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Thursday, May 9, 2013

The laissez-faire utilitarian: the Seigneur de Belesba

One of the influential anti-mercantilist and pro-laissez-faire thinkers of the last decades of Louis XIV was Charles Paul Hurault de l'Hopital, Seigneur de Belesbat (d. 1706). The great-grandson of a chancellor of France, Belesbat was an influential member, during the 1690s, of an oppositional political salon in the Luxembourg palace in the Luxembourg gardens district of Paris. The salon met weekly at the home of Belesbat's first cousin, François Thimoleon, the Abbé de Choisy.

In the autumn of 1692, Belesbat presented six memoirs to Louis XIV, copies and extracts of which were reproduced throughout France. Belesbat, too, focused on the wars with the Dutch as being the key to the economic problems of France. States became wealthy, advised Belesbat, not by seizing or destroying the commerce of other nations, but by encouraging trade that conformed to the natural interest of the nation. Instead of the French government trying artificially to capture Dutch commerce, it should allow its own agriculture to flourish.

Belesbat, too, emphasized that God had woven all peoples into an interdependent network of reciprocal advantage by means of trade and specialization: ‘There is nothing that one [country] lacks which the others do not produce.... God... having created men for society, has so well divided them that they cannot do without one another’. Restrictions on trade by government only crippled this natural interdependence; therefore, merchants should be free to pursue ‘the commerce of their choice’. The direction of economic activities in each country is usually determined by the natural resources and the type of capital investment in that area.

It is not the case, concluded Belesbat, that trade in one country benefits one party at the expense of others. Instead, the reverse is true. Moreover, freedom for merchants in domestic trade was as important as in foreign trade. The network of trade and exchange is internal as well as external. Furthermore, in a prefigurement of the Hayekian argument for the free market, Belesbat noted, as Professor Rothkrug points out, that

Every transaction, either domestic or foreign, required complete freedom because it was carried out in special circumstances by merchants whose fortunes depended partially upon the secret and unique procedures by which each conducted his business.8

State regulation, then, far from protecting the market, would cripple the liberty necessary to any prosperous trade. Natural resources, Belesbat explained, are worthless without people to cultivate them and to engage in trade and commerce. Belesbat then engaged in a sophisticated analysis of the elements necessary for successful market activity:

We call commerce an exchange between men of the things they mutually need... In both [domestic and foreign trade] the principles for success are the same. And despite the fact that there is an infinite number of ways in which to practice trade, all different, they are founded on a great liberty, large capital investment, a lot of good faith, much application, and a great secrecy. Each merchant, having his particular views, in such a way that he who profits from a sale of his products, does not prevent the one who buys them from profiting considerably by disposing of them... Thus the entire success of commerce, consisting as it does in liberty, large capital investment, application, and secrecy, prevents princes from ever intervening without destroying the principles.

Thus Belesbat, in addition to a sensitive appreciation of the role of individual entrepreneurship and energy by the merchant, and of the mutual profitability of exchange, sees, if only vaguely, that the great variety of individual trade can yet be analysed correctly in a small number of formal laws, laws or truths which apply to all entrepreneurship and exchange.

In one vital area, Belesbat advanced significantly beyond the laissez-faire views of Fenelon and others, who were so opposed to the luxury of the absolutist court and the nouveau riche bureaucracy that they wished the government to restrict luxury production and trade. Belesbat swept away such inconsistent exceptions to laissez-faire. The natural laws of trade, which for him encompassed considerations of utility, applied to luxury as well as to all other branches of production and trade.

Belesbat eloquently concluded from his analysis that ‘It must be taken as a principle that liberty is the soul of commerce, without which... good harbors, great rivers, and... fertile [lands] are of no use. When liberty is absent nothing is of any avail’.9 In short, the government should ‘let commerce go where it wishes’ (laissant faire le commerce que Von voudra).

The Seigneur de Belesbat made it clear that he grounded his hope of applying libertarianism in an extreme form of early utilitarianism, a utilitarianism that he expected would be applied by the king. The king was urged to channel people's self-interest into free and harmonious activities by seeing to it that virtue is rewarded and evil (theft and other interference with trade) is punished. In that way, men would become accustomed to pursue virtue. Belesbat went very far in utilitarianism by maintaining that ‘justice’ was always and only utility or self-interest. A fatal weakness in his theory was the confident view that the self-interest of the king, who was supposed to put all this into effect, was always identical to the harmonious self-interest of his subjects.

Belesbat also anticipated the later view that Montaigne-type scepticism about reason, rather than providing support for going along with state absolutism, teaches men humility so that they will accept liberty and the free market. Reason, however, is not the sole, and not even the main, motive for the drive for the exercise of power: acquisition of wealth and privilege would seem to be motive enough. And since there will always be people and groups who will seek to seize and aggrandize state power for their own purposes, scepticism towards reason and a rational political philosophy seems more likely to subvert any determined opposition to statism than to hinder any statist drive for power.

Austrian Perspective on the History of Economic Thought (2 volume set)

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