George Will is rightly appalled by the Luddism of Trump and American longshoremen. Two slices:
Longshoremen won a tentative 61.5 percent pay increase over six years. The Wall Street Journal editorial page notes “the astounding fact” that there are only about 25,000 port jobs, so about half of ILA members do not have to show up for work daily. The rest stay home collecting payments previously negotiated in contracts protecting “jobs” (loosely — very loosely — defined). In 2010, [Harold] Daggett said his members should make more than $400,000 annually. Today, the Journal says, “some now do with overtime.”
Daggett, however, threatens another strike on Jan. 15 unless any additional automation — e.g., automated cranes loading and unloading containers — is banned. Resistance to automation is why no U.S. port ranks among the world’s 50 most efficient. The strike could “cripple” and “crush” (his promises) the nation’s economy before Trump’s promised tariffs do.
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Like his soulmate Trump, Daggett is a 78-year-old child of Queens. His helper with the task of striking the chains from workers’ ankles is ILA’s executive vice president, his son Dennis, who says the ILA “does not support any kind of automation.” “Machines don’t pay taxes,” says the automation-opposing president of the ILA local in Mobile, Alabama. But the more productive the workforce is, the more taxes it pays.
During the three-day October strike, Kamala Harris said, “This strike is about fairness.” But Reason’s Eric Boehm noted two discordant X posts from a progressive, ILA-supporting news outlet. One praised workers for blocking “job-killing automation.” The other lamented that ILA members’ jobs are “backbreaking.
Scott Lincicome gets to the heart of Trump’s opposition to Nippon Steel’s effort to acquire U.S. Steel. Four slices:
Even the most committed free marketer will readily acknowledge an exception for national security. Trade should generally be free, for example, but you’ll rarely see free traders opposing government subsidies to and/or restrictions on defense-related goods like tanks or fighter jets. We’re always quick to add, however, that security exceptions should be limited, transparent, and well-justified, and that policymakers and the public should still scrutinize claims that X or Y is needed on national security grounds. Indeed, that national security is an exception granted by stalwart free marketers also means it’s ripe for abuse by those seeking a government-aided advantage over their competition, customers, or suppliers. And history is littered with politicians, companies, and unions using “national security” as an empty (often comical) excuse for the government to block imports, spend taxpayer dollars, or otherwise intervene in the economy in ways that benefit them alone, economically or politically, at our expense—and often the nation’s expense too.
No recent example more clearly shows said abuse than Nippon Steel’s attempted acquisition of U.S. Steel—a deal that’s good for the companies, their workers, and the nation, yet, thanks entirely to political opposition, could soon be blocked on “national security” grounds.
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Speaking of national security, that case against the transaction has also collapsed—even though it remains the primary obstacle to the deal’s completion. In March, William C. Greenwalt, former deputy undersecretary of defense for industrial policy, explained that the U.S. military needs a tiny amount of domestic steel output and gets none of it from U.S. Steel.
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Since then, independent national security and foreign policy experts at the Hudson Institute, Brookings Institution, Heritage Foundation, American Enterprise Institute, CSIS, Council on Foreign Relations, Atlantic Council, and elsewhere have similarly expressed support for the deal, and they’ve been joined by both economists and even several current U.S. government officials (anonymously, of course). To my knowledge, not a single legitimate national security expert has expressed the opposite view. Instead, “expert opinion seems unanimous that there is no real national security interest in the Nippon Steel-US Steel merger” (especially after Nippon’s supposed connections to China were debunked).
Finally, there’s CFIUS itself. As the Financial Times wrote over the weekend, the three departments with the most responsibility for and expertise in national security and foreign investment—Treasury, State, and the Pentagon—have each concluded that the deal poses no security risks. The only agency opposed, meanwhile, is the Office of the United States Trade Representative, which has no direct responsibility for the issues at hand. The FT adds that the committee even drafted a “mitigation agreement” that outlines how Nippon Steel could alleviate various security concerns, but USTR “showed no sign of reversing its opposition.”
If a leaked version of CFIUS’ thinking is accurate, moreover, the novel concerns raised by some committee members are hilariously weak. They’re reportedly worried that Nippon Steel would import large volumes of steel from its affiliates in India and quickly shutter U.S. production capacity that’s needed not for national defense but for infrastructure and commercial manufacturing—productive capacity that might someday be needed in time of war. They’re also worried that the new U.S. Steel would resist U.S. tariffs (antidumping duties, especially) to counter any new surge in imports.
Yet this “risk” not only disregards Nippon Steel’s own written commitments and the open support of downstream steel consumers, but it also bizarrely assumes that a publicly traded Japanese company would pay a large premium (more than $5 billion above U.S. Steel’s market capitalization) to destroy its new U.S. investments; that domestic steelmakers—including Cliffs and domestic titan Nucor—wouldn’t respond to any such actions with additional capacity of their own; and that the U.S. government wouldn’t have tools (subsidies, tariffs, nationalization) to address potential market gaps, especially in time of war. As Bird put it, “Nippon cannot dig up U.S. Steel’s plants and transport them to Japan.”
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Then there’s the risk that scuttling the Nippon deal further encourages other nations to adopt the United States’ flimsy approach to using “national security” as a guise for economic protectionism —harming American exports and investment along the way. As the Council on Foreign Relations’ Benn Steil just documented, this has already started happening. Since the Trump administration first declared that “economic security is national security” in 2017 and then slapped “national security” tariffs on steel and aluminum, World Trade Organization notifications invoking “national security” to excuse derogations from the WTO Agreements’ general trade liberalization rules have increased significantly, reaching an all-time high this year. Are more on the way?
Even Californians are beginning to revolt against the high costs of their government’s forced net-zero emissions march. Enter the Biden Energy Department, which on Tuesday announced a $15 billion loan guarantee for Pacific Gas & Electric Co. to keep down the state’s electric rates. This is a bailout for bad climate policy.
Energy’s Loan Programs Office is rushing out funds from its $385 billion pot before President Biden leaves. Its $15 billion loan guarantee for PG&E for green-energy and transmission projects is the largest in its nearly 20-year history, though the department stressed that the “financial benefits . . . will be passed on to the customers” of PG&E.
The utility declared bankruptcy in 2019 after amassing tens of billions in liabilities from wildfires ignited by its aging equipment. The company had for years neglected its grid while spending heavily on renewable energy. In recent years it has shut off power to communities during periods of strong, dry winds to limit future liability from fires.
This letter in the Wall Street Journal by Conan Ward is spot-on:
What Sens. Elizabeth Warren and Bernie Sanders don’t admit is that the third-party effects of ObamaCare have led to less choice and a greater concentration of the market with a smaller number of larger insurers. Their “Medicare for All” dream is the ultimate goal. Fortunately, one need only look at the rationing and care denials in Canada and the U.K. that lead to patients suffering and dying as they await treatment. Sometimes you really do get what you pay for.
Jon Miltimore explains “how billionaires became an endangered species in Norway.” Two slices:
[Fredrik] Haga went on to compare Norway’s exit tax to one of the most infamous symbols in history: the Berlin Wall.
“Instead of trying to attract and [retain] capital and talent by making Norway a better place for business the Norwegian government chose to build its very own Berlin Tax Wall with yet another tax on unrealized gains,” he wrote.
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Politicians like Kirsti Bergstø, the leader of the Socialist Left Party since early 2023, can celebrate this phenomenon and display her trophies; and writers like [Sam] Pizzigati can crow that Norway may soon “be the world’s most equal nation.” But there will be serious costs to the outflow of capital and talent, and it will be the poorest Norwegians who are most likely to pay the price.
Arnold Kling continues to be among the wisest and most insightful commenters who are active today.
“We must unleash free enterprise to meet the electricity challenge of artificial intelligence.”
Jennifer Huddleston, senior fellow in technology policy at the Cato Institute, tells Reason that legislators’ primary national security concern pertains to the Chinese Communist Party’s ability to invoke the Chinese National Security Law to circuitously acquire American TikTok user data through its “special management share” of ByteDance. If there is a genuine national security threat that is exacerbated by Americans’ use of TikTok, then legislators have a responsibility to clarify precisely what this is instead of vaguely gesturing to “an active national security threat,” as Joe Lancaster has argued in Reason.
Huddleston says the law to ban TikTok wasn’t just solely driven by concerns over American data privacy, but also by worries about Chinese propaganda. But one man’s—or country’s—propaganda can just as easily be an American citizen’s protected political speech.
