Pacific Research Institute • 1997 • 302 pages • $16.95
Philip Murray is associate professor of economics at Webber College in Babson Park, Florida.
Warren Brookes was a nationally syndicated columnist who developed a reputation as a great opponent of statist nonsense and a great proponent of sound thinking in science, economics, and politics. In a single pithy column, Brookes could debunk the best-laid plans of government bureaucrats. His untimely death in 1991 deprived us of an advocate of inestimable skill.
Thomas Bray, editorial page editor of The Detroit News, for which Brookes wrote, has collected an assortment of Brookes’s best columns into Unconventional Wisdoms. A welcome book it is. Brookes, Bray says, “always took pains to emphasize that he approached his subject as a fact-gatherer, not as an ‘expert.’” He employed salient facts and historical perspective to make his points, not econometrics and abstruse mathematics. Mix that with wit, clarity of expression, and a Bastiat-like instinct for getting at the nub of a problem and you see why he was anathema to statists.
Like Bastiat, Brookes knew that the battle between liberty and statism would persist. That explains Bray’s motive for editing the book: “Indeed, one of our primary purposes in publishing this volume is to arm the interested reader with the arguments and factual framework needed to assess the continuing debate over . . . subjects that Warren knew would be a permanent source of debate.”
Brookes was among the first journalists to explain the difference between the supply-side and demand-side world views. Demand-siders, he explained, view the world primarily as a zero-sum game. Wealth is tangible and limited; government, moreover, must constantly stoke and “fine tune” the economic engine that produces wealth. They see a need to “correctly” distribute that limited wealth and believe that people can’t have both liberty and security. For demand-siders, the latter is the right choice, but of course individuals cannot be entrusted to make such choices.
Supply-siders, on the other hand, maintain that wealth is potentially unlimited since it is ultimately the product of the human mind. They understand that the choice between liberty and security is a false one and know that government interference is certain to gum up the works of our economic engine. Thanks to Warren Brookes’s able exposition, many people who would not otherwise have understood this battle between differing world views could see and evaluate them.
Brookes took on popular neo-Malthusians like Jeremy Rifkin and their assumption that we will eventually—rather soon, in fact—run out of energy. From the Second Law of Thermodynamics (usable energy becomes unusable), Rifkin and his cohorts draw the implication that as we use unrenewable resources like oil, we must run out and the economy will cease to grow. Brookes, however, points out that the relevant energy is mental, not physical. The economy can continue to grow despite the Second Law of Thermodynamics because, as he wrote, “We are always being taught through clearer ideas how to do more with less.” And he quotes George Gilder here: “Ideas are not used up as they are used.”
Another bugaboo that Brookes smashed was the notion that the trade deficit was some great national disaster. In his “Jobs and the Trade Deficit,” he showed that there is in fact no relationship between the nation’s trade balance and employment. A few facts, some economic principles, and down crashes a protectionist dogma.
One of Brookes’s foremost accomplishments was his explanation of the “tax capitalization hypothesis.” Most people are familiar with the supply-siders’ enthusiasm for lowering marginal tax rates. Brookes saw that tax cutting would do more than just increase the incentive to earn. It would also raise property values. As he wrote, “every dollar of tax on a piece of property reduces the capitalized value of that property. . . .” When we reduce taxes, we therefore increase the value of property and put more wealth in private hands, wealth that can be used or borrowed against for endeavors that will create still more wealth.
Brookes was versatile, taking on many different subjects. His writings on the environment injected sound economics and science into issues seething with emotion and misinformation. On safety and risk, his pen was the nemesis of the doomsayers who insist on federal regulations to eliminate every minuscule or theoretical risk at great cost. How sad that Warren Brookes isn’t around today to attack the pompous Kyoto global warming treaty!
Unconventional Wisdoms is a treasure chest of commentary on economics, politics, and the environment. Highly recommended!