We have just seen that whatever makes transportation more expensive acts in the same way as a protective tariff; or, if you prefer, that a protective tariff acts in the same way as anything that makes transportation more expensive.

It is thus accurate to say that a protective tariff is like a marsh, a rut, a gap in the route, or a steep hill—in a word, it is an obstacle whose effect is to increase the difference between the price the producer receives and the price the consumer pays. It is likewise incontestable that marshes and bogs are, in effect, protective tariffs.

There are people (a small number, it is true, but there are some) who are beginning to understand that obstacles are no less obstacles for being artificial, and that we have more to gain from free trade than from a policy of protectionism, for precisely the same reason that a canal is more favorable to traffic than a “hilly, sandy, difficult road.”

But, they say, free trade must be reciprocal. If we lowered the barriers we have erected against the admission of Spanish goods, and if the Spaniards did not lower the barriers they have erected against the admission of ours, we should be victimized. Let us therefore make commercial treaties on the basis of exact reciprocity; let us make concessions in return for concessions; let us make the sacrifice of buying in order to obtain the advantage of selling.

People who reason in this way, I regret to say, are, whether they realize it or not, protectionists in principle; they are merely a little more inconsistent than the pure protectionists, just as the latter are more inconsistent than the advocates of total and absolute exclusion of all foreign products.

The following fable will demonstrate my point.

Stulta and Puera

Once upon a time there were, no matter where, two cities, Stulta and Puera. At great expense they built a highway from one to the other. When it was completed, Stulta said to herself: “Here is Puera flooding us with her products; we must do something about it.” Consequently, she created and salaried a corps of Obstructors, so called because their function was to set up obstacles in the way of traffic from Puera. Soon afterward, Puera also had a corps of Obstructors.

At the end of several centuries, during which there had been great advances in knowledge, Puera became sufficiently enlightened to see that these mutual obstacles could only be mutually harmful. She sent a diplomat to Stulta, who, except for official phraseology, spoke in this wise: “First we built a highway, and now we are obstructing it. That is absurd. It would have been better to have left things as they were. We should not, in that case, have had to pay, first for the highway, and then for the obstructions. In the name of Puera, I come to propose to you, not that we remove all at once the obstacles we have erected against each other—for that would be acting in accordance with a principle, and we despise principles as much as you do—but that we lessen these obstacles a little, taking care to balance equitably our respective sacrifices in this regard.”

Thus spoke the diplomat. Stulta asked for time to consider the proposal. She consulted by turns her manufacturers and her farmers. Finally, after several years, she declared that she was breaking off the negotiations.

On receiving this news, the inhabitants of Puera held a meeting. An old man (it has always been suspected that he was secretly in the pay of Stulta) rose and said: “The obstacles created by Stulta are a hindrance to the sale of our goods to her. That is a misfortune. Those that we ourselves have created are a hindrance to our purchases from her. That too is a misfortune. There is nothing we can do about the first situation, but we can do something about the second. Let us deliver ourselves at least from that one, since we cannot eliminate them both. Let us remove our Obstructors without demanding that Stulta do the same. Some day, no doubt, she will come to know her own interests better.”

A second councillor, a practical man of affairs, undefiled by principles and reared on the venerable experience of his ancestors, replied: “Do not listen to this dreamer, this theorist, this innovator, this utopian, this economist, this Stultophile. We should all be lost if the obstacles on the highway between Stulta and Puera were not equalized and kept in perfect balance. It would be more difficult to go than to come, and to export than to import. We should be, in relation to Stulta, in the same situation of inferiority in which Le Havre, Nantes, Bordeaux, Lisbon, London, Hamburg, and New Orleans find themselves in relation to the cities located at the headwaters of the Seine, the Loire, the Garonne, the Tagus, the Thames, the Elbe, and the Mississippi; for it is more difficult to go upstream than downstream.”

A voice: “The cities at the mouths of rivers have prospered more than those at the headwaters.”

“That is impossible.”

Same voice: “But it is a fact.”

“Very well, then they have prospered against the rules.”

Reasoning so conclusive convinced the assembly. The orator followed up his victory by speaking of national independence, national honor, national dignity, domestic industry, inundation by foreign products, tribute paid to foreigners, and murderous competition; in short, his motion in favor of the maintenance of obstacles was carried; and if you are at all curious about the matter, I can take you into a certain country where you will see with your own eyes highway maintenance men and obstructors working side by side in the most friendly way in the world, under laws enacted by the same legislative assembly, and at the expense of the same taxpayers, the former to clear the road, and the latter to block it.


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