Tag: Trump tariff

Bill Weld Announces 2020 Presidential Run

John Keller | @keller4liberty

Former Governor of Massachusetts Bill Weld announced today he is running for president against Donald Trump, hoping to secure the Republican nomination.

Continue reading “Bill Weld Announces 2020 Presidential Run”

Advertisements

Trump’s Tariffs: A Tax on Us

Nickolas Roberson | United States

A newly published report by the Tax Foundation on the 5th of December has found that the Trump administration’s recently imposed tariffs on aluminum, steel, solar panels, and a plethora of other industrial goods from China will increase taxation on Americans by $42 billion.

A tariff, as defined by the said report, is “a type of excise tax that is levied on goods produced abroad at the time of import.” Their intent is to “increase consumption of goods manufactured at home by increasing the price of foreign-produced goods.” This pricing of foreign goods is artificially increased, as the government is taxing its citizens for purchasing and consuming products. Things affected are foods, such as bananas or rice, personal goods, such as televisions or furniture, or commercial goods that could be tractors, cars, airplanes, etc. Why? The governments of our world state that their intentions are to protect their domestic industries from the competition and “vices” of foreign businesses and companies. In reality, tariffs are further methods for big brother to increase his control over us, regulating our methods of voluntary exchange, what goods we trade, and by taking away our money in the form of extended taxation.

Regarding the Trump administration’s tariffs specifically, there will be a 25 percent tariff on imported steel ($7.3 billion tax increase), a 10 percent tariff on imported aluminum ($1.7 billion tax increase), 25 percent tariff on imported goods from China that have a total value of $50 billion ($12.5 billion tax increase), and a 10 percent tariff on $200 billion worth of other imports from China ($20 billion tax increase). Thus, as reported by the Tax Foundation, the overall tax increase will be near $42 billion on American citizens. Additionally, the administration threatened to implement another $129 billion worth of tariffs on more Chinese products and merchandise.

When analyzing the economic impacts of the President’s current protectionist tariffs, the Tax Foundation found that they would “reduce long-run GDP by 0.12 percent ($30.4 billion) and wages by 0.08 percent and eliminate 94,300 full-time equivalent jobs.” If the proposed tariffs are implemented as well, “long-run GDP would fall by 0.38 percent ($94.4 billion) and wages by 0.24 percent, and 292,600 full-time equivalent jobs would be eliminated.” It should be reiterated that tariffs are artificially increased prices of imported products and services by the government to discourage consumers from purchasing them. It is truly a form of taxation. No Chinese business or manufacturer is paying this tax, as the Trump administration continues to attempt to debate and establish.

Now, what are the origins of tariffs? For centuries, European nations practiced a trading system dubbed mercantilism, which attempted to prevent goods and services from leaving a home country, preventing trade value from leaving the said country. Incredibly high tariffs and other trade barriers were put into place, leading to high costs for manufactured goods and multiple trade wars throughout the world. However, in 1776, an economist named Adam Smith published his work titled Wealth of Nations.

This magnum opus regarding economics questioned the systems of mercantilism and proposed the idea of free trade: an economic theory that promoted competition between businesses and individuals across a global scale, voluntary trade without regulations such as tariffs, and no discrimination against imports or exports. As this new idea spread across the globe, nations and its citizens experienced a rapid flow of commerce, development of economies, and increases in productivity and innovation. The practice of the aforementioned theory was so successful. Organizations such as the World Trade Organization, NAFTA, and the European Union were developed to continue to promote its benefits to the human race.

Unfortunately, President Donald Trump and his administration seem to be ignoring this history of free trade and its plethora of benefits. With their tariffs, both current and proposed, competition will be stifled in the economy of the United States, resulting in higher prices for goods and services; jobs will be lost, GDP will fall, and the overall economy could possibly become a bear market. The next question that must be asked: will these tariffs counteract the benefits of Trump’s deregulation plan, with it increasing the economic freedom and reducing the regulatory costs of the nation? Furthermore, when will this expansion of government end? When will big brother stop raping and pillaging people for their capital and assets to pay off its own enormous debt? Only time will be able to answer this question, but one thing is obvious to the naked eye: the future of the United States of America is a foggy and obscure one.


71 Republic is the Third Voice in media. We pride ourselves on distinctively independent journalism and editorials. Every dollar you give helps us grow our mission of providing reliable coverage. Please consider donating to our Patreon, which you can find here. Thank you very much for your support!

Featured Image Source

Trump’s Treason

By Craig Axford | United States

Treason is a word that will send many rushing to Google to look up the legal definition of the term. But excessive legalism can get in the way of describing certain actions accurately. Synonyms include betrayal and faithlessness, both of which can easily apply whether or not a prosecutor feels confident of being able to clear the high bar we rightly set to convict people of such serious crimes within a court of law.

When our presidents and other politicians raise their right hand and take an oath to uphold and defend the Constitution of the United States, we are not insisting upon a particular partisan or ideological interpretation of that document. Nor should we expect everyone to agree that our leaders are always interpreting it correctly. However, we are, or at least should be, demanding that they take the Constitution seriously.

The evidence that Donald Trump has never taken this responsibility remotely to heart is now so abundant that it requires a complete disregard for reason, regular recourse to conspiracy theories, and assertions of “fake news” on the part of his defenders to justify his actions. It’s tempting to end this article right here with the words enough said, and publish it. But if one is committed to making a serious case for treason that simply will not do.

To begin down that road let’s consider the by now well-established fact, which even the White House makes no serious attempt to deny, that Donald Trump insists upon only short bullet-pointed briefing papers. That even these cursory shallow analyses of what’s going on domestically and globally are not discussed at length, let alone absorbed, could be dismissed on the grounds Trump is merely too stupid to truly understand the nuances and history behind the information being presented to him. If this were, in fact, the case, his removal from office could simply be justified on the grounds he is incapable of carrying out the job.

But stupidity provides us with a reason to pity the president, not accuse him of betrayal. A lack of intelligence would still leave open the possibility that Donald Trump is a man who cares but is merely in over his head. To at least some degree this version of reality could easily be mitigated if Trump surrounded himself with people of greater intelligence and expertise who could educate and advise him. This would, of course, require a certain humility and willingness to listen. Even someone of incredibly average intelligence could and likely would if they somehow found themselves burdened with the responsibility of leading the United States, find considerable relief through delegation and deferral to smarter well-intentioned men and women possessing more familiarity with the workings of government.

Whatever Trump’s level of intelligence, humble and willing to listen he is not. President Trump has made explicit his attitude toward experts and general lack of interest in books or lengthy reports. A Washington Post article about his reading habits published shortly before he received his party’s nomination put his view of the written word this way:

He said in a series of interviews that he does not need to read extensively because he reaches the right decisions “with very little knowledge other than the knowledge I [already] had, plus the words ‘common sense,’ because I have a lot of common sense and I have a lot of business ability.”

Of course, not being an avid reader, or really much of a reader at all does not rise to the level of treason. It doesn’t even necessarily make you unqualified to be president. As the Washington Post article also points out, Trump wouldn’t be the first president that preferred short documents or to receive their information orally. But, as the historian Alan Lichtman pointed out, “Trump is really something of an outlier with this idea that knowing things is almost a distraction. He doesn’t have a historical anchor, so you see his gut changing on issues from moment to moment.”

The glee Donald Trump takes in his lack of curiosity is disconcerting in a citizen, but negligent in a country’s chief executive. For example, to willfully resist detailed briefings, preparation, or advice in any form in advance of a summit either with allies or adversaries rises to a level of irresponsibility that transcends merely being uninformed or apathetic. It is at this point that the oath taken on Inauguration Day to “faithfully execute the office of President of the United States, and will to the best of my ability, preserve, protect, and defend the Constitution of the United States” (emphasis added) becomes central to the claim that treason is the word that best describes the president’s attitude.

This isn’t a debate about learning styles. If charts, graphs, and pictures enable a president to absorb information better than lengthy briefing books, or if a president prefers to surround him/herself with people with diverse opinions and have a debate regarding the pros and cons of all the various policy options and never actually reads a word, we must still concede an effort is being made to receive and consider at least some of the relevant information. This president, however, goes out of his way to avoid even that level of engagement.

But Trump’s approach to acquiring and processing information is only the first plank in the case for treason, and it’s the weakest. To get to the crux of the argument we must confront his approach to the truth.

Every president has gotten caught misspeaking, and at one time or another, it’s safe to say they’ve all given in to the temptation to mislead or engage in spin in order to promote legislation or policy that they support. But as the philosopher Harry Frankfurt points out in his famous essay On Bullshit, “The liar is inescapably concerned with truth-values. In order to invent a lie at all, he must think he knows what is true.”

In other words, though we may disapprove we can still take an odd sort of comfort from a president that is lying to us because he/she must care about the truth and make some effort to learn what it is, or at least what he/she believes it to be, in order to create the lie. In addition, a president and his/her staff will typically attempt to justify the lie, if only to themselves, on national security or greater good grounds. Whether the justification they come up with is right or wrong can be left to history to decide, but there is usually at least some concern at that moment with how the lie might be morally evaluated should it be revealed. So a liar, whether they are president or not, is concerned with the truth and with morality, even if only for the purpose of better covering his/her own ass. A liar has an agenda and has rationalized that agenda as an end that justifies the means.

None of this is true of the bullshitter. Harry Frankfurt argues that what differentiates the liar from the bullshitter is what each is attempting to deceive us about:

This is the crux of the distinction between him [the bullshitter] and the liar. Both he and the liar represent themselves falsely as endeavoring to communicate the truth. The success of each depends upon deceiving us about that. But the fact about himself that the liar hides is that he is attempting to lead us away from a correct apprehension of reality; we are not to know that he wants us to believe something he supposes to be false. The fact about himself that the bullshitter hides, on the other hand, is that the truth-values of his statements are of no central interest to him; what we are not to understand is that his intention is neither to report the truth nor conceal it. This does not mean that his speech is anarchically impulsive, but that the motive guiding and controlling it is unconcerned with how the things about which he speaks truly are. (Emphasis in bold added)

Not all presidential lies represent treason, but the pervasive shoveling of presidential bullshit always does. That’s because bullshit represents something worse than a lie: it represents a complete lack of concern for what is actually true. When our leaders take their oath of office, they commit themselves to hold a certain minimum level of regard for the truth. They cannot “faithfully execute” their offices without it. National security concerns, or even just political maneuvering to win a vote, might possibly explain or justify a lie. But nothing can justify a complete disregard for what the truth is when you’ve sworn to defend the values enshrined in your country’s primary legal document. A leader can be forgiven for not understanding or finding the truth, but not for adopting a posture of indifference toward it.

Bullshit requires the bullshitter to make a lack of curiosity his/her primary value. If an effort to intentionally undermine the Constitution or give aid and comfort to an enemy constitutes treason, it can hardly be argued that a consistent lack of concern for what the Constitution actually says and total disregard for what might qualify as aid and comfort to any given enemy isn’t as well, at least in so far as this represents the attitude adopted by a president or other high-ranking government official. The difference is only that the former serves as an example of a specific willful act of betrayal while the latter represents a general ongoing betrayal without regard to circumstance.

Perhaps all Trump’s BS is just a smokescreen. Maybe it’s just intended to distract us from his real criminal or treasonous acts: ones that involve collusion with Russia and/or self-enrichment at the public’s expense. But if Trump’s bullshit is part of a plot to hide something else that’s going on, it’s not really bullshit. At least, not if we’re using Frankfurt’s definition. Using BS to distract us is more reminiscent of a magician drawing our attention away from the real slight of hand taking place elsewhere in order to create the illusion something has vanished into thin air. The magician, like the liar, is aware of what’s really happening and intentionally attempts to trick us into seeing something else.

Trump’s treason is more dangerous than the more familiar betrayal committed to advance an ideology or to get rich. His treason is best described as an embrace of nihilism. It constitutes a complete betrayal of the very idea of truth as well as a total indifference for either the United States in particular or the world generally. It is disruption for its own sake. Authoritarianism is desirable not on ideological grounds, but because it is a means to achieve a world where bullshit can be practiced without checks. To call Donald Trump a fascist is to attribute to him a kind of worldview, which gives him too much credit.

We struggle with how best to resist men like Trump because the vacuousness of it all is outside almost every human’s experience. Few of us can even begin to imagine it is possible for a human mind to float so free not only from what is true but from concern for what is true. A man that can stand there and tell us with a straight face that he is the only Republican to win Wisconsin in more than 70 years is perhaps ignorant of the truth or perhaps a liar. But a man that can do it over and over again in spite of being repeatedly corrected in the media is simply reminding us that his power lies in his capacity to ignore reality entirely.

Donald Trump does not merely baffle us with his bullshit. He mesmerizes us with it. The claim that his Inauguration Day crowds were the largest ever isn’t about promoting a lie. It’s about demonstrating to us how he can look at the exact same pictures as everyone else and without hesitation, shame, or probably even much extra mental effort claim to see people that aren’t even there. Immediately people begin to diagnose and to rationalize as if he cared whether or not he was suffering from a narcissistic personality disorder or some other psychopathology. Take him seriously but not literally. No no, take him literally but not seriously. Before we know it nonsense has become the national language and we have become as unanchored from history and values as the president. As a consequence, the nation itself begins to die.

Debating civility in the face of nihilism on this scale is like debating the proper response to a black hole. The only thing we can do is avoid the event horizon. Because where that is isn’t exactly clear, the best course of action is to steer as far away from it as possible.

Some may argue it is not polite to label such complete disregard for the truth treason. What do we call it then? I’ll happily call it something else provided the word we use communicates with moral clarity the danger living too near the edge for too long poses.

Others argue we do not want to get down into the mud and wrestle with Trump and his supporters. This, they say, will only leave us as dirty as they are. To these people, words like treason will only sully those that utter them while serving to embolden his most ardent supporters.

This kind of thinking is a form of denial. It assumes we have not yet achieved a national volume of mudslinging to get everyone good and dirty, or that cleanliness will be restored to the rest of the country once someone turns on the mid-term or 2020 showers and washes all this filth away with a Democratic victory. Or perhaps people believe that Robert Mueller will be able to wipe us clean using the pages of his eventual report to Congress.

All of that may be necessary but none of it is sufficient. We are facing a challenge not just to our values, but to the very idea of values. This storm will not clear simply by winning an election or impeaching a president. Nihilism never relinquishes until it has been utterly rejected.

America needs a zero-tolerance policy not at its borders but within them. Enlightenment democratic principles rest upon the idea that shared human values are real. They are aspirational, to be sure. As such they are flexible enough to expand to include more people and a greater diversity of thought, but they are not relativistic. The absence of bullshit, particularly in our leaders, is not a luxury. If we are to remain true to our principles it must be seen as a necessity.

Traditionally treason has represented a line that is crossed by the intentional betrayal of one’s country. That’s not a line we should ignore. However, we shouldn’t kid ourselves by thinking there’s nothing beyond it. Donald Trump has shown us there is considerable territory on the other side.

We don’t yet know with certainty whether Trump or members of his campaign engaged in a conspiracy to steal an election, but we do know he has abandoned the very idea of truth and the very notion of values. That’s more than enough to condemn him. Ultimately there can be no treason greater than this within a society committed to human rights and the rule of law. Each additional day we mince our words and dither about the presence of this human moral void in our midst we are one day closer to the event horizon. We cannot risk finding out too late we have already crossed it.


To support 71 Republic, please donate to our Patreon, which you can find here.

Featured Image Source.

Follow Craig on Twitter or read him on 71Republic.com

Other articles you may enjoy:

The Economic Myths Upholding Trump’s Tariffs

By Isaiah Minter | United States

In recent weeks, President Trump has angered a significant portion of his base with his remarks on gun control. Since his calls to raise the gun-buying age to 21 and confiscate guns without due process, Trump, in an attempt to quell the anger of his base, has called for steep tariffs on aluminum and steel.

While I have covered Trump’s ignorance on trade in the past, the following piece will be a more accessible re-edition that deals with his more recent tweets and statements. In addressing such trade statements, I will dispose of many of the economic myths put forward by the Trump team, demonstrating why protectionism and tariffs are not the way forward for promoting American prosperity and global peace. So without further ado, here are the facts.

Trump and Manufacturing

Last Thursday, Trump began his assault on free trade by tweeting about the state of American industries:

Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world. We must not let our country, companies, and workers be taken advantage of any longer. We want free, fair and SMART TRADE!

— Donald J. Trump (@realDonaldTrump) March 1, 2018

Here is why the Donald is wrong.

US manufacturing jobs 2

While it is true that American manufacturing has seen a decline in employment over the decades, manufacturing employment levels mimic those of 1941. Today, some 12.4 Americans work in manufacturing, with less than 150,000 workers employed in steel production. So while American manufacturing employs a smaller portion of the American labor force, there is little reason to suspect it is in danger.

Even with this decline in employment, American manufacturing is thriving. With 1941 employment levels, American manufacturing is producing nearly 50 percent more than 20 years ago. In other words, the manufacturing industry is producing more with a smaller share of workers. Why this is an evil, the Trump trade team never explains.

Similarly, American steel is performing well. In 2016, the steel industry boomed due to an increase in car sales. Last year, U.S. steel production rose by 5%, with U.S. Steel going from a $250 million loss in 2016 to a $341 million profit in 2017. Similarly, Nucor Corporation has seen strong increases in net earnings and value, reporting a net profit increase of 65% over 2016, and a stock price increase of $53 over the last 18 years.

American manufacturing is going through the same trend that American agriculture once endured, and for the same reason: technological advancement.

Image result for american agricultural output and employment

In 1800, 83% of the American labor force was employed in agriculture. By 2008, that figure was less than 2%. And yet, agricultural output is at an all-time high. From robots milking cows to GPS guidance calculating the most energy-efficient way of performing various farm tasks, technology has loosened the burden on the farmer, provided clear environmental benefits, and allowed a growing American population to be fed.

It is true that technology has displaced American workers, just as technology displaced American farmers in the past. But these workers do not remain permanently displaced. On the contrary, we have a social safety net for this very reason. Further, in any dynamic market economy, industries are continuously faced with turmoil to this degree. The agricultural industry endured the storm and is now more productive than ever.

Comparably, the manufacturing industry is already in the storm. One study done by two Ball State University professors found that nearly 87% of the decline in manufacturing employment from 2000 to 2010 resulted from an increase in factory efficiency. No amount of protectionist policy is going to reverse this trend.

In this respect, Trump is not preserving a dying manufacturing industry, for it doesn’t exist. Rather, he is spouting economic ignorance and attempting to stifle a prosperous manufacturing industry.

Trump and Trade Deficits

Shortly after Trump’s tweet on the supposed decline of American manufacturing, he slammed trade deficits in two tweets:

When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!

– Donald J. Trump (@realDonaldTrump) March 2, 2018

The United States has an $800 Billion Dollar Yearly Trade Deficit because of our “very stupid” trade deals and policies. Our jobs and wealth are being given to other countries that have taken advantage of us for years. They laugh at what fools our leaders have been. No more!

– Donald J. Trump (@realDonaldTrump) March 3, 2018

By now, it’s safe to say that Trump doesn’t understand trade at all. A trade deficit occurs when a country imports more goods than it exports. This does not signal any sort of exploitation of American consumers by foreign nations.

In 2015, America had trade deficits of $69 billion with Japan and $366 billion with China. Neither of these nations sits on their American dollars and laugh at the stupidity of American consumers. Rather, they invest it back into the American economy. The simple fact is, with a popular reserve currency, secure assets, and strong markets, America is a successful investment location. America receives nearly $4.4 trillion in foreign investment every year, and yet no one claims we have been hurt by that.

But I want to get to Trump’s central theme, that in order for someone to win in the marketplace another must lose. The notion could not be more disconnected from reality.

As a clear example, Trump has a deficit with his grocery store. He buys more from the grocery store than the grocery store buys from him. I have a deficit with my barber, I buy more from him than he buys from me. Neither scenario implies any exploitation. Trade is no different, it is two parties coming together to engage in a voluntary and reciprocal exchange. Why the latter is frowned upon by the Trump trade team, but not the former, is troubling.

American consumers playing German pianos, driving Japanese cars, and drinking Brazilian coffee do not consider themselves victims of foreign exploitation. It’s time the Trump team followed suit.

Trump and Tariffs

Clearly, Trump has no understanding of the state of American manufacturing, or even how trade operates, whether inside or across borders. It should then not surprise anyone that Trump has no understanding of the effects of tariffs.

The most disastrous tariff in American history, the Smoot-Hawley Tariff of 1930, taxed over 3,000 imported items with a steep increase on 887 of them. The results were destructive: exports dropped by $4.5 billion by 1932, unemployment increased by 16 percent by 1931, and American car sales plummeted by more than 3.5 million by 1932. More than 40 percent of all banks closed, and real income fell by nearly a third. The enactment of retaliatory tariffs by European nations only worsened the problem. For all of Trump’s talk on winning trade wars, it remains unclear how a contraction in American trade and a steep decline in American prosperity can be considered winning.

Smaller tariffs have been pursued in the decades since the Smoot-Hawley Tariff. In 2002, Bush placed an import tax on steel.

With increased steel prices, more workers in steel-consuming industries lost their jobs than the total number of workers in the steel industry.

Similarly, President Obama enacted a tariff on Chinese tires in a quest to promote fair trade. In the end, 1200 jobs were saved at a cost of $1.1 billion, or nearly $1 million per job.

In promoting steel tariffs, Trump never seems to cite any benefit achieved by his 30% tariffs on solar panels. Nor should we expect him to, for the tariffs offered little benefit. SunPower canceled a $20 million investment in an American factory, depriving the American people of hundreds of new jobs. Similarly, one projection estimates that the solar panel tariffs would cancel 23,000 installation jobs and billions of dollars in clean energy investment.

Even outside of hard evidence, Trump’s policy proposal is illogical. With a tariff placed on steel, the price of steel is raised. Since most steel-consuming industries import their raw materials, tariffs serve to increase their costs of manufacturing. In this sense, steel tariffs are likely to kill jobs from the very manufacturing industry that Trump is concerned about.

If the claim is that American industries cannot compete with foreign companies, it makes little sense to pass higher prices onto American consumers and American companies. Higher prices mean less demand, which in turn can lead to smaller profit margins. Combining this with higher manufacturing costs is a recipe for consumer despair and business collapse.

Similarly, it makes little sense to benefit a small group at the expense of a large group. The ratio of Americans employed in steel-consuming industries compared to those in steel-producing industries is forty-five to one. Saving one job at the expense of forty-five, without even factoring in costs to the American taxpayer, is ignorant policy.

Ultimately, Trump doesn’t understand American manufacturing, he doesn’t understand the basics of trade, and he doesn’t understand the effects of the tariffs he is enacting. Stop pardoning his protectionist ignorance because he’s a billionaire businessman that gets things done.

How Tariff Policies Inhibit Man’s Economic Power and Encourage His Political Idiocy

Glenn Verasco | Thailand

I am not going to sugar-coat the stupidity of President Trump’s proposed aluminum and steel tariffs. There is no justification for taxing foreign products that Americans want to buy. It is complete and utter idiocy.

On economic grounds, tariffs cause prices to rise and competition to soften. That means fewer and lower-quality products at an inflated price for all.

On moral grounds, the argument that a steel tariff will save American jobs in the steel-producing industry is quickly squelched by the much larger number of steel-using industries that lose jobs and opportunity. This is not simply a theoretical law of economics either. President George W. Bush placed tariffs on steel imports too. He protected a handful of steel jobs, caused the loss of hundreds of thousands of others, and then wisely repealed the tariffs. This was less than 20 years ago.

(If one is bright enough to understand that tariffs kill more jobs than they create, and still supports tariffs, he is corrupt, and his opinions need not be taken seriously.)

On political grounds, however, tariffs might be brilliant. They stir the masses and often result in short-term gains for a few sympathetic people (like a steel mill in rural America reopening). Protectionism masquerades as Patriotism, claiming to be in the interest of American workers and American industry. And by the time tariffs take their imminent toll, voters have been fed so much propaganda that they are unable to construe the negative effects of tariffs on the overall economy from Wall Street to Main Street. Tariffs secretively punish everyone, and ostentatiously benefit a few.

When it comes to understanding the Global economy or even the American economy, President Trump is a complete moron. But this is nothing to be ashamed of, Mr. President! Obama is a moron on this issue too! So are Gary Johnson, Hillary Clinton, Paul Krugman, Alan Greenspan, Neil Cavuto, every economist who has ever lived, and me! We are all complete morons when it comes to understanding the economy!

This is because the economy is far too complicated for any one person or group of people to even begin to grasp.

As I type this essay, I am looking at scattered items all over my table. There is a glass, a plastic cup, some dental floss, a box cutter, two pairs of scissors, many pens and pencils, a notebook, a remote control for my air conditioner, my iPhone, a calendar, two chargers, a ruler, a stapler, my glasses, a sock, my laptop, a mouse and mouse pad, a platform with a fan that keeps my laptop from overheating, and some tissues.

I don’t know where any of this stuff was made. I don’t know who manufactured it. I don’t know how it was manufactured. I don’t know how it was shipped to wholesalers and retailers. I don’t know who arranged the shipments and wholesale purchases. I don’t know precisely what raw materials these items are made of. I don’t know how or where the raw materials they consist of were harvested. I don’t know what equipment was used to harvest those raw materials. I don’t know how or where or by whom or with what materials the equipment used to harvest or synthesize the materials that were manufactured into the products sitting on my desk was made either!

I only know that I purchased them, where I purchased them, how much I paid for them, and that I use them. And if I run out of one or it breaks or I become dissatisfied with it, I will go out and replace it to the best of my ability (or not if I don’t think it’s necessary).

The great economist Frederick Hayek, in his essay “The Use of Knowledge in Society,” referred to someone like me as “the man on the spot”. Hayek begins by explaining that “If we possess all the relevant information, if we can start out from a given system of preferences, and if we command complete knowledge of available means, the problem which remains is purely one of logic.” This is a general idea that applies to all aspects of life. If it’s 10:00pm on Monday night, and you need to be in Reno by 11:30am on Tuesday, and it takes two hours to fly to Reno, and the red eye is sold out, and there are flights to Reno at 7:00am and 9:00am on Tuesday morning, and the 9:00am flight is out of your price range, you have to take the 7:00am flight. You and I can solve these problems by applying a smidgen of logic to the information at hand.

But when it comes to the world economy, possessing knowledge this concise is impossible for one individual or one group of people no matter how educated or informed they might be. As Hayek says:

The peculiar character of the problem of a rational economic order is determined precisely by the fact that the knowledge of the circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess.

The “dispersed bits of knowledge” are possessed by people like you and me and every other idiot in the world. Hayek calls each one of us with our own unique and specialized collection of data “the man on the spot.” As dumb as we are in comprehending the “economic order,” we are ingenious at making economic decisions in our everyday lives. And it does not take much more than half a brain to be a genius as a man on the spot:

How much knowledge does he [the man on the spot] need to do so [make good economic decisions] successfully? Which of the events which happen beyond the horizon of his immediate knowledge are of relevance to his immediate decision, and how much of them need he know?

There is hardly anything that happens anywhere in the world that might not have an effect on the decision he ought to make. But he need not know of these events as such, nor of all their effects. It does not matter for him why at the particular moment more screws of one size than of another are wanted, why paper bags are more readily available than canvas bags, or why skilled labor, or particular machine tools, have for the moment become more difficult to obtain. All that is significant for him is how much more or less difficult to procure they have become compared with other things with which he is also concerned, or how much more or less urgently wanted are the alternative things he produces or uses. It is always a question of the relative importance of the particular things with which he is concerned, and the causes which alter their relative importance are of no interest to him beyond the effect on those concrete things of his own environment.

If read in bad faith, one might come away with the impression that Hayek is an elitist snob talking down to a bunch of ants in a terrarium. “Those concrete things of his own environment” can come off as condescending. But Hayek is a man on the spot himself, and he knows it. Due to his profession as an economist, he is certainly slightly more informed than many of the other men on the spot around him. But when compared to the inconceivable number of events taking place around the world at all times, that extra information is largely insignificant.

It is often said that there are three kinds of knowledge. There is 1) what you know, 2) what you know that you don’t know, and 3) what you don’t know that you don’t know. You know that the Eagles won the Super Bowl. You know that you don’t know how nuclear power works. But did you know that there is a giant, mongoose-like creature in Madagascar called a fossa that hunts lemurs? See, you didn’t know that you didn’t know that (until I told you).

When Hayek explains that the man on the spot does not know and does not need to be aware of every event that takes place and its effect on the economy, he is not saying that he is the one who actually understands these things. Hayek is just like you! The only thing that makes his knowledge superior is his awareness that many events are taking place around the world that are beyond his knowledge. Hayek does not seek to assert himself as the arbiter of the global economic order. He is simply suggesting that a more humble approach is needed.

And this is where politics spoils everything.

Hayek’s approach to economics is to decentralize as much as possible. This runs counter to the ambitions of governments, bureaucrats, and special interest groups. Governments gain wealth and power by usurping controls of the means of production. Bureaucracies remain in demand only by setting up barriers between the man on the spot and his economic decisions. And special interest groups benefit from undermining their competition via legislative fiat because they can’t compete on an even playing field. All of this is incompatible with allowing the man on the spot to live and choose freely.

Ironically, the ingenious man on the spot is politically retarded, and is thereby encouraged to participate in politics as often as possible. His emotions and his ignorance are manipulated by politicians and activists to best serve their agendas. The man on the spot is told that we must take action, not that we must step aside and live our lives peacefully and reasonably. The unseen impacts of tariffs and rent-seeking are difficult to illustrate and conceptualize while a single steel mill hiring 500 new workers bedazzles and affirms mythical beliefs.

Thomas Sowell once said “the first lesson of economics is scarcity: there is never enough of anything to satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics.” President Trump and his populist base are disregarding all of the evidence and all of the facts. The country they claim to love will suffer as a result. We’ll have to wait and see if it pays of politically. My commitment to voting for the Libertarian candidate is growing stronger by the day.

***

If you enjoyed this post, please follow me at www.howtocureyourliberalism.com. Also check out my podcast on iTunes  and like my Facebook page.

Image Source Flickr