Wednesday, July 3, 2013

Hume Had Many Leather-Bound Books and His Apartment Smelled of Rich Mahogony

From Essays, Part II, Essay I: Of Commerce:
May not the sovereign lay claim to [superfluous (unemployed) labor], and employ them in fleets and armies, to encrease the dominions of the state abroad, and spread its fame over distant nations? It is certain that the fewer desires and wants are found in the proprietors and labourers of land, the fewer hands do they employ; and consequently the superfluities of the land, instead of maintaining tradesmen and manufacturers, may support fleets and armies to a much greater extent, than were a great many arts are required to minister to the luxury of particular persons. Here therefore seems to be a kind of opposition between the greatness of the state and the happiness of the subject [emphasis SLW]. A state is never greater than when all its superfluous hands are employed in the service of the public. The ease and convenience of private persons require, that these hands should be employed in their service. The one can never be satisfied, but at the expense of the other. As the ambition of the sovereign must entrench on the luxury of individuals; so the luxury of individuals must diminish the force, and check the ambition of the sovereign.
Knowing this, if you were a sovereign, and you wanted to "encrease the dominions of the state abroad", you might be tempted to underwrite those policies that best produced superfluous labor among the classes most suited to service in the fleets and armies. To sell these policies to the median voter, found doubtless among the tradesmen and manufacturers, you might pivot your claim in the soil of non-euvoluntary exchange. Labor isn't euvoluntary; employers exploit workers by BATNA disparity ergo minimum wage legislation ergo low-skilled labor is unemployable in the private sector ergo we can boast an end strength of 1.3 million heads ergo political elites can wage endless wars around the world.

Before you punch me through your computer screen, I'm not saying that this is actually necessarily the story of political economy, but I am asking my readers to consider that there might be more to a story than just the simple cry of "exploitation" and a hastily scribbled statute aimed as a remedy. Mungo is part of an upcoming series on Bastiat that I heartily recommend for these very reasons. Earlier in the Essay I quote above, Hume makes a distinction between shallow and abstruse thinkers. When it comes to matters of commerce, it pays well to dive straight into the deep end.

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Do you have suggestions on where we could find more examples of this phenomenon?