Here’s a letter to National Review:
Editor:
Samuel Gregg eloquently demolishes the national-conservatives’ case for reorienting the economy away from serving our interests as consumers and toward serving our interests as producers (“Let Consumer Sovereignty Reign,” May 21). As Mr. Gregg explains, true production occurs only insofar as our efforts as producers satisfy our demands as consumers – demands expressed by income earners spending their own, and only their own, money in whatever peaceful ways they choose. Ironically, were the U.S. government to override these demands in order to freeze workers in the jobs that they currently perform, America would by slow degrees be transformed from a nation of people who produce for each other into one in which people are parasitical on each other.
Implicit in Mr. Gregg’s piece is a point that deserves to be made explicit. It’s this: The desire of workers to keep particular jobs that no longer serve consumers as well as possible is itself a consumption demand. This demand can be satisfied – ‘purchased’ – by workers in those jobs agreeing to cut their pay to levels that allow their employers to profitably employ them. But were government instead to protect those jobs with subsidies or tariffs, government would unjustly elevate these workers’ consumption demands over the consumption demands of their fellow citizens. The ability of fellow citizens to consume would be artificially suppressed in order to artificially enhance the ability of protected workers to consume.
In the end, therefore, the NatCon policy of elevating production over consumption turns out to be nothing of the sort. It is a policy that instead would subsidize the consumption of some by suppressing the consumption of others – and, in the process, reduce America’s overall productivity.
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
