Buchanan and Market

LR ^ | Jeff Tucker

[VinnyTex]

Buchanan and Market

by Jeffrey A. Tucker

In all the commentary on Patrick J. Buchanan?s new book ( The Death of the West , NY: Thomas Dunne Books, 2002), has anyone discussed his silly economic fallacies and highly interventionist policy agenda? This is the conservative book of the year, the core thesis of which (the West needs higher rates of population increase to keep up with the Third World) impacts very strongly on economic issues.

What then does Buchanan propose?

The Family Wage: Buchanan says (p. 232) he favors amending the Civil Rights Act "to allow employers to pay higher wages to parents than to single people.... This should apply to single dads and moms.... Employers should be given tax incentives to pay higher wages to parents."

Does he really believe that employees want to pay higher salaries to people with children but are currently not doing so for fear of lawsuits? If anything, the pressure runs in the opposite direction, married people suing because single people are paid more.

Does he not understand that wages and salaries are determined by the supply and demand for an individual?s contribution to the productivity of the firm? Can he not grasp that employing federal law to raise the price of parent-labor would reduce, not increase, its marketability, and thus create incentives not to be married and have children?

Corporate Taxation: Buchanan says (p. 233) that "the burden of corporate taxation should be shifted off family businesses and farms onto the larger corporations. As Ronald Reagan used to say, corporations don?t pay taxes, people do. Corporations only collect taxes. Let the Fortune 500 do the collecting."

Huh? Buchanan is demanding that if a corporation is really successful at marketing its product and running a tight ship, and then becomes a Fortune 500 company, the government should only then start demanding that it function as a proxy for the IRS!

Reagan employed his quip as a case against taxing all corporations. His point was to say that corporations in the abstract aren?t doing the paying. They are being forced to collect from individuals, and its comes out of workers? wages and salaries. Buchanan?s suggestion will only lower the incomes of people who work for the best companies.

New Revenue : Buchanan says (p. 233): "If new revenue is needed to pay for these family tax cuts, it can be obtained through taxes on consumption and duties on imports."

Now there?s an idea! Prevent the Death of the West through higher prices on consumer goods!

Women in the Workforce: Buchanan says (p. 33): "As men?s jobs in manufacturing, mining, farming and fishing are no longer needed, or are shipped overseas, the skills and talents of women are now more desirable. Businesses, large and small, offer packages of pay and benefits to lure talented women out of the home and keep them out of the maternity ward."

Here we go again demonizing business, and with the weirdest theory ever: the conspirators behind economic development are really out to smash the employability of the male sex in favor of the female sex. It takes a heated imagination to dream up this stuff.

A major reason moms went to work was inflation and taxes, which caused the real standard of living of the American family to decline. The first year when both mom and dad were more likely to be working, rather than not, was 1985, and the biggest growth in this trend occurred at the same time real family income took its biggest postwar hit. To resist that impulse (and many do) requires a high income or deep convictions. In any case, it is going to take far more than a few taxes credits to restore the belief that one income is enough to provide for the family. Making government more intrusive won't help; intrusive government is the problem.

In any case, does he not know that the rap against high tech is that unfairly employs too many guys, that its work isn?t really designed for women? Does he believe that women on farms sit around and coddle the young?ns while Dad does all the work? Not so in any farm I?ve ever seen. Of course business is pleased to employ anyone who will assist in its desire to serve the consuming public. But women, like men, all face a choice. Is it really so hard to imagine that people can make choices consistent with their own best interest?

Evils of Riches: Buchanan says (p. 34): "The richer a nation becomes, the fewer its children, and the sooner it begins to die"; and (p. 37): "When the income tax rate for the wealthiest was above 90 percent in the 1950s, America, by every moral and social indicator, was a better country"; and (p. 47), today "young people are not concerned about their souls; they're worried about the Nasdaq."

Like the environmentalists, then, Buchanan has decided that poverty has a wonderful upside. That?s one way to save bad economic ideas: claim they are supposed to depress the standard of living! But there are a few problems with Buchanan?s theory that poverty makes people pious and pregnant. Poverty-stricken places like Bosnia-Herzegovina, among many other Hell holes, have lower birth rates than the US. And as even Buchanan has to admit, the first time US births fell below replacement level was during the Great Depression. Finally, for the record: I know many people who want to save their stock portfolios and their souls.

Anti-Corporate Mentality: Buchanan says (p. 229): "The transnational corporation is a natural antagonist of tradition. With its adaptability and amorality, it has no roots; it can operate in any system. With efficiency its ruling principle, it has no loyalty to workers and no allegiance to any nation. With share price and stock options its reasons for being, it will sacrifice everything and everyone on the altar of profit. The global capitalist and the true conservative are Cain and Abel."

Or one might point out that multinational corporations increase competition and quality, expand access to new technology, reduce the price of goods for consumers and producers, create hundreds of millions of new paying jobs, lift the developing world out of poverty, permit the developed world to specialize in what it does best, foster peace among nations, promote financial stability, undermine the power of dictators, break up entrenched producer cartels, expand economic opportunity, undermine the welfare state, crush the menace of union power, and spread prosperity and liberty to the entire human race.

Or is it better to sacrifice everything and everyone on the altar of losses?

Dogs Eating Dogs: Buchanan says (p. 33): "The Global Economy works hand in hand with the New Economy, transferring manufacturing jobs from high-wage Western nations to the low-wage, newly industrializing nations of Asia and Latin America."

Last check, the unemployment rate was 5.8 percent and falling, and this in a recession. This is below what the Keynesians used to call full employment. The number of people working in manufacturing has indeed fallen, which reflects a sectoral shift due to economic development: witness the steady rise in household income since the mid-1990s. Thus, the Latin American, Asia, and Westerns nations are growing wealthier together by cooperating through trade and exchange.

Surprise: trade works! Why must Buchanan see conflict where there is none? Is it really necessary to point out that getting rid of high tech and global trade at this point would reduce the standard of living rather dramatically? How the heck does Buchanan expect the massive population increases he hopes for to be sustained absent economic development?

Freedom Is Heresy: Buchanan says (p. 37): "Many conservatives have succumbed to the heresy of Economism, a mirror-Marxism that holds that man is an economic animal, that free trade and free markets are the path to peace, prosperity, and happiness...."

Sorry, but free trade and free markets are the path to peace and prosperity. There?s a word for people who deny it: socialists. As for happiness, Thomas Jefferson was right that freedom allows only for its pursuit.

Disastrous Trends: Buchanan says (p. 127): "People identify less and less with the nation-state, more and more with kith and kin."

This is supposed to be bad news. To stop this horrible trend, Buchanan offers no proposals to curb big government and plenty to expand it (like instituting a National History Bee administered by Historian-in-Chief George W. Bush).

I know Buchanan?s book is about more than economics. Buchanan is right (p. 55) that John Lennon shouldn?t have said, 36 years ago, "We?re more popular than Jesus." He?s right that "American Beauty" was an awful movie (p. 84). He is right that Confederate symbols are not racist, that the left is engaged in cultural jihad, that high Third World immigration has been invasive.

But what he suggests as a replacement is another central plan, one that would promote impoverishment. But he has put zero thought in the core issue: if you want a huge population increase, you have to come up with some system of economics to sustain it. The capitalist process of economic progress is the only system that does so. As even Buchanan notes in passing (p. 13), the welfare state brings about depopulation.

Buchanan hasn?t made his peace with the market economy, but his book is not highly unusual in this regard. Economic fallacy is everywhere. I shudder to think of the errors unleashed on the world simply because people haven?t taken a weekend off to read a basic text like Murray N. Rothbard?s Power and Market .

March 23, 2002

Jeffrey Tucker [send him mail ] is vice president of the Mises Institute .

[Jethro Tull]

SEE #20

[4Freedom]

Thanks, Cacophonous. I, too, couldn't believe the reactions, of most of these posters, to this intellectually dishonest hit-piece. I had to double-check to make sure I was on FR.

Tucker jumps to false conclusions from false premises, regarding Buchanan's beliefs, and receives thunderous applause from the uninformed that have been duped into their share of almost $10 trillion dollars of national debt, by transnational corporations, practicing Marxist economics.

I'm tempted to take Tucker's turkey apart point-by-point. Although, I'd probably be wasting my time with this crowd. They seem to want to accept and believe anything negative about Buchanan.

[4Freedom]

"TUCKER IS A FULL BLOWN WHACK JOB!"

That was worth repeating. LOL.

[ex-snook]

Bush/Gore saw a rising stock market and budget surpluses, tax cuts, and pork spending as far as the eye could see. Buchanan warned the dangers of our Enron asset-less service economy which traded our jobs and our factories for cheaper sneakers. It seems that all that is in the famous Bush/Gore lock box is bullshxt.

The author cited pages which sure is a change from the usual Buchanan mystery writers. He might not agree with Buchanan's thesis that the Western civilization has adopted a culture of death but the survival of the West sure is not going to be addressed by just looking as dollars and cents. Buchanan has the vision thing. Read the book not the reviews.

[VinnyTex]

It's the way my newsreader formats the article. Couldn't figure that one out I see

[AmericaUnited]

$10 trillion dollars of national debt

All those who yap about the national debt are completely ignorant of the way money get created in a fractional reserve banking system, such as we have. The only way for money to be created is by debt creation.

You do understand that when the FED takes money out of the money supply, the economy contracts. If your 10 trillion was paid off, that would be 10 trillion dollars taken out of the money supply. It would be impossible to do that without creating such a devastating depression that the Great Depression in comparison would look like the Roaring 20s.

[4Freedom]

I would disagree with your perception that the West adopted a 'culture of death', we were duped into it by these Marxist economists.

I remember being lectured back in elementary, high school and college about the destruction we would wreak on the United States by our over-population.

Where are these environmentalist whackos when you need them to oppose massive, out-of-control legal and illegal immigration?

[The Irishman]

This post and the first 14 replies proves that there is one clear difference between conservatives and libertarians. This article was posted at 1 AM and the 14 anti-Pat replies that followed it were in by 7AM. An impressive record for insomniacs.

As usual, the comments are of the usual ad-hominem variety that we have come to expect from the Pat haters.

I'll respond in kind, Jeff Tucker is not even close to Buchanan in intellect or erudition. Furthermore, obvious truth remains obscure to him, because he is the prisoner of his narrow libertarian ideology.

Rather than sitting up all night in front of a computer screen, I suggest you folks get in touch with a local physician who can fix you up with a sleep hypnotic.

Sweet dreams.

Regards.

[VinnyTex]

JT, I don't think you understood the piece. He's not attacking Christmas.

[VinnyTex]

Guess you never figured that lots of people don't work 8-5 jobs.

[VinnyTex]

but these are all questions that should be dealt with more seriously than Tucker does.

What did ya want him to do, write a book. It's a short review of Pat's book.

I like Pat and support his stance on immigration as do most Americans. But it's his solutions on economics that would devastate the economy. The evolution began to take place in the early 90s. I think he sat next to Mark Shields too long on the Capital Gang.

[4Freedom]

Oh yeah, paying $500 billion dollars a year in interest is a good thing. According to you, anybody that doesn't feel that way is just ignorant of how our criminal federal??? reserve system works.

We have to learn to appreciate the economic brilliance of a 'strategy' that keeps us up to our necks in debt, for the good of the globe. >sarcasm<

'Federal Express' is as federal as the federal reserve.

LOL.

[x]

I repeat my point. The government imposes a lot of burdens on us. Buchanan's arguments that one can and should shift those burdens isn't adequately dealt with in Tucker's silly article. It's not just a question of whether the policies Tucker disagrees with are wrong in his eyes. Maybe Buchanan's politics are the wrong ones, but it's also a question of whether or not they are more wrong than what we have now or more wrong than other alternatives. Are tariffs or consumption taxes worse than high and graduated income taxes? Utopian critics like Tucker attack all existing policies but provide little guide to what we should do now in terms of what is practical and possible. After being exposed to enough Rockwellite "Blah, blah, blah the state is evil, blah, blah, blah the market is good" it's hard to take it seriously as a guide to which policies we should adopt.

[independentmind]

After being exposed to enough Rockwellite "Blah, blah, blah the state is evil, blah, blah, blah the market is good" it's hard to take it seriously as a guide to which policies we should adopt.

How I wish that this type of thinking was limited to Rockwellites. The above pretty accurately reflects the opnions of most of the posters on Free Republic.

[VinnyTex]

After being exposed to enough Rockwellite "Blah, blah, blah the state is evil, blah, blah, blah the market is good" it's hard to take it seriously as a guide to which policies we should adopt.

You contradict yourself X.

If you've been exposed to enough Rockwellite BLAH BLAH as you write, then you should know by now what they propose. Nothing more radical than the idea that the constitution should be followed. It's not by a long shot right now that's for sure. The critique of the book is just examining that Pat's cure is worse than the disease.

As Tucker writes:

I shudder to think of the errors unleashed on the world simply because people haven't taken a weekend off to read a basic text like Murray N. Rothbard's Power and Market .

[AmericaUnited]

This post and the first 14 replies proves that there is one clear difference between conservatives and libertarians. This article was posted at 1 AM and the 14 anti-Pat replies that followed it were in by 7AM. An impressive record for insomniacs.

Clearly you don't appear to be even a semi-deep thinker otherwise you might have realized that the timestamps on FR are PST, and someone such as myself, who posts at 4:30AM EST, would get a 1:30 PST timestamp.

As far as insomnia... I woke up at 4:30 AM, after going to bed at 10:00 PM, and getting 6.5 hours of solid sleep.

[AmericaUnited]

Oh yeah, paying $500 billion dollars a year in interest is a good thing. According to you, anybody that doesn't feel that way is just ignorant of how our criminal federal??? reserve system works.

You don't seem to have a clue how the Federal Reserve and our fractional reserve banking system works, especially related to how money is created/destroyed.

Question) Where would the $500 billion dollars a year of interest payments go?

Answer) TO THE PEOPLE AND COMPANIES WHO BOUGHT THE TBILLS, NOTES, AND BONDS! They get the interest, which they either invest or spend back into the economy.

[x]

It's true that reading a good book about markets and economics like Henry Hazlitt's or Frederic Bastiat's can help people to vaccinate themselves against a lot of economic errors and fallacies. But the Rockwellites come to sound a lot like those cranks one wants to avoid becoming. They remind me of the deconstructionists. They can demonstrate the contradictions and inadequacies in anything people propose. It's all to the good to the degree that those proposals are flawed, but Rockwellites don't have any real answers themselves and content themselves with feeling superior and secure in their possession of the answers. But that still leaves us with the question of what we should do. Much of the time we may not have to do anything, but sometimes -- even under a Rockwellite government -- we will, and their ideologies don't provide any answer, save perhaps "Do nothing." As I understand it, Buchanan is saying that that answer may not always be adequate. It could very well be that he's wrong and that his prescriptions won't work, but it's admirable that he's asking questions, rather than assuming that some Rothbard or Mises has given him all the answers in advance.

[VinnyTex]

X, X, X, all Pat does anymore is offer big government solutions !

You tell me, does Pat think this country was better off when the highest tax rate was 90 percent? Or when organized labor was much stronger than it is today?

From what I see after reading, Pat is a techno phobe. He hates E-mail. Pat is a smokestack type guy. Very anti market.

[4Freedom]

Was the federal reserve board established in our Constitution?

Did the Founding Fathers believe it was in the best interest of we the people to cede our right to coin our own currency to a cabal of anonymous, wealthy industrialists and European bankers and, from that day forward, to pay interest on every dollar printed and every coin minted?

Did the Founding Fathers believe that our Nations success would be guaranteed by an enormous national debt and the paying of an equally enormous amount of interest on that debt, yearly?

When Congress established the federal reserve it committed a crime against the American Taxpayer that we have yet to invent a punishment severe enough for.

If the Founding Fathers could be brought back to see what Congress had allowed to be foisted on the American People, they'ed just start shooting.

Maybe bank robbery and home invasion should be legalized as long as the criminals agree to invest the stolen goods?

LOL.