… is from page 22 of Thomas Sowell’s Compassion Versus Guilt, a 1987 collection of some of his popular essays; specifically, it’s from Sowell’s March 1st, 1985, column titled “The Wonderful World of ‘Solutions’”:
Trade-offs are not good enough for the morally anointed. There must be solutions.
Here’s a letter to the Wall Street Journal.
Editor:
David Hebert masterfully exposes several of the errors that infect Peter Navarro’s attempt to defend Trump’s tariffs (Letters, December 24). But because the number of these errors is so large, several more letters are necessary to complete the job.
Another of Mr. Navarro’s errors is his boast that the tariffs are eaten by foreigners (thus causing no price hikes in America) and will spark an increase in U.S. manufacturing activity. This boast is illogical. Tariffs can spark more manufacturing in the U.S. only by causing the prices of manufacturing imports to rise which, in turn, then enable U.S. manufacturers to profitably raise the prices they charge for their outputs. If, as Mr. Navarro asserts, foreigners are eating the tariffs, these same tariffs are driving the excessively low prices that he alleges are now being charged by foreign manufacturers even lower and, thus, doing nothing to incite more American manufacturing.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
Peter Navarro begins his op-ed “Tariffs Are a Discipline, Not a Press Release” (Dec. 22) by knocking down a straw man. No serious economist predicted that the levies would “immediately crash the economy” or “ignite runaway inflation.” We said they’d make Americans poorer by forcing them to pay higher prices or accept inferior substitutes—which is exactly what’s happening.
Mr. Navarro claims victory because we haven’t seen a recession. But his colleague, Commerce Secretary Howard Lutnick, promised in March that the economy would be “humming” by now. Instead, manufacturing employment has declined for nine consecutive months, business optimism is depressed and consumer sentiment nears historic lows.
Notice the pattern: When tariffs don’t deliver the promised renaissance, administration officials push back the timeline. First it was weeks, then months. Now, we need “the right timeline” and must not grade policy “on a news cycle.” This isn’t economic analysis—it’s buying time until the economy improves despite tariffs, at which point the administration will claim victory.
Mr. Navarro says that a slogan, “Who pays the tariff?,” is misleading. The data say otherwise. The Harvard Pricing Lab finds that after six months U.S. consumers are eating 20% of the tariffs on average in the form of higher prices. For President Trump’s first-term tariffs, the pass-through rate stayed under 5% for a full year. Mr. Trump 2.0’s tariffs are hitting us harder and faster, and there’s evidence that this pass-through rate will climb.
Tariffs don’t “discipline” foreign producers. They discipline American families, businesses and workers who must now pay more for less. No amount of rhetorical repackaging will change that.
David Hebert
American Inst. for Economic Research
Millions of American children are looking forward to Santa Claus’s visit and his sleigh full of presents. Timeless tradition? Harmless fun?
Not anymore. The United States has adopted a new philosophy about foreign trade under President Donald Trump, and jolly old St. Nick is desensitizing American kids to the dangers of trade deficits.
Here’s how Claus gains an illicit advantage and creates a trade deficit. Claus is not an American, and he brings his gifts from the North Pole (which is suspiciously close to Canada, a country that threatens U.S. national security). The gifts are produced by elves who don’t have the protections of U.S. labor laws in workshops that aren’t subject to U.S. environmental or safety standards. Claus has stolen jobs from American workers with his industrial policy, which uses Yuletide magic to subsidize the manufacturing and transportation of his exports. This unfair competition allows Claus to flood our country with toys priced lower than anyone else can produce them: $0.
….
Trading relationships are fair only if the exchange of goods is balanced or America has a surplus. Which is to say: Americans must export as much, or more, to foreigners as they export to us. Yet in exchange for all those toys, the only things Americans export to Claus is cookies. The paunchy pillager should at the very least commit to buying a few hundred billion dollars’ worth of American oil and natural gas — or better yet, coal — to take a step toward balanced trade.
That way, every request from a child sitting on his lap at the mall would help create good-paying jobs in the Rust Belt. The white-bearded interloper also uses a foreign-domiciled vessel to make deliveries in the U.S. when he jumps from house to house. Efficient as it may be, Kriss Kringle’s sleigh and reindeer operation denies jobs to the hardworking American truck drivers, train engineers and union dockworkers who would transport the gifts instead.
Higher production and distribution costs might result in fewer toys, but as Trump has said before, girls don’t really need so many dolls anyway. Parents can have a teaching moment when they explain to their kids around the tree that the short-term pain of a less fun Christmas is worth the long-term gain of national sovereignty and a new golden age for manufacturing.
The transition away from the Santa Claus tradition won’t be easy for many families, but the era of outsourcing and trade deficits is over. Young children are too impressionable to risk developing fond sentiments about low-priced goods produced abroad. They might grow up to support free trade.
Here are the Editors of National Review on the MAGA-fueled ruination of the Heritage Foundation.
Eli Lake justly criticizes J.D. Vance for embracing illiberal provocateurs such as Tucker Carlson. A slice:
Vance has aligned himself with the side that wants to keep the MAGA tent as wide as possible. And that means he is on Team Tucker Carlson. On the other side of the party’s civil war are conservatives like Newsweek senior editor Josh Hammer, Fox News host Mark Levin, and [Ben] Shapiro. Shapiro’s speech denounced those inside the MAGA coalition who were too afraid to call out conspiracy theory hokum, lest they offend their very-online audiences. In short, Shapiro is asking the MAGA coalition to enforce its own borders and keep out the kooks, conspiracy theorists, and antisemites.
Vance’s allegiance to Carlson is understandable. Carlson played a major role in persuading Trump to select him as his running mate in 2024. And Vance made clear on Sunday that he will not turn on Tucker, despite having occasional disagreements with him. Vance is the prohibitive favorite to win the 2028 Republican presidential nomination and he is counting on support from Carlson and his audience for the nomination.
Much to the detriment of the common American, increased government regulation and other types of economic intervention have consistently shaped the current US version of free enterprise. Damaging regulations and harmful public-private business relationships are responsible for some of the largest economic problems Americans have faced in the past 50 years.
The debate over the direction of the post-Trump right is underway, and one of the first casualties is the Heritage Foundation. On Monday some of its most important conservative scholars and their policy departments said they are leaving Heritage to join Mike Pence’s policy shop.
Some 15 or more Heritage employees, including the leaders of three prominent policy departments, are jumping to the Advancing American Freedom foundation that the former Vice President established in 2021. The defectors include the leaders of Heritage’s most important policy shops: The Edwin Meese III Center for Legal and Judicial Studies, the Center for Data Analysis, and the Roe Institute for Economic Policy Studies.
The move by John Malcolm and his colleagues at the Meese Center is especially notable. We’re told it is endorsed by Mr. Meese, the Reagan-era Attorney General who is now 94 years old and has been a fixture at Heritage. The Roe Institute is the think tank’s free-market shop—or it was before Heritage embraced Trumpian industrial policy. One data project stifled at Heritage is to map the district-by-district impact of the Trump tariffs.
“They called us first,” says Mr. Pence about the defectors. “They see us as being a consistent, reliable home for Reagan conservatism.” Or maybe simply conservatism, which Heritage was founded to promote and did for decades. But that changed with the arrival of Kevin Roberts as president, who tried to play the game of populist politics rather than promote the think tank’s traditional principles.
The conference climaxed with an address by Vice President JD Vance, heir apparent to President Donald Trump. Vance audaciously claimed, “President Trump did not build the greatest coalition in politics by running his supporters through endless self-defeating purity tests.”
What? Trump doesn’t run his supporters through purity tests?
Ask Marjorie Taylor Greene, Thom Tillis, Liz Cheney, Brian Kemp, Jeff Flake, Paul D. Ryan, Ben Sasse, Justin Amash, Peter Meijer, Don Bacon, Denver Riggleman, Jaime Herrera Beutler … The entire Trump era is littered with Republican elected officials who disagreed with Trump and found themselves driven out of office. Ask former Cabinet officials like John Bolton, Elaine Chao, H.R. McMaster, Jim Mattis, John Kelly or Nikki Haley. Heck, ask his former vice president, Mike Pence! A pro-Trump crowd was ready to hang Pence over his willingness to certify the results of the 2020 election on Jan. 6, 2021. That doesn’t count as a “purity test”?
President Trump’s desire to have his name on everything, preferably in gold, is well-known, and at first we thought the addition of his name to the John F. Kennedy center for the arts in Washington, D.C., was ignorable as familiar Trumpian news. But there is the matter of the law.
Under 20 U.S.C. § 76i(a), Congress in 1964 established the Kennedy Center as “a building to be designated as the John F. Kennedy Center for the Performing Arts.” The title of the building isn’t a casual naming of the kind that happens when philanthropists donate to a museum and are honored with a wing named after them. The name is enshrined in statute as a memorial to the assassinated President.
The Kennedy Center’s board of trustees was also created by statute, in 20 U.S.C. § 76 (j), which enumerates the responsibility of the officers, including to present music, opera, drama and dance, to contribute to performing arts education and to provide “facilities for other civic activities.” The board is also tasked with ensuring the facility received “necessary maintenance” and had “safe and convenient access” for pedestrians.
Notably absent from this list is the power to rename the Kennedy Center or augment the name by adding Mr. Trump alongside. Further memorials are explicitly banned by the statute, which instructs the board to “assure that after December 2, 1983, no additional memorials or plaques in the nature of memorials shall be designated or installed in the public areas of the John F. Kennedy Center for the Performing Arts.”
“China Imports No U.S. Soybeans for Third Month; Argentine Arrivals Up 634%”
… is from page 173 of the 1996 Liberty Fund collection of Frank Meyer’s essays, In Defense of Freedom (William C. Dennis, ed.); specifically, it’s from Meyer’s June 6th, 1956, National Review article titled “Conservatives in Pursuit of Truth”:
There is no more logic in the conclusion that a love of freedom implies a disbelief in, a lack of enthusiasm for, ultimate values than there is in the Liberal canard that a belief in ultimate values makes impossible a belief in freedom. The reverse is the case: the belief in ultimate values and the belief in freedom are dependent one upon the other, integral aspects of the same understanding.
Nick Gillespie’s recent discussion with Matt Ridley, about science and Science, is excellent.
Progressive Democrats (with their obsession with a “green” economy), like MAGA Republicans (with their obsession with tariffs), apparently believe that Americans are too wealthy. A slice from a new Wall Street Journal essay:
The House on Thursday passed the Standardizing Permitting and Expediting Economic Development (Speed) Act, 221-196. Every Republican except Brian Fitzpatrick of Pennsylvania voted for the bill. But the Hakeem Jeffries’ Democrats voted 195-11 against the bill that is co-sponsored by Democrat Jared Golden of Maine. The 11 Democrats other than Mr. Golden who voted aye include four from Texas and represent swing districts where Republicans have at least a chance at winning.
The Speed Act attempts to simplify the morass of federal permitting by limiting environmental reviews to the impact from a proposed project but not from speculative downstream effects. The Act also imposes sensible limits on the lawsuits that are routinely deployed to delay projects for years. Under the bill, lawsuits must be filed within 150 days and can only be filed “by a party that has suffered or imminently will suffer direct harm from the final agency action.”
The Democrats who voted no bowed to the green lobby that refuses to accept any changes to the National Environmental Policy Act (NEPA), the 1970 law that has become the main impediment to building roads, bridges, tunnels, pipelines, transmission lines, you name it. Some 26 environmental interest groups opposed the bill, while nearly all business groups supported it.
Megan McArdle writes about the “diversity”-inspired institutionalized bias against young straight, white males. Two slices:
Everyone in media, academia and entertainment knew it was happening. A number of them had qualms. Almost none spoke up. And now that someone has said something, many are pretending they didn’t see it happen with their own eyes. This is incredible, in every sense of the word.
I am talking about how for years, at many institutions, there was a hiring preference for anyone but White, straight men. As Jacob Savage argues convincingly in a recent essay for Compact magazine, this most affected one group: younger White men who hadn’t had time to gain the skills and experience that might have compensated for their melanin deficiency.
…..
Young White males were about a quarter of college graduates in 2022, so we’d have expected them to average about a quarter of new hires for various elite professions. They didn’t drop to 12 percent of junior television writers because of demographics, or because studios stopped discriminating against other groups. They dropped because employers started discriminating against them to make their institutions “look like America.”
If you want to understand the backlash to diversity, equity and inclusion, you need to understand how bad that math was for a certain class of educated millennial men. You also need to recognize that a lot of this math was bad, period.
National Review‘s Editors rightly applaud Ben Shapiro. A slice:
First, at the Heritage Foundation, he [Shapiro] argued that a political movement, like a nation, needs borders. He illustrated the point with reference to the Heritage Foundation mission statement, which supports free enterprise, limited government, individual freedom, traditional American values, and a strong national defense.
He then compared those principles with the beliefs of Tucker Carlson, with whom Heritage President Kevin Roberts has been in ideological sympathy, up to and including initially defending Carlson’s interview with Nick Fuentes (before backpedaling). Shapiro persuasively argued that by Heritage’s own standards Carlson — who expresses routine contempt for markets, who launders Russian propaganda, who sees the advantages of sharia law, and who gives sympathetic interviews to white nationalists, Churchill-hating World War II revisionists, and proud misogynists accused of rape — is no longer a conservative.
We assume that Roberts won’t be inviting Shapiro back any time soon, but his talk was received warmly by the audience at the Heritage Foundation.
A couple of days later, Shapiro spoke at TPUSA’s AmFest conference. He addressed the rank pandering to audience, widespread conspiracy-theorizing, and cowardly unwillingness to call out lunacy on the right that has infected the right-wing influencer space. Here, Shapiro focused on the absolutely cracked theories promoted by Candace Owens about the Charlie Kirk assassination; these rancid, obsessive musings, which would set off alarms bells for any psychiatrist if spouted by a patient, have significantly shaped the debate on the right about Kirk’s assassination.
True to form, Owens responded to Shapiro’s speech with an anti-Jewish rant.
… is from page 228 of Thomas Sowell’s Compassion Versus Guilt, a 1987 collection of some of his popular essays; specifically, it’s from Sowell’s December 10th, 1985, column titled “By the Numbers”:
When intellectuals discover that the world does not behave according to their theories, the conclusion they invariably draw is that the world must be changed. It must be awfully hard to change theories.
Here’s a letter to a relatively new correspondent.
Mr. W__:
Thanks for your follow-up email.
Contrary to your charge, I do not believe that I misled anyone when I earlier described Ronald Reagan as a free trader. Former senator Phil Gramm – whose commitment to free trade is deep and rock-solid – tells me (as he’s said publicly) that he witnessed first hand Ronald Reagan agreeing to protectionist measures reluctantly and only as a means of steering Congress away from imposing even worse protectionism.
As for China, the well-established national-security exception to the case for free trade might well apply in this case. But the desire to strengthen America’s (or the West’s) national security against a Chinese military threat cannot not explain Trump’s tariffs.
If Trump were truly intent on using trade measures to strengthen the U.S. relative to China, he would not have imposed baseline tariffs on imports from nearly all countries, along with additional tariffs on 67 others (not counting China). He would seek to deepen commercial ties with Canada, Mexico, Japan, and other allies rather than antagonize these countries, as he’s done with his indiscriminate tariff-rattling. Not only do tariffs on imports from friendly countries deny to us important inputs from these countries – inputs that bolster our military abilities – by antagonizing our friends Trump makes them less eager to help us and more open to increasing their commercial ties with China.
I’m open to a serious argument in support of thoughtfully crafted trade restrictions narrowly targeted to reduce a military threat from China. But what we’re getting from the Trump administration is anything but such thoughtful policy. What Trump serves up as justification for his tariffs is rank economic ignorance – for example, his insistence that U.S. trade deficits are a problem – splattered about, as are the tariffs themselves, with all the discretion and discipline of a toddler throwing a temper tantrum.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
Rachel Lu – inspired by a 1964 book written by George Mosse – reviews some of the “second-rate thinkers who paved the way for Nazism.” (HT Arnold Kling) A slice:
From the opening pages of Mosse’s work, one is immediately struck by two defining features of Volkish thought that are in tension with our usual vision of Nazis. It was profoundly anti-modern. And it was deeply rooted in nineteenth-century romanticism, spurning philosophical rationalism and classical economics, and embracing instead an ideology that glorified nature, rootedness, idyllic visions of pre-industrial peasant life, mystical experience, rose-tinted nostalgia for feudalism, and the promise of greater meaning and a revitalized sense of community.
Why does this matter? Because today, the conservative movement is in serious danger. It is in danger not just from a left that all too frequently excuses everything up to and including murder. The conservative movement is also in danger from charlatans who claim to speak in the name of principle but actually traffic in conspiracism and dishonesty, who offer nothing but bile and despair, who seek to undermine fundamental principles of conservatism by championing enervation and grievance. These people are frauds, and they are grifters. And they are something worse: a danger to the only movement capable of stopping the left from wrecking the country wholesale.
…..
Emotive accusations, conspiracy theories, and “just asking questions” is lazy and stupid and misleading. None of them are a substitute for truth. So when Candace Owens says, “I don’t know know, but I know,” that’s retarded, and we are all more retarded for having heard it. When Steve Bannon, for example, accuses his foreign policy opponents of loyalty to a foreign country, he’s not actually making an argument based in evidence—he’s simply maligning people with whom he disagrees. Which is par for the course from a man who was once a PR agent for Jeffrey Epstein.
Entrepreneurship is in Alejandro Flores-Muñoz’s blood.
Back in his birthplace of Guadalajara, Mexico, his mother and other relatives sold whatever they could—hair products, food products—to make ends meet. After Flores-Muñoz’s mom brought him to the U.S. as a child, she got a nine-to-five job but kept her entrepreneurial streak alive. “From me just having to watch her figure out how to make a large batch of cheesecakes and flanes” to observing her develop “her selling points” and participate in pop-up events, Flores-Muñoz says, “that entrepreneurship spirit was instilled in me.”
He was inspired to become an entrepreneur himself in 2012 after receiving Deferred Action for Childhood Arrivals (DACA), a status established by President Barack Obama’s administration that delays deportation for people who were brought to the U.S. without documentation as children. That gave him a way to get a Social Security number and the ability to earn the licenses and certifications he needed to become a full-fledged business owner who employs others. He launched several hustles throughout his 20s before becoming part owner of a food truck in 2018. He now owns a catering company.
…..
Those businesses provide the products and services that Americans enjoy every day, and they also contribute to the national economy in big ways. “Most immigrant entrepreneurs own the types of businesses that populate Main Street,” noted Laura Collins, director of the George W. Bush Institute–Southern Methodist University Economic Growth Initiative, in 2019. They “start more than a quarter of all ‘main street’ businesses—retail, neighborhood services, and accommodation and food service.” Immigrants have also founded some of the country’s biggest companies: Over a fifth of all Fortune 500 companies were started by immigrants, and about a quarter were founded by the children of immigrants. Those companies employ 15.5 million people globally, according to the AIC.
Here’s a new empirical study the results of which, although utterly unsurprising to economists, will be ignored by the likes of Zohran Mamdani, with the cost of this ignorance being paid by lower-income people: rent control reduces the availability of residential rental units. (HT Scott Lincicome)
Steve Chapman appropriately criticizes the selling of one’s soul in exchange for political position. A slice:
[Kevin] Hassett’s time in the White House confirms that there is no principle or insight of economics that he is not willing to discard to please his boss. When Trump spouts nonsense, Hassett is always there to offer a smiling, expert gloss on it. Last summer, when the Bureau of Labor Statistics revised its May and June calculations of job growth—a perfectly normal event—Trump fired the commissioner and claimed the report was “RIGGED in order to make the Republicans, and ME, look bad.” The NEC director promptly went on TV to back him up. Hassett asserted that the revision was the biggest since 1968, which was false, while offering no evidence of deception by the agency. He went on to say, “The president wants his own people there so that when we see the numbers, they’re more transparent and more reliable”—as if Trump had the slightest fondness for valid data.
Hassett is not above lying about the most basic and verifiable facts. Gasoline prices, he said recently, are “below $2 a gallon in a lot of places.” In fact, as AAA documented, there is and was no state where gas prices averaged as low as $2.
What is so remarkable about Hassett, though, is that he was once, in his own words, “an unabashed free-trader.” In 2008, he went so far as to praise Bill Clinton for his “aggressive pursuit of free trade.” In 2003, he wrote that “liberalized trade” is “a key ingredient in the recipe for prosperity.” But you can’t sup at Trump’s table without swallowing your convictions. Hassett had an epiphany that revealed to him the cruel unfairness of our free-trade agreements and the importance of reducing the trade deficit—which he, in a flight of fantasy, holds responsible for “hundreds of thousands of deaths from fentanyl.” Trump’s tariffs, he suggests, are the antidote. Any reputable economist can attest that tariffs will not necessarily reduce the trade deficit, which is merely the other side of our massive capital surplus, the result of foreigners investing in American assets. What could reduce it is the economic slowdown the tariffs threaten to cause, something that a man who was once a free-market economist at the conservative American Enterprise Institute understood perfectly well.
Indeed, in his 2021 book, The Drift: Stopping America’s Slide to Socialism, Hassett recounts how he battled Peter Navarro and other trade hawks over tariffs, a contest he lost. But he stayed on nonetheless, and when research indicated that the duties on washing machines created only a few jobs, and at an exorbitant cost, he insists that Trump “watched the evidence closely and adjusted his game accordingly.” Oh? The tariffs stayed in place till the end of his first term—and beyond, because Joe Biden extended them before letting them expire in 2023. And if you believe Trump cared about the evidence, I have a White House East Wing to sell you.
Understand that the Kennedy Center was named by statute. It is patently illegal for it to be renamed by a “board of directors,” by presidential diktat, or by anything except legislation. But that doesn’t matter to Donald Trump! What does the law mean to our Dear Executive Leader? Trump has contempt for the very idea that he might restrained by either Congress or the law, as is abundantly clear by the way he has conducted his second term to date.
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