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Do We Need To ‘Rebuild The Military’? – Article by Ron Paul

Do We Need To ‘Rebuild The Military’? – Article by Ron Paul

The New Renaissance HatRon Paul
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The Republican presidential debates have become so heated and filled with insults, it almost seems we are watching a pro wrestling match. There is no civility, and I wonder whether the candidates are about to come to blows. But despite what appears to be total disagreement among them, there is one area where they all agree. They all promise that if elected they will “rebuild the military.”

What does “rebuild the military” mean? Has the budget been gutted? Have the useless weapons programs like the F-35 finally been shut down? No, the United States still spends more on its military than the next 14 countries combined. And the official military budget is only part of the story. The total spending on the US empire is well over one trillion dollars per year. Under the Obama Administration the military budget is still 41 percent more than it was in 2001, and seven percent higher than at the peak of the Cold War.

Russia, which the neocons claim is the greatest threat to the United States, spends about one-tenth what we do on its military. China, the other “greatest threat,” has a military budget less than 25 percent of ours.

Last week the Pentagon announced it is sending a small naval force of US warships to the South China Sea because, as Commander of the US Pacific Command Adm. Harry Harris told the House Armed Services Committee, China is militarizing the area. Yes, China is supposedly militarizing the area around China, so the US is justified in sending its own military to the area. Is that a wise use of the US military?

The US military maintains over 900 bases in 130 countries. It is actively involved in at least seven wars right now, including in Iraq, Syria, Pakistan, and elsewhere. US Special Forces are deployed in 134 countries across the globe. Does that sound like a military that has been gutted?

I do not agree with the presidential candidates, but I do agree that the military needs to be rebuilt. I would rebuild it in a very different way, however. I would not rebuild it according to the demands of the military-industrial complex, which cares far more about getting rich than about protecting our country. I would not rebuild the military so that it can overthrow more foreign governments who refuse to do the bidding of Washington’s neocons. I would not rebuild the military so that it can better protect our wealthy allies in Europe, NATO, Japan, and South Korea. I would not rebuild the military so that it can better occupy countries overseas and help create conditions for blowback here at home.

No. The best way to really “rebuild” the US military would be to stop abusing the military in the first place. The purpose of the US military is to defend the United States. It is not to make the world safe for oil pipelines, or corrupt Gulf monarchies, or NATO, or Israel. Unlike the neocons who are so eager to send our troops to war, I have actually served in the US military. I understand that to keep our military strong we must constrain our foreign policy. We must adopt a policy of non-intervention and a strong defense of this country. The neocons will weaken our country and our military by promoting more war. We need to “rebuild” the military by restoring as its mission the defense of the United States, not of Washington’s overseas empire.

Ron Paul, MD, is a former three-time Republican candidate for U. S. President and Congressman from Texas.

This article is reprinted with permission from the Ron Paul Institute for Peace and Prosperity.

No, Mr. Trump, Victims of Eminent Domain Do Not “Get a Fortune” – Article by George C. Leef

No, Mr. Trump, Victims of Eminent Domain Do Not “Get a Fortune” – Article by George C. Leef

The New Renaissance HatGeorge C. Leef
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Trump’s huge mistake about eminent domain

During the debate among Republican presidential candidates last month, Jeb Bush hammered Donald Trump on his abuse of eminent domain. But Trump apparently sees nothing wrong in having government officials force people to sell their property.

Trump replied,

Eminent domain is an absolute necessity for a country, for our country. Without it, you wouldn’t have roads, you wouldn’t have hospitals, you wouldn’t have anything. You would have schools, you wouldn’t have bridges.

And what a lot of people don’t know because they were all saying, oh, you’re going to take their property. When somebody — when eminent domain is used on somebody’s property, that person gets a fortune. They at least get fair market value, and if they’re smart, they’ll get two or three times the value of their property.

This last assertion led George Mason law professor Ilya Somin (an expert on eminent domain) to quip at the Volokh Conspiracy, “If eminent domain really were a good way to make a fortune, the Donald Trumps of the world would be lobbying the government to condemn their property. But that rarely, if ever, happens.”

Put aside Trump’s hyperbole about the supposed impossibility of schools, hospitals, and bridges without eminent domain. What I want to focus on is his claim that eminent domain is not objectionable because people who have their property taken make out just fine financially.

That claim is simply indefensible. The truth is that people who lose their property to eminent domain proceedings are almost never made whole.

Legal scholars have for many years been writing about the injustice that usually befalls people who have to settle for what the government deems “just compensation” under the Fifth Amendment. I wouldn’t expect Mr. Trump to know about that because he is too busy making deals. But the kind of deals businessmen usually make involve two parties who can say “no,” unless and until they think the deal will improve their positions.

With eminent domain takings, however, the property owner can’t say “no,” and usually must settle for much less than he or she would have bargained for in a voluntary setting.

Professor Gideon Kanner has written extensively about the problem of inadequate compensation for people who’ve been forced to sell under eminent domain. In his article “[Un]Equal Justice under Law: The Invidiously Disparate Treatment of American Property Owners in Taking Cases,” he writes:

The true standard of compensation is not indemnity, but rather fair market value so artfully defined as to exclude factors that sellers and buyers in voluntary transactions would consider, and that the government need only pay for what it acquires, not for what the owner has lost.

Those losses include business goodwill, relocation expenses, and the emotional damage of having to leave a community where one may have strong ties. In the government’s calculus, people are expected to suffer such losses as part of the price of living in America.

As the Supreme Court stated in the 1949 takings case Kimball Laundry v. U.S., “Loss to the owner of non-transferable values … is properly treated as part of the burden of common citizenship.” That “tough luck, property owner” mindset still prevails.

Knowing that they hold the high cards (and ultimately the guns) when they deal with property owners, government officials take full advantage. As Kanner observes, “Condemning agencies regularly reap unjustified windfalls from the fact that the majority of their offers (including the many low-ball ones) are accepted without litigation or even involvement by a private appraiser or lawyer.”

Therefore, eminent domain causes many property owners to suffer uncompensated losses.

Far from “getting a fortune” or “two or three times” the market value of their property, most owners are left substantially worse off for their unwanted encounter with condemning government agencies. Few if any of them shrug off the losses as their part of the “burden of common citizenship.”

Although the eminent domain issue came up during a debate among presidential candidates, there is hardly anything that the president can do to rectify the problem of under-compensation for property owners. He (or she) cannot issue an executive order mandating that property owners be made whole.

If there is to be a solution, it must come from the judiciary.

Judges, and especially the justices of the Supreme Court, will have to stop ruling that merely because an individual is paid an amount deemed “fair market value,” the Fifth Amendment’s requirement of “just compensation” has been satisfied.

It would also help property owners if the Supreme Court would overturn Kelo v. New London and establish that property can only be taken for actual “public use,” as the Fifth Amendment requires, and not for private use that local politicians think might have some “public benefit.”

Since we are going to have confirmation hearings for a new member of the Court eventually, it would be important to find out precisely what the nominee thinks “just compensation” and “public use” actually mean.

George Leef is the former book review editor of The Freeman. He is director of research at the John W. Pope Center for Higher Education Policy.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution 4.0 International License, which requires that credit be given to the author.

Who Won in Iowa? And Why? – Article by Daniel Bier

Who Won in Iowa? And Why? – Article by Daniel Bier

The New Renaissance HatDaniel Bier
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It depends on what was really at stake

On Monday, the political world watched as the early results trickled in from the Iowa caucuses. First, Donald Trump was ahead, then Ted Cruz overtook him, then Marco Rubio started creeping up. In the final count, Cruz won convincingly with 28 percent, Trump came in second with 24 percent, and Rubio took home bronze with 23 percent.

Commentators are scrambling now to read the tea leaves of these results. A lot of the alleged meaning depends on the hopes and expectations people had before. The last (and typically best) Iowa poll, released just two days before the caucuses, had Trump at 28 percent, Cruz at 23 percent, and Rubio at 15 percent.

Trump, it was thought, had run a lazy campaign and had very little grassroots mobilization, so maybe he would get crushed by better organized rivals. And though he did lose to Cruz, and barely beat Rubio, it’s hardly the death blow some hoped. It turns out that at least a quarter of the highly motivated GOP base in Iowa really do like Trump, in spite of his lackadaisical operation, and the polls that show him in the lead aren’t skewed or exaggerated.

Cruz’s triumph, driven by evangelical voters, might seem to bode well for his nomination prospects. Rubio did better than expected, so maybe that means something. Carson, Jeb, and Rand garnered very modest support; the rest of the pack did so poorly they didn’t received any delegates at all, and some are already dropping out.

This week, pollsters will be furiously dialing potential voters. Pundits will be scribbling and shouting, all angling for some unique or authoritative or contrarian perspective on these results.

But there’s one source of information that’s a better predictor of where the wind is blowing than polls, statistical models, or expert forecasts: the market. Specifically, betting markets, where people are forced to put their money where their mouth is.

With hard cash on the line, the incentive to be right is powerful — and, it turns out, pretty effective.

Here’s what the betting odds looked like for most of this endless campaign season. Early on, there’s a lot of uncertainty, but the odds of Trump actually winning the nomination were always consistently low, despite his huge leads in the polls. Bettors didn’t believe voters would really go for him, or that the party insiders would allow him to succeed.

betting-odds-oct-dec

But in the last month, something changed. Maybe it was because the party insiders didn’t seem to be doing anything to stop Trump. Maybe it was because the mainstream never coalesced around a “establishment” candidate. Maybe it was because Trump’s long-predicted crash in the polls never materialized.

Either way, Trump’s odds started steadily improving in January, and Christie, Cruz, and Rubio started slipping. On January 13, at 7:01 AM, Trump took the lead for the first time, and after that, his odds soared. On the day of the Iowa caucuses, bettors put his probability of winning the Republican nomination at over 50 percent.

betting-odds-january

But as the results started trickling in, and it became clear that Cruz would beat Trump, the markets reacted.

In just 90 minutes, Trump’s odds of winning the nomination cratered — falling from over 50 percent to about 25 percent — and Marco Rubio’s soared, from about 30 percent to over 55 percent. As for Cruz’s big win, it barely brought him back to where he stood two weeks ago.

betting-odds-feb

According the markets, Rubio won in Iowa, and Trump lost.

If you’re concerned about the rise of Trump’s fascist, populist demagoguery — its virulent and xenophobic identity politics, economic nationalism, and lawless authoritarianism — this might seem to be good news, of a sort.

But the bad news is that Trump’s loss is probably due in large part to his rival’s embrace of Trumpism. At the Atlantic, Peter Beinart notes that Rubio “surged by borrowing Trump’s message while pledging to more effectively package it.”

In the final weeks before Iowa, Rubio grew markedly more anti-immigration. Having previously warned against using terrorism as a pretext to restrict legal immigration, the Florida senator in mid-January declared that because of the rise of ISIS, “the entire system of legal immigration must now be reexamined for security first and foremost.”

He also followed Trump’s lead on trade, suggesting that he might oppose the Trans-Pacific Partnership agreement he had once praised.

Rubio echoed Trump when it came to the rights of Muslims, too. Asked in a January debate about Trump’s call for banning Muslim immigration, Rubio praised the billionaire for having “tapped in to some of that anger that’s out there about this whole issue because this president has consistently underestimated the threat of ISIS.” … The listener who didn’t already know Rubio’s position might well have thought he supports Trump’s plan.

When asked about Trump’s call for closing mosques, Rubio did Trump one better, declaring that, “It’s not about closing down mosques. It’s about closing down any place — whether it’s a cafe, a diner, an Internet site — any place where radicals are being inspired.”

… Having once pitched himself as a bridge between the GOP and the changing face of twenty-first century America, Rubio instead began appealing to “all of us who feel out of place in our own country.”

Here is the moderateestablishment candidate calling the whole system of legal immigration into question, attacking foreign trade, fear-mongering about religious minorities, calling to shut down and censor the Internet, and blowing tribalist dog whistles.

Of course, Rubio isn’t Trump: he’s a politician. If he captures the nomination, he’ll try to pivot from identity politics and emphasize his “moderate” credentials. He’s still an establishment figure, with the credibility of being sophisticated, eloquent, and (above all) “electable” — everything Trump isn’t.

But this is the larger problem. Trump has convinced the establishment that they need to embrace his priorities and methods in order to maintain control. Worse, he might be right. This may be the most troubling development in the whole Trump saga, and not just because the establishment won’t flatly repudiate a man conjuring up religious tests, concentration camps, and mass deportation.

By rallying long-suppressed nationalist factions, Trump has shifted the margins of acceptable debate more than any other political figure in recent memory. “Trump has redefined what “moderate” means,” Beinart argues.

In 2008 and 2012, Mitt Romney and John McCain never had to praise a rival for suggesting a religious litmus test for entering the country. During their presidential bids, Romney and McCain both shifted right on illegal immigration. But they didn’t backpedal on their support for legal immigration.

Trump probably couldn’t win the general election, and if he did, he couldn’t institute his agenda effectively without the network of interest groups that make policy happen. That’s what makes him so dangerous: he’s unconstrained by the traditional network of interests, compromises, and pressures of the status quo — nobody has any idea what he might try to do.

But that’s also what makes his candidacy a long shot. The more established candidates might very well win and effectively implement their agenda — pushing the bounds of executive power that Bush and Obama softened into playdough — without triggering an open constitutional or political crisis. Their embrace of Trump’s agenda is a troubling sign both of how the political landscape has shifted and what might now come from even a “moderate” presidency.

The ballots say Cruz won. The markets say it was Rubio. But, in time, we may find that it was Trump after all.

Daniel Bier is the editor of Anything Peaceful. He writes on issues relating to science, civil liberties, and economic freedom.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution 4.0 International License, which requires that credit be given to the author.

The Conservative Meltdown, Courtesy of Trump – Article by Jeffrey A. Tucker

The Conservative Meltdown, Courtesy of Trump – Article by Jeffrey A. Tucker

The New Renaissance HatJeffrey A. Tucker
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Trumpflag2For 60 years, the conservative establishment has worked to overcome the biggest leftist lie of them all: that non-leftists are really Nazis in disguise. To wreck that view, conservatism reinvented itself after World War II.

William Buckley, editor of National Review, led the way. He purged the hard racists, dedicated segregationists, the Falangists, the anti-semites, the crypto-Nazis, the theocrats and ecclesiocrats, and the wildly paranoid conspiracy mongers.

Buckley was the one to do it too, because he was erudite and educated, with a subtle sense of things. It was a massive effort in social and political control, and it mostly worked. The culminating victory came with the election of Ronald Reagan.

So sensitive was Buckley to the charge of Nazi sympathies that he lost his composure completely, on live television, when in 1968 Gore Vidal charged him with being a crypto-Nazi. It was enough to cause Buckley, again on live television, to threaten Vidal with a punch in the face.

And Buckley never stopped the purges even through the 2000s. To be in the Buckley circle, you had to be housebroken. You had to avoid the fever swamps.

Many of these purges were wholly justified, but there was also collateral damage. He also purged the libertarians and the Randians too, for different reasons. Libertarians weren’t on board with the Cold War, so that was enough for him. As for Rand, perhaps it was the atheism above all else, since by this time, a firm defense of religious faith had become essential to the package of this new thing called conservatism.

If Buckley was so worried about the impression that the only alternative to leftism was Nazism, he might have cooled it a bit on suggesting nuclear war against the North Vietnamese and the Russians. If a distinguishing mark of Nazism is the use of mass violence to serve political ends, an ideological change would have been more effective than purges in countering the smears against the right. He might also have shown less affection for police-state tactics against antiwar protestors. After all, these smears from the left have the whiff of credibility for a reason.

And now in 2015 enters Donald Trump. He is not a marginal candidate. His rise and persistent dominance of the Republican field has establishment conservatives panicked, simply because it’s proof that their ideology is not dominant among GOP voters. Every demographic analysis of his supporters shows that they do not get their news from magazines or the internet. These people (middle age, middle income, white) are TV watchers and mostly haven’t been to college. What the intelligentsia says doesn’t impact their lives at all.

And yet their voices have a plurality in the Republican party. We haven’t heard from them that much in recent years because they’ve not had a standard bearer and the establishment has exercised such tight control. Now with Trump, we have the perfect storm: a person who is the caricature of the ugly American. He pushes patriotism to the point of nativism, energy in the executive to the point of fascism, police power as a solution without limits, and military strength to the point of outright worship of war as the only suitable means.

The latent statism of the right reaches its apotheosis in Trump, and it is driving the conservative establishment crazy. He is the painting in the attic, and they want it to remain hidden.

As for populism generally, both conservatives and libertarians have variously toyed with it in the past. Surely the people want liberty. Surely the only real problem is the ruling class and its power. If the people get their way, through an assertive wresting of control from the elites, the result would be a freer America. The real problem traces to the people controlling the party, not the voters as such.

But look at what’s happening. The establishment is losing control, but the result is not a movement that favors freedom but something more like the right-wing version of the Red Guard. The Trump movement is unleashing unguided hate: it was Mexicans, then Syrians, then all Muslims, and now he can stand in front of audiences ridiculing free speech and elicit cheers from the frothing masses.

H.L. Mencken is making much more sense to me today. This is a change for me. I’ve always appreciated Mencken’s love of freedom, his suspicion of the state, his appreciation for high culture, his disdain for the age-old superstitions. All that I could grasp and share. What I could not entirely share was his dread of the common man, and his absolute loathing of the political system that puts the hoi polloi in charge of choosing political leadership. He found the system preposterous.

I’ve always understood the intellectual arguments against democracy and agreed more or less. But I could never muster Mencken’s passion concerning the topic. I’ve never fully understood his intense conviction that democracy is the single biggest threat to liberty.

Trump has changed all that. Now I see it fully. The common man is gold as a consumer, worker, family member, church goer. As a voter and political influencer, the common man is a disaster waiting to happen.

What effect does this have on conservative ideology? It makes the job of seeming intelligent and responsible ever more difficult. If I were a leftist, I would be laughing out loud at all these upheavals. Trump as the only alternative to Sanders/Hillary is not a world I want to inhabit.

My prediction is this. Whether or not Trump snags the nomination, his dominance of the polls in 2015 has given the biggest boost the left has received in half a century. It also calls on conservatives to clean up their act: get more libertarian or prepare for the full Trumpization of your movement.

Read more:
Trumpism: The Ideology
Why We Should Talk About Fascism
The Eff Word Goes Mainstream
Has Donald Trump Unleashed the Neo-Nazis?
How Carly Fiorina and a Boring Debate Took Out Trump
The Rand Paul Campaign: A Retrospective

The featured image was taken by Michael Vadon (CC BY-SA 2.0 — photoshopped).

Jeffrey Tucker is Chief Liberty Officer of Liberty.me (http://liberty.me/join), a subscription-based, action-focused social and publishing platform for the liberty-minded. He is also distinguished fellow of the Foundation for Economic Education (http://fee.org), executive editor of Laissez-Faire Books, research fellow of the Acton Institute, founder of the CryptoCurrency Conference, and author of six books. He is available for speaking and interviews via tucker@liberty.me.

Bernie Is Wrong: Trade Is Awesome for the Poor and for America – Article by Corey Iacono

Bernie Is Wrong: Trade Is Awesome for the Poor and for America – Article by Corey Iacono

The New Renaissance HatCorey Iacono
August 28, 2015

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The socialist senator is totally wrong about free trade

Sen. Bernie Sanders, the Democratic presidential hopeful, is no fan of free trade. In an interview with Vox, Sanders’ made his anti-trade position clear: “Unfettered free trade has been a disaster for the American people.”

He also noted that he voted against all the free trade agreements that were proposed during his time in Congress and that if elected President he would “radically transform trade policies” in favor of protectionism.

Sanders and his ilk accuse their intellectual opponents of promoting “trickle-down economics,” but that is precisely what he is advocating when it comes to trade. The argument for protectionism ultimately relies on the belief that protecting domestic corporations from foreign competition and keeping consumer prices high will somehow benefit society as whole.

However, the real effect of protectionism is to increase monopoly and consequently reduce overall economic welfare. In fact, according to a paper by economists at the Federal Reserve Bank of Minneapolis, “Government policies…such as tariffs and other forms of protection are an important source of monopoly” that lead to “significant welfare losses.”

In contrast to Sanders’ assertion that the expansion of free trade has been a disaster for the American people, there is a near unanimous consensus among economists that the opposite is true.

An IGM Poll of dozens of the most renowned academic economists found that, weighted for each respondent’s confidence in their answer, 96 percent of economists agreed, “Freer trade improves productive efficiency and offers consumers better choices, and in the long run these gains are much larger than any effects on employment.”

When the vast majority of economists of all sorts of ideological stripes agree that free trade is a good thing, maybe, just maybe, they’re onto something.

In fact, they surely are. Using four different methods, economists at the Petersen Institute for International Economics estimated the economic benefits from the expansion of technology that facilitates international trade (such as container ships), as well as the removal of government-imposed barriers to international trade (such as tariffs). Since the end of World War II, they generated “an increase in US income of roughly $1 trillion a year,” which translates into an increase in “annual income of about $10,000 per household.”

This result is mostly driven by the fact that foreign businesses produce many goods which are used in the production process at a lower cost than their domestic competitors. Access to these low-cost foreign inputs allows American businesses to decrease their production costs and consequently increase their total output, making the nation as a whole much wealthier than it otherwise would have been.

Moreover, contrary to common conjecture, the benefits of international trade haven’t simply accrued to the wealthy alone. Low and middle income individuals tend to spend a greater share of their income on cheap imported consumer goods than those with higher incomes. As a result, international trade tends to benefit these income groups more so than the wealthy.

Corey Iacono Sanders ArticleIndeed, according to the President’s Council of Economic Advisers, middle income consumers have about 29 percent greater purchasing power as a result of international trade.

In other words, middle income consumers can buy 29 percent more goods and services as a result of the access to low-cost imports from foreign countries.

Low income consumers see even greater gains with 62 percent higher purchasing power as a result of trade. In contrast, the top 10 percent of income earners only saw an increase in purchasing power of 3 percent as a result of trade.

On top of that, international trade has provided benefits by bringing new and innovative products to American consumers.

According seminal research by Christian Broda of the University of Chicago and David E. Weinstein of Colombia University, the variety of imported goods increased three-fold from 1972 to 2001. The value to American consumers of this import induced expanded product variety is estimated to be equivalent to 2.6 percent of national income, about $450 billion as of 2014. That’s not exactly small change.

The spread of free trade has also made considerable contributions to environmental protection, gender equality, and global poverty reduction. As a result of the spread of clean technology facilitated by freer trade, “every 1 percent increase in income as a result of trade liberalization (the removal of government-imposed barriers to trade), pollution concentrations fall by 1 percent,” according to the Council of Economic Advisers.

The CEA also has found that “industries with larger tariff declines saw greater reductions in the [gender] wage gap,” suggesting that facilitating foreign competition through trade liberalization reduces the ability of employers to discriminate against women.

In regards to global poverty reduction, research has shown that in response to US import tariff cuts, developing countries, such as Vietnam, export more to the US, leading to higher incomes and less poverty.

Despite the large gains from trade America has already reaped, there is still room for improvement (contrary to Sen. Sanders’ accusations of “unfettered” free trade). The PIIE economists estimate that further trade liberalization would increase “US household income between $4,000 and $5,300 annually,” leading the them to conclude that, “in the future as in the past, free trade can significantly raise income — and quality of life — in the United States.”

Ultimately, the conclusion that most economists seem to reach is that, from being a disaster, the expansion of free trade has been a tremendous success, and that further trade liberalization would most likely make Americans, and the rest of the world, considerably better off.

Don’t let fear-mongering about foreigners and China scare you: free trade benefits everyone, especially the poor, while protectionism benefits only the politically powerful.

Corey Iacono is a student at the University of Rhode Island majoring in pharmaceutical science and minoring in economics. 

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution 4.0 International License, which requires that credit be given to the author.

Why the Candidates Keep Giving Us Reasons to Use the “F” Word – The Electoral Clown Car Is Full of Nationalistic Socialists – Article by Steven Horwitz

Why the Candidates Keep Giving Us Reasons to Use the “F” Word – The Electoral Clown Car Is Full of Nationalistic Socialists – Article by Steven Horwitz

The New Renaissance HatSteven Horwitz
August 6, 2015
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“There are far too many candidates,” writes Dana Milbank at the Washington Post. “And to gain attention they are juggling, tooting horns and blowing slide whistles like so many painted performers emerging from a clown car.” The two clowns making the most noise in recent weeks are Bernie Sanders and Donald Trump.

At first glance, it would seem they couldn’t be more different: a Democrat and a Republican, a friend of the unions and a CEO, a man of relatively modest means by congressional standards and one of the wealthiest men in the United States. But a closer look reveals some interesting similarities and teaches us an important lesson about the history of ideas. What Sanders and Trump have in common is no laughing matter.

Recent articles by libertarians on both candidates have suggested that they are both strongly nationalist. Dan Bier tore apart Sanders for his views on immigration, and both Jeff Tucker and Jason Kuznicki have associated Trump with nationalism and perhaps even a variant of fascism. I think they are all on to something: Sanders and Trump have a lot more in common than many think. But before I get there, we need to take a detour into the history of socialism and fascism.

In its original conception, Marxian socialism was strongly internationalist. Marx’s theory was based on the idea of class struggle and the disparity in power between those who owned the means of production (the capitalists) and those who did not (the proletariat).

Marxism has nothing to do with nationality. It’s all about class, defined as whether or not one owns capital. For true Marxists, a German worker has much more in common with a Russian worker or an Italian worker than he or she does with a German capitalist. Marxism did not give any importance to national borders.

For many in the early 20th century, this was a problem with Marxism, especially in the aftermath of World War I. Much like today, people were looking for a “third way” between capitalism and socialism. For many of those people, that third way was fascism.

Today we use the word fascism as an epithet, especially for bossy people. We associate it with dictatorships, and especially with Nazism. It turns out that fascism was a fairly well-worked-out theory of how to organize a society, and in its original form was not about racism or anti-Semitism directly. Fascism was an attempt to combine what people saw as the best parts of capitalism and socialism, and then to do so in the context of putting nationality before class.

The most extensive writing about how fascism would work came from the Italians in the 1920s and 1930s, and interested readers should find a copy of Luigi Villari’s The Economics of Fascism to see the details. (You can find a nice summary of those ideas in Sheldon Richman’s entry on fascism in the online Concise Encyclopedia of Economics.)

The fascists argued that the whole notion of class conflict was the problem. Instead of pitting class against class and tearing nations apart, why not bring all the parties together and give them the chance to cooperate with each other rather than struggle their way to socialism? The fascist economy was built around a series of cartels where the state, the nominal owners of the means of production, and the workers (represented by labor unions) would get together and figure out what to produce, how to produce it, what to charge, and how much profit would be “allowed.”

The fascists agreed with socialism’s desire not to leave markets to spontaneous ordering forces, but they thought the nation-state should direct the economy, not the workers. Both capitalism and socialism involved conflict, not cooperation. The same third-way thinking, and some of the same structures, were present in the first two years of the New Deal in the United States. The cartels of the National Recovery Administration were modeled after Italian fascism, and FDR and Mussolini were mutual admirers.

You can see how fascism took elements of both capitalism and socialism, then added nationalism. The idea was to look out for the welfare of the nation-state first. The Italian capitalist and the Italian worker were both Italians first and foremost, and that should be the first call on their allegiance. Lashing socialism to the glorification of the nation-state gives us fascism, and you can see why anyone who represented a threat to national identity would quickly become a problem.

This is one reason why the German version of fascism so easily linked up with a long history of German anti-Semitism. The Nazis were undoubtedly socialist (recall that Nazi is short for National Socialist German Workers Party), as even a quick glance at their 1920 platform will tell you. They were also, even at that date, fiercely nationalist. In Hitler’s hands, that national pride quickly became a desire to glorify the Aryan race.

Plus, recall that Jews were disproportionately both capitalists and supporters of the Marxist revolution in Russia — not to mention the symbol of the cosmopolitan, rootless nomad for centuries. Many of those who wanted to reject both capitalism and Marxian socialism saw the Jews as the symbol of both.

So what does this have to do with Bernie Sanders and Donald Trump?

I would argue that they are both “nationalist socialists.” That is, they both embody key elements of fascism. They both think the nation comes first, and they both think the United States is an organization (not a spontaneous order) that should be under someone’s control.

The difference is that Sanders sees both the problems and the solutions from the workers’ perspective, so he’s focusing on both the exploitation by capitalists and keeping immigrants out to protect the wages of US workers. The losses to US workers matter more than the large gains to foreign-born workers coming here.

Trump sees all of this from the CEO/owner/capitalist perspective. He thinks the United States is, or should be, like a big firm where we all work together for a common goal. He envisions himself as the CEO, negotiating deals with other countries as if they, too, were just big corporate firms. But nations are not firms — they are spontaneous orders.

As I argued in an earlier column, “Socialism Is War and War Is Socialism,” this desire to turn spontaneous orders into hierarchies is characteristic of both war and socialism. It is also deeply embedded in fascism, and Sanders and Trump exemplify that tendency among the presidential candidates, though they do so with different emphases and rhetoric.

Their commonalities are also why our conventional binary left-right political spectrum makes no sense. That one candidate is perceived as far to the left and the other as (to some degree) a right-wing capitalist shows the depth of our failure to understand history. They have both rejected the spontaneous order of the market as well as the cosmopolitanism of liberalism and socialism. They are fascist brothers under the skin.

That both are getting the attention and support of so many Americans should be a matter of grave concern. After all, some clowns are far more scary than funny.

Steven Horwitz is the Charles A. Dana Professor of Economics at St. Lawrence University and the author of Microfoundations and Macroeconomics: An Austrian Perspective, now in paperback.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution 4.0 International License, which requires that credit be given to the author.