Broken windows and house-owning dogs: the French Connection and the Popularization of Economics from Bastiat to Jasay.

Author:Hart, David M.
Position:Frederic Bastiat and Anthony de Jasay - Critical essay
 
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What do broken windows and house-owning dogs have in common? They are featured in the titles of two provocative, thought-provoking, and amusing essays written to promote an understanding of how free markets operate and the benefits they provide to ordinary working people. The first is the title of a chapter in the last book Frederic Bastiat wrote before he died, What Is Seen and What Is Not Seen (July 1850), in which he introduces the idea of opportunity cost in order to analyze the impact of government intervention in the economy. (1) The second is the title of the very first essay Anthony de Jasay published in the Liberty Fund web journal Econlib in April 2002, in which he used the figure of the family dog to ask very profound questions about how economic value is distributed among all those who contribute to the creation of a good or service (Jasay 2002b). In this case, because the dog helps defend the home, it, too, has contributed to the home's value and hence in some sense "owns your house." Both are excellent examples of how economists have used stories and catchy metaphors over the past 150 years or so to help nonacademic readers understand some of the complexities of the free market.

Anthony de Jasay, like many free-market economists before him, is concerned that popularly held fallacies about the way markets operate are very dangerous and need to be countered by economists. Most do so by writing scholarly books and journal articles, but such materials are not read by the educated public, let alone the nonacademic public. Hence, many economists feel the need to "reach out" by writing more popular pieces, which they publish in newspapers or blogs, or by making themselves available for radio and TV interviews in the hope that their "sound bites" in favor of the free market will drown out the cacophony of chomping that goes on in favor of government intervention and regulation.

Free-market voices very occasionally rise above the din of interventionist dining either because they are able to capture the popular imagination, at least for a moment, or because of the sheer quality of what they have to say and the way they say it. The textbook example of the witty and clever defender of the free market is of course Frederic Bastiat (1801-50). (2) Before he came to popular attention in the mid-1840s, there had been several popularizers of economic ideas of varying levels of skill and sophistication in France and England, the most notable of which were Harriet Martineau (1802-76) and Colonel Thomas Perronet Thompson (1783-1869) in England (see Martineau 1832, 1834; Perronet Thompson [1827] 1834, 1835, 1836). Contemporary with Bastiat and probably inspired by his example the most significant in France was Gustave de Molinari (1819-1912). (3) After Bastiat's death in 1850, the numbers drop dramatically so that by the end of the century only Yves Guyot was left in France attempting to defend free ideas before a popular audience. (4) What makes Bastiat stand out in this group of popularizers of economic ideas are his extraordinary wit and word play, which often conceal a very deep theoretical understanding of how markets operate. The activities of the English and French free traders and antisocialists in 1840s, such as Bastiat and Molinari, surely make this one of the golden ages in the history of the popularization of free-market ideas.

After the near disappearance of free-market thinking in the first half of the twentieth century, there was a revival of sorts before the end of World War II. Free-market ideas were again brought to the attention of the public in works such as Friedrich Hayek's The Road to Serfdom (1944), the journalism of Henry Hazlitt in the New York Times and his book inspired by Bastiat, Economics in One Lesson (1946), and the republication of some of Bastiat's works by R. C. Hoiles and Leonard Read (Bastiat 1944, 1944-45). In the 1960s and 1970s, there was another burst of free-market popularization with the publication of new translations of some of Bastiat's works by the Foundation for Economic Education in 1964; (5) the novels and essays by Ayn Rand (see, e.g., Rand 1966); and Milton Friedman's Newsweek column (1966-84) as well as his book Free to Choose (Friedman and Friedman 1980) and the television documentary made from it. It might seem strange that the 1960s and 1970s, a period during which the modern welfare state was under construction in Europe and the United States, might also be regarded as another high point in the history of the dissemination of free-market ideas with the work of Rand and Friedman, but it is if the sheer number of book sales and readership is the measuring stick.

I would argue that we are living through another golden age in the popularization of free-market ideas in the early twenty-first century given the extraordinary explosion of free-market blogs such as Econlog and Cafe Hayek as well as websites such as the Mises Institute site and the Online Library of Liberty, to mention only a few. (6) This is not to argue that the dissemination of free-market ideas has been successful in changing pubic opinion or government policies, but the sheer volume of free-market material that is available and being distributed has never been higher. That this large amount of available material has failed to have the impact we would like is another question that we cannot enter into here.

Anthony de Jasay has been part of this new golden age with his academic books as well as his articles and monthly column "Reflections from Europe," (7) which he has written for Econlib for the past twelve years. He is an outstanding writer in English, even though it is not his native language (perhaps this Hungarian is the economic equivalent of the Polish-born English novelist Joseph Conrad), who has written some path-breaking works in political economy but who has remained for much of his life outside the academic mainstream (see Radnitzky 2004; Wolf 2011). In this article,

I explore the "French connection" to Jasay's economic journalism, especially his connection to the work of Frederic Bastiat, with whom he shares many features.

Jasay as "a Frederic Bastiat of Our Times"

In his introduction to a collection of Jasay's writings published in 2009, Political Economy, Concisely, the editor Hartmut Kliemt notes of Jasay: "Anthony de Jasay may be seen in the role of a Frederic Bastiat of our times. Like Bastiat, whom he admires... Jasay himself is a philosopher-economist with hard-won, practical experience. ... A longtime resident of France, Jasay shares Bastiat's encounters with the perversities of the centralized state. Like his great French forerunner, he took (and still takes) to the pen to express his criticism. However, unlike Bastiat, who was a Frenchman, Jasay came to France from Hungary, his native country, with stops in Austria, Australia, and finally Oxford, where he taught economics" (Kliemt 2010).

I would make a slight correction to Kliemt's passage by noting that although technically Bastiat was a Frenchman, he came from the southwest province of Gascony, which made him somewhat of an outsider when he went to Paris because of his strong regional accent and his country style of dress that amused the Parisian economists very much. Growing up on the border with Spain and the Basque country, Bastiat was fluent in the Gascogne dialect and Spanish and knew some Basque as well. He also read Italian and spoke reasonable English. I don't know how many languages Jasay speaks, but being a Hungarian he probably speaks German as well as French, English (both the Oxford and the Australian versions), and obviously his native tongue. Thus, in my view, Jasay is even more like Bastiat than Kliemt thinks. As polyglot outsiders, they both see the world they inhabit quite differently from others.

Jasay has referred to Bastiat explicitly at least six times in his Econlib columns, but Bastiat's ideas and style of writing are present in many more. In "Thirty-Five Hours," the second article Jasay wrote for Econlib, he laments the fact that France has ignored two of its greatest economists, J. B. Say and Frederic Bastiat, whom he describes as "shamefully neglected and underestimated." He specifically mentions Bastiat's "most brilliant essay," What Is Seen and What Is Not Seen, credits Bastiat for having anticipated the concept of opportunity cost, and states that he was "to my knowledge, the first economist ever to use and explain it" (2002a). (8) He also credits Bastiat with having discovered a number of other important economic ideas, such as rent seeking in the essay "The State" (1848), which was well ahead of the public-choice school, and the notion of negative-factor productivity in "The Negative Railway." (9) A number of contemporary economists have also noted the similarity between Bastiat and the approach of the pubic-choice school, and there is of course the claim for his membership in the Austrian school that goes back to William Stanley Jevons in the 1870s and that a number of economists associated with the Ludwig von Mises Institute strongly advocate. (10)

Jasay's explanation for the neglect of Bastiat by the academy is a cynical one, though not untrue because of that. In an early article, "The Seen and the Unseen, Part I: On the Economics of Protecting Employment" (2004), he comments on Bastiat's brilliant writing style (as does Murray Rothbard (11)) and attributes the neglect of him by modern economists and historians of economic thought such as Joseph Schumpeter to the assumption that because he could write so well, he must therefore not be a proper economic theorist. One should recall Schumpeter's notorious assessment of Bastiat: although Bastiat was "the most brilliant economic journalist who ever lived," he was also an example of a "bather who enjoys himself in the shallows and then goes beyond his depth and drowns" (1954, 500-501). (12) Jasay, however, provides a very...

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