Also, Ilya Shapiro at the Cato Institute gives a thumbs up to the Court’s decision. Undoubtedly many readers of this blog share these sentiments and cheer today that homosexual couples can marry just like opposite-sex couples. However, before you get caught up in celebrating this “victory” for liberty, think about several things.

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Health Spending as a Share of Personal Consumption Keeps Rising



health_costsWhere is your money going? Increasingly, the answer is health care. This morning’s third estimate of first quarter Gross Domestic Product (GDP) was not as awful as previously estimated – a real decline of 0.2 percent, not 0.7 percent.

The overall drop of $7 billion was driven by a decline in exports and nonresidential structures. Personal consumption expenditures increased by $58.3 billion. However, $48.1 billion of that was services, of which $24.2 billion was health care. Almost half the quarterly increase in personal consumption was health care.

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The War of Ideas



battle of ideasWriting popular press pieces, you open yourself up to a lot of criticism. If you write about economic topics, you might as well be waving a red flag in front of a bunch of Spanish bulls. Without a doubt, I’ve received my fair share of critical commentary, been accused of pushing all kinds of agendas and being the worst of both political parties. Some comments, though, are pretty creative. Some of my personal favorites include,

“The author probably isn’t smart enough to tie her shoes.”

“The author is clearly a socialist.” (I was writing a piece which, in fact, was highly critical of socialism.)

“Someone forgot her meds this morning.”

I am not alone in my experience. Though these types of comments are often worthy of a smirk or occasional chuckle, some aren’t as amusing. I was once discussing reactions to popular pieces with another colleague who writes a regular column for a popular outlet. He stated that most comments don’t bother him. The exception was one commenter who, in responding to a policy piece, stated he hoped my colleague’s wife and children would die in a car wreck.

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CBO: Repealing ACA Would Grow U.S. Economy; Reduce Number of Insured by 10 Million



health_costsI have asked, and the Congressional Budget Office has answered. Well, not really.

Although, I have been urging the CBO to do a comprehensive estimate of all the effects of the Affordable Care Act, effectively for the first time since 2012. It did so last week. The main takeaway is that “repealing the ACA would increase GDP by about 0.7 percent in the 2021–2025 period, mostly because provisions of the law that are expected to reduce the supply of labor would be repealed.”

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Donald Boudreaux’s The Essential Hayek



EssentialHayekReaders who want to get a flavor for the ideas of Friedrich Hayek will find an excellent introduction in Donald Boudreaux’s The Essential Hayek. The book can be downloaded free by clicking here.

Each chapter begins with a quotation from Hayek, but the book’s chapters explain Hayek’s ideas in Boudreaux’s words. Those ideas come from various works by Hayek, so the book is not a summary or discussion of specific works by Hayek, but rather an overview of Hayek’s ideas on the economy, on law, and on social organization more generally.

The book provides an excellent discussion of the advantages of free markets and limited government, and on the way that institutions can arise spontaneously without anyone planning them out, as a result of human action but not of human design.

The book is not a study guide to Hayek’s work, or a summary of his work, because, outside of the quotations that open each chapter, there are no references to the specific works of Hayek from which Boudreaux develops the chapter’s ideas. The book does end with suggestions for further reading, which can help guide those who want to know more.

Boudreaux’s discussion is insightful, clearly written, and provides an excellent introduction to the ideas of limited government. Rather than read what I have to say about it, read it yourself. It’s a free download.

  • MyGovCost.org
  • FDAReview.org
  • OnPower.org
  • elindependent.org