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The Editorial Board of the Washington Post explains what shouldn’t – but, alas, what nevertheless does – need explaining: Britain’s economy will not be ‘fixed’ by greater government involvement. A slice:

The “new path” proposed by British Prime Minister Andy Burnham in his debut speech at the Labour Party’s annual conference last week sounds a lot like the one that led the United Kingdom into prolonged stagnation.

Wall Street Journal columnist Mary Anastasia O’Grady warns that in Venezuela Trump “is pushing oil production over good governance and may end up with neither.” A slice:

It’s been nine months since President Trump used the U.S. military to arrest dictator Nicolás Maduro inside Venezuela, take him to New York, and promote his deputy, Delcy Rodríguez, to top despot. Venezuelans thought they were going to get elections. Instead U.S. sanctions on oil sales have been lifted and dollars are again flowing to the criminal regime. Popular opposition leader María Corina Machado desperately wants to return, but Washington won’t allow it.

The energy confab was a Trump administration idea. It’s betting that by talking up the Venezuelan petroleum industry even while a dictatorship is still signing the contracts, it can get capital flowing into the country. The rebuilding of democratic institutions is supposed to follow.

Trump critics say that’s an error in sequencing. They believe that before investors sink real money into long-term commitments in Venezuela, in amounts that matter, they will want to be dealing with a legitimately elected government operating under a rules-based system.

History is on the side of the skeptics. At a minimum, caution is in order when dealing with the chavistas, who over the past quarter-century have repeatedly “dialogued” with democrats, as they’re doing now, only to refuse to relinquish power.

The energy summit harked back to a time in the once-prosperous South American nation when oil was the engine of growth. But elsewhere in the capital and the rest of the country, things remain dire. Triple-digit inflation and persistent power outages make life miserable for most Venezuelans. Ms. Rodríguez still holds an estimated 324 political prisoners, and more than two dozen others are under restricted freedom. Venezuelans at home and abroad are souring on the Trump administration.

Team Trump says it’s still pushing for political reform through negotiations between Ms. Rodríguez’s brother Jorge, head of the National Assembly, and the opposition. The two sides have been meeting on and off for two months and are rumored to be near an agreement on an independent supreme court. After that they’re supposed to form an independent electoral council. If all goes well, some insiders say the country could hold elections by mid-2027.

Venezuelans who want to recover their country are holding onto this hope. But doubts creep in when the Trump administration attaches no importance to restoring good governance and instead makes a boom in oil production, driven by secret agreements, its priority. By continuing in this direction it’s likely it will get neither.

Attending the conference was a low-cost way for large companies to generate goodwill with the White House. Even companies with little interest in Venezuela had reason to show up to stay on Mr. Trump’s good side. Marginal players probably wanted to rub shoulders with Oil Ministry bigwigs who have discretionary power over rights to explore and exploit oil blocks. Sweetheart deals in exchange for who knows what are the way things work in Venezuela.

Venezuelans are complaining bitterly about the recent regime decision to grant proprietary rights over 17 oil fields to North American Blue Energy Partners, whose majority owner is palace insider Alejandro Betancourt. Yet rather than object to the no-bid contract, the Trump administration further eroded confidence by appropriating its own minority stake in the company.

Roger Pielke Jr. ponders Pres. Trump’s carbon tax.

Mark Mills writes wisely about AI. Two slices:

Before the telegraph, widespread information transmission had also never moved faster than a horse. In 1858, the New York Times reported that telegraphy could spread lies “too fast for truth” to catch up. Experts warned that the technology would create a “morbid appetite for startling news and a monomania for extravagant and almost incredible rumors.” In 1861, barely a decade into the telegraph era, the Morning Pennsylvanian observed that “so far as its communications for the public eye are concerned, it is almost an unmitigated curse.” The New York Times aired worries that the electricity in the first-ever proliferation of wires festooning the countryside could endanger animals and crops and quoted experts warning that “girdling the earth with electrical wires” could even risk destabilizing the planet’s rotation.

History is legion with examples of what we view in hindsight as hysterical and even amusing reactions to new technologies. But it seems wired into human nature to ignore the implications because, well, “this time it’s different.” It’s always the case that every new technology is different in the particulars and that otherwise smart people have said exceptionally silly things about new technologies. Reflexive presentism is hard to escape.

Cataloging history’s episodes of techno-hysteria doesn’t mean that new technologies were free of negative consequences and disruptions. But as history also shows, it’s apparently too much to expect that we will react much differently this time than we did last time.

…..

As for water and land, data centers use far less of both than golf courses, never mind agriculture. Where were the protesters when Congress enacted mandates and subsidies for corn-ethanol in gasoline? Nearly 200 times more water is used per gallon to produce ethanol than gasoline.

Finally, on land use: the total square footage of warehouses in America is, at present, almost 100-fold greater than for data centers. Again, where were the demonstrators when politicians and promoters started subsidizing solar power installations that blanket farmland and fragile deserts by the square mile with black, glass-covered silicon?

Also writing insightfully about AI, but from a very different angle, is Bob Graboyes.

National Review‘s Jim Geraghty decries “the rise of dumb, anti-innovation, job-saving laws in blue cities and states.” Here’s his conclusion:

Rhode Island passed its law; starting January 1, 2027, any grocery store in the state that provides self-service checkout stations must have a ratio of one manual checkout station for every three self-service stations. Heaven forbid we let the grocery stores decide for themselves! Heaven forbid we allow customers to decide which option they want to use!

Joseph Steinberg tweets: (HT Scott Lincicome)

I think it’s very clear that ADH [the “China Shock” work of David Autor, David Dorn, and Gordon Hanson] and its follow-ups have led many people to believe that trade with China was a net negative for American jobs in the aggregate, when it’s not at all obvious that was the case. If you read their abstract & intro, and those of many other similar papers, there are no caveats whatsoever about relative vs absolute effects. In ADH, it’s relegated to a footnote. And their extrapolation to aggregate effects is totally inappropriate—a practice they have continued through all their work and propagated to the broader set of papers building on their work.

Allen Mendenhall’s thoughts about economics and economics training are excellent. (HT Arnold Kling)

Peter Suderman describes the new Tom Cruise movie, Digger, as a “disaster.”

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… is from page xvi of Samuel Gregg’s forthcoming book, The Civilization of Commerce:

The act of situating the case for markets within a wider argument about civilization reminds us, moreover, that much more is involved in the defense of market economies than emphasizing their ability to create wealth. Distinctly nonmaterial goods like liberty and justice are equally at stake.

DBx: Sam is correct.
…..
I’ve lost count of the number of times I’ve witnessed the following: The case for free markets is made on consequentialist grounds – for example, markets supply greater material prosperity to ordinary people, including better health, longer lives, and access to more leisure – only to be met with the objection that market-oriented scholars are blind to the nonmaterial dimensions of human flourishing. The market-oriented scholar then declares that he or she does indeed value nonmaterial goods – above all, liberty – so highly that he or she would, if necessary, willingly sacrifice much material wealth in exchange for greater liberty. This declaration is then met with the objection that the market-oriented scholar isn’t to be trusted because he or she is an ideologue.

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Here’s another letter to a long-time correspondent.

Mr. McKinney:

Thanks for sharing John Carney’s tweet in response to my recent open letter to J.D. Vance – a letter in which I document some of the many ways that ordinary Americans’ economic condition is far better today than it was 40 years ago. Mr. Carney writes:

Dear Don Boudreaux,

You have frequently complained that “the state” is too big and argued more should have been done to constrain its growth. You’ve argued that we need a balanced budget amendment to prevent government from financing its growth with debt.

Since 1985, the annual federal budget deficit is about 8.4 times larger in nominal dollars than in fiscal year 1985, roughly 2.8 times larger after inflation. Gross federal debt has grown far more — from about $1.8 trillion at the end of FY1985 to roughly $40 trillion by the start of October 2026.

How curious. Please tell me which of the following results [the ones in the open letter to Vance] of the growth of a growing government and ever-larger debt over the past 40 years do you wish to undo?

Sincerely,
John Carney

PS: See how this works?

Contrary to your prediction, I actually believe that Mr. Carney’s point is fair. I (like many others) have indeed complained for decades that government is too big and intrusive and, hence, harmful to the U.S. economy. And yet despite the continued growth of government on many fronts, ordinary Americans are today much better off economically than they were 40 years ago. Mr. Carney is justified in seeing in my arguments a potential inconsistency.

For two related reasons, however, I plead innocent to the charge of being inconsistent. First, my classical-liberal consequentialist argument against big government is not that such government necessarily makes the economy absolutely worse off over time; rather, the classical-liberal argument is that big government prevents the economy from performing as well as it would were government smaller and less intrusive.

Second, although I’ve no doubt that the increased government spending – especially that which is funded by debt – over the past 40 years worsened economic growth, on other fronts there’s been liberalization which fueled economic growth. For example, much of the Carter-Reagan deregulation of communications, energy, banking, and surface and air transportation remains in place today. The top marginal income-tax rate was cut dramatically starting in the early 1980s and has since remained well below its rate when Reagan first took office. And until 2018, average tariff rates had fallen.

For the above two reasons, the absolute improvement in the U.S. economy is not inconsistent with the arguments that I and other market-oriented economists have made over the years against large and intrusive government.

However, this improvement in the U.S. economy is inconsistent with J.D. Vance’s argument, which is that the U.S. economy has performed abysmally over the past 40 years. Vance repeatedly talks of America’s “hollowed out” industrial base and middle class. Vance describes the economy as having suffered 40 years of “decline” – which is a categorically different claim from saying that the economy has done well over the past 40 years but could have done even better.

In short, my and other market-oriented economists’ complaints about large and intrusive government are that such a government prevents the economy from working even better than it currently does. Vance’s complaint is that the market-oriented policies of the past 40 years have caused the American economy to suffer actual decline. The data are consistent with the former complaint, but disprove the latter.

Sincerely,
Don

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Charles Cooke gives details of just how much of our modern, convenient lives depend upon data centers. A slice:

Certainly, we wildly underestimate the extent to which we rely on data centers. Take my actions today. This morning, I sat down with my coffee and looked through National Review’s website. To get there, I typed “nationalreview.com” into my browser, and before I’d even hit “Enter,” my computer used a data center to look up where that site was located on the web. Once that location had been discovered, my browser then contacted the website via its primary IP address — which, in the case of a popular site such as National Review, meant a digital “visit” to whichever one of the many “proxy” data centers happened to be geographically closest to me. After a secure connection to that data center had been established, my browser then started assembling the text, images, videos, podcasts, fonts, scripts, advertisements, and other elements that made up the page I hoped to see. Because this involved all manner of different content types — some cached, some dynamic, some streaming — and required the use of application servers, database servers, and distributed content-delivery networks, it invariably required trips to multiple data centers, all playing different roles. Thus, before I had read a single word, my computer had been served 150 web requests, across 34 domains, having contacted roughly ten data centers spread across networks operated by nine different companies. Because everything worked as it should have, this process was invisible. But that doesn’t mean it wasn’t happening. Without seeing it, I had taken a remarkable journey around the world.

And that’s just for a visit to the homepage of a website. Presumably, like me, you have a smartphone. Have you ever thought about how it works? At the same time that I was visiting nationalreview.com today, my phone was relentlessly pinging data centers across the globe. An email arrived, a message appeared in the family group chat, a video from yesterday finished uploading to the cloud: those actions were the result of data centers, data centers, and — yep — data centers. When my weather widget refreshed its forecast, my calendar picked up a change to an appointment, one of my apps downloaded an update, and my stock ticker moved: data centers did that. Each one of the little conveniences that I have slowly stacked over time involved computers in one or more data centers doing work on my behalf. Magic? Not on your life.

Having had my coffee, I ran some errands in my car, and as usual, I used Waze to avoid the traffic. In so doing, I blithely connected to an unfathomably impressive piece of infrastructure — all of which remained out of sight. My phone accurately calculated its position on Earth by listening to a series of precisely timed signals sent from a bunch of satellites up in space and comparing the data issued by each to determine where I was. At the same time, its internet connection linked it to a host of servers that, among other things, supplied the requisite maps, calculated optimal directions, and processed real-time traffic information that had been collected from other drivers. To obtain even the simplest of instructions — “turn left” — I was the beneficiary of signals from space, mathematics in my pocket, and information that had been processed by distant computers in data centers across the world. While driving, I turned on Apple Music, and thanks to a data center nearby, I had at my disposal virtually all of the music that has ever been recorded. On my way home, I made a phone call to my wife and thereby relied on a data center in my carrier’s network to connect us and route my conversation to the right place. Had I driven through a toll, a data center would have matched my transponder to my billing record. If I’d stopped for gas or lunch and paid by card, the payment would have been authorized by my bank’s data centers. All this, for a simple trip to the barber!

We take all this for granted. Once, we had to go to the bank to cash a check, wait on the phone to buy a plane ticket, take a trip to a shop to buy a light bulb, drive to a video store to rent a movie, call theaters for showtimes, and consult encyclopedias to find the most elementary of facts. We don’t now — because of data centers. On Sundays, during NFL season, I watch the games over the internet on my TV, which requires a lot of data centers; I participate in two fantasy football leagues and one pick ’em league, all of which are hosted in data centers; and, like many others, I text my friends during the games — via a data center, naturally. So reflexive is this behavior that we have forgotten how it works. But we’d notice if it went away. If, during the next Super Bowl, even 10 percent of the nation’s data centers were to be summarily switched off, the people of the United States would be on the verge of revolution.

The term we have chosen to describe the technology I have discussed here is “the cloud.” But, of course, there is no such thing. There are just data centers and the computers that run inside them. Conceptually, “the cloud” is a useful abstraction. But if taken too literally, it blinds us to an important reality: Each one of the 5,427 data centers in the United States is a real place, full of rows of real machines, that run on real electricity, and that are maintained by real people. Your data — by which I mean your emails, your bank account, your business files, your photographs of your kids — are sitting somewhere on a real hard disk. If I drove to where that hard disk is and smashed it up with a pickaxe, it would break, and the only reason that you probably would not permanently lose the data that it once held is that the data also exist in some other real location, on another real disk, in another data center, that is maintained by another real person. Bluntly put: The integrity of your data — and of your ability to access it whenever you want — is the result of your having cheap access to lots of different data centers, in lots of different places, so that if something bad happens to one of them, your stuff is backed up elsewhere.

Paul Schwennesen isn’t impressed with the new book by Eric Beinhocker and Nick Hanauer. A slice:

Hanauer and Beinhocker describe “Market Humanism” as a new paradigm “grounded in twenty-first century thinking.” What that means isn’t clear, but they argue that the “old paradigm” — economics as the study of how society manages its scarce resources — has “constrained economic thinking for the past 150 years.”  They propose instead an economics centered on human flourishing, in which “markets are servants, not masters,” and argue that the real genius of markets lies less in their efficiency at allocating existing resources, but rather in their ability to generate innovation. Erm… paging Dr. Schumpeter to address the blindingly obvious. He wrote, way back in 1942, of the “perennial gale of creative destruction” that allows continuous innovation across the entire economy.

There is, moreover, an odd tension at play.  Hanauer himself readily acknowledges that market capitalism has been astonishingly successful. “No social technology,” he writes, “has done more to create prosperity and raise living standards” than market capitalism. Human beings, he notes, are now leading substantially longer, healthier, more comfortable, more fulfilling lives than at any other time in history.

So what, exactly, is the old paradigm failing to explain?

Despite the window dressing, I suspect Hanauer’s answer is that it fails to justify the political case for greater taxation of the uber-rich. The simplest way to summarize Hanauer and Beinhocker’s “very different model,” then, might be “market capitalism with socialist characteristics.” And maybe they have a point — if the basic problem with traditional market capitalism is that it has been too successful, and that the risk of toppling our social edifice at the altar of envy is acute, then maybe we should take the argument seriously.

Tad DeHaven and Chad Smitson report on the increasing number of private companies with shares now owned by the U.S. government.

Reem Ibrahim is right that “Rand Paul was right to block the Senate’s attempt to censor the internet.”

The Endangered Species Act hinders the building of housing.

Jonathan Allen tweets: (HT Scott Lincicome)

I am sorry to learn that North Carolina-based women’s budget fashion retailer Cato Fashions is closing 120 stores because of tariffs, rising fuel prices, and weakening family budgets.

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… is from page 258 of F.C. Benham’s 1932 paper “The Balance of Trade,” which is Chapter XVIII of the 1932 report of a commission in the U.K., chaired by Sir William Beveridge; the title of the collection is Tariffs: The Case Examined:

A tariff does not leave consumers free to select which imports they can best do without. It makes the selection for them, or, at least, strongly influences their choice. This may be thought wise. We think it a loss. Nor is a tariff as flexible an instrument as a free exchange-rate. It creates vested interests and can only be readily altered in an upward direction. Further, by reducing imports it tends to make the rate of exchange higher than it would otherwise be. This places export industries at a disadvantage, even if wages and other internal costs do not rise.

DBx: Yes.
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I can find no link to a copy of this book. The hard copy that I own, and from which the above quotation is taken, was given to me as a gift by the generous Doug Irwin.

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Here’s a letter to National Review Online.

Editor:

Michael Brendan Dougherty completely misses the point of Dan Foster’s excellent response to J.D. Vance’s express desire to “undo” 40 years of globalization (“Undoubtedly 6.8 Percent Is Less than 70 Percent,” October 2). Contrary to Mr. Dougherty’s portrayal, Mr. Foster’s argument is not that the many improvements in America’s economy over the past four decades are due overwhelmingly to globalization, with little to no role played by domestic factors. Instead, as is clear from reading Mr. Foster’s post, he’s challenging Vance’s premise about the condition of America’s economy today compared to its condition in the mid-1980s.

Mr. Dougherty treats Vance’s premise as being this: such a small share of America’s enormous economic improvement over the past 40 years is due to globalization that we can afford to “undo” globalization. But Mr. Dougherty is mistaken. Vance’s actual premise is that there has been no such improvement over the past 40 years in America’s economy. It is that this economy has been so severely damaged over the past 40 years that we must “undo” the economic policies, including globalization, that Vance alleges caused this supposed calamity.

Yet as the facts mustered by Mr. Foster make clear, America’s economy – including the lot of ordinary Americans – has dramatically improved since the mid-1980s. He thus disproves Vance’s premise that the economic liberalization of the past 40 years has failed ordinary Americans.

By the way, I, too, offered evidence against Vance’s clueless premise about the condition of the U.S. economy. And here are yet other bits of evidence against Vance’s ignorant belief:

– America today has 93% more industrial capacity than it had in 1985 (even though U.S. population today is only 44% larger).

– The real value of America’s capital stock was, as of 2023 (the latest year for which I have data), 138% larger than it was in 1985.

– U.S. industrial output is today 85% higher than it was in 1985.

– Americans’ exports of goods and services are nearly 600% greater, in inflation-adjusted dollars, than were Americans’ exports in 1985.

Lusting for greater power, both the MAGA right and the ‘progressive’ left continually insist that the failure of government over the past 40 or so years to further squelch free markets has inflicted deep and unambiguous damage on America’s economy. That’s Vance’s message. It is utterly without foundation.

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

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America’s founding generation was remarkable, but also human. David Henderson reflects on the great John Adams.

My former Mercatus Center colleague Patrick McLaughlin, now at the Hoover Institution, has this excellent letter in today’s Wall Street Journal:

Jamie Dimon identifies a promising route to his 3% growth goal before turning to foreign economic policy: removing domestic regulatory obstacles (“A Plan for the Western World’s Revival,” op-ed, Sept. 29). That opportunity deserves more than a passing mention.

In research published in the Review of Economic Dynamics, Bentley Coffey, Pietro Peretto and I showed that federal regulatory accumulation reduced U.S. economic growth by approximately 0.8 percentage point per year between 1980 and 2012. The buildup of regulatory requirements distorts investment decisions, which ultimately weakens the business-led innovation that makes workers more productive.

There is also evidence that reversing the accumulation can help. For example, the Canadian province of British Columbia reduced its regulatory requirements by roughly 36% after launching reforms in 2001. Research I conducted with Mr. Coffey estimated that those reductions increased annual economic growth by about one percentage point.

While those estimates don’t guarantee an identical result if the U.S. cuts regulations by 36%, they do make a strong case for the regulatory budgeting approach that British Columbia pioneered.

The approach involves three initial steps and then a feedback loop. First, inventory existing requirements, set reduction targets and require agencies to identify rules whose costs exceed their benefits. Then continually measure success against economic performance and the health, safety and environmental outcomes regulation is supposed to improve.

Mr. Dimon is right to seek faster growth. A serious effort to clear away obsolete and counterproductive rules should be central to that agenda.

The Washington Post‘s Editorial Board explains what shouldn’t – but, sadly, what nevertheless does again – need explaining: price ceilings create shortages and raise the costs that ordinary people incur to acquire price-ceilinged goods and services. Two slices:

In May, Kyrgyzstan imposed price controls on fuel. Gas stations reported shortages. The government repealed the price cap on gasoline in July.

In Bangladesh earlier this year, some drivers waited in line up to 14 hours for price-controlled fuel. As soon as the government allowed prices to rise, the lines in Dhaka, the crowded capital, shortened by two-thirds. Lines elsewhere disappeared entirely.

TotalEnergies, the French oil giant, announced it would voluntarily cap fuel prices at its gas stations in March. In early April, the great majority of gas stations in France had no shortages. Of the 900 that did, 700 belonged to TotalEnergies.

Also in France, universities in April capped meal prices at one euro for all students. The actual cost averages eight euros. The surge in students using cafeterias now means there is often nowhere to sit, and unions threatened to strike over the big increase in work. Some students have said that the long lines make it impossible to eat between classes.

Catalonia, in northeastern Spain, imposed sweeping rent controls in 2024. What followed was a decline in rental agreements. As of March, the supply of rental housing had declined by 23 percent.

…..

Price controls are still doing what they always do: destroy investment, encourage lawbreaking and cause shortages. Politicians would be wise to remember that voters’ opinions might change, but the laws of economics don’t.

Daniel Foster adds his voice to those rightly criticizing J.D. Vance’s wish to “undo” 40 years of globalization. A slice:

A 2024 WTO study suggests that reductions in trade costs between 1995 and 2020 increased global real GDP by about 6.8 percent. For low-income economies, the increase was much larger, about 33 percent.  As for the U.S. in particular, one estimate concludes that international trade alone led to “an increase of $7,014 in [inflation-adjusted] GDP per capita and $18,131 in GDP per household” in the United States between 1950 and 2016. A census report concludes that lower import prices under globalization held inflation down for all American groups between 1995 and 2018, relative to autarky. (The benefits were most pronounced for rural Americans, which will be relevant when you get to the paragraph after next.)

None of these studies capture the full warp and weft of globalization. They’re mostly focused on trade barriers, with some comparative advantage and diffusion of technology and ideas thrown in. But left out are the beneficial effects of foreign direct investment, labor and capital mobility, factor price convergence, multinational production chains, financial integration, and so forth, which are also well-recognized drivers of growth.

David Sergent tweets: (HT Scott Lincicome)

Defining a reduction in trade barriers and the development of technologies (containerization, global aviation) that made international trading easier as “central economic planning” is a bait and switch. No one thinks “central planning” = “globalization.” Nor should they.

Harold Black reflects wisely on Trump’s new steel mill in Iowa. A slice:

Ohio State is playing Iowa today, and the president is busy patting himself on the back – a sport in which he remains undefeated. The occasion: a new $15 billion steel mill, the first in 50 years, coming to Iowa.  Naturally, he credited his 50% tariffs. The project is expected to create 1,750 permanent jobs and support up to 6,000 construction jobs. Trump added that it would also create 2,000 new manufacturing and mining jobs. Over the next decade, it is projected to generate $95 billion for the U.S. economy. He took credit, saying his “powerful 50%” tariffs on steel imports last year meant that “our steel industry is roaring back to life. Everyone’s building their plant here because they don’t want to pay tariffs. It’s really not that complicated.”

Actually, it is a bit more complicated than that. The president is a short-timer. If the next president lowers or scraps the tariffs, will the math on a $15 billion plant still work, or does Iowa end up with one of the world’s most expensive machine sheds?  Although not as apparent as beef or energy, Trump’s tariffs have made Americans to pay more for steel than any other country in the world. And while the president bragged that the steel will be “mined, melted, and made completely in the U.S.,” calling it “something very unusual,” he skipped a small detail: the mine’s owner is Mesabi Metallics, a Minnesota-based company owned by India’s Essar Group. Made in America, owned by India – which, to be fair, is “something very unusual.” The plant will be fed by a newly developed $2.5 billion iron ore mine that Mesabi opened on September 17 on Minnesota’s Mesabi Iron Range. And the Export-Import Bank of the United States (EXIM) will provide up to $10 billion in financing for the new Iowa steel mill. Hold that thought. Also keep in mind (mine?) that the US steel industry is being dominated by foreigners – US Steel is a wholly owned subsidiary of Nippon Steel. I thought Trump’s policy was America First?

But what is the Export-Import Bank and why is it providing financing for an Indian company? This is from its website: “The EXIM Bank is the official export credit agency of the United States. Our mission is to support American job creation, prosperity and security through exporting. We accomplish this by unlocking financing solutions for U.S. companies competing around the globe. We help level the playing field and fill gaps in private sector financing.” https://www.exim.gov

So let me get this straight: a U.S. government bank is putting up $10 billion of the $15 billion so an Indian corporation can set up shop in Iowa. And once this foreign-owned mill is running, Trump’s 50 percent tariffs will protect it from… foreign competition. Sounds like a sweet deal to me – sweet as Iowa corn. And timing, of course, is everything. The announcement comes just before the midterms. Between the tariffs and the price of fertilizer and diesel, Iowa is suddenly in play. The governorship, a U.S. Senate seat, two of the four congressional districts, and the attorney general’s office are all suddenly competitive in races where the republicans should have been favored. Surely that had nothing to do with the announcement. Right?

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… is from page 306 of my late Nobel-laureate colleague James Buchanan’s 1962 essay “Marginal Notes on Reading Political Philosophy,” which is an appendix to Buchanan’s and Gordon Tullock’s seminal 1962 book, The Calculus of Consent; the page number here is from Liberty Fund’s 1999 edition of Calculus:

Indeed the only purpose of science is its ultimate assistance in the development of normative propositions. We seek to learn how the world works in order to make it work “better,” to “improve” things: this is as true for physical science as it is for social science.

DBx: Jim Buchanan was born on this date – October 3rd – in 1919.

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Mr. Vance:

Yesterday, you boasted to Jack Posobiec that the Trump administration is “trying to undo 40 years of bad policy, of globalization, of shipping American jobs overseas.”

How curious. Please tell me which of the following results of the “bad policy” and globalization over the past 40 years do you wish to undo?

Unemployment rate
1985: 7.2%                        2025: 4.3%

Total nonfarm employment
1985: 97.53M                  2025: 158.43M

Real avg. hourly wage of production and nonsupervisory workers (2025$)*
1985: $22.10                    2025: $31.34

Real per-capita GDP (2017$)
1985: $35,793                 2025: $70,020

Real median household income (2025$)
1985: $63,090               2025: $87,460

Real median household wealth (2022$)**
1983: $87,859               2022: $192,700

Percentage of manufacturing workers laid-off
1985: 19%                        2025: 11%

Median sq. footage of newly built single-family homes
1985: 1,620 sq. ft.          2025: 2,142 sq. ft.

Life expectancy at birth
1985: 74.6 years            2025: 79.4 years

Perhaps you have other evidence that justifies your insinuation that, over the past four decades, Americans have been – to use a favorite expression of your boss – “ripped off.” If so, please do share that evidence with the American people. A man with your intellect surely doesn’t want to make bold claims that are unsubstantiated by the facts.

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

* 1985 dollars converted into 2025 dollars using the personal-consumption-expenditure index.

** Calculations performed by economist Jeremy Horpedahl and shared with Bryan Caplan and me, to appear in Bryan’s and my forthcoming book, Blockade (Cato Institute, 2027).