IV: THE SUBORDINATION OF PRODUCER TO CONSUMER
Bastiat laid considerable stress upon this principle, but it is not easy to realise its harmonic significance.
The subordination of producer to consumer is nothing less than the subordination of private to general interest. Producers always consult their own interests, and are continually in search of profits. Still, everything invented with a view to increasing profits results in lowering prices, so that the consumer is the person who finally benefits by it.[726] And so economic laws, the law of competition and of value, constrain the producer who really wishes to be selfish to be altruistic, even despite himself. The laws outwit him, but his undoing benefits everyone else. While working for a maximum profit he is really toiling to satisfy the needs of others in the most economical fashion, and therein lies the harmony.
In all difficult economic problems the criterion should be this: What solution will prove most advantageous to consumers? Never ought we ask what will be most profitable for producers, although, unfortunately, this is the more usual question. In matters of international trade, when the interest of the producer is uppermost, Protection is established. If we only consulted the interest of consumers, Free Trade would become an immediate necessity. Or take the case of public or private expenditure. The producer can bring himself to excuse or even to approve of breaking windows or wasting powder,[727] but the consumer unceremoniously condemns all such destruction of wealth as useless consumption.
But Bastiat is not content with giving the consumer mere economic pre-eminence. He is equally anxious to demonstrate his moral superiority. “If humanity is to be perfected, it must be by the conversion of consumers, and not by the moralising of producers,”[728] and so, he holds consumers responsible for the production of unnecessary or worthless commodities, such as alcohol.[729] Bastiat’s contribution to this subject is quite first-class, and may possibly be his best claim to a place among the great economists. He was not far wrong when on his death-bed he delivered to his disciples as his last instructions—his novissima verba, “Political economy should be studied from the consumer’s standpoint.” This distinguishes him from his famous antagonist, Proudhon, who always had the producer’s interest at heart.
The only things with which we can reproach Bastiat are a too persistent faith in natural harmonies and a belief in the efficacy of ordinary economic laws to bring about the supremacy of the consumer. In fact, the consumer’s reign has not yet come, and the economic mechanism is becoming more and more the tool of the profit-maker. The consumer has had to seek in organisation a method of defending his own interests and those of the public, with whose interests his own are often confused. This is why we have institutions like the co-operative society and the consumers’ league. His moralisation, moreover, is not entirely his own affair. Before the consumer realises the full measure of his responsibility and the extent of his duties a great deal of work will be necessary on the part of buyers’ social leagues, temperance leagues, etc.
Strangely enough, economists of the Liberal Individualist school view such institutions with a somewhat critical eye.[730]
V: THE LAW OF SOLIDARITY
We must not forget, as most writers on the subject seem to have done, that Bastiat was the first to give the law of solidarity—so popular in the economics of to-day—a position of honour within the science of political economy.[731] One of the unfinished chapters of the Harmonies, entitled “Solidarity,” was meant to expound the thesis that “society is just a collection of solidarities woven together.”[732]