The 5 Laws of Decline – (#2) Bastiat’s Law

Posted: August 11, 2013 in Economics, Freedom
Tags: , , , , , , , , , , , , ,

TheLawPreviously we had discussed the first law of decline; Sturgeon’s Law. This law stated that 90% of everything is crud, and showed how you can’t count on 90% of leaders and politicians to do the right thing without some kind of check in place to stop them. 90 percent of them will undoubtedly fall to the second law of decline; Bastiat’s law.

These laws come from Orrin Woodward‘s book ‘Resolved‘ as well as his and Oliver DeMille‘s book ‘LeaderShift‘.

A couple of years ago I read a book by Frederic Bastiat called ‘The Law‘. In this book, Bastiat goes through the concept of having a law; what it is supposed to be used for and what it then actually get’s used for. He shows how laws are supposed to be there to protect a persons property, and thus people themselves, but end up getting used to steal or harm people’s property.

Bastiat’s Law

Bastiat wrote a profound passage that Orrin Woodward takes for his second law of decline, which he first outlined in ‘Resolved: 13 Resolutions for Life.’

Man can live and satisfy his wants only by ceaseless labor; by the ceaseless application of his faculties to natural resources. This process is the origin of property.

But it is also true that a man may live and satisfy his wants by seizing and consuming the products of the labor of others. This process is the origin of plunder.

Now since man is naturally inclined to avoid pain—and since labor is pain in itself—it follows that men will resort to plunder whenever plunder is easier than work. History shows this quite clearly. And under these conditions, neither religion nor morality can stop it.

When, then, does plunder stop? It stops when it becomes more painful and more dangerous than labor. It is evident, then, that the proper purpose of law is to use the power of its collective force to stop this fatal tendency to plunder instead of to work.

– Frederic Bastiat, The Law

Bastiat’s law: Since men are naturally inclined to avoid pain, which labor is itself, it follows that they will resort to plunder whenever it is easier than work.

We can probably think of many laws we don’t agree with, that they are not fair for one group or another. From this you should be able to agree that laws are not always confined to their original purpose of protecting people and their property, even if you believe that overall, government is good.

Laws should be protecting property and punishing plunder, but unfortunately governments are run by men. Since laws need to be backed by force to have any effect, this force is entrusted to those who make the laws in the first place. Since man would prefer to satisfy his wants with the least possible effort, the person or group controlling the use of force can very easily be influenced into creating laws that plunder property instead of protect it.

We see this all the time in society today. Barely a day goes by during election season where we don’t hear about some corporation buying the influence of some politician or party. Laws are constantly being created that not only don’t protect our rights, but that take them away. There are many laws in place that benefit people, but only at the expense of others. When a law is used in this way, it makes theft legal. Bastiat calls this legal plunder. One of the problems he talks about in regards to this type of plunder deals with the redistribution of wealth (of property),

Under the pretense of organization, regulation, protection, or encouragement, the law takes property from one person and gives it to another; the law takes the wealth of all and gives it to a few—whether farmers, manufacturers, shipowners, artists, or comedians. Under these circumstances, then certainly every class will aspire to grasp the law, and logically so.

As long as it is admitted that the law may be diverted from its true purpose—that it may violate property instead of protecting it—then everyone will want to participate in making the law, either to protect himself against plunder or to use it for plunder.

Many will argue that in many cases it is right to take from a group that has more, and give it to those who don’t, that it is the moral thing to do, and the right thing for society.

Thinking in moral terms, is right to steal from someone to help someone else? If you know someone who can’t afford to eat and is starving, would the moral thing be to rob someone right after they take money out of a bank machine in order to feed the starving person? No! so why is a law that does just that, the moral thing to do? It can’t be denied that this person needs help, but charity is the answer here. Voluntary donations are the moral thing to do. There are those that would argue there are not enough people with the moral character to donate to those in need, and that is why laws are needed to make them donate.

There are many problems that arise from this thought, most of which stem from the third law of decline, but there is enough to discuss under Bastiat’s law.

Even if it is right to play the role of Robin Hood, stealing from the rich to give to the poor, it is a precedent that grows out of control. It allows everyone to go to the government and claim their share, whether it is in the way of subsidies or special tax breaks for businesses, grants for art projects, or welfare for those who can’t work and those who don’t want to work. As the law states, if someone can get something for nothing, they will. Even if you think social spending is good in some cases, understand that Bastiat’s law means there are many people getting other laws created, to get something for themselves.

When people do end up getting something from the government, they will try to get the most possible, even when that ‘most’ is not really needed. Unemployment insurance (UI) would be a great example of this. It is rare to find an individual who will try to get another job immediately after losing the previous one. This will usually only happen if the difference between the UI salary and the salary needed to survive is wide enough the it becomes too painful, as Bastiat would put it, to not get another well paying job.

Ninety percent of people, if you go by Sturgeon’s law, will stay at home or even go on a government sponsored vacation; getting their freebie from the government. I’ve talked to a few people who told me straight out “Why go get another job right now? I get enough UI (or welfare) to get by. I sit at home playing video games all day, and the government pays for it!”

Every time you have someone getting something for nothing, it brings down the economy. This is because, contrary to popular belief, economies are boosted by production, not consumption. So we have people not producing anything, because they can take from those who are; this means the producers are not getting anything for some of what they produce. This gives them less of an incentive to produce, especially when you take into account the third and fourth laws of decline which will be discussed another day.

The other big argument for needing the government to take care of everyone instead of protecting everyone, is that not enough people give to charity on their own. It may just be my opinion, but It’s probably a safe bet that too many people just don’t have the money to give since it was already taxed from them, and they no longer feel the need. They no longer feel obliged because the government is already taking their money to give to the needy (supposedly) for them.

My current salary is quite a bit below the average full time wage in Canada, and more than 50% of my salary goes to taxes (which includes government fees like driver’s license registration). How many people would feel they can afford to give more to charities in that situation? Maybe ten percent, if you go by Sturgeon’s law.

With Bastiat’s law stating that we want to work as little as possible for the most pay, it stands to reason that many will be reluctant to give more; we are already being rewarded for only half of our work.

Due to Bastiat’s law, and everyone going to the government for their fair share, we are constantly running a deficit with astronomical government spending. Even with some of the government’s social programs being good, it has been blown all out of proportion. There are many causes you can attribute to why our economy is in bad shape, and our government can’t balance the budget, but they all come down to Bastiat’s law.

Bastiat’s law is the fatal flaw in communistic theories, since the 90 percent will do as little as possible if given an opportunity, while the 10 percent will be driven to despair because they aren’t rewarded for their productive efforts. The only proven way to combat Bastiat’s law is to develop, score, and reward performance.

– Orrin Woodward, ‘Resolved‘.

Unchecked, Bastiat’s law rewards the non performers, the 90%, while punishing the producers, the 10%. This also leads to Gresham’s law; When bad behavior is rewarded, more of the bad behavior will be done, and in turn will drive out the good behavior.

  1. Nicolas Coombs says:

    I love the analysis you’re doing on these laws of decline, and I’m very much looking forward to your elaboration on the rest of them!

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