Applications--Free Trade

January 27, 2022

My maxims are:

  1. The individual is not accountable to society for his actions, in so far as these concern the interests of no person but himself.

Advice, instruction, persuasion, and avoidance by other people if thought necessary by them for their own good, are the only measures by which society can justifiably express its dislike or disapprobation of his conduct.

  1. Actions that hurt the interests of others should be punished socially or legally.

In many cases, an individual causes pain or loss to others or intercepts a good which they could have gained, by pursuing a legitimate object. Such oppositions of interest between individuals often arise from bad social institutions. But these are unavoidable while those institutions last. Some would be unavoidable under any institutions.

Whoever succeeds in an overcrowded profession, or in a competitive examination; whoever is preferred to another in any contest for an object which both desire, reaps benefit from the loss of others, from their wasted exertion and their disappointment.

But it is, by common admission, better for the general interest of mankind, that persons should pursue their objects undeterred by this sort of consequences.

In other words, society admits no rights, either legal or moral, in the disappointed competitors, to immunity from this kind of suffering; and feels called on to interfere, only when means of success have been employed which it is contrary to the general interest to permit—namely, fraud or treachery, and force.

Free Trade

Trade is a social act. Whoever sells goods to the public affects the interest of society. Thus, trade comes within the jurisdiction of society.

Before, it was the duty of governments to fix prices and regulate manufacturing processes. But nowadays, after a long struggle, the cheapness and the good quality of commodities are best realized by leaving the producers and sellers perfectly free, under the sole check of equal freedom to the buyers for supplying themselves elsewhere.

This is the doctrine of Free Trade, which rests on grounds different from, though equally solid with, the principle of individual liberty asserted in this Essay.

Restrictions on trade, or on production for purposes of trade, are indeed restraints; and all restraint, quâ restraint, is an evil= but the restraints in question affect only that part of conduct which society is competent to restrain, and are wrong solely because they do not really produce the results which it is desired to produce by them.

The principle of individual liberty is not involved in the doctrine of Free Trade. Neither is it in most of the questions which arise respecting the limits of that doctrine.

For example, what amount of public control is admissible for the prevention of fraud by adulteration; how far sanitary precautions, or arrangements to protect work-people employed in dangerous occupations, should be enforced on employers. Such questions involve considerations of liberty, only in so far as leaving people to themselves is always better, cæteris paribus, than controlling them= but that they may be legitimately controlled for these ends, is in principle undeniable.

On the other hand, there are questions relating to interference with trade, which are essentially questions of liberty; such as the Maine Law, already touched upon; the prohibition of the importation of opium into China; the restriction of the sale of poisons; all cases, in short, where the object of the interference is to make it impossible or difficult to obtain a particular commodity. These interferences are objectionable, not as infringements on the liberty of the producer or seller, but on that of the buyer.

An example is the sale of poisons. What are the proper limits of the police power? How far liberty may legitimately be invaded for the prevention of crime, or of accident?

The government must take precautions against crime before it occurs, and to detect and punish it afterwards. The preventive function of government, however, is far more liable to be abused, to the prejudice of liberty, than the punitory function. There is hardly any part of the legitimate freedom of action of a human being which would not admit of being represented, and fairly too, as increasing the facilities for some form or other of delinquency.

Nevertheless, if a public authority, or even a private person, sees any one evidently preparing to commit a crime, they are not bound to look on inactive until the crime is committed, but may interfere to prevent it. If poisons were never bought or used for any purpose except the commission of murder, it would be right to prohibit their manufacture and sale.

They may, however, be wanted not only for innocent but for useful purposes, and restrictions cannot be imposed in the one case without operating in the other. Again, it is a proper office of public authority to guard against accidents.

If either a public officer or any one else saw a person attempting to cross a bridge which had been ascertained to be unsafe, and there were no time to warn him of his danger, they might seize him and turn him back, without any real infringement of his liberty; for liberty consists in doing what one desires, and he does not desire to fall into the river. Nevertheless, when there is not a certainty, but only a danger of mischief, no one but the person himself can judge of the sufficiency of the motive which may prompt him to incur the risk= in this case, therefore (unless he is a child, or delirious, or in some state of excitement or absorption incompatible with the full use of the reflecting faculty), he should be only warned of the danger; not forcibly prevented from exposing himself to it. Similar considerations, applied to such a question as the sale of poisons, may enable us to decide which among the possible modes of regulation are or are not contrary to principle.

Such a precaution, for example, as that of labelling the drug with some word expressive of its dangerous character, may be enforced without violation of liberty= the buyer cannot wish not to know that the thing he possesses has poisonous qualities. But to require in all cases the certificate of a medical practitioner, would make it sometimes impossible, always expensive, to obtain the article for legitimate uses.

Preappointed evidence in Contracts

The only mode apparent to me, in which difficulties may be thrown in the way of crime committed through this means, without any infringement, worth taking into account, upon the liberty of those who desire the poisonous substance for other purposes, consists in providing what, in the apt language of Bentham, is called “preappointed evidence.”

This provision is familiar to every one in the case of contracts.

A legal contract requires certain formalities such as signatures, attestation of witnesses, etc. In case of subsequent dispute, there will be evidence to prove that:

  • the contract was really entered into, and
  • it was legally valid

This prevents fictitious contracts or invalid contracts. The same precautions can be made in the sale of articles adapted to be instruments of crime.

For example, the seller might be required:

  • to enter into a register the:
    • exact time of the transaction
    • the name and address of the buyer
    • the precise quality and quantity sold
  • to ask why it was wanted and the reply to this question

When there was no medical prescription, the presence of some third person might be required, to bring home the fact to the purchaser, in case there should afterwards be reason to believe that the article had been applied to criminal purposes.

Such regulations would not prevent obtaining the article. But a very considerable one to making an improper use of it without detection.

There is a maxim that purely self-inflicted misconduct cannot be meddled with. But this should be limited as to ward off crimes by society against itself.

For example, ordinary drunkenness is not a fit subject for legislative interference. But it is valid if a man did violence while drunk. If proven, the he should be punished. If he commits another offence, the punishment should be more severe.

The drunkeness that does harm to others is a crime. Likewise, idleness, except in a person receiving support from the public, or except when it constitutes a breach of contract, cannot without tyranny be made a subject of legal punishment;

but if either from idleness or from any other avoidable cause, a man fails to perform his legal duties to others, as for instance to support his children, it is no tyranny to force him to fulfil that obligation, by compulsory labour, if no other means are available.

There are many acts which, being directly injurious only to the agents themselves, ought not to be legally interdicted, but which, if done publicly, are a violation of good manners and coming thus within the category of offences against others may rightfully be prohibited.

Of this kind are offences against decency; on which it is unnecessary to dwell, the rather as they are only connected indirectly with our subject, the objection to publicity being equally strong in the case of many actions not in themselves condemnable, nor supposed to be so.

In cases of personal conduct supposed to be blamable, but which respect for liberty precludes society from preventing or punishing, because the evil directly resulting falls wholly on the agent; what the agent is free to do, ought other persons to be equally free to counsel or instigate?

This question is not free from difficulty. The case of a person who solicits another to do an act, is not strictly a case of self-regarding conduct. To give advice or offer inducements to any one, is a social act, and may therefore, like actions in general which affect others, be supposed amenable to social control.

But a little reflection corrects the first impression, by showing that if the case is not strictly within the definition of individual liberty, yet the reasons on which the principle of individual liberty is grounded, are applicable to it. If people must be allowed, in whatever concerns only themselves, to act as seems best to themselves at their own peril, they must equally be free to consult with one another about what is fit to be so done; to exchange opinions, and give and receive suggestions.

Whatever it is permitted to do, it must be permitted to advise to do. The question is doubtful, only when the instigator derives a personal benefit from his advice; when he makes it his occupation, for subsistence or pecuniary gain, to promote what society and the state consider to be an evil. Then, indeed, a new element of complication is introduced; namely, the existence of classes of persons with an interest opposed to what is considered as the public weal, and whose mode of living is grounded on the counteraction of it. Ought this to be interfered with, or not?

For example, fornication and gambling must be tolerated. But should a person be free to be a pimp, or to keep a gambling-house?

The case is one of those which lie on the exact boundary line between two principles, and it is not at once apparent to which of the two it properly belongs. There are arguments on both sides.

On the side of toleration it may be said, that the fact[Pg 188] of following anything as an occupation, and living or profiting by the practice of it, cannot make that criminal which would otherwise be admissible; that the act should either be consistently permitted or consistently prohibited;

that if the principles which we have hitherto defended are true, society has no business, as society, to decide anything to be wrong which concerns only the individual; that it cannot go beyond dissuasion, and that one person should be as free to persuade, as another to dissuade.

In opposition to this it may be contended, that although the public, or the State, are not warranted in authoritatively deciding, for purposes of repression or punishment, that such or such conduct affecting only the interests of the individual is good or bad, they are fully justified in assuming, if they regard it as bad, that its being so or not is at least a disputable question=

That, this being supposed, they cannot be acting wrongly in endeavouring to exclude the influence of solicitations which are not disinterested, of instigators who cannot possibly be impartial—who have a direct personal interest on one side, and that side the one which the State believes to be wrong, and who confessedly promote it for personal objects only.

It may be urged that nothing is lost by so ordering matters that persons shall make their election on their own prompting, as free as possible from the arts of persons who stimulate their inclinations for interested purposes of their own.

Thus, the statutes respecting unlawful games are utterly indefensible. —though all persons should be free to gamble in their own or each other’s houses, or in any place of meeting established by their own subscriptions, and open only to the members and their visitors—yet public gambling-houses should not be permitted.

The prohibition is never effective. Whatever tyrannical power is given to the police, gambling-houses can always be maintained under other pretences;

but they may be compelled to conduct their operations with a certain degree of secrecy and mystery, so that nobody knows anything about them but those who seek them; and more than this, society ought not to aim at.

I will not decide whether these forceful arguments are enough to justify the moral anomaly of punishing the accessary, when the principal is (and must be) allowed to go free; or fining or imprisoning the procurer, but not the fornicator, the gambling-house keeper, but not the gambler.

Still less ought the common operations of buying and selling to be interfered with on analogous grounds. Almost every article which is bought and sold may be used in excess, and the sellers have a pecuniary interest in encouraging that excess; but no argument can be founded on this, in favour, for instance, of the Maine Law; because the class of dealers in strong drinks, though interested in their abuse, are indispensably required for the sake of their legitimate use. The interest, however, of these dealers in promoting intemperance is a real evil, and justifies the State in imposing restrictions and requiring guarantees, which but for that justification would be infringements of legitimate liberty.

Should the State indirectly discourage conduct which it deems contrary to the best interests of the agent?

Should it make the means of drunkenness more costly? Or add to the difficulty of procuring them, by limiting the number of the places of sale?

Taxing stimulants just to make them more difficult to be obtained is similar to banning them. It would be justifiable only if that ban were justifiable.

Every increase of cost is a prohibition, to those whose means do not come up to the augmented price; and to those who do, it is a penalty laid on them for gratifying a particular taste.

Their choice of pleasures, and their mode of expending their income, after satisfying their legal and moral obligations to the State and to individuals, are their own concern, and must rest with their own judgment.

These considerations may seem at first sight to condemn the selection of stimulants as special subjects of taxation for purposes of revenue.

But taxation for fiscal purposes is absolutely inevitable. A considerable part of that taxation should be indirect. The State, therefore, cannot help imposing penalties, which to some persons may be prohibitory, on the use of some articles of consumption.

Hence, the State should consider, in the imposition of taxes, what commodities the consumers can best spare; and à fortiori, to select in preference those of which it deems the use, beyond a very moderate quantity, to be positively injurious.

Taxation, therefore, of stimulants, up to the point which produces the largest amount of revenue (supposing that the State needs all the revenue which it yields) is not only admissible, but to be approved of.

The question of making the sale of these commodities a more or less exclusive privilege, must be answered differently, according to the purposes to which the restriction is intended to be subservient. All places of public resort require the restraint of a police, and places of this kind peculiarly, because offences against society are especially apt to originate there. It is, therefore, fit to confine the power of selling these commodities (at least for consumption on the spot) to persons of known or vouched-for respectability of conduct; to make such regulations respecting hours of opening and closing as may be requisite for public surveillance, and to withdraw the licence if breaches of the peace repeatedly take place through the connivance or incapacity of the keeper of the house, or if it becomes a rendezvous for concocting and preparing offences against the law. Any further restriction I do not conceive to be, in principle, justifiable.

The limitation in number, for instance, of beer and spirit-houses, for the express purpose of rendering them more difficult of access, and diminishing the occasions of temptation, not only exposes all to an inconvenience because there are some by whom the[Pg 193] facility would be abused, but is suited only to a state of society in which the labouring classes are avowedly treated as children or savages, and placed under an education of restraint, to fit them for future admission to the privileges of freedom. This is not the principle on which the labouring classes are professedly governed in any free country; and no person who sets due value on freedom will give his adhesion to their being so governed, unless after all efforts have been exhausted to educate them for freedom and govern them as freemen, and it has been definitively proved that they can only be governed as children.

The bare statement of the alternative shows the absurdity of supposing that such efforts have been made in any case which needs be considered here. It is only because the institutions of this country are a mass of inconsistencies, that things find admittance into our practice which belong to the system of despotic, or what is called paternal, government, while the general freedom of our institutions precludes the exercise of the amount of control necessary to render the restraint of any real efficacy as a moral education.