Tucker Carlson's Broadside Against Austrian Economics

Fox News host Tucker Carlson took to the airwaves of this popular show last night to lambaste Austrian economics and libertarianism, which he views as twin pillars of a failed ideology that doesn't protect American workers and their interests.

The GOP, he argues, is in thrall to free-market corporate interests and esoteric economic theories from dusty textbooks. Republicans remain wedded to unbridled libertarian political philosophy, tax cuts, deregulation, and unilateral free trade, all of which enrich elites but hurt average people. Meanwhile, presidential aspirants like Elizabeth Warren and Bernie Sanders offer the American electorate real-world solutions to economic insecurity, jobs, and healthcare.

It's a compelling story, but untrue. Does Carlson honestly think Republican members of Congress are overly theoretical and ideological? And here we thought they were a bunch of unprincipled and poorly-read hacks!1

Does he honestly think the budget-busting GOP of recent political memory, from Bush II (Iraq War, Medicare Part D, Department of Homeland Security, Patriot Act), John McCain, Mitt Romney are ideological libertarians? Why did Ron Paul and Rand Paul fare poorly among Republican primary voters, if in fact free-market ideology and its donor class dominate the party? And hasn't the party been overtaken by Trumpist protectionists?

Of course we're pleased when Right populists recognize the influence of the Austrian school, just as we're pleased when Left-liberals at the New Republic convince themselves that Misesean "neoliberalism" has taken over the world. We note that Mises and Rothbard continue to receive criticism decades after their respective deaths, a testament to their deep (and apparently nefarious!) influence and an honor given to few economists.

Carlson, a onetime Cato Institute staffer and Weekly Standard writer, understands both Republican politics and the DC world of think tanks and punditry. When he references the Austrian school or libertarianism, it's shorthand for "Koch money and influence" rather than any real ideology. It's his shorthand for the "self-interests of rich guys," interests given an intellectual veneer by academics and writers who are happy to accept billionaire crumbs in exchange for cozy non-profit sinecures. "Conservatism, Inc." (or "Libertarianism, Inc.") has become an self-serving industry unto itself, sclerotic and ripe for criticism.

There is truth to this. But it's not an ideological truth. Tucker Carlson knows better, He knows full well how tariffs make society overall worse off, how markets make poor Americans far better off than the poor in many countries, why government medicine doesn't work, and how minimum wage laws hurt the least-skilled workers. His argument is about priorities and strategy (and TV ratings), not ideology. And it accepts a fundamental tenet of the Left: self-interest for me is noble and warranted, self-interest for others (especially the rich) is suspicious if not sinister.

In other words, Carlson presents a fundamentally zero-sum perspective, which is to say a fundamentally political perspective.

That said, his populism—particularly his antiwar stance—should not be dismissed. Populism per se is not an ideology, but rather a strategy. It can be imbued with any political philosophy, and thus can be equally dangerous or beneficial. At its core populism questions not only the competence of elites, but also their worthiness. It asks whether elite interests comport with those of average people, and in most cases correctly concludes that political elites have interests at odds with those people.

When elites are state-connected or state-protected, i.e. when they maintain or even derive their wealth and influence through their relationship with the state, libertarians have every obligation to object. Elites in the West—from politicians and bureaucrats to central bankers and media figures to defense contractors and patent-coddled pharmaceutical execs—richly deserve our ire. They screwed things up, and ought to be held accountable.

Tucker Carlson is right about that.

I’ll try to give you a different perspective, and hope that you will find it at least somewhat persuasive .

Philosophically speaking, if you are a nation with all (or almost all) natural resources, as well as an adequate labor force, tariffs are not bad for society.

“Having” resources is not the issue. Being able to acquire and use them with less expenditure of time and toil is. Would residents of California or Texas, resource-rich states, have a higher standard of living if they erected substantial tariffs against the residents of the other 49 states?

The way I see it, even though prices may inflate, comparatively, due to the reducing in cheap consumer goods. On the opposite side of the coin those tarifs insulate your mean standard of living...

One’s standard of living is what one can and does buy with the resources, substantially time and the specific skills one has. Allowing imports to come in tariff-free (the contrary to your “tariffs”) simply means more producers, domestic and foreign, to compete for consumers’ money. That must be good for consumers.

It is true that domestic firms must compete harder for consumers’ business (as, arguably, they should). It is also true that some domestic workers will lose jobs or have their pay cut to try to keep these firms in business. But most Americans don’t work in firms like this. As of May, 2019, manufacturing employment was 12,839,000. Total employment was 155,539,000. So most workers would be in the position of paying higher prices to allow a much smaller number of workers to be able to compete less. It is unlikely this would be good for the American standard of living,

...from the drain that occurs when all your labor and production is exported.

On labor, see above. Most people are not doing work where jobs are being exported, and never have. On production, without question manufacturing employment has declined substantially since 1980. But manufacturing as a share of GDP has not been affected nearly as much.. How do we reconcile these things? Facing more competition, not all of it foreign, American manufacturers have been continually forced to figure out ways to get more, with fewer workers. In this they are like many other economic activities (farming, e.g.)

...forces your economy to internally satisfy it’s own demand with it’s own supply.

What consumers “demand” depends on price charged, and features of the product offered, relative to the alternatives. It is not a fixed number, unless the government wants to decree a fixed standard of living for all. Other countries tried this; it didn’t work out so well.

To protect particular jobs at any moment in time by limiting competition to a one’s own specific area of the map is to damage consumers by limiting how many sellers can compete for their services. It is not any better for a nation’s residents than a state’s, and indeed is no more reasonable economically than deciding your family’s standard of living will go up if everything they consume will from now on be produced by members of the family.

Economies are dynamic things. This is how we live better, by competition working to better satisfy consumers in ways profit-seeking sellers have incentives to pursue.

Finally note that the argument here does not apply to the national-security argument for not depending on foreigners to provide our military and people with critical goods.

Statement one is false - US was mercantilist from 1780 to 1942 while the UK was a free trader nation. In fact, tariffs as a percentage of total imports was very similar in the two nations and was actually much higher in the U.K. in the early 19th century.

Statement two is stupid - “Capital Stock”?!? Who cares? That is not how a nation is judged. Why not pick an equally meaningless term such as carbon emissions?

Statement three shows poor analysis - China has grown over the past 40 years due to a reduction in the government control/communism in its economy.

Statement four is crass - mental masturbator?

The truth - Over the past 200+ years we have seen a global decline in tariffs as a percentage of goods traded. During that time economies have flourished. Those countries that have dropped tariffs the most have flourished the most - US and U.K. Countries who have removed tariffs less have flourished less - France. Therefore tariff reduction is a cause of, if not it is at least highly correlated with, an increase in national power.

All of these tariff rates as a percentage of total imports may be googled.

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