Kicking Away the Ladder. Development Strategy in Historical Perspective

laissez-faire; free markets could never have come into being merely by allowing things to take their course. Just as cotton manufacturers – the leading free trade industry – were created by the help of protective tariffs, export bounties, and indirect wage subsidies, laissez-faire itself was enforced by the state. The thirties and forties saw not only an outburst of legislation repealing restrictive regulations, but also an enormous increase in the administrative functions of the state, which was now being endowed with a central bureaucracy able to fulfil the tasks set by the adherents of liberalism. To the typical utilitarian … laissez-faire was not a method to achieve a thing, it was the thing to be achieved’ (1957 [1944], 139). Also see Perelman 2000 on how the Classical economists endorsed state intervention that was deemed necessary for the establishment of the market system, especially the creation of wage labourers through the destruction of small-scale rural production.

49

Fielden 1969, p. 82.

50

See Clarke 1999, on the rise and fall of the Tariff Reform League and Chamberlain’s role in it.

51

Bairoch 1993, pp. 27-8.

52

Bairoch 1993, p. 30.

53

Trebilcock 1981, p. 83.

54

North 1965, p. 694.

55

Of course, there is no simple one-to-one correspondence between someone’s ‘material’ position and his/her intellectual position. Despite being a Southern slave-owner, Jefferson was strongly in favour of infant industry protection. In contrast, despite being from the Northern manufacturing part of the country and being a famous industrial inventor, Benjamin Franklin was not a supporter of infant industry protection. However, Franklin still supported protection of American manufacturing industry on the ground that the American industry would never be able to compete with European industry that could get away with paying subsistence wage, whereas the American industry could not, given the abundance of land and shortage of labour. See Kaplan (1931, pp. 17- 27).

56

Corden 1974, chapter 8; Freeman 1989; Reinert 1996. Of course, there were thinkers before Hamilton who had elements of the infant industry argument in their writings. For these, see Reinert 1995. According to Bairoch 1993, between Hamilton’s Reports and List’s National System of Political Economy, there were other writings advocating infant industry protection by authors such as the German Adam Muller and the Frenchmen Jean-Antoine Chaptal and Charles Dupin (p. 17).

57

Henderson 1983; Reinert 1998. For further details on List’s life and work, see Henderson 1983. List’s full argument was published in The National System of Political Economy in 1841. However, according to Spiegel (1971), the earliest version of his argument for the development of national ‘productive power’ was made in a book that he wrote for the Pennsylvania protectionists in 1827, Outlines of American Political Economy (pp. 362-3).

58

Bairoch (1993, p. 17) credits Hamilton for inventing the term, ‘infant industry’.

59

Dorfman and Tugwell 1960, pp. 31-2; Conkin 1980, pp. 176-7.

60

According to Elkins and McKitrick, ‘[a]s the Hamiltonian progress revealed itself - a sizeable· funded debt, a powerful national bank, excises, nationally subsidized manufactures, and eventually even a standing army – the Walpolean point was too obvious to miss. It was in resistance to this, and everything it seemed to imply that the ‘Jeffersonian persuasion’ was erected’ (1993, p. 19).

61

Garraty and Carnes 2000, pp. 139-40.

62

Garraty and Carnes 2000, pp. 153-5, 210; Bairoch 1993, p. 33.

63

Garraty and Carnes, 2000, p. 210; Cochran and Miller, 1942, pp. 15-16.

64

Bairoch 1993, p. 33.

65

Garraty and Carnes 2000, p. 210.

66