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The Economic Thought of Gustave De Molinari, 1845-1855 by David M

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The Economic Thought of Gustave De Molinari, 1845-1855 by David M Draft: Monday, March 28, 2016 The Struggle against Protectionism, Socialism, and the Bureaucratic State: The Economic Thought of Gustave de Molinari, 1845-1855 by David M. Hart “Liberty! That was the cry of the captives of Egypt, the slaves of Spartacus, the peasants of the Middle Ages, and more recently of the bourgeoisie oppressed by the nobility and religious corporations, of the workers oppressed by masters and guilds. Liberty! That was the cry of all those who found their property confiscated by monopoly and privilege. Liberty! That was the burning aspiration of all those whose natural rights had been forcibly repressed.” (S12) ! Gustave de Molinari (1819-1912) A Paper given at the Austrian Economics Research Conference (31 March to 2 April 2016), The Mises Institute, Auburn, Alabama !1 Draft: Monday, March 28, 2016 CONTACT DETAILS Author: Dr. David M. Hart. • Director of the Online Library of Liberty Project at Liberty Fund <oll.libertyfund.org> and • Academic Editor of the Collected Works of Frédéric Bastiat <oll.libertyfund.org/pages/ bastiat-project-summary> • Editor of Gustave de Molinari, Evenings on Saint Lazarus Street: Discussions on Economic Laws and the Defence of Property (1849) <oll.libertyfund.org/pages/gdm-soirees> Email: • Work: <[email protected]> • Private: <[email protected]> Websites: • Liberty Fund: <oll.libertyfund.org> • Personal: <davidmhart.com/liberty> Date created: 24 Feb. 2016 Date revised: Monday, March 28, 2016 This paper is available online: • HTML <davidmhart.com/liberty/Papers/Molinari/Socialism/ EconomicThought1845-55/> • PDF<davidmhart.com/liberty/Papers/Molinari/Socialism/ EconomicThought1845-55.pdf> !2 Draft: Monday, March 28, 2016 ABSTRACT In the late-1840s in Paris there was an extraordinary group of economists who had gathered around the Guillaumin publishing firm to explore and promote free market ideas. One of these was the young Belgian economic journalist Gustave de Molinari (1819-1912) who was just starting out on his career which would lead him to eventually becoming one of the most important and prolific free market economists in Europe in the 19th century. In this paper I explore the first ten years of Molinari’s career as an economic journalist, author of a book on labor issues and slavery, and on the history of tariffs, a free trade activist, editor of classics of 18th century economic thought, lecturer on economics at the Athénée royal, activist in the 1848 Revolution, prolific author of articles in the Journal des Économistes, author of Les Soirées de la rue Saint-Lazare (Conversations on Saint Lazarus Street), contributor to the Dictionnaire de l’Économie politique, and, after going into self- imposed exile to Brussels after the coup d’état of Louis Napoleon in December 1851, professor of economics at the Musée royal de l'industrie belge, author of a treatise on economics, owner-editor of a newsletter L’Économiste belge, author of a book on the class analysis of Bonapartist despotism, and another popular book of “conversations” about free trade. In the middle of this very hectic period of his life Molinari published a book for Guillaumin as part of their anti-socialist campaign after the February 1848 Revolution saw socialists seize power and attempt to implement some of their ideas, especially that of the “right to a job,” paid for at taxpayer expense, as part of the National Workshops program run by Louis Blanc. Within the new Constituent Assembly politicians like Frédéric Bastiat fought to terminate the National Workshops program and keep the “right to a job” clause out of the new constitution. Outside the Assembly the economists wrote scores of books and pamphlets to intellectually defeat socialist ideas at both the popular and the academic level. Molinari’s book was designed to appeal to educated readers and consisted of a collection of 12 “evenings” or “soirées” at which “a Conservative,” “a Socialist,” and “an Economist” debated important political and economic issues. In these conversations, the economist (Molinari) exposes the folly of both the !3 Draft: Monday, March 28, 2016 conservative (who supported tariffs, subsidies, and limited voting rights) and the socialist (who supported government regulation of the economy, the right to a job for all workers, and the end to the “injustice” of profit, interest, and rent). Molinari begins by arguing that society is governed by natural, immutable and absolute laws which cannot be ignored either by conservatives or socialists, and that the foundation for a peaceful and prosperous society is the right to private property. He then proceeds to explain the free market position on a host of topics to his skeptical audience. Some of the more controversial topics Molinari discusses include the following: intellectual property, eminent domain laws, public goods such as roads, rivers, and canals, inheritance laws, the ban on forming trade unions, free trade, the state monopoly of money, the post office, state subsidies to theaters and libraries, subsidies to religious groups, public education, free banking, government regulated industries, marriage and population growth, the private provision of police and defense, and the nature of rent. On all these issues, Molinari shows himself to be a radical supporter of laissez-faire economic policies. For modern Austrian economists, what is most interesting about Molinari’s work from this period are the following: • he believed that once freed from government regulations entrepreneurs would spring up in every industry to supply goods and services to customers • he offers private and voluntary solutions to the problem of the provision of all so-called “public goods”, from the water supply to police services • he seems to have inspired Rothbard to come up with his own theory of “anarcho-capitalism” in the 1950s and 1960s when he was writing MES and P&M For modern libertarians, his book may well be the first ever one volume overview of the classical liberal position - much like an 1849 version of Rothbard’s own For a New Liberty (1973). !4 Draft: Monday, March 28, 2016 ABOUT THE AUTHOR David Hart was born and raised in Sydney, Australia. He did his undergraduate work in modern European history and wrote an honours thesis on the radical Belgian/French free market economist Gustave de Molinari, whose book Evenings on Saint Lazarus Street (1849) he is currently editing for Liberty Fund.1 This was followed by a year studying at the University of Mainz studying German Imperialism, the origins of the First World War, and German classical liberal thought. Postgraduate degrees were completed in Modern European history at Stanford University (M.A.) where he also worked for the Institute for Humane Studies (when it was located at Menlo Park, California) and was founding editor of the Humane Studies Review: A Research and Study Guide; and a Ph.D. in history from King’s College, Cambridge on the work of two early 19th century French classical liberals , Charles Comte and Charles Dunoyer, entitled Class Analysis, Slavery and the Industrialist Theory of History in French Liberal Thought, 1814-1830: The Radical Liberalism of Charles Comte and Charles Dunoyer (1994).2 He then taught for 15 years in the Department of History at the University of Adelaide in South Australia where he was awarded the University teaching prize. Since 2001 he has been the Director of the Online Library of Liberty Project <oll.libertyfund.org> at Liberty Fund in Indianapolis. The OLL has won several awards including a "Best of the Humanities on the Web" Award from the National Endowment for the Humanities, and was chosen by the Library of Congress for its Minerva website archival project. He is currently the Academic Editor of Liberty 1 Available online: David M. Hart, Gustave de Molinari and the Anti-Statist Liberal Tradition (Dept. of History, Macquarie University, 1979). Published in the Journal of Libertarian Studies, 1981-82, Part I in vol. V, no. 3, (Summer 1981), pp. 263-290; Part II in vol. V, no. 4, (Fall 1981), pp. 399-434; and Part III in Vol. 6, no. 1, (Winter 1982), pp. 83-104. Online: <davidmhart.com/ liberty/FrenchClassicalLiberals/Molinari/Thesis/>. 2 Available online: David M. Hart, Class Analysis, Slavery and the Industrialist Theory of History in French Liberal Thought, 1814-1830: The Radical Liberalism of Charles Comte and Charles Dunoyer (unpublished PhD, King's College Cambridge, 1994) <davidmhart.com/liberty/Papers/ CCCD-PhD/HTML-version/>. !5 Draft: Monday, March 28, 2016 Fund’s translation project of the Collected Works of Frédéric Bastiat (in 6 vols.)3 and is also editing a translation of Molinari’s Evenings on Saint Lazarus Street: Discussions on Economic Laws and the Defence of Property (1849).4 A third large project he is working on is an online collection of over 250 Leveller Tracts from the 1640s and 1650s.5 David is also the co-editor of two collections of 19th century French classical liberal thought (with Robert Leroux of the University of Ottawa), one in English published by Routledge: French Liberalism in the 19th Century: An Anthology (Routledge studies in the history of economics, May 2012), and another in French called L'âge d'or du libéralisme français. Anthologie XIXe siècle (The Golden Age of French Liberalism: A 19th Century Anthology) (Paris: Editions Ellipses, 2014). 3 See the “Summary of the Bastiat Project” <http://oll.libertyfund.org/pages/bastiat-project- summary>. There is also “A Chronological List of Bastiat’s writings” <http:// oll.libertyfund.org/pages/list-of-bastiat-s-works-in-chronological-order>. 4 See the Liberty Matters online discussion of “Gustave de Molinari’s Legacy for Liberty” <http://oll.libertyfund.org/pages/roderick-long-gustave-de-molinari-s-legacy-for-liberty- may-2013>. And a working draft of Liberty Fund’s translation of Les Soirées de la rue Saint- Lazare (Evenings on Saint Lazarus Street) (1849) <http://oll.libertyfund.org/pages/gdm- soirees>.
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