Bastiat Lives!

It’s not every day that an award competition ends in a tie, but that’s what happened last night at this year’s International Policy Network‘s Bastiat Dinner in New York, where IPN announces the winner of its Frederic Bastiat journalism prize, “to encourage, recognise and reward writers around the world whose published works elucidate the institutions of a free society.” This year two writers shared first prize, Tim Harford of the Financial Times, and Jamie Whyte, a freelance writer for his contributions to The Times. Third place went to Rakesh Wadhwa of Nepal’s Himalayan Times. Following are some samples of the articles for which they won. In “Trade deficit with a babysitter,” Tim Harford points out the silliness of the very concept of trade deficits. He tells of “Sally” a babysitter he and his wife have hired.

“Family Harford runs a substantial bilateral trade deficit with Sally…We spend $100 a week on service exports from Sally, and we earn nothing at all from her. That’s a yawning bilateral trade deficit, but we’re happy enough with it…If politicians were in charge of Family Harford trade policy they would bully Sally to raise her hourly rates, so that trade would take place on a ‘fairer’ basis. The politicians in charge of Sally’s trade policy would refuse.”

In another article, “Yes, we have bananas—we just can’t ship them,” he looks at a more concrete example of how politics distorts trade.

“The Group of 20, comprised of developing countries like Argentina, Brazil, China and India, has been pushing hardest of all for an end to rich countries’ agricultural subsidies and tariffs. Paradoxically, some of the most vocal members of the group impose regulatory barriers that are just as crippling to exporters in their own countries.”

And in “How the government can quit an oppressive habit,” he proposes a novel idea for smokers who want to quit.

“My proposal is simplicity itself. Any smoker who wants to quit can call a government hotline or log on to a website and buy ‘Quitter’s Bonds.’”

These bonds will be financial assets with “an unusual feature.”

“They will pay no interest and will not be redeemable except by the original purchaser. In order to cash in her Quitter’s Bonds she will have to pass a year of random blood tests to demonstrate that she has stubbed out the habit. Until then, the money is an interest-free loan to a hard-hearted government with unlimited reserves of moral superiority.”

Jamie Whyte has a similarly innovative idea, though the reasoning behind this one is to show up some politicians’ twisted logic, this time regarding risk-based pricing. In “Genetics is a risky business,” he cites Sir John Hulston, vice-chairman of Britain’s Human Genetics Commission, who decries the idea that insurers would charge higher premiums to customers whose genetic history would place them in higher risk groups.

“I plan to get rich by helping. If the Government takes Sir John’s advice and bans discounts for genetically low-risk customers, I will start an insurance company serving British customers but based offshore, perhaps in the Cayman Islands.”

Free from UK regulations, Whyte’s company “will serve only those who can produce documentary evidence that they are genetically low risk.”

“This will allow it to charge much lower premiums that its British competitors, who will be legally obliged to serve both high-