On the Record | Making a Case for Trump’s Entrepreneurial Inaugural Address

Please see my latest wire for The American Spectator, ‘Making a Case for Trump’s Entrepreneurial Inaugural Address’:

PRESS RELEASE

Hell’s Justice Department issues forth this “Devil’s Advocate” brief…

We are compelled to respond to the Institute of Economic Affairs’ policy head Ryan Bourne’s excellent analysis of President Donald Trump’s paean to protectionism in his first Inaugural Address. (See how we devils like to taunt our colleagues in the #NeverTrump department?) In response to the President’s admonition to “Buy American and Hire American,” Bourne replies that “If Trump goes down the protectionist route, he’ll be hurting American consumers and the growth potential of the US economy.”

In general, we agree with Bourne on the benefits of free trade: lower prices, greater and more diverse availability of goods and services, specialization as a facet of the division of labor, greater productivity, and overall more wealth for all. Yet it also behooves us to mention drawbacks to free trade, for those who lose their jobs to foreign competition and who must either take up new employment with lower emoluments, re-train, or relocate to more financially promising communities. Some, sadly, will find all these alternatives unpalatable or impossible to fulfill. In the larger scheme of things, these are short-term drawbacks, but for the individuals and families involved, they are no small matter and the negative impact can be great.

Nevertheless, we Devil’s Advocates can point to two elements of President Trump’s Inaugural that may give free traders consolation.

Read more . . .

__________

My thanks to editor Wlady Pleszczynski of The American Spectator.

On the Record | May Takes a Step Forward to British Independence with an Eye Out for Trump

Please see my latest wire for The New York Sun, ‘May Takes a Step Forward to British Independence with an Eye Out for Trump’:

Prime Minister May’s Lancaster House speech outlining the British government’s Brexit agenda takes an impressive step forward in Britain’s withdrawal from the European Union — and keeps a weather eye out for the man who is about to become President Trump. Brexit was “a vote to restore . . . our parliamentary democracy, national self-determination, and to become even more global and internationalist in action and in spirit.”

The Prime Minister opened with an apologia, setting out the reasons for Britons’ June decision to leave the EU and set out once more on their historic path of international engagement. “The decision to leave the EU represents no desire to become more distant to you, our friends and neighbours,” Mrs. May assured. “It was no attempt to do harm to the EU itself or to any of its remaining member states.” The lovelorn will recognize the “it’s not you, it’s us.”

Mrs. May detailed a dozen markers that will guide her Brexit strategy, from negotiating a new free trade agreement with the Union (maintaining and revising those current provisions that work for both parties) to normalizing relations for EU citizens living and working in the UK (and vice-versa), while assuring member countries of Britain’s continuing commitment to mutually beneficial co-operation in matters of continental security, defence, and cultural engagement.

Europe was not Mrs. May’s only audience. While England is the dominant “kingdom” in the Union, the Prime Minister assured the administrations of Scotland, Wales, and Northern Ireland that their concerns and suggestions will be heard at Westminster. Strengthening “the precious union between the four nations of the United Kingdom” is also part of the Brexit framework, as the referendum vote demonstrated the urban-rural divide and the tensions between England and the periphery regions.

Read more . . .

One point raised in the wire, to counter both prime minister Theresa May’s ‘modern industrial strategy’ and President-elect Donald Trump’s ‘America First’ protectionist policy, I believe needs to be especially emphasised: ‘Far better to look to future prospects than past accomplishment and base economic policy on the pillars of property, competition, innovation, and entrepreneurship.’ It is the basis of classical liberal economics and, as the French say, la théorie des débouchés (‘law of markets’).

__________

My thanks to editor Seth Lipsky of The New York Sun.

On the Record | Must the Blue States Remain Blue and Depressed?

Please see my latest wire for The American Spectator, ‘Must the Blue States Remain Blue and Depressed?’:

Has President-elect Donald Trump a mandate to govern? Debate roils on. While he captured the Electoral College, 306-to-232, critics respond that “popular” momentum lies with Hillary Clinton, who won by more than 2.6 million ballots. Trump supporters counter that in presidential politics, it’s the state-by-state tally that matters; otherwise, Republicans would have played a different ground game. Meanwhile, a world away from this partisan sniping, ordinary Americans eke out their existence. And in this all-important contest, Democrats are clearly losing.

So argues Trump economic adviser Stephen Moore. In a column charting the migration to business-friendly states from those burdened with over-government (analysed by Moore in ALEC’s Rich States, Poor States, co-authored with economists Arthur Laffer and Jonathan Williams), he describes the “economic depression in the blue states that went for Hillary.”

All have the hallmarks of Democrat politics. “High taxes rates. High welfare benefits. Heavy regulation. Environmental extremism. Super minimum wages.” And all are losing taxpayers to those red states where the government footprint is less intrusive, more welcoming to wealth creators. Americans are voting with their feet, to Texas and Florida from California and New York.

As I conclude:

It is time for Democrat states to throw off their artificial fetters, invigorate entrepreneurial innovation, and no longer be blue in spirit. They may not convert to red politically, but they can stop being “in” the red and prosper once more by being in the black. The Empire State, for one, should take a lesson from Tammany Hall sachem George Washington Plunkitt: “I seen my opportunities and I took ’em.”

Read more . . .

__________

My thanks to editor Wlady Pleszczynski of The American Spectator.

On the Record | Trump Tariff Threat Gains Tactical Victory in Kentucky

Please see my first wire for The American Spectator, ‘Trump Tariff Threat Gains Tactical Victory in Kentucky’:

A mere fortnight after becoming President-elect, Donald Trump’s tariff threat gained a tactical victory in the battle to keep American jobs at home.

Trump announced via Twitter that Ford Motor Company intentions to transfer SUV production south of the border were shelved. Chairman Bill Ford “advised me that he will be keeping the Lincoln plant in Kentucky — no Mexico,” Trump tweeted last Thursday.

“During his campaign, Trump was relentless in his criticism of Ford for planning to move all its North American small-car production to Mexico,” Bloomberg reported, “where wages are 80 percent lower than in the U.S.” Critics argued that Ford had intended to relocate only the Lincoln MKC but, in response to the tweet, “the company acknowledged for the first time it had been considering moving production of the MKC to Mexico” following the expiration of the union contract, albeit to allow Ford to focus on its Escape model which outsells Lincoln, 12-to-1.

Nevertheless, Trump supporters, Kentucky politicians, and union members rejoice at the news. But this is only the beginning. The company issued a statement that the future of Ford production in America was contingent on the belief that “President-elect Trump and the new Congress will pursue policies that will improve U.S. competitiveness.” And therein lies the rub, for producers and consumers alike.

Read more . . .

__________

My thanks to editors Wlady Pleszczynski and F.H. Buckley of The American Spectator.

__________

DMI wishes its American friends a happy Thanksgiving Day!

On the Record | Britain Itches for Freedom and a Trade Accord with Trump’s America

Please see my latest wire for The New York Sun, ‘Britain Itches for Freedom and a Trade Accord with Trump’s America’:

President-elect Trump is in like Flynn with America’s most enduring “special relationship.” For though his electoral victory is the cause of protests at home and unease at European capitals, “Mr. Brexit” basks in favorable reviews from the British government. Small wonder. Both nascent administrations swept to office on a wave of anti-establishment populism.

Leading the welcoming party are Brexiteers who spearheaded efforts to take the United Kingdom out of the European Union and regain the sovereign powers it had ceded to the continent. UKIP’s former leader, Nigel Farage, calls Mr. Trump “instinctively Anglophile;” Britain’s foreign secretary Boris Johnson is urging EU colleagues to cease their “collective whinge-o-rama” and accept the incoming American administration. Mr. Johnson, himself New-York born, betrayed affinities for across the pond when he christened the June 23 vote for Brexit Britain’s “Independence Day.”

Prime Minister May, in an address earlier this week at the Lord Mayor’s Banquet, echoed an openness to Trump. Mrs. May, who became premier when her pro-EU predecessor David Cameron resigned following the vote for British independence, began by noting their joint brash rise to high office: she, to “forge a bold, new confident future for ourselves in the world;” Mr. Trump, “who defied the polls and the pundits all the way up to election day itself.”

So 2016 is the year of change politics and “when people demand change, it is the job of politicians to respond.” Mrs. May has reason to sympathize with Mr. Trump, as both will be contending with obstructionists.

Read more . . .

__________

My thanks to editor Seth Lipsky of The New York Sun.

On the Record | Trump Awakens the Entrepreneurial Spirit

Please see my latest post for the Quarterly Review, ‘Trump Awakens the Entrepreneurial Spirit’:

Businessmen don’t understand politics. Success in the marketplace doesn’t necessarily follow in the political arena. Early criticism of Donald Trump’s presidential campaign were variations on this theme, from the first day he rode down the escalator at Trump Tower to announce his candidacy. How that tune has changed. Trump’s business acumen may prove his greatest political asset to an America that elects him president.

He may be learning on the fly the science of politics, but Trump instinctively comprehends the craft of intuiting the people’s discontent and offering them an alternative to the Capitol Hill duopoly. Whether on illegal immigration, terrorist threats, endless wars, or disappearing jobs, Trump reads the American mood like the practised pols of old. What he lacks in sophistication he more than compensates with gut instinct.

His outsider status is Trump’s self-proclaimed ace card — he’s not a politician but he understands how they operate, since he’s been negotiating with them all his life as a mega-developer. It’s these transformative skills that he exploits in his White House bid. ‘I’ve been very lucky. I’ve led a great life,’ he told an audience Sunday in Greeley, Colorado. ‘Now I want to give back to the country which has been so good to me.’

Read more . . .

__________

It may surprise that a student of the political careers of Benjamin Disraeli, Earl of Beaconsfield, and Sir John A. Macdonald would take such a dim view of protectionism. I simply refer you to 19^thcentury French economic journalist Frédéric Bastiat’s Economic Sophisms and his rigorous deconstruction of the protectionist argument.

With respect to Donald Trump and his policy of border tariffs, as I suggest in this article (and my two columns to which I link), Trump has offered two alternative methods of addressing American business decline: an end to global currency manipulation and entrepreneurial innovation.

And it is Trump’s appeal to the entrepreneur and to the ‘law of markets’ in which ‘demand is constituted by supply’ where great opportunity lies.

So my approach has been much like Kennedy’s attitude to Khrushchev’s conflicting messages during the Cuban Missile Crisis: ignore the one full of bluster and bellicosity, and focus instead on the note promising hope and a way forward. Take Trump’s protectionist threat as a negotiating bid with other nations (and U.S. industries) while defending and encouraging his call to entrepreneurs.

Conservative essayist Joseph Sobran limned the political divide between nomocracy with its simple plan to enforce the ‘rule of law’ and teleocracy with its vision of the perfect society to foist upon an unsuspecting public.

Donald Trump is, in my view, a nomocrat, as evidenced by his ‘America First’ presidential campaign. As such, he should be criticised when he errs and, if elected President, be subject to the checks and balances of American constitutional federalism; but Trump should also be praised when in the right and given all the support and assistance of the American people.

__________

My thanks to editor Dr Leslie Jones of the Quarterly Review.

On the Record | Trump’s Off-Hand Aside on State Competition Opens a Door on Policy

Please see my latest wire for The New York Sun, ‘Trump’s Off-Hand Aside on State Competition Opens a Door on Policy’:

Give The Donald his due: rarely is there a dull moment at a Trump rally. Last night at Geneva, Ohio, he ruminated on his “America First” economic policy. Mr. Trump returned to his protectionist message that companies moving manufacturing jobs out of country would be subject to a 35% tariff at the border. The he added a twist with the potential to reshape American enterprise.

“Our good jobs are going to other countries. So we’re going to stop it. It’s not even hard to stop it. And when they know there is that kind of a consequence, they’re not leaving, they’re staying,” Trump reiterated. Then, almost nonchalantly, he added: “They may go to a different State, and that’s different. Right? But they’re staying, they’re staying in our country.”

In a stroke of ostensibly unconscious genius, he recast a problematic policy into the promise of voluntary interstate competition, shorn of federal coercion. Free marketeers have always chafed at Mr. Trump’s protectionist program, which goes against every laisser-faire tenet of free trade, comparative advantage, and consumer choice. Yet they were faced with the fact that jobs were fleeing to foreign jurisdictions, leaving displaced American workers with few alternatives.

Mr. Trump assuaged these misgivings by focusing on currency manipulation, promising to bring forward legislation against Communist China and marking the Federal Reserve’s own easy money policies for contributing to what he calls in America a “false economy.” The limits of this demarche in enthusing voters were evident. Something more, to capture the imagination and spirit of American initiative, is needed.

Read more . . .

__________

My thanks to editor Seth Lipsky of The New York Sun.

On the Record | Clinton’s Pledge on Debt Emerges as a Risible Claim

Please see my latest wire for The New York Sun, ‘Clinton’s Pledge on Debt Emerges as a Risible Claim’:

A risible headline comes courtesy of Hillary Clinton. “I am not going to add a penny to the national debt,” she promises. Raucous readers are permitted a moment to compose themselves.

Let’s be generous and take the former secretary of state at her word. Seriously. How does she plan to pay for the largesse of her presidential platform, be it infrastructure and research spending, enriching ObamaCare, subsidizing college — among other emoluments to its base?

Vote-buying is an art form among Democrats, who no longer camouflage the contours of their platform, summarized as any number of “soak the rich” vendettas, targeted through income, capital gains, corporate, or inheritance tax hikes. “We’re going to go where the money is,” Mrs. Clinton admits in a restatement of what is called “Sutton’s law,” after Willie “The Actor” Sutton. “We’re going to make the wealthy pay their fair share.”

Without doubt, a cheer erupts from Mrs. Clinton’s constituency, exulting over their supremacy over “the other,” ignorant that no one escapes the consequences of tax increases, the poor and middle class least of all. Revenge is a dish best served as cold comeuppance.

Read more . . .

__________

My thanks to editor Seth Lipsky of The New York Sun.

On the Record | British Tribune of Trade Could Steal the March on Trump’s Protectionism

Please see my latest wire for The New York Sun, ‘British Tribune of Trade Could Steal the March on Trump’s Protectionism’:

Britain after Brexit is wasting no time announcing to the trading world it is open for business. Minister of International Trade Liam Fox speaks of free trade with an optimism that must inspire envy in America’s market conservatives. Who can imagine government praising the virtues of free trade?

Economic growth, Mr. Fox asserts, is supported by three pillars of market freedom. One is liberty of trade, unshackled from state interference, since “the idea that governments should restrict the right of individuals to exchange their hard work for goods and services at an agreed price in an open market is one of the gravest infringements of personal liberty.”

Two is entrepreneurship, where “competition leads to innovation” that in turn “powers progress.” Three is competitive advantage, whereby markets “specialise in the production of goods where they have the greatest efficiency.”

Read more . . .

__________

My thanks to editor Seth Lipsky of The New York Sun whose encouragement acts as a necessary inducement to write.

On the Record | Trump Rallies Entrepreneurial Spirit to Restore the American Dream

A golden-haired hero arrived in Toledo, Ohio, Wednesday last to rescue the American Dream. Donald J. Trump is its paladin: “We’re going to have this economy work again for you.”

The spirit that shook thirteen colonies to independence and catapulted a nation to world-power status a mere century later will rise again. Anæmic growth and stagnant employment will come to an end, he promised, by unleashing the competitive initiative held in check by government red tape.

Please see my latest posting for the American Thinker, ‘Rallying the entrepreneurial spirit’:

The guardians of economic orthodoxy took issue with Trump from the beginning, whether it was his tariff threat against foreign imports or his promise to penalize manufacturers who moved industries out of country. Classical economists, from Smith to Ricardo to Mill and beyond, had demonstrated that Western civilization was built upon the foundations of division of labor and the law of comparative advantage. How did Trump imagine he could “make America great again” when he flouted the free trade principles responsible for said greatness?

Over the summer Trump redeemed himself. He focused on currency manipulation as a key component of unfair foreign competition -- hand-in-hand with incompetent American trade negotiators -- while taking aim at high taxes, regulatory burdens, and Federal Reserve chicanery among the factors contributing to President Obama and the Democrat Party’s “false economy.”

“The contrast between the presidential contenders could not be starker,” writes Trump economic advisor Lawrence Kudlow. “Mr. Trump has an economic-recovery-and-prosperity plan. Mrs. Clinton has an austerity-recession plan.”

Read more . . .

__________

My thanks to the editors at the American Thinker.

__________

With the arrival of the autumnal equinox, it’s that time of year again to recommend the quintessential fall film, The Trouble with Harry.

Starring John Forsythe and Shirley MacLaine, Edmund Gwenn and Mildred Natwick, with a young Jerry Mathers, director Alfred Hitchcock set this 1955 classic in a Vermont countryside bursting with a riot of colour.

Part mystery, part romantic comedy, this film is an excellent way to welcome the arrival of autumn — when the air is crisp, the leaves turn, and gilded sunlight throws long shadows, you’re sure to be humming Bernard Hermann’s wonderful score in anticipation.

(Trailer below to whet your interest; once hooked, enjoy this complete YouTube video of The Trouble with Harry.)

Speculation in light of Catholic Social Teaching

To-day the Institute of Economic Affairs posted my essay ‘Pope Francis should praise speculators, not spurn them’. Addressing a conference in Rome meeting to discuss the topic of impact investing, the Pope praised its work on behalf of the poor and marginalised, with a not-too-subtle condemnation of investment for self-interest.

Yet from the economic perspective, any legal investment is an investment toward the common good (barring criminal activities), as any successful enterprise will benefit not only the entrepreneur but also provide employment opportunities and make available a new good or service that serves a public need. At the same time, the increase in wealth makes additional charitable-giving possible. Asking the State to intervene in the investment process will only set up new bureaucratic obstacles, leading to economic decisions that are not motivated by the efficiency of free consumer-choice but by the wastefulness of political agendas.

__________

#DMI_Reads Update — Here is a list of current reading for the month of June:

• Dwight R. Lee and Richard B. McKenzie, Failure and Progress: The Bright Side of the Dismal Science (Washington, DC: Cato Institute, 1993) [insightful analysis that economic growth also entails failure as innovation and competition jostle in the marketplace; fortunately, though, the failure of some usually means better opportunities for all]; and
• S.C. Littlechild, The Fallacy of the Mixed Economy: An ‘Austrian’ Critique of Recent Economic Thinking and Policy, 2^nd ed. (London: Institute of Economic Affairs, 2009 [1986]) [a lovely account of Austrian economic principles in relation to classical economic theory and planned economies, particularly in relation to the early years of the Thatcher ministry].

I have also been reading up on scholarly articles, listing them under the category of ‘Journal jottings’. Follow-up comments or suggestions for complementary reading are most welcome.

And to-morrow, enjoy a peaceful Dominion Day!