Economic Sophisms/Chapter 34

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Economic Sophisms by Frédéric Bastiat
The Salt-Tax, Rates of Postage, and Customhouse Duties


 
XII.
 
THE SALT-TAX, RATES OF POSTAGE, AND CUSTOMHOUSE DUTIES.

WE expected some time ago to see our representative machinery produce an article quite new, the manufacture of which had not as yet been attempted—namely, the relief of the taxpayer.

All was expectation. The experiment was interesting, as well as new. The motion of the machine disturbed nobody. In this respect, its performance was admirable, no matter at what time, in what place, or under what circumstances it was set agoing.

But as regarded those reforms which were to simplify, equalize, and lighten the public burdens, no one has yet been able to find out what has been accomplished.

It was said: You shall soon see; wait a little; this popular result involves the labours of four sessions. The year 1842 gave us railways; 1846 is to give us the reduction of the salt-tax and of the rates of postage; in 1850 we are to have a reformation of the tariff and of indirect taxation. The fourth session is to be the jubilee of the taxpayer.

Men were full of hope, for everything seemed to favour the experiment. The Moniteur had announced that the revenue would go on increasing every quarter, and what better use could be made of these unlooked-for returns than to give the villager a little more salt to his eau tiéde, and an additional letter now and then from the battle-field, where his son was risking his life?

But what has happened? Like the two preparations of sugar which are said to hinder each other from crystallizing, or the Kilkenny cats, which fought so desperately that nothing remained of them but their tails, the two promised reforms have swallowed up each other. Nothing remains of them but the tails; that is to say, we have projets de lois, exposés des motifs, reports, statistical returns, and schedules, in which we have the comfort of seeing our sufferings philanthropicaUy appreciated and homœopathically reckoned up. But as to the reforms Template:Hws Template:Hwe, they have not crystallized. Nothing has come out of the crucible, and the experiment has been a failure.

The chemists will by-and-by come before the jury and explain the causes of the breakdown.

One will say, "I proposed a postal reform; but the Chamber wished first of all to rid us of the salt-tax, and I gave it up."

Another will say, "I voted for doing away with the salt-tax, but the Minister had proposed a postal reform, and my vote went for nothing."

And the jury, finding these reasons satisfactory, will begin the experiment of new on the same data, and remit the work to the same chemists.

This proves that it would be well for us, notwithstanding the sources from which it is derived, to adopt the practice introduced half a century ago on the other side of the Channel, of prosecuting only one reform at a time. It is slow, it is wearisome; but it leads to some result.

Here we have a dozen reforms on the anvil at the same time. They hustle one another, like the ghosts at the Gate of Oblivion, where no one enters.

Template:Fs90/s

Template:FqmOhimè! che lasso!
Una a la volta, per carità."

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Here is what Jacques Bonhomme said, in a dialogue with John Bull, and it is worth being reported:—

JACQUES BONHOMME, JOHN BULL.

JACQUES BONHOMME: Oh! who will deliver me from this hurricane of reforms? My head is in a whirl. A new one seems to be invented every day: university reform, financial reform, sanitary reform, parliamentary reform, electoral reform, commercial reform, social reform, and, last of all, comes postal reform!

JOHN BULL: As regards the last, it is so easy and so useful, as we have found by experience, that I venture to give you some advice upon the subject.

JACQUES: We are told that postal reform has turned out ill in England, and that the Exchequer has lost half a million.

JOHN: And has benefited the public by ten times that sum.

JACQUES: No doubt of that.

JOHN: We have every sign by which the public satisfaction can be testified. The nation, following the lead of Sir Robert Peel and Lord John Russell, have given Rowland Hill, in true British fashion, substantial marks of the public gratitude. Even the poorer classes testify their satisfaction by sealing their letters with wafers bearing this inscription: "Public gratitude for postal reform" The leaders of the Anti-Corn-Law League have proclaimed aloud in their place in Parliament that without cheap postage thirty years would have been required to accomplish their great undertaking, which had for object the removal of duties on the food of the poor. The officers of the Board of Trade have declared it unfortunate that the English coin does not admit of a still greater reduction! What more proofs would you have?

JACQUES: But the Treasury?

JOHN: Do not the Treasury and the public sail in the same boat?

JACQUES: Not quite. And then, is it quite clear that our postal system has need to be reformed?

JOHN: That is the question. Let us see how matters now stand. What is done with the letters that are put into the post-office?

JACQUES: The routine is very simple. The postmaster opens the letter-box at a certain hour, and takes out of it, say, a hundred letters.

JOHN: And then?

JACQUES: Then he inspects them one by one. With a geographical table before him, and a letter-weigher in his hand, he assigns each letter to its proper category, according to weight and distance. There are only eleven postal zones or districts, and as many degrees of weight.

JOHN: That constitutes simply 121 combinations for each letter.

JACQUES: Yes; and we must double that number, because the, letter may, or may not, belong to the service rural.

JOHN: There are, then, 24,200 things to be inquired into with reference to every hundred letters. And how does the postmaster then proceed?

JACQUES: He marks the weight on one corner of the letter, and the postage in the middle of the address, by a hieroglyphic agreed upon at headquarters.

JOHN: And then?

JACQUES: He stamps the letters, and arranges them in ten parcels corresponding with the other post-offices with which he is in communication. He adds up the total postages of the ten parcels.

JOHN: And then? JACQUES: Then he enters the ten sums in a register, with counterfoils. JOHN: And then? JACQUES: Then he writes a letter to each of his ten correspondent postmasters, telling them with what sums he debits them. JOHN: And if the letters are prepaid? JACQUES: Then, I grant you, the service becomes somewhat complicated. He must in that case receive the letter, weigh it, and consign it to its proper category as before, receive payment and give change, select the appropriate stamp among thirty others, mark on the letter its number, weight, and postage; transcribe the full address, first in one register, then in a second, then in a third, then on a detached slip; wrap up the letter in the slip; send the whole, well secured by a string, to the correspondent postmaster; and enter each of these details in a dozen columns, selected from fifty other columns, which indicate the letter-bag in which prepaid letters are put.

JOHN: And all this for forty centimes (4d.)!

JACQUES : Yes, on an average.

JOHN: I see now that the despatch of letters is simple enough. Let us see now what takes place on their arrival.

JACQUES: The postmaster opens the post-bag.

JOHN: And then?

JACQUES: He reads the ten invoices of his correspondents.

JOHN: And after that?

JACQUES: He compares the totals of the invoices with the totals brought out by each of the ten parcels of letters.

JOHN: And after that?

JACQUES: He brings the whole to a grand total to find out with what sum, en bloc, he is to debit each letter-carrier.

JOHN: And after that ?

JACQUES: After that, with a table of distances and Template:Hws Template:Hwe in hand, he verifies or rectifies the postage of each letter.

JOHN: And after that?

JACQCTES: He enters in register after register, and in column after column, the greater or less results he has found.

JOHN: And after that?

JACQUES He puts himself in communication with the ten postmasters, his correspondents, to advise them of errors of 10 or 20 centimes (a penny or twopence).

JOHN: And then?

JACQUES: He collects and arranges all the letters he has received, to hand them to the postman.

JOHN: And after that?

JACQUES: He states the total postages that each postman is charged with.

JOHN: And after that?

JACQUES: The postman verifies, or discusses, the signification of the hieroglyphics. The postman finally advances the amount, and sets out.

JOHN: Go on.

JACQUES: The postman goes to the party to whom a letter is addressed, and knocks at the door. A servant opens. There are six letters for that address. The postages are added up, separately at first, then altogether. They amount to 2 francs 70 centimes (2s. 3d.).

JOHN: Go on.

JACQUES: The servant goes in search of his master. The latter proceeds to verify the hieroglyphics. He mistakes the threes for twos and the nines for fours. He has doubts about the weights and distances. In short, he has to ask the postman to walk upstairs, and on the way he tries to find out the signatures of the letters, thinking it may be prudent to refuse some of them. JOHN: Go on. JACQUES: The postman when he has got upstairs pleads the cause of the post-office. They argue, they examine, they weigh, they calculate distances—at length the party agrees to receive five of the letters, and refuses one. JOHN: Go on.

JACQUES: What remains is to pay the postage. The servant is sent to the grocer for change. After a delay of twenty minutes he returns, and the postman is at length set free, and rushes from door to door, to go through the same ceremony at each.

JOHN: Go on.

JACQUES: He returns to the post-office. He counts and recounts with the postmaster. He returns the letters refused, and gets repayment of his advances for these. He reports the objections of the parties with reference to weight and distance.

JOHN: Go on.

JACQUES: The postmaster has to refer to the registers, letter-bags, and special slips, in order to make up an account of the letters which have been refused.

JOHN: Go on, if you please.

JACQUES: I am thankful I am not a postmaster. We now come to accounts in dozens and scores at the end of the month; to contrivances invented not only to establish, but to check and control a minute responsibility, involving a total of 50 millions of francs, made up of postages amounting on an average to 43 centimes each (less than 4½d.), and of 116 millions of letters, each of which may belong to one or other of 242 categories.

JOHN: A very complicated simplicity truly! The man who has resolved this problem must have a hundred times more genius than your Mons. Piron or our Rowland Hill.

JACQUES: Well, you seem to laugh at our system. Would you explain yours to me?

JOHN: In England, the government causes to be sold all over the country, wherever it is judged useful, stamps, envelopes, and covers at a penny apiece.

JACQUES: And after that?

JOHN: You write your letter, fold it, put it in the envelope, and throw it into the post-office.

JACQUES: And after that?

JOHN: "After that"—why, that is the whole affair. We have nothing to do with distances, bulletins, registers, control, or accounting; we have no money to give or to receive, and no concern with hieroglyphics, discussions, interpretations, etc., etc.

JACQUES: Truly this is very simple. But is it not too much so? An infant might understand it. But such reforms as you describe stifle the genius of great administrators. For my own part, I stick to the French mode of going to work. And then your uniform rate has the greatest of all faults. It is unjust.

JOHN: How so?

JACQUES: Because it is unjust to charge as much for a letter addressed to the immediate neighbourhood, as for one which you carry three hundred miles.

JOHN: At all events you will allow that the injustice goes no further than to the extent of a penny.

JACQUES: No matter—it is still injustice.

JOHN: Besides, the injustice, which at the outside cannot extend beyond a penny in any particular case, disappears when you take into account the entire correspondence of any individual citizen who sends his letters sometimes to a great distance and sometimes to places in the immediate vicinity.

JACQUES: I adhere to my opinion. The injustice is lessened—infinitely lessened, if you will; it is inappreciable, infinitesimal, homœopathic; but it exists.

JOHN: Does your government make you pay dearer for an ounce of tobacco which you buy in the Rue de Clichy than for the same quantity retailed on the Quai d'Orsay?

JACQUES: What connexion is there between the two subjects of comparison?

JOHN: In the one case as in the other, the cost of transport must be taken into account. Mathematically, it would be just that each pinch of snufif should be dearer in the Rue de Clichy than on the Quai d'Orsay by the millionth part of a farthing.

JACQUES: True; I don't dispute that it may be so.

JOHN: Let me add, that your postal system is just only in appearance. Two houses stand side by side, but one of them happens to be within, and the other just outside, the zone or postal district. The one pays a penny more than the other, just equal to the entire postage in England. You see, then, that with you injustice is committed on a much greater scale than with us.

JACQUES: That is so. My objection does not amount to much; but the loss of revenue still remains to be taken into account.

Here I ceased to listen to the two interlocutors. It turned out, however, that Jacques Bonhomme was entirely converted; for some days afterwards, the Report of M. Vuitry having made its appearance, Jacques wrote the following letter to that honourable legislator:—

Template:Dent

"MONSIEUR,—Although I am not ignorant of the extreme discredit into which one falls by making oneself the advocate of an absolute theory, I think it my duty not to abandon the cause of a uniform rate of postage, reduced to simple remuneration for the service actually rendered.

"My addressing myself to you will no doubt be regarded as a good joke. On the one side appears a heated brain, a closet-reformer, who talks of overturning an entire system all at once and without any gradual transition; a dreamer, who has never, perhaps, cast his eye on that mass of laws, ordinances, tables, schedules, and statistical details which accompany your report,—in a word, a theorist. On the other appears a grave, prudent, moderate-minded legislator, who has weighed, compared, and shown due respect for the various interests involved, who has rejected all systems, or, which comes to the same thing, has constructed a system of his own, borrowed from all the others. The issue of such a struggle cannot be doubtful.

"Nevertheless, as long as the question is pending, every one has a right to state his opinions. I know that mine are sufficiently decided to expose me to ridicule. All I can expect from the reader of this letter is not to throw ridicule away (if, indeed, there be room for ridicule), before, in place of after, having heard my reasons.

"For I, too, can appeal to experience. A great people has made the experiment. What has been the result? We cannot deny that that people is knowing in such matters, and that its opinion is entitled to weight.

"Very well, there is not a man in England whose voice is not in favour of postal reform. Witness the subscription which has been opened for a testimonial to Mr Rowland Hill. Witness the manner in which John Bull testifies his gratitude. Witness the oft-repeated declaration of the Anti-Corn-Law League: 'Without the penny postage we should never have had developed that public opinion which has overturned the system of protection.' All this is confirmed by what we read in a work emanating from an official source:—

Template:Fs90/s "'The rates of postage should be regulated, not with a view to revenue, but for the sole purpose of covering the expense.' Template:Fs90/e

"To which Mr Macgregor adds : —

Template:Fs90/s "'It is true that the rate having come down to our smallest coin, we cannot lower it further, although it does yield some revenue. But this source of revenue, which will go on constantly increasing, must be employed to improve the service, and to develop our system of mail steamers all over the world.' Template:Fs90/e

"This brings me to examine the leading idea of the commission, which is, on the other hand, that the rate of postage should be a source of revenue to government.

"This idea runs through your entire report, and I allow that, under the influence of this prejudice, you could arrive at nothing great or comprehensive, and you are fortunate if, in trying to reconcile the two systems, you have not fallen into the errors and drawbacks of both.

"The first question we have to consider is this: Is the correspondence which passes between individual citizens a proper subject of taxation?

"I shall not fall back on abstract principles, or remind you that the very essence of society being the communication of ideas, the object of every government should be to facilitate and not impede this communication.

"Let us look to actual facts.

"The total length of our highways and departmental and country roads extends to a million of kilometres (625,000 miles). Supposing that each has cost 100,000 francs (£4000), this makes a capital of 100 milliards (£4,000,000,000) expended by the State to facilitate the transport of passengers and goods.

"Now, put the question, if one of your honourable colleagues asked leave of the Chamber to bring in a bill thus conceived:

Template:Fs90/s "'From and after 1st January next, the Government will levy upon all travellers a tax sufficient not only to cover the expense of maintaining the highways, but to bring back to the Exchequer four or five times the amount of that expense.…' Template:Fs90/e

"Would you not feel such a proposal to be anti-social and monstrous?

"How is it that this consideration of profits, nay, of simple remuneration, never presents itself to our minds when the question regards the circulation of commodities, and yet appears so natural when the question regards the circulation of ideas?

"Perhaps it is the result of habit. If we had a postal system to create, it would most assuredly appear monstrous to establish it on a principle of revenue.

"And yet remark that oppression is more glaring in this case than in the other.

"When Government has opened a new road it forces no one to make use of it. (It would do so undoubtedly if the use of the road were taxed.) But while the Post-office regulations continue to be enforced, no one can send a letter through any other channel, were it to his own mother.

"The rate of postage, then, in principle, ought to be remunerative, and, for the same reason, uniform.

"If we set out with this idea, what marvellous beauty, facility, and simplicity does not the reform I am advocating present !

"Here is the whole thing nearly put into the form of a law.

Template:Fs90/s "'ARTICLE 1. From and after 1st January next there will be exposed to sale, in every place where the Government judges it expedient, stamped envelopes and covers, at the price of a halfpenny or a penny.

"'2. Every letter put into one of these envelopes, and not exceeding the weight of half an ounce, every newspaper or print put into one of these covers, and not exceeding the weight of … will be transmitted, and delivered without cost at its address.

"'3. All Post-office accounting is entirely suppressed. "'4. All pains and penalties with reference to the conveyance of letters are abolished.' Template:Fs90/e

"That is very simple, I admit—much too simple; and I anticipate a host of objections.

"That the system I propose may be attended with drawbacks is not the question; but whether yours is not attended with more.

"In sober earnest, can the two (except as regards revenue) be put in comparison for a moment?

"Examine both. Compare them as regards facility, convenience, despatch, simplicity, order, economy, justice, equality, multiplication of transactions, public satisfaction, moral and Template:Hws Template:Hwe development, civilizing tendency; and tell me honestly if it is possible to hesitate a moment.

"I shall not stop to enlarge on each of these considerations—I give you the headings of twelve chapters, which I leave blank, persuaded that no one can fill them up better than yourself.

"But since there is one objection—namely, revenue—I must say a word on that head.

"You have constructed a table in order to show that even at twopence the revenue would suffer a loss of £880,000.

"At a penny, the loss would be £1,120,000, and at a half-penny, of £1,320,000; hypotheses so frightful that you do not even formulate them in detail.

"But allow me to say that the figures in your report dance about with a little too much freedom. In all your tables, in all your calculations, you have the tacit reservation of cœteris paribus. You assume that the cost will be the same under a simple as under a complicated system of administration—the same number of letters with the present average postage of 4½d. as with the uniform rate of twopence. You confine yourself to this rule of three : if 87 millions of letters at 4½d. yield so much, then at 2d. the same number will yield so much; admitting, nevertheless, certain distinctions when they militate against our proposed reform.

"In order to estimate the real sacrifice of revenue, we must, first of all, calculate the economy in the service which will be effected; then in what proportion the amount of correspondence will be augmented. We take this last datum solely into account, because we cannot suppose that the saving of cost which will be realized will not be met by an increased personnel rendered necessary by a more extended service.

"Undoubtedly, it is impossible to fix the exact amount of increase in the circulation of letters which the reduction of postage would cause, but in such matters a reasonable analogy has always been admitted.

"You yourself admit that in England a reduction of seven-eighths in the rate has caused an increase of correspondence to the extent of 360 per cent.

"Here, the lowering to 5 centimes (a halfpenny) of the rate which is at present at an average of something less than 4½d., would constitute likewise a reduction of seven-eighths. We may therefore be allowed to expect the same result—that is to say, 417 millions of letters, in place of 116 millions.

"But let us count on 300 millions.

"Is there any exaggeration in assuming that with a rate of postage one half less, we shall reach an average of 8 letters to each inhabitant when in England they have reached 13.

  1. Millions.
  2. Now 300 millions of letters, at 5 centimes, give
    ................................................................................................................................................................................................................................................................................................................................................................................................
    15
  3. 100 millions of journals and prints, at 5 centimes, give
    ................................................................................................................................................................................................................................................................................................................................................................................................
    5
  4. Travellers by malles-postes,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    4
  5. Money parcels,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    4
  6. Total receipts,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    28
  7. The present expense (which may diminish) is
    ................................................................................................................................................................................................................................................................................................................................................................................................
    31Template:Gap
  8. Deducting for mail steamers,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    5Template:Gap
  9. There remains for despatches, travellers, and money parcels,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    —— 26
  10. Net product,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    2
  11. At present the net product is
    ................................................................................................................................................................................................................................................................................................................................................................................................
    19
  12. Loss, or rather reduction of gain,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    17

"Now I ask whether the Government, which makes a positive sacrifice of 800 millions (£32,000,000) per annum in order to facilitate the gratuitous transport of passengers, should not make a negative sacrifice of 17 millions, in order not to make a gain upon the transmission and circulation of ideas?

"But the Treasury, I am aware, has its own habits, and with whatever complacence it sees its receipts increase, it feels proportional disappointment in seeing them diminished by a single farthing. It seems to be provided with those admirable valves which in the human frame allow the blood to flow in one direction, but prevent its return. Be it so. The Treasury is perhaps a little too old for us to quicken its pace. We have no hope, therefore, that it will give in to us. But what will be said if I, Jacques Bonhomme, show it a way which is simple, easy, convenient, and essentially practical, of doing a great service to the country without its costing a single farthing?

"The Post-office yields a gross return to the

  1. Treasury of
    ................................................................................................................................................................................................................................................................................................................................................................................................
    50 millions
  2. The salt-tax,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    70 Template:Gap
  3. Customs,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    160 Template:Gap
  4. Template:Gap
  5. Template:GapTotal yield of these three services,
    ................................................................................................................................................................................................................................................................................................................................................................................................
    280 millions

"Now, bring down postages to the uniform rate of 5 centimes (a halfpenny).

"Lower the salt-tax to 10 francs (8s.) the hundredweight, as the Chamber has already voted.

"Give me power to modify the customs tariff in such a way that I shall he peremptorily prohibited from increasing any duty, but that I may lower duties at pleasure.

"And I, Jacques Bonhomme, guarantee you a revenue, not of 280 millions, but of 300 millions. Two hundred French bankers will be my sureties, and all I ask for my reward is as much as these three taxes will produce over and above 300 millions.

"Is it necessary for me to enumerate the advantages of my proposal?

"1. The people will receive all the advantage resulting from cheapness in the price of an article of the first necessity—salt.

"2. Fathers will be able to write to their sons, and mothers to their daughters. Nor will men's affections and sentiments, and the endearments of love and friendship, be stemmed and driven back into their hearts, as at present, by the hand of the tax-gatherer.

"3. To carry a letter from one friend to another will no longer be inscribed in our code as a crime.

"4. Trade will revive with liberty, and our merchant shipping will recover from its humiliation.

"5. The Treasury will gain at first twenty millions, afterwards it will gain all that shall accrue to the revenue from other sources through the saving realized by each citizen on salt, postages, and other things, the duties on which have been lowered.

If my proposal is rejected, what am I to conclude? Provided the bankers I represent offer sufficient security, under what pretext can my proposal be refused acceptance? It is impossible to invoke the equilibrium of budgets. It would indeed be upset, but upset in such a way that the receipts should exceed the expenses. This is no affair of theory, of system, of statistics, of probability, of conjecture; it is an offer, an offer like that of a company which solicits the concession of a line of railway. The Treasury tells me what it derives from postages, salt-tax, and customs. I offer to give it more. The objection, then, cannot come from the Treasury. I offer to reduce the tariff of salt, postages, and customs; I engage not to raise it; the objection, then, cannot come from the taxpayers. From whom does it come, then? From monopolists? It remains to be seen whether their voice shall be permitted in France to drown the voice of the Government and the people. To assure us of this, I beg you to transmit my proposal to the Council of Ministers. Template:Float right

"P.S.—Here is the text of my offer:—

"I, Jacques Bonhomme, representing a company of bankers and capitalists, ready to give all guarantees and deposit whatever security may be necessary,

"Having learnt that the Government derives only 280 millions of francs from customs duties, postages, and salt-tax, by means of the duties at present fixed;

"I offer to give the Government 300 millions from the gross produce of these three sources of revenue;

"And this while reducing the salt-tax from 30fr. to 10fr.;

"Reducing the rate of postage from 42½ centimes, at an average, to a uniform rate of from 5 to 10 centimes,

" On the single condition that I am permitted not to raise (which will be formally prohibited), but to lower as much as I please the duties of cuatoms. Jacques Bonhomme.

"You are a fool," said I to Jacques Bonhomme, when he read me his letter. "You can do nothing with moderation. The other day you cried out against the hurricane of reforms, and here I find you demanding three, making one of them the condition of the other two. You will ruin yourself."

"Be quiet," said he, "I have made all my calculations; I only wish they may be accepted. But they will not be accepted."

Upon this we parted, our heads full, his of figures, mine of reflections which I forbear to inflict upon the reader.