The issues of grain trade liberalisation

Supported by Pierre Le Pesant de Boisguilbert at the turn of the seventeenth and eighteenth centuries as one of the greatest means for France’s economic recovery (Faccarello 1986), the evolution of State-controlled grain trade policy towards an internal and external liberalisation became a major issue of the 1750s.

On the job, Turgot did not behave dogmatically, but with their uncompromising attitude in their writings, the physiocrats and their allies were under attack during these decades, presented as dangerous fanatics, responsible for starving the poor by many men of letters and pamphleteers (Orain 2015a). Linguet and Mably were, in line with the abbe Galiani (1770), part of this fight against supporters of grain trade liberalisation. They did so because they viewed the fetishising of private prop­erty - the first condition of a complete freedom of trade - as a potential destruction of society through the explosion of inequalities. But here again, we should avoid caricature: under the condition that a nation would be largely made up of little land­owners (with no or very few rich farmers and wage earners), Linguet and Mably could have given their assent to a liberalisation of grain trade.

Rousseau had a stronger position. He expressed his ideas on the issue at the beginning of the debate, in the entry “CEconomie” (1755b) of Diderot’s Encyclo- pedie. Listing the different duties of government and the rules of “public econom­ics”, he pointed out that civil society has to secure “the goods, the life, and the freedom of each member through the protection of all”. This is the reason why

[i]t is not enough to have citizens and to protect them; it is also necessary to give thought to their subsistence; and to provide for the public needs is a clear consequence of the general will, and the third essential duty of government.

(Rousseau 1755b, 23)

The idea was not to provide people with work but to allow all those who work to meet their needs easily. In this respect, Rousseau was against grain exports. Speak­ing of the English policy of his time, he wrote ironically:

One has to have seen with one’s own eyes a government subsidise, instead of taxing, the export of grain in years of plenty, and its import in years of scarcity, to believe it, and one would treat such facts as fictions if they had occurred in the distant past.

(1755b, 27)

In order to prevent scarcity and high prices, he was in favour of public granaries - a heresy for the future physiocrats and for Turgot (see Kaplan 2017, 611-12) - as those of Geneva, established and maintained by a wise administration, which “are the public resource in bad years” (1755b, 28). In the Social contract, Rousseau supported a policy of autarky, because

[a]ny branch of foreign trade... provides a kingdom in general with little more than a deceptive benefit; it may enrich a few individuals, even a few cities, but the nation as a whole gains nothing from it, and the people is no better off for it.

(Rousseau 1762, 79)

In Rousseau’s perspective, exports of foodstuffs or manufactured goods increase the quantity of money in the hands of a few landowners and powerful farmers, artisans and entrepreneurs. This wealth from foreign trade reserved for an elite has harmful consequences: it arouses envy, jealousy and luxury. The rich claim their power, subject the poor, and reinforce inequalities and injustice (Hurtado 2010, 77). In this respect, attempting to develop exports is for Rousseau simply a mis­taken approach of economic policy.

Rousseau did not evoke the liberalisations of the grain trade during the 1760s- 70s, contrary to Linguet and Mably. In his Histoire des revolutions de l'Empire Romain (1766), Linguet’s unrestrainedly praised this policy (Linguet 1766, 132-4) but four years later, the wind had turned: his books having been under physiocratic attack, the experiment of liberalisation being a dramatic failure, Linguet decided to change his position.

Galiani’s Dialogues sur le commerce des bleds was published during the first days of 1770. The timing of the publication, the author’s personality and the vir­tuosity of the book’s style came as a bombshell against the policy of liberalisation advocated by the physiocrats (Faccarello 1998; Kaplan 2017, 80-96). From July to December 1770, the new Comptroller General, abbe Terray, endorsed a de-liberal- ising policy (Kaplan 1976, 510-26).

In the first two parts of the Docteurs modernes, after recalling that the major­ity of human beings never eat bread and that one can easily do without this food, Linguet argued that bread is both physically and morally lethal (Linguet 1771, II, 59). He suggests that the cultivation of grain puts people in cruel dependence, due to the tyranny of ownership, the slavery of the plough. Concerning liberalisation, attributed to the physiocrats, Linguet was persuaded that it led to misery for “half the nation”. If farmers or owners had grown richer, this meant that the workers had not had any pay raise and, thus “their wealth is horrible; it sullies, it contami­nates the cowardly hands which have taken it.” In addition, these higher revenues were lost for agriculture, because the farmer often hoarded the cash to buy some ennobling title (1771, III, 76-86). And if, after several years, the farmer decided to increase his workers’ wages, many of them had already died, and this raise would have been given to their ashes. But even farmers would not be able to enjoy higher grain prices for very long, because, when the lease was renewed, landowners would demand a higher rent. In the end, the latter would be the only ones to benefit from the effects of grain trade liberalisation.

Aside from these technical questions, Linguet intended to support the opposi­tion between the right to property and the living body of human beings. Going back to Galiani’s starting point (see Kaplan and Reinert 2019, 221-303), Linguet maintained that grain was not just any kind of merchandise, it is the object of our most immediate and imperious primary needs:

According to the law, any living being is entitled to demand food.... His first priority, and the most sacred one indeed, is to ensure his preservation, to look for means of subsistence. The right to seize anything that might satisfy him, derives from this duty. This is particularly true when his needs are so pressing that he even puts his life at risk. Society may have established the way to enforce such a right, or to provide an alternative and modify the exer­cise thereof, but it has not been able to destroy this right.

(Linguet 1771, III, 53-4)

This extensive definition of the notion of preservation implies that “according to the law, there are thus circumstances under which the police are obviously author­ised to require, even in a violent manner, that markets should be supplied” (1771, III, 56). If grain meets a basic natural need, private property becomes secondary. Naturally, by returning to his original fiction, Linguet justified this point of view even better: since the social pact was not the fruit of mutual consent, but the result of usurpation, it was all the more legitimate that these “so-called landowners” should yield “to an even more sacred right” (1771, III, 63), the right of those they had plundered to exist.

At the beginning of the decade of the 1760s, Mably was not so violent. He even shared with the physiocrats the idea that freedom of the grain trade, both domestic and foreign, could be favourable to the nation as a whole:

Foreign trade will be pernicious for the republic when it exports more mer­chandise from its workshops than products of its fields, and the reason for this is simple. The products of this trade will be shared by a small number of men and will rapidly introduce luxury into the cities By exporting the mere foodstuffs of its lands, the benefits of this trade are divided between as many parts as there are citizens, and serve primarily to support farmers. They will have their conveniences, without having luxury, and lands, increasingly cultivated, will be more fertile.

(Mably 1764, 531)

Free exportation will make possible a comfortable rural life. But the terrible con­sequences of the liberalisations were to lead Mably to revise his position on the question in his famous Du commerce des grains, written in 1775 during the episode of riots known as the “flour war”:

M. Quesnay being marvellously ignorant about politics and perhaps in domestic administration, it is hardly surprising that he mistook the first trivi­alities that presented themselves to him as admirable discoveries His

first discovery was that if the products of the land rose in price, the revenues of his new domains would also increase, and he would find he had made an excellent acquisition. First success encourages. If the net product of land­owners, said M. Quesnay, is doubled, the wealth of the state will be twice as great as it was.

(Mably 1775, 296)

Mably now saw himself constrained to propose a system of regulation for the grain trade. Since grain relates to the first promise of society, that of self-preservation, he henceforth considered that it “ought to be an object of economic conservation and not of trade” (1775, 264). In 1775, Mably was still favourable to the domestic free trade of grain, and although it can be said that he was against grain exports, this was mainly for economic reasons. He believed that external liberalisation led to an increase of gold and silver flows into the kingdom that produce upward pressure on the price of goods and a destruction of commerce as a whole:

Even if you imagine a hundred ways to somehow invigorate the countryside, I will find them all bad as long as they provoke complaints and murmurs from the majority of the citizens.... You want to enrich landowners by ruin­ing everyone; there is nothing more ridiculous.

(Mably 1775, 257-8)

Having shamefully enriched a few landowners, farmers and grain merchants, the price increase that followed this freedom should finally have been abandoned because it had not produced the anticipated effect: the comfort of the most numer­ous rural classes. The legislators should not “sacrifice to [the landowner’s] greed this countless multitude with only its manpower and its industry to subsist” (1775, 275). Close to Linguet’s ideas, Mably thought that the liberalisation of the grain market would allow that, but he admitted that he was wrong after the devastation caused by the experiments of liberalisation. However, he did not completely aban­don his initial ideas on the issue:

But I beg you, my dear Eudoxe, to pay close attention to one thing, which is that I would subject the grain trade to less strict rules in a country where there are many more landowners than in ours, and which was not inhabited almost entirely by men who live only from their work.

(Mably 1775, 273)

This is an important point, as it was not the external liberalisation of the grain trade in itself that was harmful, but the fact that it increased inequalities, enrich­ing a small number of citizens who spent their wealth in the luxury of the cities, increased prices and then destroyed the purchasing power of the vast majority of citizens. The institution of free export could be a good policy for domestic com­merce, as Mably initially thought, but only on condition that most inhabitants are landowners. Mably’s economic ideas did not imply freedom of external trade, and more broadly support for foreign trade, but neither do they exclude it in principle. By focusing on inequalities and the guarantee of the promise of the social pact, Mably and Rousseau proposed an ideal that was clearly different from the physi- ocratic one.

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