Documento de trabajo 9116 BENTHAM ON SPANISH PROTECTIONISM Pedro Schwartz Carlos Rodríguez FACULTAD DE CIENCIAS ECONOMICAS y EMPRESARIALES. UNIVERSIDAD COMPLUTENSE. Campus de Somosaguas. 28,023 Madrid. Esta publicación de Documentos de Trabajo pretende ser cauce de expresión y comunicación de los resultados de los proyectos de investigación que se llevan a cabo en la Facultad de Ciencias Económicas y Empresariales de la Universidad Complutense de Madrid. No obstante, la publicación está abierta a investigadores de otras instituciones que de­ seen difundir sus trabajos en ella. Los Documentos de Trabajo se distribuyen gratuitamente a las Universidades e Instituciones de Investigación que 10 solicitan. Así­ mismo, las peticiones personales pueden ser atendidas en la medida en que se disponga de ejemplares en existencia. 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ESPAÑA. 1--_----__ --------------------------- 1 1 1 1 1 1 1 1 BENTHAt1 01-4 SPAI-IISrl PF,OTECT lOt~ lSl'l Pedro Schwartz and Carlos Roorlguez Sraun In 1821, John Bowring published a m¿..nusc,' i p t of Bentham's under the title of Observations on the restrictive and prohibitory commerclal svstem: especlally with a reference to the Decrep of the Soanish Cortes of July 1820. 1 In alr probability this text was originally conceiveo as an appendix to a book that Bentham never pUbllEhed, to Wlt 'Rlo Yout"'se 1 ves Df Ul t,'ama,'ia'. the commentary on 5panisn e o 1 on 1 Z 2. t ion & The 1821 publisned text has been reprinted by W,Sta~k In the third volume of Jpremy Bentham's Economic Wlth sorne COt"'t"'ections of abVIOUS ffilsprlnts, but witnout the beneflt Di the manuscrlpt. Stat ... ~ was vet~y dlsmisSlve oi ~nlS "m,'k, wnich he thought 'demonStrateo how bat"'ren econOffilC thought had bEcome -" St-B.t"k belleved that wa=- too or-thooo:< in attacking Spanlsh protectlonlsm wheG~ Stark said,2 Spain was a caSE flt for'" an "educatlonal ta,'iff', In the fashlon proposed by LISt. HO~.oJevet ... , msny economlsts today think that few tnings are so harmful for an underdeveloped country as a ta,'iff, educa"tional Ot.... not (e>:eept when it i5 low ,'a ted. t"'evenue anO accompanied by an equivalent domestic excise tax)~ Bentham's essay was a criticism oi tne new Tariff Law pas=-ed in fa.c t in Oc tobe,' 1820 oy the ,'eeen t 1 Y Spanish Co,-tes. In November of that same year additional decrees establishins a new Custams organisation, comp i1in8 the 11st of goods and thei,- ,-espective duties, wet'e also enacted. The spit'it of dec f"ees ~....,as not p,-ohibitionist as had been that Di sorne previous custom systems that totally to,-bade the impot-tation of goods competins loca.l ma.nufactut"'es whi le additionally chat--S! ns a tat'iff on expot'ts. It tUt'ned out to be less p,--otectioflist than late,- tat'iff 1 al-IS , such as the Ta,-·iff ot 1825 proclaimed two years later when the ConstitL~tion had been suspended a.nd the Cor-·tes disbanded ¿';9ain~ lt was fact a measure very much in the lIberal spirit oi the times. Benth&.1TI and Spa.lo The connection between Bentnam and Spaln was one 0+ long standing. Ft'om 1802 to 1825 and beyono, Spain and net~ colol1ies took in the mind of Bentham the place that Greece was to take in the tast seven yeat's of his llfe: that 0+ a countt'y whet'e his ideas of t'ational legislation and gODO economic house-keeping could be applled without, he thought, facing the oostacles of an ancient Constitution anO entt'enched intet'ests, as they did in Bt'itain. In 1802 Bentham met gene,-al Ft'ancisco de Mit'ande (1750-18161, the Venezuelan patt'iot who by then had star~ed his 10ns fight agalnst Spanish rule. Mit'anda made Bentham conceive the hope that he would be the la.\.~J makel"' 0+ liberated Venezuela. ¡-Jhen .n 1811, Miranda mounted hlS abortive expedition to oust the Spaniards from Venezuela, Bentham prepared for him the outlines of a civil Code and 0+ a Pr'ess La\.~l. This is not the flace to follow up this connection with Miranda, and Bentam's relations with Bolívar and the great Chilean sage and politician Andrés Bello, but it is interesting to note that the young Bello started to translate the pages that Miranda took with him On the voyaBe back to America. We shall see below that Bentham's ln~e"es~s ln America did not cease with the downfall of Miranoa. In 1808 the Pen i ns~, 1 a" Wa,' s tarted a.nd t¡-,e F "'ee¡-, ovet~'r'an the gr-eatet"' part of Spain. In lBiCl, tlle fr'ee Swanls:1 of both nemispheres shelterlns in CadlZ, covened the Cor~es and scarted drafting a Constitution. On the sU9ges~.on of a Spania~-'d 10ne t'''es,ident in Landan, ...José Blanco VJhite, ano oi Lo,'d Ho 11 and, and Etienne Dumont, Bentnam started adapting a book of rules he had written In 1789 Wlth the F,'eneh .ctats Géné,'aux in mind, for the use 0+ t~e Cortes. The work as usual wlth Bentham took foreseen and was not published unt.l 1816, ln a Ft'ench translatlon by Dumont, under the title, lac:'tique de" Assemblées législatlves. It was finally and rather uselessly published in Spanish in Pa"ls 1n 1824, when a seeond attempt at constitutional rule in Spain had just come to a sorry end. In 18')2 Dumont had publ ished in Paris Mis personal adaptation of a number of important legal frasments culled from the manuscripts of Bentham. This book, titled Traités de lésislation civile et pénale, was widely read in France and the whole of Eut'ope. It soon fOLmd t'eaders in 5pain ".6 ~,e 11 . In Salamanca, there was a sroup of enlishteneo literati, where Bentham's ideas found consenial soil .n which to srow. Its undisputed leader was the masistrate and poet Juan Meléndez Valdés (1754-1817), who in 1803 had bousht Sur les pauvres (1801) from his booksel1er. Two of this 8~ouP were to become distin8uished Benthamites: Torlblo Núfíez (?-18:3",4), ,~ho was to be Librarian of the Univet'si ty, and Ramón de Sala~ a professor of civil law there. In 1807, F t"ench Ar'my, a soldier on his way to Portugal with the had brought a copy of the Traltés 'n h.s bassase. TOt'ibio Nútíez pUt'chased it¡ when he "'as dismissed from his post of librarian to the Universlty In 1815! ne started translatins Dumont. As SDon as the liberty Di tne pt'ess was restored, he pUbllshed a summary of Bentnam's ie- sal .nd ethical thought, under the title of ESDlritu de Bentham ó sistpma de la ciencia SOCial (Spirit of Bentham or System of the Social Science, 18201, as a prelude to his intended translation of the Traités¡ and ayear later, his translation had been pre-empted by the publication of that of Sa.las, he pL,blished an interestins imas.nat'Y oialo­ sue amons Kant and Bentham and himself on physics and ethics. Ramón de Salas, was Nút'lez 's mento,'. We wet'e un';;.ble to tt'ace the dates of his bit'th (in Belchite, A,'agón) and death. In 1796 he clashed with the Inquisition who suspected him of disseminating the wot'ks of the philosophes. Salas inclined towat'ds Napoleon in the civil wat' that the English know as the ~Peninsular wars', accepted a post ft'om kinS Joseph Bonapó",te and had to take t'efu8e in Ft'ance when the F,'ench los t. DUt'ing the yeat's in exile between 1814 and 1820, he too set to wot'k on the tt'anslation of Dumont, but . . had finished the wot'k at the be8inning of the Tt'iennium, \'¡hen Núfíez had only completed one volume. He published his t,'anslation in 1821, in five volumes cat't'yin8 detailed comments. In that same yeat' Salas, appointed membet' of the Cot'tes in 1820 and assumed to be one of the authot's of the penal code, pUblished Lecciones d- Det'echo Público y Constltucional (Lectut'es on public and constitutional .,he,-·e he showed h i mse 1 f to be an i ndependen t a.nd we ll-t'ead thinket' on political questions. An example of a diffet'ent kind of Benthamist may be of in te,'es t het'e, since many on the Continent intet'preted Bentham as a conservative thinket', an antidote of the radicalism of 'natural law' Rousseaunians. José Gómez Het'mo- silla (1771-18231 was also an afrancesado, that is to say, sided with Joseph Bonaparte. Back ft'om exile with the t'etut'n of the Constitution dUt'ing the T,'iennium, he published a translation of Bentham's 'Anarchical Fallacies' in the Censo,'. In 1823 he published a book called Jacobinismo, where 'under the protection', he says, 'of tl1at p';;.r';;.gon of libet'alism, Jet'emy Bentham' , he fOU8ht 'the anat'chical pt'inciples of the Jacobin sect'. All this helped to broadcast Bentham's name amona Spanish liberals during the Constitutional Triennium, a period which we could call the high tide 0+ Benthamism .n Spain. We could name many more Spanish correspondents and disciples of Bentham at this time, but shall choose only anothet' two, especially connected with the Tariff 8ill against ,~hich Bentham dit'ected his Obset'vations: they "' .... e Mora and Canga Argüelles. José Joaqu1n de Mora, a journalist and prolific writer, as well as an international edueationalist, was born in C-­ diz in 1783 and died in Madrid in 1864. He travelled widely, blown hither and thither by the w.nds of pol.t.es. Tne Freneh made him a prisoner at the beginning of the Peninsu­ lat"' Wat"'. Dut"'ing the Constitution.a.l Tr'lennium, hor"a ,..¡as vet-·y active as a journalist and political propagandls~; these were precisely the years when he corresponded with Bencham, tt~anslated his pamphlets, and, more to the point, could have sU8gested him that he intervene in the d •• eu.s.on on the Tat'iff. In e,-:ile in London, t-1ot'a ,~ot'ked fot, 10he puDl •• he,' Rudolph Aekermann, for whom he wrote many educat.onal works and almanaeks, and tt'anslated copiously. Then he tt'avelleo with his wife to Argentina, Chile, and Bolivia, settlng up schools, publishing newspapers, and with his pen and hiS counsel helping the diverse Liberal politic.ans who hao invited him th.ther. Back in Spain, he published De la 1.­ bertad de comercio 10f free trade, 18431. For a time he was the Spanish consul in London. He died a member of the "Real Academia de la Lengua". José Canga Argüelles (1770-18431, born in Asturias, that maritime nest of liberals as Cádiz was in the South, Was a politician and a public finance specialist. A former Minister of Finance during the Gobierno de la Resencia (1810-18141, and later a deputy at the Cortes of Cádiz, he lived in Landon as did the other exiled liberales from 1814, when the Constitution was suspended, until 1816. In 1820 he was appointed again head of the Spanish Treasury in the first aovernment of the Triennium. On the re-establishment of the absolutist réaime, he fled once aaain to London, whet'e he published Elementos de la ciencia de Haciend.3 (Elements af Science of Finance, 1825) and Diccionario de Hacienda (Dictianary of Public Finance, 1827-281, his main titles to fame. At the time of his death he had become the Director of the "Archivo Histórico de Simancas". He was an oeeasional eorrespondent of Jeremy Bentham. The final chapter in the story of Bentham's eonnection with Spain h.3s to do with Ameriea again. In 1818 Bernardlno Rivadavia (1780-18451, an Argentinian who had come ta Europe to find a Kina for the River PI ate, visited Bentham and then corresponded with him. On his sugaestion, Bentham aaain started adapting a pamphlet he had written for the Freneh In 179j, this one titled Emaneipate your Colonies. He provisionally called started re-writing it "Emancipation Spanishl!. Then he i t "d",a,-_-"c"a.,p"-,,,-o undet' the ti t 1 e Yourselves oi Ultramaria l1 , under the form of a series 0+ letters to the Spanish. This book was much mot'e than an anti-colonial pamphlet, i t had tu,'ned into a pioneerin8 commentary on the 1812 Constitution of Cádiz. Although Bentnam dwelt upon the incompatibility of a democratlc system with the holding of colonies, his main object in this 'advice to the people of Spain, in a series of 1 et te,'s ' was not so much the relinquishment of the Spanish colonies as the reform oi :<; their Constitution.- He nad much advanced in the book when the absolute rule of Ferdlnand VII was re-imposed in Spain in 1823, i3.nd In 1824 General Sucre defeated the Spaniards in a last decisive battle in Ayacucho and the Spanish posseesions in Amet·ica wet""'e r"educed to Cuba and F'uer-..to Rico. Bent"ham"-S int:et'est in Spanish matters had waned, and his interest in Greece waxed. TheTrienio Liberal' One cannot unde,'stand: the Decrees of 1820 that Bentnam was criticising wlthout bearin8 In mlnd the political and administrative circumstances ln Spain at the time. The two last kin8s of the Ancien RéSlme, Charles 111 (who reigned f,'om 1759 to 1788) i'.nd Cha,'les IV (f,'om 1788 to 18(8) hao shown sorne reformlng zeal, the first usin8 direct rule, the second through his favourite, Godoy. Charles 111 intr-oduceo sorne freedom in the peninsular grain trade and broke tne Cádiz monopoly In the trade wlth the Indies. Charles 10 substituted a protectionist for a prohibltionist tariif i~ 1802. A most cruel and devastatins war asainst the French, lastins from 1808 until 1813, left Spain at its lowest palnt since the time when Castille discovered America, more than three centuries earlier. In the American kinadoms of the Spanish Monarchy, rebellion and war started in 1810 and were to culminate in the final rout of t~e Spanish expedltionary force at Ayacucho (Perú) in 1824. Durina the Peninsular War the 11berals had ta~en shelter in Cádiz under the wins of tne British Navy. "rnere the belea9Uet~ed representatlves of the 5panlsh klngdoms, includins the klnsdoms, viceroyalties and capitancies oi tne Indies, proclaimed the t~adical Constltution oi 1812, WhlCf¡ was to be the obJect of extensive commentary by Bentham In 'Rid Yourselves of Ultramaria". As soon as Ferdlnand VII, the son of Charles IV, set foot on Spanish soil In 1614, after leavins Talleyrand's country seat wnere he nad been held in custody durins the Peninsular War, he abolished the Constitut10n of 1812. In 1820, troops destined to fisht the insursents in America stased a coup and restored the liberal réS1me. Thl& new democratic period, however, was to be short-lived Slnce 1n 1823 Ferd1nand VII asain, with the help of troops sent in by the Holy Alliance, restared his absolute rule. It Was precisely durins this short period, calleó "the lIberal triennium", that the Cortes passed the protectionist decrees criticized by Bentham. Economic chanses ¡~hen the Co!'tes tLwned thei!' attention to fOl'eign t!'ade, changes in Spain since the enactment of the p!'evlous tariff had not been me!'ely constitutional. The state of the economy was deeply wo!'!'ying owing to three clrcumstances: the devastation of the war, the loss of the Indies. ano the g!'owing industrialization of competing nations, especiali)" Britain. Economic historians do not Bgree on the extent oi the trade and revenue losses caused by the rebelll0~ Ir) America. In Spain itself, however, the scorched eartn pOllCy of the Spanish guer!'lllas and the plunde!'ing hablts ot the French must have tu!'ned the country into a semi-deserto AIso the administt~ative apparatus of the State was tht~own ln~o di sat"'t"ay. As far as the loss of the Indies is concerned, the effect seems to have been mot'e a shift in Spanish cu..-t'en"ts of trade than a fall in !'eal terms, since the klngdoms beyond the seas after the dec!'ees of the 1760 s issued by Charles 111 had ceased to be exploited colonies and became comme,-·cial pa,'tners in a p,'otected commonwea.l th. One hist.o- !'ian at least, L.Prados de la Escosura, has B'''8ued tnat Spanish fo!'eign t!'ade as a whole was not materially much reduced by the severing of ties with the Indies, but malniy shunted in a EUf'opean dir'ection .. 4 One pr'essur-e gf"oup keenly felt the competition of Bt'itish manufac tur'er-s: tne Catalonian clothmakers, who clamoured for protection against English cotton. The invasion of iron and steel goods was not to come till sorne ten years latero For the rest of the century, the commercial policy oi the Spanish governments was to be inspi,'ed by principies: a minor one, the wish to protect Catalonia from the onslaught of Lancashire; a major one, 'the reform of tne tax system and within it, that of the tariff, to adapt It to the transformation of foreisn trade and to recover the e revenue producins capacity of customs duties".u But 5panish commet'cial poI icy did not become thoroL,shly pt'otectionist until the end of the century. From 1820 onwards the tide of free trade was sursing on every shore: Spain was to follow somewhat reluctantly. Cobden vIsited Cádiz triumpnantly In 1846. The most favoLlt'ed natlon clause of the Cobden-Chevalier Treaty of 1 860 \'mu 1 d influence Spanish trade agreements even when free trade had eboed. The hlSh point of liberalism was the tariff 0+ Laureano FIguerola In 1869, when Queen Isabel"la 11 had been toppled by the Prosressive Liberals, its 'Base 5a.·, or fifth principIe, whereby teNtile protection was maintained untll 1875, but was thereafter reduced until level with the domestic eNcise taN in 1881. Pt'otectionism, turnins into economic nationalism, soon became pr-ominent. In 1891 and 1906 two protectionist tariff laNs Nere enacted. This NaS the result of the influence of American and Continental pt"otec t ion i Sin. set in motion by the Civil War, Bismarck, and Cavour, more importantly by Spanish internal developments. Spain, in the middle of the nineteenth century, had been plaaued by Carlist dissension, leading to three civil Nars. When Aifon- so XII Nas restared to the throne of his mother, 1 s ",.b e 1 1 «. II, the politicians that restored him immediately too k protectionist measures. The purpose NaS to Nean the Catalans aNay f"om Carlismo Pt'otectionism tu,-ned to nationalism ano then to aut¿\t'chy as the 20th centu,'y dt'eN on. The \·¡ate,-·shed Nas 1959, Nhen Genet'al Ft'anco decided that Spain shoulo jOln the OECD and the IMF and liberalised fot'eian tt'ade. 8he has nevet' looked back, and membet'ship of the EEC. 6 now i5 set in free trade ways Given this backgrouno, the decree Nas not as bad as Bentham made it out to be. lI-Jl tn 1820 Prohibitionism and free trade stirrinss 1n early 19th centut'y Sp«.in The intentions of successive Spanish legislators \'¡hen settina up tariffs aftet' 1821 Nas not to defend the budolng economic development of the countt'y, but t'athet' to raise revenue. Tt'ue, the 1802 Tariff resnante Carolo IV had had a pt'otectionist intention, but the Peninsular Wat' had throNn the customs or'sanisation into disar't"'ay and Spain had become the kingdom of the contrabandista. The commercial policy of Charles IV's father, Cn2-. r· 1 es JII, had the tNofold aim of backing cottage lndustry, and creating a free trade area for the whole 04 the Span.sh Monarchy including America. One aim Nas sought with the prohibitionist tariff of 1778; the other, Nith the decrees of 1765 suspending the monopoly 04 Cádiz in the American trade, and allowing in that year and after an number of Peninsular ports to trade with the Ind.es. But Spain effectlvely lost her empire after the Napoleonlc invasion in 1808; and al! thoughts oi an industrial policy vanished when the State was troubled by public bank,~uptcyL The need for revenue had turned the tar.ff ínt.:o an excise tax on the lmpDI~tation and exportatlon 0+ a few staples. One may, howevet-., sense an indlcatlon oi a d.fferent klnd of protectlonlst pOllCy in t-he dt"'lft a.w.a)< from the total prohibition of competing manufactured g0005 towards the imposition of tariff rates allowing some entry. In April 1816, four years before the re-instatement of the Cádiz Constitution, a committee nad been created under the name of the 'Junta de Aranceles'. Its Report was handeo to the Cortes in 1820 and it was a strong protectlonlst reporto The neN Secretary for the Treasury, however. was the abovementioned José Canga. At'güelles, a modet'ate libe,'al. Canga ArgOelles presented the Report to the Cor~es the 13 and 14 July 1820, including it in hlS speech on annual budget. He eritieized the ideas of the 'Junta de A- ranceles', spoke about the 'chimerlc project of closins OUt~ doors to trade', u"ged the Cortes to 'g i ve up the eomme,-·c 1 al monopoly', and suggested a 's.¡eet 5ystem' of 10w tax'if-rs that would produce (8. la Laffe,') a rnaximum revenue. C2.ngd ArgUelles quoted Adam Smith in this anti-mercantilist 5peeeh, and following Smith he recommended a diseriminatery tariff treatment in favour of the cemmoditie5 carried by Spanish ships in view of the ealamitous situation of QU.t--. commerei¿l fleet', along the lines of the Navigation Laws that Smlth himself had aceepted as an exception to trade. He also proposed the abolition OT the pt~otectionlst system ln favout' oi a reYenue 7 little avaií. raiSlns one. Al1 thlS was Though the maln recommenoatlons of the Repo,'t embodled in the Ta,'iff aeC'-'ee of 182(1,8 it tLlt-'nea out te ,'elatlvely mot'e 1 ibet'al than late,-' tarlff laws. Pe"haps to De nOt: asaln until the la~e 1860s, when the Liberals oriefly galned pOli-Jet" agaln aftet' toppllng the monar'"chy, Span 1 SIl commercial policy relatively so favourable to free b'ade. Decree XLVI, af October 5, 1820, 'Establishlng a CustOffiS Tar'iff', is an inter"estin8 piece Di economic legislatlon, ir¡ that it app,'o"imated to the pt'inciples of a non-discriminatory tariff mueh than strietures would lead one to expeet. Rates were relatively moderate. Article ~~ estaolisned a maximum of 30 per cent ad valorem on the importatlon of foreign goods, with a minimum of 2 per cent for dlspatch; and a maximum of 10 per cent on the export 0+ Spanish goods, with a minimum of 2 per cent for dispatch. The same ari::icle established an internal excise tax of a maximum of 15 per cent on the Spanish goods having to pay it. stated that between those maxima and minima there were to be 'the proper graduations, according to the scientiflC p,-inciples that t"'ule in this matte,-'. Ther'e was B.l so in a,-ticle 7 the rule that no prize, gratiflcatlon, 01"" reduction of the rate would be conceded to stimulate the entr'y ot"' exit: of any good ~""hatever, be i t fo .. '" motl\/ES 0+ utility or security, nor'" for' any other motive. As p,-ohibited 8°005, a no-discrimination established. Article 25 decreeci tnat whatever be prohlOited or permitted In any part of the Spanish Monarchy, will h· . .l -.' general rule be so in every part'; even exceptions were ta be sranted -In camman benefit of al¡ Spanlards Flna.liy, ÍlG less than 15 articles (articles 9 to 23) were devoted to tMe details of the preference for transport in Spanlsn snlp~~ Bentham's Obset'vations Jeremy Bentham was anly vaguely familiar with all these el rcumstances when he Wt"ote h is Obset"'"va.t i ons, though he /Tia.y have t"eceived information about Canga's speech: thus, he speaks of a. 'dect-'ee' of July 1820, ,..,hen the oebate tOI:Jk pla- ce, instead Di when the decree was pub 1 i E-hed. Benth.a.ffi sa.ys: The writer takes it fOI"-· gt-·anted that decree exists, though neither he, nor any individual he has is able to speak to the fact of its publication,.9 Tne seen, the Observa.tions is full allusions to smu8s1ers' songs 5 and information a.bout Spanish te}-{tile pr'oduction. It may have been inspired by sorne newspaper piece written by José Joaquín de 110t'a o,' by cot't'espondence t'eceived tht"OU8 h John Bow,'in8. The ot'i8inal manuscript of the Observatinns seems to ha.ve been destt""'oyed as usually happened with anj-.'thing sent to the presa by Bentham 01' by BoWt'in8. Besides the nali oozen pages in UC 268-274, a of the pB.mph let i s to be fauno in d,'aft form in UC cl}~ o-t tile Bentham Collection at Unlversity Collese London. 10 It bears the date of Januat"'y 1821 and a r'epeated indication of it beins an 'Appendix'. It appears that Bentham may ha ve wan~ed to pub 1 ish it tosether with 'Rid Yourselves of Ultramaria',ll though perhaps he first intended te have it issued in Spain, in view of the success . , 12 pamphlet a8ainst a Spanish House of Loros. The fact is that BoWt'in8 published the Observations independently in English in 1821. He may have lntended. the EnSlish edition as a preparation for"' a t t"ans 1 a t i on into Spanish. Despite this~ there are enough allusions to the British Gorn Laws to justify an En9iish publication on the basis of English clrcumstances alone. I The Obset"'vat ion~ and 'Rid Yout"'sel ves' wet-'e concei ved as independent pieces. In a lette,- w,-i tten but nct Eent by' Bentham to the Chilean President Bernat"'do O'Hissins, Bentham refers to both 'Rid YOLlt"'selves' and the Ob~~rvatian~ as being prepared for consumption in the Hispanic World, but i "'7 without any relation established between the two .... _' pleces. Although the date of the draft letter to O'Higgins is not certain, it was probably written in 1821. 14 The at-'sumÉnt of the Obc;;.et-·vations Stark was wrong in seeing the Observation~ as a sample of Bentham's economic thollght at its most bar't"'en: fr'om a modern point of view thE essay has many features to commeno it. One is the 1istIng of the advantages and disadvantases of the prohibitory system. The burthen to those who are lnjured, what is its amount? The benefit of those who are meant to be favaUt""'ed, what is its amount? persons -human feelings- pounds, shillings and pence in EnSlish, in Spanish reals of Vellón -to a11 these sllbjects must the arithmetical calculation be applieo, before we can come to any just and well-groundea l . 15 cone USlons •• ", Another interesting feature i5 that Bentham actually 2-.sks himself rnea.SLlt"'ES as this prohibitlon 2.t--·e actually enforced, if the balance of their effects 15 as harmful as in the case under consideration. The system of injustice a.nd impolicy thus extensively pursued, to what causes shall its existence and domination be ascribed? In this ca- se, as in others, the cause will be found in the comparative strength of trie pt'oducing ínflL!ence~ the comparative weakness of the opposins and restrainins influence. 16 The point of VIEW is akin to that of today's proponents o~ Public Choice theory, in that it does not rest content wlth underlinins a policy's bad welfare effect, but proceeds to try to explain why it is adopted if the balance Di l"tS effects is so manifestly negative. Bentham starts by distinguishing three situatione the event of a prohibitory commerclal law beins passed: (i) The prohibitlon is obeyed and the homespun a~-tlcle purchased in substitution; the effect is that oi ata.}: on th~ consumption of the 8ood, the proceeds of which So lnto the pockets Di the locally protected manufacturers. ( i i ) The prohibition is obeyed and nothin8 bought substitution; no pecuniary follows .. 10ss but a 1055 o-f comfor-·t (iii) The prohibition is disresarded. Bentham says that the costs of flaunting it must be borne by tne cornmunity, malniy in the form of gains pocketed (and prison terms suffered) by the contrabandlstas. The sains pocketed, however, at~e pure redistribution and not an absolute loss of welfare, in that it is not the market distribution. except Bentham then proceeds to try and evaluate the balance of mischief. He first looks at the hisher tota 1 price 01 protected soods, a larse effect in the :E5ú(J.0(1I) yearly imported from Ensland into Spain. Then he mention= Boods not capable of beins produced in Spain at all that are henceforth forbidden¡ then the removal of the incentivE improve throush competition. Fu,' t h e "mo ,'e, he notes Spanish soods used to pay for the imports that now wil1 ncC be demanded abr'oad. The measure must also affect t:ne receipts of the customs tax, in Spaln nearly a fourth QT the total revenUE. He mentians the waSEs oi the civil ser've.e ts needed to wateh over the prohibltion, and so on, down to the national dlSCOt·d between favoured and discrlffilnated regIons, and the growth of Bssressive nationalisffi between countries~ Finally, Bentham returns to the public chOIce questlon, oi why then is the mischevlous prohibition imposed at ail. HlS answér, basad on the assymetr~y of ttlE corlcentratlon of the sains and diffusion of the losses caused by the prohibition, has become classical: What facilities of Bene,'a 1 association Ct" combination are possessed by individuals employed as seneral shopkeepers, bakers, butchers, tailors, shoemakers, farmers, carpenters, bt"icklayet--s, masons, etc.? None whatsoever. 17 On the contrary, the protectlonists easily form iobbles. Of the baneful effects P t'oduc ed by the concentr~ted efforts of ~ co~lition oi those ind.- vidLl~l interests which fOt'm the in tet'es t, as opposed to the gener~l nat.ional interest, the Sp~nish prohibitory decree is a t'em~d,~ble illustration •.•• [A] clamot"'ous manuf~cturers and a few short-sighted, se 1 f-n¿t.med p~triots, united their forces, the Cortes with their representations. 18 Bentham and lai~sez faire This pamphlet asainst Spanlsh protectionism undouoteclj shOWS Bentham as an enthus18stic and able free tr'8der. lf he lntended publishing it as an appendi:< to 'Rid y'c.ur'sejves ClT Ultramaria', then Spaniarcis have even more reasons to regret th~t thl~ book w~s never finished or publlshed. lt woula h~ve dlsplayed ~t one ~nd the s~me time Benth~ms perceptlve cr--iticisms oi Sp~in's coloni~l system, ~ democr'atic cornmentary on her Constitution, and a condemnation of her~ restrictive commercial policy. What the future held 1n store in those three fields is now well-known. Spain lndeeó 80t rid' of her empire, but also of her Constitution ~nd her liberal ,'égime, in p,'actlcally no time a.t a11 afte,' the 1821 publication of Bentham's Observations in English. Notes An earlier draft of this article was presented at the Conference of the International Bentham Society, Univet"'sity College London, 1987. We wish to thank the participants for their comments. We are also grateful for the help and suggestions received from F.Rosen, S.Conway and P.Schofielo. 1. Observations on the restrictive and prohibitory systam, especially with a reference to the decree of the Soanish Cortes of July 1820. 'Leave us alone'; from the MSS. of Jeremy Bentham by John Bowring, London, 1821, E.Wilson, Pp. xi + 44. Also in The Works of Jeremy Bentham, Publ ished under the superintendence of •.• John Bowring, 11 vols., Edinburgh, 1838-43, iii. 85-103. We shall use the text as in Jeremy Bentham's Economlc Writinss, ed. W.Stark, 3 vols., London, 1952-4, iii. 383-417. Cf. also C.M.Atkinson, Jer-emy Bentham. His life and work, New York, 1969 edn., p. 195. 2. Sta.r"k, 3. C.Rodríguez Braun, "'Libraos de Ultramar". Bentham fren- te a Espa"a y sus colonias', Revista de Historia Económica, iii (1985), 497-509, and La cuestión colonial y la economla clásica. De Adam Smith y Jet'emy Bentham a Kat'l Mat'x, ~ladrid, 1989. 4. L.Prados de la Escosura, De imperio a nación. Crecimien- to y att'aso económico en Espa"" 11780-193(», t1adt'id, 1988, Ch. 2. 5. J.Nadal Fat~reras, España y Gt'a.n B,'etat'ía de 1772 a 1914: Política económica y t'elaciones comet'ciales, Madt'id, 1978, pp. 77, 80. 6. Cf. J.Velat'de, 'La evolución de la economía en los últi- mas 25 at'íos', in Cuat"o ,'assos del vivi,' en Espa.ña, Zat'agoza et al., Fat'maindustt'ia, Madt'id, 1989, pp. 127-130. 7. J.Canga At'güelles, 't1emo,'ia sobt'e los pt'esupuestos de los gastos, de los valot'es de las contt'ibuciones y t'entas públicas de la Nación española, y de los medios para cuerlr el déficit, que pt'esenta a las Cot'tes ordinarias de 18~0 D.José Canga ArgUelles, Secretario de Estado y oel De5PBcho Universal de Hacienda de España y de Ultramat'; leida en las sesiones de 13 y 14 de Julio de 1820', DIario de las 5e510- nes de Cortes, Appendix to No. 9, 13 July 1820, pp. See espec",lly pp. 1(¡7-8, 110-1, 120-1. Illuminatlng debate" on duties on pp. 1(¡59-66, 1873-83. A sample 0+ Spaln s protectionist tt'aditlon on pp. 1698-9, but an able quotatlon of Hume and the price-specie-flow mechanism on p. 1874. 8. The I~ot'dlng of Repo,-t and Dect'ee IS lnOeea almost identical. Compat'e Diario de las Se~iones de Cot'te-, No. 58, ~,1 August 1820, pp. 746-8 and Dec,'ee XLVI of 5 !Jctobe,- 182'), 'Se establece un ar'ancel sener-al de aduanas·., in Coleccion de Reales Dect'etos, 1820-21, pp. 170-8. 9. The Report was officially t'ead as such on 31 August and enfot'ced as a dect'ee on 5 Octobet' 1820. Cf. DIarIO de la~ Sesiones de Cortes, Nos. 58 and 93, 31 August ano 5 October 1820, pp. 746-8 and 1416. Ironlcally, a fot'tnlght after the publication of the decree, the Cortes agreed to concede a 'honorific mention' to Bentham in the Diario de Sesion~=, appreciatina Bentham's 'warm feelings' towal'ds Spain. Cf. Stark , iii. 385n and the 'mención honorífica' to Bentham 1n Diario de las Sesiones de Cortes, No. 108, 20 October 1520, p. 1797. 10. UC xxii. 268-74 are marainal sheets, in the hand of a copyist, and headed 'Spanish Anticommerc1al Oecree 'Spanish Prohibitory Decree'. There are drafts, in Bentham s r,and, headed . ¡:;. d Your'selves .. Appendi ,., F t--oh 1 b 1 t 1 ':¡n OecI'ee', on tne vel'so of the fol10wing sneets in UC; cL" 252, 253, 255, 260, 261, 262, 263, 264, 265, 278, 285, 301, 339, 340, 344, 347, 348, 349, 364, 365, .366, .367. ln addition, UC clH. :,OOv is headed Decree', clx. 345v, 350v ar'e headed 'Rid Yourselves , and ClH~ 351 is headed 'Ema.ncipation 5panl~h. It can be noted that these sheets appear to contain most of the gene,'a 1 economic reasonln8 of the Observations, but very little pa,'tlcula,'s on the situation of 5paln and nothing on ¡,el" American colonies. 11. The p,'evious name of the ,"ol'k, 'Emancipation Soanish', was changed to 'Rid YOLlt-'selves of Ultt"'amat"'ia; SOflletlme ln 1820. Bentham probably wrote 'Ultramaria' inspirad by the Ultramar mentioned in the Cádiz Constitution. 12. Consejos que dirige a las Cortes y al pueblo espahQl Jel'emias Bentham (1820), tt'anslated by José JO"'.qllin de NOt'·", .• 13. UC 1:<. 66, 67. 5307411188 14. P.Estelle M., 'Un proyecto de código para Chile, ~e- vista Chilena de Derecho, iv (19771, 359-363. It should be noted that O'Higgins's name is not mentioned 1n thi~ at'ticle. 15. Stad~, i i i .. 390 .. 16. Ibid. , p. 403. 17. Ibid., p. 408. 18. Ibid. 9116A 9116B 9116C