- Cafe Hayek - https://cafehayek.com -

Whose MONEY Is It, Anyway?

Tweet [1]

Here’s a letter to The American Conservative (HT Craig Kohtz):

Pat Buchanan repeats his familiar litany against free trade and immigration (“Whose Country Is It, Anyway? [2]” Sept. 19).  That litany boils down to a simple formula: the U.S. economy declines as American consumers gain better access to lower-priced goods and services, and as American producers gain better access to lower-cost means of production.

In short, competition creates poverty, while monopoly creates wealth.

Economists [3] have repeatedly and utterly debunked such claims for the alleged marvels of monopoly power.  I’ll not here repeat any such debunking.  Instead, I merely highlight one internal inconsistency in Mr. Buchanan’s own arguments.

He frequently asserts that 19th-century America’s policy of relatively high tariffs, along with its impressive economic growth, proves that protectionism promotes prosperity [4].  End of story; full stop; no further analysis is necessary.  Fact A’s simultaneous existence with fact B proves that A caused B.

Well, 19th-century America also had open immigration.  So Mr. Buchanan ought to join the ranks of those of us who support a return to that policy.  After all, according to the tenets of his own epistemology, the mere fact that booming 19th-century America had open immigration proves that open immigration promotes – or at least doesn’t hamper – vibrant economic growth.

Donald J. Boudreaux

UPDATE: And, in fact, the evidence does seem to indicate that open immigration unlike protectionism – played a significant role in promoting economic growth in the latter half of 19th-century America [5].