The founding of l'Institut Turgot was inspired by the Institute of Economic Affairs (I.E.A.) set up in London in 1955, of which Margaret Thatcher said, a few years ago, that if it hadn't been there, she wouldn't have been able to launch her free-market revolution in Britain.
In France, and in a number of French-speaking countries, free-market ideas are neither known nor understood and in that respect, the French situation is similar to that of Great Britain before the creation of the IEA.
The state of classical liberalism in France
Classical liberal thought is all but unknown in France. The few defenders of freedom are readily called "extreme free marketeers" and subject to « excommunication », i. e. rejected from the common "right-thinking" universe.
This, in spite of the work done by Euro 92, by the Cyber-Institute set up by Henri Lepage — as well as ALEPS (Association pour la Liberté Economique et le Progrès Social) and the success of its yearly Summer University in Aix-en-Provence.
The situation is thus characterized by an extreme marginalization of free-market teaching in higher education. The recruitment of economics teachers in France is controlled by unions which, almost systematically, eliminate openly free-market candidates. Thus, it is impossible to rely on the universities to expound free-market ideas.
Warped teaching translates into the ideas commonly accepted and spread among the media. Among journalists and commentators, clearly free-market figures can probably be counted on the fingers of a single hand. There is no French-speaking equivalent of the editorial pages of the Wall Street Journal, the free-market journalistic reference which played such an important role in the success of Reagan's programs. The logic behind supply side tax cuts is ignored by everyone.
As a consequence, the task of a government wishing to implement a free-market program is almost impossible. It will be misunderstood by the media and its own bureaucracy. The latter will only bring about their failure, as it tries to do well.
France, of which Jacques Rueff said that nothing prevented it from reaching the standard of living of the United States, as he presented his reform program in 1958, is weakening and impoverishing itself. It is afflicted by high marginal tax rates on income, on savings (capital tax, inheritance tax), by regulations the most conspicuous of which are those on the labor market (the 35-hour work week) and subsidies of all kinds. The case of the 35-hour legislation exemplifies the ignorance of elementary economic laws. That ignorance inspires an uncritical acceptance of government interference with labor markets and thus the rejection of freedom of contract.
A large part of the elites, combining intellectuals, media, politicians, civil servants and business people living in symbiosis with the government, who are now also dependent on Brussels, and stuck in the ignorance of a future of freedom, unwittingly presides over that decline.
The approach of l'Institut Turgot
For l'Institut Turgot, there will be no long-term free-market solutions until the long-term battle of ideas is joined, and won.
To take up the terms of the IEA, the goal of the Institute « is to explain free-market ideas to the public, including politicians, students, journalists, businessmen, academics and anyone interested in public policy ». In simple terms, the IEA reminds that:
« The core belief of free-marketeers is that people should be free to do what they want in life as long as they don't harm anyone else. ». Hence the belief that « government action… should be kept to a minimum ».
To clarify and communicate
To put in words free-market ideas, to make them known and help them spread, l'Institut Turgot organizes conferences and seminars, in Paris and Brussels, thus giving a platform to classical liberal economists. To take advantage of research in other countries a place is reserved for foreign thinkers. An Internet site– Turgot.org – also posts accounts presented during conferences or other texts written by young French-speaking scholars. Translations and texts in foreign languages are also available on the site. Finally, l’Institut Turgot, according to its resources, distributes published documents.
The Institute includes a Scientific Council consisting of well-known figures who oversee the orientation and quality of published material (on paper ans on the Internet). The aim is to obtain the best quality papers in order to convince through the rigour of analysis.
Classical liberals belong to different schools of thought: some may for instance disagree on currency policy. L’Institut Turgot will remain open to the works of all different free-market currents, provided they are good, provided that general principles, and most particularly respect for property rights, closely linked with responsibility, are acknowledged as founding elements (et thus also understood as sources of efficiency).
To guarantee its own freedom of expression, l’Institut Turgot intends to be independent from political parties as well as employers' associations. One of the most radical reform programs was implemented by a Labour government in New Zealand. Neither will it seek government help. It will be funded by contributions, donations plus income from sales and conferences.
Although there is a need for that, the purpose of the Institut is not to formulate a comprehensive government program of free-market reforms. It will concentrate its scarce resources on what precedes a legislative program: the promotion of free-market ideas.
The Institute doesn't intend to place itself at the other end of the possible field of action, namely fundamental economic research. Its calling consists essentially in ensuring the preparation and discussion of economic policy projects (on taxation, money, trade, health or retirement insurance) and, more generally, dealing with the institutions of a free society.
The choice of Turgot's name is symbolic. It is a reminder that there is a French-speaking free-market tradition (Say, Turgot, Bastiat…), and that Turgot was a great economist - recognized as such by historians abroad — even before becoming a reform-minded Minister of Finance.
His loss of grace, and the failure to implement his program, are an encouragement to work thoroughly in order to win the battle of ideas and make the task less perilous for his successors.
Why Turgot ?
Whereas Turgot's name is well-known in France and appears on the facades of many public buildings, the works of that great thinker remain largely unknown there.
Turgot is one of the founders of modern economics. He wrote, among others, Eloge de Gournay (1759), Reflections on the Formation and Distribution of Wealth (1766). His ideas had a major influence on Adam Smith and the writing of The Wealth of Nations.
He was Minister of Finance of King Louis 16th from August 1774 to May 1776. During that short period, he redressed a seemingly desperate financial situation, established free trade in grain, and introduced a fiscal reform aimed at abolishing some feudal privileges.
L’Institut Turgot intends to follow in the path of that « spiritual father of classical liberalism », as it wishes to remind that France has a great free-market tradition, born in the 18th century, flourishing in the 19th, and which ought to be revived and become visible again in the 21st, to help the country overcome the major challenges it has to face.
