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Saturday, January 21, 2017

The Split Personality of the Trump Presidency

Combining state authoritarianism with a hands-off state in domestic affairs is not viable.

Tax outsourcing, but cut the capital gains tax. Tax imports, but repeal regulations on business. Restrict hiring from abroad, but free the labor market. Give more power to the police, but get the government off our backs. Crack down on illicit drugs, but liberalize health insurance. End senseless wars, but stop at nothing to smash Islamic radicalism.

These are just some of the contradictory themes emerging in the Trump presidency. It’s not hard to spot the strange contradiction here. Some rely on more government power, and some less. And this is why those of us who hope for a new liberty keep toggling between despair and hope for the new presidency.

Below is an explanation for how this strange situation came to be.

The Downside

Several themes have been constants in Donald Trump’s 18-month campaign, from his first speeches through his dark inauguration speech. He speaks about walls, borders, nationalism, and his power as a leader, with insinuations that most of our problems trace to external invasions and ripoffs of one sort or another. The first time I heard it, I knew I had recognized it from somewhere.

We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs. Protection will lead to great prosperity and strength. … We will follow two simple rules: Buy American and hire American. … At the bedrock of our politics will be a total allegiance to the United States of America, and through our loyalty to our country, we will rediscover our loyalty to each other.

Who might take issue with these views? Nearly everyone who has celebrated liberty for the last several hundred years. Protectionism doesn’t create prosperity; it pillages consumers for the sake of a crony elite. Hiring abroad is not harmful; it expands the division of labor and creates wealth. Our loyalty to each other comes from personal interaction; it is neither created nor mediated by the nation state.

There was not a word in the inaugural address about cutting government.There was not a word in the inaugural address about cutting government, backing freedom as anything valuable, the rights of individuals, a market economy, or anything remotely resembling any of those things. It’s enough to cause anyone who loves liberty to double over in despair. It is painful. We’ve worked so hard for so long to educate, inspire, and build a world that loves liberty, or at least leaders who understand that trade works, that wealth comes not from restriction but freedom, that personal values are truly personal, not the result of state imposition.

And yet now there is Trump, who sounds like a right-wing version of left-wing collectivism that the most brilliant minds of the ages have worked to displace. And he has found a few people such as Peter Navarro (now special advisor on trade) who agree with him on these points.

Where have we gone wrong?

The Upside

There are hundreds if not thousands of people with fantastic views – libertarian views – who have latched onto these elections results. But wait, a full portrait of the Trump presidency is not limited to this voice and ideology. Every day, news pours in of some pretty awesome people who have fantastic plans for this presidency. For example, Ajit Pai is a Federal Communications Commissioner. He is super fired up. He vows to smash terrible government regulations. We “need to remove outdated and unnecessary regulations… We need to fire up the weed whacker and remove those rules that are holding back investment, innovation, and job creation,” he says.

There are hundreds if not thousands of people with fantastic views – libertarian views – who have latched onto these elections results. It’s not just the cabinet appointments, though there are good minds heading HHS, HUD, EPA, Interior, SEC, Education, Energy, and Labor, just to name a few. Each of them has other appointments to make, so there will be like minds everywhere in government who want to slash back regulations, cut taxes, devolve power, and crush bureaucratic management.

It’s Locke vs. Rousseau, Smith vs. Hegel, Hume vs. Hobbes. These people are sincere and optimistic. Will they succeed? I have no idea. What intrigues me is the aspiration itself. It is not toward power, centralization, and the leadership principle. For many of these people, the theme is not nationalism; it is liberty. It is not about imposing power or values or trust; it is getting government out of the way so that power devolves to the people, values can be expressed by us, and trust is in the organic process of social interaction and market forces.

This is a clear contradiction. We have liberty on one hand, and collectivism on the other, freedom on one hand and fascism on the other, power to the people one one hand and power to the leader (who purports to embody the spirit of the people) on the other.

This is Locke vs. Rousseau, Smith vs. Hegel, Hume vs. Hobbes, Jefferson vs. Hamilton.

What can we make of this?

The Left-Wing Theory

To the left, all this makes some strange sense. In their view – I have a hard time fairly representing this perspective because I find it so preposterous – free markets and deregulation are a natural fit with authoritarian regimes. Enforceable property rights are a ruling class trick, they say, that requires police-state tactics and jack-booted thugs. Privatization and tax cuts are not really about freedom; they are about handing spoils to capitalist thugs. And so on.

To us, freedom is all of a piece.Like I said, I can’t make any sense of this theory. They might cite cases such as General Pinochet in Chile, where we saw freer markets alongside a brutal police state. For them, it is a paradigmatic case that “neoliberalism” is really just a form of imperialist statism.

To be sure, as I think about it, that markets and authoritarianism go together is not just a left-wing theory; it is also the view of the alt-right (once again, left and right are mirrors images). They too believe that a capitalist economy needs a powerful regime to crack down on dissent and force homogeneity. Whereas the left condemns Pinochet, the alt-right thinks this regime had it right, complete with throwing political enemies out of helicopters.

No libertarian can accept this outlook. To us, freedom is all of a piece. You need a free press for free speech and a free market to make both real. You need free trade to have a free market. You need the freedom to contract with anyone in order to have real capitalism. All of this is made possible by private property, which limits, restricts, or even eliminates the state as we know it.

Another Theory

There is a way to make sense of this seeming contradiction. When Trump started putting together his administration, he developed two standards for his star performers: they had to share his enemies (the relevant ones of which are mainly or almost entirely on the left, as the confirmation hearings have clearly shown) and they had to be accomplished and experienced experts.

It all traces to one great event that began an unstoppable revolution.As the transition team looked around the policy world for such people who qualified, whom did he find? Mostly he found not people with his own views but libertarians and market-friendly people, particularly for the posts in domestic policy. These are the people who qualify according to Trump’s own standard. They have no real history of supporting protectionism, nationalism, or even anti-immigrationist theories.

Why is this? It all traces to one great event that began an unstoppable revolution: the founding of the Foundation for Economic Education in 1946. The state of the country at the end of the war was abysmal: price controls, wage controls, huge government, censorship, high taxes, and the New Deal now firmly entrenched in the form of wartime industrial planning. Leonard Read and some friends including Henry Hazlitt and Lawrence Fertig decided to do something about it.

Conventional universities were closed to liberty-minded ideas, for the most part. Not even Ludwig von Mises, who had immigrated in 1940, could find a prestige post. So they started a new model outside academia. It was the first “think tank” dedicated to the cause of freedom. It adopted guerilla tactics such as publishing in the commons while eschewing copyright.

FEE was the font of what was then a revolutionary idea.FEE made possible the publication of Mises’s masterwork, inspired Murray Rothbard to take up economics and write for its publication, and gave a home to Hazlitt after he left the New York Times. FEE commissioned new works, distributed Hayek’s books, and became the central salon of a serious resistance movement rooted in the confidence of ideas. Ron Paul was among the tens of thousands of people inspired to become activists under FEE’s inspiration.

FEE was the font of what was then a revolutionary idea. Other institutions followed in succession and by inspiration: the Mont Pelerin Society (1947), the Institute of Economic Affairs in London (1955), the Institute for Humane Studies (1961), the Cato Institute (1977), and the Atlas Network (1981).

Then there were other great literary events such as the publication of Ayn Rand’s Atlas Shrugged (in 1957). She too was connected with the FEE network, carrying on a correspondence with Read and moving in the New York circles that made up the burgeoning free-market movement.

The Power of Ideas

Liberty-minded ideas represent the viable only alternative to the status quo establishment.Note that few of these people had connections to any establishment. They were outsiders with a new and radical idea: society should be left alone to grow and develop on its own, with the institutions of the market (rather than bureaucrats) serving as the essential signaling device. As the decades moved forward, the idea proved ever more persuasive, as the alternative failed again and again.

We look around today and see that the idea caught fire all over the world and, in particular, in the United States. After all these years, and all this educational and publishing work, convinced and well-trained disciples of the idea are honeycombed through every sector of life: finance, media, ever more think tanks, foundations, policy studies, and even academia.

They are the experts. They are the professionals. They are still not the establishment, and have no desire to be. Liberty-minded ideas represent the viable only alternative to the establishment, an alternative that is backed by experience and intellectual integrity. 

It took many decades, but now 70 years after FEE’s founding we can see the results that Leonard Read predicted at the outset. The ideas were unstoppable. When Donald Trump looked around the policy world for people who opposed the leftist model of central planning, and also had the necessary skill set to do a good job, he found the libertarians. It’s not that he personally accepts their views (though he has said that he likes Ayn Rand as a novelist).

Are They Working for the Enemy?

Friends of mine have accepted the deal, and I completely understand, despite all my deep misgivings about the Trump administration.A concern I’ve heard expressed is the danger that these libertarians are going to give cover to a presidential agenda that is not really about freedom at all. It’s possible of course, but I also see why anyone who want to try their hands at making a difference. If you had a passion and deep knowledge of, for example, the problems at the FDA, and Trump called to have you work for the agency, it’s not a bad idea to accept the job. Turning it down accomplishes nothing; accepting it means that you at least have a chance to make a difference.

Friends of mine have accepted the deal, and I completely understand, despite all my deep misgivings about the Trump administration. You do what you can do when you are offered the chance to do it. It is not “selling out”; it is seizing on a chance to make a difference.

Maybe it won’t work. In fact, the odds are that it won’t work.

And what if the reputation and integrity of the idea of liberty are damaged in the meantime. That is a risk. There is also the ever-present danger of personal corruption: they will come to love government work after all, and toss out their ideals. That could happen too. But consider the decision to join itself. What if you believe that your only contribution is to stop matters from getting worse? Isn’t that alone something worthwhile?

None of this changes the uncomfortable reality that there is a deep rift between what the libertarians want and the ideas frequently expressed by the president himself. Perhaps a deep clash is coming. Or maybe the Trump administration will sow such confusion and disorientation that the system will begin to break down on its own, even as liberty-friendly people on the inside cheer its demise.

Anything is possible. In the meantime, those of us who long for clean transitions from power domination to sweet liberty will just have to live with the imperfect, messy, and chaotic world that politics has created for us.