ABSTRACT
List's major work on economics, The National System of Political Economy, which appeared in 1841, marked the culmination of a long campaign against the doctrines of the classical economists. He first put forward his views on fiscal policy in his petition to the Federal Assembly of the German confederation in 1819 and in his "Vienna Memorandum" of 1820. In the petition of 1819, while paying lip service to "the cause of free trade, by which alone Europe can reach the highest stage of civilisation", he urged the Federal Assembly to establish a national customs union "based upon the principle of retaliation against foreign countries". 7 And in a memorandum submitted to Metternich in the following year List asserted that "if foreigners hamper the natural flow of our trade by erecting hostile customs barriers against us, we should in selfdefence, retaliate by taking similar action against them and so force them to strike a fair bargain with us. Only by such means can we achieve world free trade which represents the highest stage of human welfare."8 Similar views were expressed in articles which List contributed to the journal of the Union of German Merchants. In his "Letters on the Economic Condition of Germany" he complained that cheap English imports were ruining German industry,9 while in his "Thoughts on a South German Customs Union" he recommended the imposition of import duties on English manufactured goods.10 There can be no doubt that in 1819-20 List was advocating the protection of German industry by the erection of a tariff barrier to restrict the importation of foreign manufactured goods. In April 1825, shortly before leaving Europe for the United States, List wrote:
However much the world may owe to this economist (Adam Smith) in other respects, all his services cannot make amends for the enormous harm that he has done by persuading some of our capricious doctrinaires to accept the doctrine of so-called free trade. Adam Smith's fundamental error is that he ascribes to capital alone a productive power which, in fact, can be created only by labour in association with a large or a small amount of capital.ll
List's writings between 1819 and 1825 do not support the view that
