Trump gets that!
By Rich Kozlovich
Dan Mitchell is a libertarian and one of the economic wonks at the Cato Institute, which if you read his history, it's impressive. Dan has allowed me to publish his work for a number of years, and he's prolific. Having been heavily involved with economic policy in America he clearly understands the ins and outs of government economics, which is an unending slight of hand game. I like much of his work, so I publish his articles.... unless I don't agree with them.
I know, I can hear it now. Who does this bugman think he is to disagree with a man with Mitchell's vast experience and knowledge? Well, I will admit, much of the economics I read makes my eyes roll up into the back of my head, and truth be told, I think economists make it that complicated deliberately.
I've been a history buff and an avid reader for all of my life, and I have some qualities I think are important in order to understand anything. First, life is all about patterns, and the patterns of life repeat over and over again. The natural function of the human mind is to see those patterns, but that means striving to attain as much knowledge, on as many subjects as there are, filling your mind with a lot of seemingly extraneous information. But as your doing this your mind will unconscionably be filing, collating, and correlating that information into useful patterns, ultimately giving you worthwhile insights.
I see patterns more quickly than most and I see things farther, deeper, and wider than most, and the fact is, most economists have no idea what they're talking about. Here are four of my commentaries dealing with economics, I especially like number four.
- The E-Myth
- What is the Proper Definition for "Opportunity Economics"? Capitalism!
- When An Accident is Waiting to Happen, It Eventually Does
- Preconceptual Economics
On November 6, 2024 Dan published this commentary, Trump, Part II, and much of it I liked, but I didn't publish it because he's got this Libertarian affliction about tariffs.....all being bad in the eyes of Libertarians, which as time goes by I find more and more irritating.
Last week he posted an article that predicted Trump would lose the election, and I published it even though I thought it was an foolish prediction, and it was. He notes:
"I’m a lousy political forecaster. I predicted Trump would lose and he instead won a convincing victory."
But it doesn't end there as he notes that "economists are also lousy forecasters" about economics saying:
Don’t trust economists......Sometimes a picture really does tell a thousand words. Here’s a chart, based on data from the Philadelphia Fed, showing actual economic results compared to the predictions of professional economists. As you can see, my profession does a wretched job. Comparisons based on predictions from the IMF, OECD, CBO, and OMB doubtlessly would generate equally embarrassing results.
Conclusion? Economists either have no idea what they're talking about, they're lying, or they're smart people who were made stupid by the embrace of a foolish ideology.
"Socialism is a philosophy of failure, the creed of ignorance and the gospel of envy, its inherent virtue is the equal sharing of misery." Winston Churchill
When you read what economists are teaching in American universities, you must conclude many of them are guilty of all three.
His article goes on to offer five suggestions on how the GOP can fix government, and it's clear some of his suggestions are good ones, until he comes to number three, saying: I am terrified about the prospect of more protectionism. If Trump merely targeted China, it might be possible to justify his actions because of national security. But he wants to be “Tariff Man” for all cross-border commerce. Didn’t work for Hoover. Won’t work for Trump."
What he's citing is the Smoot/Hawley Tariff bill, and he's not alone in that, as John Hinderaker called Trump's efforts, Smoot-Hawley II saying:
Why do I object to that? Because when Hoover signed the Smoot/Hawley Tariff bill in 1930 the world's economy was far different than today. Entirely too many think in terms of the Smoot-Hawley tariff, which triggered a trade war that was an important instrument in starting the Great Depression, as the lesson we need to take seriously today. Wrong!
America's economy and the world’s economies in 1930 were far different then than now. We needed them and they needed us in proportion. Now? We don’t need them, they need us, and the point that we have a major trade deficit with these nations makes us stronger in such a battle is critical. If we stop buying their products they collapse.
We have five criteria that makes us the winner in any trade war.
- We can feed ourselves
- Fuel ourselves
- Arm ourselves
- Defend ourselves
- We can create our own internal market.
We don't need them....they....need ...us!
To save our allies after WWII, economically and militarily, we created the Bretton Woods hegemony, where we opened our markets to our allies and we protected them militarily since they were totally broke even before the war's end. The only time in world history where a nation created an hegemony that was for the benefit of others. As a result capitalism became redefined as meaning America would go on forever letting our trading partners impose tariffs and trade protections while not protecting American workers and our industrial base with tariffs.
A philosophy that predicated one of the worst economic and political decisions ever made by a President of the United States, Nixon opening China up to world trade, and western civilization has been funding it's own destruction ever since.
Those days are over!
One last point. Dan admits Libertarians like him who are all in on open borders but have no idea what to do about the consequences of open borders. Libertarians in so many ways, and so very often, are just like economists. They have no idea what they're talking about.
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