What Buchanan is really proposing is an economic war against his own people. The Chinese aren’t spending enough of their dollars on US goods? Fine then, we’ll make it harder and more expensive for US citizens to engage in voluntary trade with Chinese citizens! Hah! That’ll learn ‘em.

Trade with China would be great if it were anything close to free and fair. It’s hard to compete with businesses that are subsidized. Then there are the issues of national security and morality. Please read below. The article is from January 2000.

Subsidizing Trade With China
by Heather Brick(Link)
The Red giant’s entry into the WTO includes the prerequisite that it will be granted permanent “Normal Trade Relations” (formerly “Most Favored Nation”) status.

The deal that the U.S. and Communist China signed last November to facilitate China’s accession into the World Trade Organization (WTO) has become a cause for rejoicing among many who support “free trade” with China. Nevertheless, there is a sound national security argument against doing business with the Red giant. Since China is a self-avowed enemy of the United States, it makes no sense to engage in technology transfers that enable it to modernize and enhance its military capabilities. There is also a sound moral argument. Since China is a tyrannical regime that suppresses basic rights, engaging in trade that strengthens the regime can only make the chains of despotism even heavier for the Chinese people.

Subsidized, Not Free, Trade

Yet even if the national security and moral considerations are put aside, there is another problem. It seems that the trade we have been conducting with China has not been free but subsidized — not only by the Chinese government but by the American taxpayer as well.

The U.S. government’s Export-Import Bank subsidized trade with China to the tune of $5.9 billion in 1998. The U.S. taxpayer-subsidized Asian Development Bank and World Bank awarded $1.5 billion and $2.4 billion, respectively, in new loans to China that same year. Without these subsidies, it is unlikely that wealthy transnational elitists would invest in China’s risky market.

Even so, most foreign companies are finding that the promise of a profitable Chinese market has been oversold. The June 21, 1999 Electronic Telegraph quoted one management consultant comparing China to an apparently attractive bride who looks very different without her make-up. Subsidies continue to work as rouge and lipstick for this Chinese bride.

The bride’s rouge and lipstick includes subsidies China has been able to apply for and obtain through Normal Trade Relations (NTR), formerly Most Favored Nation (MFN), status. Until now, the President has been required to renew this status annually. However, based on last November’s U.S.-China trade agreement, China must be granted permanent NTR status before it can be admitted into the WTO.

A Growing Deficit

China’s pool of slave laborers — about 10 million in its laogai (“reform through labor”) prison camps — also contributes to the inequity between China and the U.S. when it comes to trade. This slave labor system gives China a competitive edge in pricing its products in the international marketplace and contributes to the growing U.S. trade deficit with China.

The Chinese would rather that we not notice this deficit ($64 billion as of August 1999 according to the U.S. Commerce Department). China’s Prime Minister Zhu Rongji, speaking at MIT in April 1999, implored Americans, “Don’t make such a big deal out of this trade deficit.” He asserted, “This is not such a serious problem.” Perhaps it is not a serious problem for China, but it is for the United States. For instance, this infusion of American consumer dollars is funding the Red regime’s military build-up.

The large trade deficit is not only due to slave labor. Chinese regulation of the economy is mostly to blame. Even with concessions made for entrance into the WTO, China retains a tight rein on business. Foreign investors can only own a percentage of a few business ventures. It is also unlikely that China would allow trade to become too open, in spite of its promise of a freer system. When Ross H. Munro, director of Asian Studies at the Center for Security Studies, testified before a House Committee of International Relations on June 24, 1998, he noted that, even with China reducing tariffs, there are still “tens of thousands” of non-tariff barriers. The application of non-tariff barriers has contributed to China’s significant overall trade surpluses. The Wall Street Journal for November 22, 1999 reported that the Chinese press is already pointing out that China can still use bureaucracy to restrict foreigners even if tariffs drop. In the same article, the Journal reported that at a conference in Guangzhou, factory managers and government officials who were encouraged to improve efficiency in order to be competitive with foreign investors were assured that the government would not abandon them.

Indeed, China greatly subsidizes its state-run economy, making actual free trade nearly impossible. As Munro testified, Beijing has responded to economic slowdowns by “increasing its indirect export subsidies, mainly in the form of larger tax rebates and more special low-interest loans for exporters.” It has also encouraged stock market growth by use of regulations that encourage its citizens to invest their savings in the market. As the August 22, 1999 Washington Post reported, the government’s goal is to “stimulate the economy and thereby save China’s state-owned industries by using the hard-earned savings of its people.” In China, when privatized sectors fail, the government comes to the rescue. For example, when banks get into trouble, the government takes over the bad debt. And as was reported in the November 1, 1999 Washington Post, the state-owned banks would be considered bankrupt already if Western accounting practices were applied. Such government bailouts, while propping up particular industries for a time, can only hurt the economy as a whole. But the damage of Chinese statism is lessened by Western subsidies.

We should take Chinese President Jiang Zemin at his word when he spoke at the Communist Party’s 78th anniversary this summer. Jiang declared that socialism would defeat capitalism and that there would be no all-out privatization of the state sector. Trade with such a partner is far from free and would not be in the United States’ best interest. It would only serve to enrich the Chinese government.

The poor prefer a particular “truth.” So the fallacious distinction arises that there are “greedy sellers”, then “poor buyers.” Everyone is both a seller and buyer. Everything that you trade away is a sale, everything that you trade for is a purchase. That fallacy is the root of the problem here. The fact that even some *cough* economists have adopted it makes one really wonder what exactly people are smoking. Whatever it is, they should sell that to China to fill the “trade deficit.”

Chad: You’re saying that the Chinese government is subsidizing production and selling to us at below market prices, yes? That would mean that the Chinese government is subsidizing American consumption. If that’s a plan to enrich China at the expense of the United States, it’s not a very good one.

Thus does he believe that only China looses if “we” impose tariffs.

I hate to nitpick, but the word is “loses”, not “looses”. This misspelling drives me crazy. “Looses” means the opposite of tightens, although I suppose that word could work in this context as well.

It is ironic that in the US Chinese economic growth is seen as a threat. In Japan and South Korea China is seen as the great saviour from their economic woes. China´s boom seem to have accomplished what endless stimulus packages and zero interest rates failed to accomplish: lifting Japan from its stagnation.

And there is certainly no evidence that China´s protectionist policies are the cause of the US trade deficit with China. China has a gigant trade deficit with the rest of the world, roughly as big as its trade surplus with the US, while the US also has a trade deficit not just with China but with nearly all other countries. The root of the US trade deficit is as I have pointed out before, the low domestic savings rate.

Regarding Chad Bull´s talk of the alleged military threat from China, there is no indication at all that China has any hostile intentions against the US or any other country not historically and ethnically linked to China, that is all countries except Taiwan. Unless the US intends to attack China if it tries do with Taiwan what Lincoln did with the Confederacy, there is no risk of a military confrontation with China.

Lisa Marie, when trade is conducted with China, it is not carried out by individuals in a free and open market. Chinese businesses are highly controlled by the Chinese government as is their economy. Our government and their’s subsidize these businesses. American businesses and workers are suffering as a result. You cannot have a free exchange with China. I am not sure how many ways this needs to be explained. I am not waiting for a perfect world in order to conduct trade. This sophomoric comment ignores the glaring inequity that exists in trade with China. Until China and our foreign policy change, these inequities will continue and free and open trade is a pipe dream. I applaud your desire for a free market, however there isn’t one in China. You did get it right by the way, the government, we the people, does have to take “everything else” into consideration where dealings with foreign nations is concerned. That’s one of its primary functions. How much it interferes is up to us.

Stefan, it’s a bit of a stretch to say that “there is no indication at all that China has any hostile intentions against the US”. Only blinders or sand would keep one from seeing or reading about this threat. A little research on the subject will show that there is at the very least “some” evidence of a threat. My study has shown overwhelming evidence, however. Below I have included an article from the U.S. Embassy, Tokyo, Japan, that discusses one aspect of this threat. My posting of the Senator’s assesment does not constitute my support of his positions. I am simply making a point about lack of indicators.

Excerpts: Senator Kyl Says China Threatens U.S. Security(Link)
Following are excerpts of Senator Kyl’s October 10 speech from the Congressional Record:

CHINA’S THREAT TO U.S. NATIONAL SECURITY

(Senate – October 10, 2000)

Mr. KYL. Mr. President, I would like to talk about something this afternoon that I think is of great importance to this country and one of the biggest challenges we are going to face in the coming years; that is, the challenge of how the United States manages our relationships with countries that potentially present threats to our national security.

While few would like to admit it, I think China cannot be omitted from this scrutiny, and I, therefore, would like to discuss that question with respect to China today.

As my colleagues know, it was not long ago that the bill to grant permanent normal trade status to China passed through the Senate without amendment. I voted for this bill because I recognize the economic benefits it will have for many American workers, businesses, and consumers. That said, it is of utmost importance that we not lose sight of the fact that trade alone does not define our relationship with China. The actions and the heated rhetoric of China’s communist leaders should be of great concern. So now, in the aftermath of our recent decision to grant PNTR to China, we are obligated to face the other challenges presented by the communist Chinese government.

Time and time again, Chinese officials and state-sponsored media have made bellicose and threatening statements aimed at the United States and our long-standing, democratic ally, Taiwan. They have even gone so far as to issue implied threats to use nuclear weapons against the United States. The question is, will we take them at their word on these defense matters as we did when they made trade commitments.

For example, in 1995, General Xiong Guangkai warned a visiting U.S. official that China could use military force to prevent Taiwan’s gaining independence without fear of U.S. intervention because American leaders `care more about Los Angeles than they do about Taiwan.’ An editorial in a military-owned newspaper this March was more blunt, warning that, `The United States will not sacrifice 200 million Americans for 20 million Taiwanese.’

In February of this year, a state-owned paper again warned the United States against becoming involved in a conflict with China over Taiwan. The People’s Liberation Army Daily carried an article which stated, `On the Taiwan issue, it is very likely that the United States will walk to the point where it injures others while ruining itself.’ The article went on to issue a veiled threat to attack the U.S. with long-range missiles, stating, `China is neither Iraq or Yugoslavia . . . it is a country that has certain abilities of launching a strategic counterattack and the capacity of launching a long-distance strike. Probably it is not a wise move to be at war with a country such as China, a point which U.S. policymakers know fairly well also.’

Not only has China warned against U.S. military intervention in the event that Taiwan declares its independence, Chinese officials have also issued threats against U.S. sale of theater missile defenses (TMD) to Taiwan. In February 1999, China’s top arms control official, Sha Zukang, was interviewed by a reporter for the publication Defense News. When asked if U.S. assistance on theater missile defense for Japan, South Korea and possibly Taiwan could cause damage to U.S.-China relations, he replied, `If the U.S. is bent on its own way on this issue, it will not, to put it lightly, be conducive to the development of legitimate self-defense needs of relevant countries.’ When further questioned about theater missile defense for Taiwan, he stated, `In the case of Taiwan, my God, that’s really the limit. It constitutes a serious infringement of China’s sovereignty and territorial integrity. It also represents a deliberate move on the part of the United States to provoke the entire Chinese people. Such a move will bring severe consequences.’ . . .

These are not examples of isolated threats. They are a small sample of the bellicose statements that China’s government has made recently. I have compiled dozens of such statements and am disappointed at the sparse attention they have received. Mr. President, I have compiled a document containing 14 pages of threats issued by communist Chinese officials. It is by no means a comprehensive compendium of such statements, and is merely a sample. I ask unanimous consent that it be printed in the Record at the conclusion of my statement.

The PRESIDENT OFFICER. Without objection, it is so ordered.

Mr. KYL. Mr. President, the rhetoric from Beijing has also been accompanied by troubling actions. China has long-range nuclear-tipped missiles targeted at American cities, and is already increasing its arsenal of such weapons. It is greatly increasing the number of short-range missiles aimed at Taiwan, and has taken steps to improve its ability to invade or blockade the island.

China has also been the world’s worst proliferator of missiles and weapons of mass destruction. It has sold ballistic missile technology to Iran, North Korea,

Syria, Libya, and Pakistan, despite promising to adhere to the Missile Technology Control Regime. It has sold nuclear technology to Iran and Pakistan. It has aided Iran’s chemical weapons program and sold that nation advanced cruise missiles. Because of China’s assistance to rogue nations and its military advances, the American people, and our forces and friends abroad, face a much greater threat.

Mr. President, as we craft effective national security policies for the United States, it’s important that we look for warning signs of problems. As Winston Churchill said, in his `Iron Curtain’ speech in 1946, less than one year after the end of World War II, `Last time, I saw it all coming and I cried aloud to my own fellow-countrymen and to the world, but no one paid any attention. Up till the year 1933 or even 1935, Germany might have been saved from the awful fate which has overtaken her . . . There never was a war in all history easier to prevent by timely action than the one which has just desolated such great areas of the globe . . . but no one would listen . . . We surely must not let that happen again.’

Now, more than 50 years later, we live in a very different world. The collapse of the Soviet empire, the spread of democracy and civil society in Eastern Europe and the Baltics, and the emergence of the United States as the sole-surviving superpower could lead some to mistakenly assume that the world is no longer a dangerous place.

To the contrary, the threats we face today are even more complex and harder to predict than those we faced during and before the Cold War. We must now be more clear than ever in our own minds about our strategic intentions, and just as clear in signaling these to our potential aggressors.

Obviously, China is not Nazi Germany, and it presents different challenges, yet the message delivered by Churchill about the need to heed warning signs is timeless. Many are quick to dismiss the rhetoric from Beijing as empty threats. This could be true, but I believe we must be prepared for another possibility–what if China’s leaders mean what they say?

China’s proliferation of the technology for ballistic missiles and weapons of mass destruction has increased the threat faced by the United States and our allies. China is increasing the size and capabilities of its strategic nuclear force targeted on the United States. And furthermore, China has tried to use the threat of missile attack to coerce the United States into staying out of any future conflict in the Taiwan Strait.

These are but three of the many compelling reasons why we need a national missile defense system to protect the United States and to guarantee our freedom of action. I disagree with those who claim China’s objection to our proposed national missile defense, NMD, system will lead to an arms race with that country. As Secretary of Defense William Cohen testified to the Senate in July of this year, `I think it’s fair to say that China, irrespective of what we do on NMD, will in fact, modernize and increase its ICBM capability.’ Of course, that is precisely what China has done. Left with this reality, we have no option but to deploy a national missile defense system that will protect the United States.

Frankly, I am disappointed that for the last eight years, the Clinton-Gore Administration has failed to pursue the most promising forms of missile defense and has underfunded the limited programs it has authorized due to loyalty to the ABM Treaty. For example, one of the Administration’s first decisions in early 1993 was to return unopened proposals the Defense Department had requested from three teams of companies that had bid to develop a ground-based national missile defense interceptor. In 1993, the Clinton Administration also cut the budget for missile defense for fiscal year 1994 by $2.5 billion over the amount requested in President Bush’s final budget, and has continued to underfund missile defense programs every year.

I believe that the ABM Treaty is obsolete. It was made with an entity that no longer exists. In the words of former Secretary of State Henry Kissinger, this treaty `constrains the nation’s missile defense programs to an intolerable degree in the day and age when ballistic missiles are so attractive to so many countries.’ Dr. Kissinger has also stated that, `Deliberate vulnerability when the technologies are available to avoid it cannot be a strategic objective, cannot be a political objective, and cannot be a moral objective of any American President.’ We must not allow loyalty to an outdated piece of paper called the ABM Treaty to stand in the way of a sound defense given the threats we face.

In addition to the deployment of a national missile defense system, it is important for the United States to use the full range of economic and diplomatic tools to halt China’s proliferation of the technology for missiles and weapons of mass destruction. I believe the Senate missed an opportunity when we failed to pass an amendment offered by Senator Thompson to combat this problem. I hope this legislation will be considered and passed next year. In addition, we need to ensure that strong export controls on U.S.-made products are in place so we don’t inadvertently help China modernize its military.

It remains to be seen whether the rhetoric from Beijing will become reality, but in light of China’s troubling actions, prudence demands that we take steps to address China’s behavior. We ignored warnings in the past and paid a high price. We surely must not let it happen again. . . .

(end of excerpts)

I think that to simply look at trade with China as an exchange of goods and currency is a bit simplistic.

Yes citizens in America get cheap consumer goods. However, they are removing economic stimulus from their own economy and gutting their manufacturing sector to the benefit of the economy of another nation.

It is not wise nor is it sustainable to continue to do so. A $75 DVD player while the economy continues to grind down is of questionable value.

“Lisa Marie, when trade is conducted with China, it is not carried out by individuals in a free and open market.”

I’m involved with businesses that conduct trade with China, and Lisa Marie is absolutely right. Trade consists of voluntary transactions between individuals, and the US government has no right using force to say what we can and cannot do. The only control I’ve observed the Chinese government apply is in controlling the currency exchanges between yuans and dollars. And frankly, neither we nor the Chinese businessmen we trade with care about that. If the Chinese government wants to hoard worthless greenbacks, let ‘em.

To take the macroeconomic policies of politicians and then make the illogical conclusion that trade occurs between “countries” and not between real people making free choices, and then to pretend that regulations and restrictions can fix the “problems” that trade produces, is a fallacy.

And I agree with Xavier: if the Chinese government thinks sending the US real goods and capital in return for worthless paper is somehow improving their position, they’re fools.

Chad, it seems clear from your pro-Empire rhetoric that you’re into Big Government, Big Regulation, Blaming Our Problems on the Commies, and Bringing Back the Cold War. It’s time to come out of the bunker and realize that the Ruskies and the Chinese aren’t champing at the bit to invade your precious country. If anything, they’re scared of a nation that outspends the rest of the world on weapons, bombs, and death. At any rate, if you’re not really interested in free market economics and reduced government intervention, perhaps an Austrian website like Mises.org isn’t really up your ally. Maybe there’s a Re-elect Bush and Cheney website you could be helping out at instead.

Paul,

You cannot see the forest for the trees. Calm down and read my ealier posts. My position in favor of free markets should be perfectly clear. I never said that trade only occurs between countries not individuals. Maybe this part was not clear. You got all the words right, but put them in the wrong context. My statement was about the reality of trade with China. It’s not a free market exchange. It should be, but it’s not. Our businesses are swamped with regulations that force them to raise prices, while Chinese businesses are subsidized by both of our governments. Now add slave labor. This allows the Chinese to unfairly undercut the market. Our businesses can’t compete, close up shop, workers lose jobs and consequently fewer people spending money and less profit for investment. Sure, cheaper poducts for consumers will be nice for a while, but it won’t last, products of socialism never will. Go back and read my earlier posts. My point has always been that I am in favor of a free market… but there is not one with China. Therefore it is unfair to American business and as it is with China it will be with the FTAA, CFTA and all other so called free trade agreements. Should I be in favor of such things simply because they are labeled “free trade”? Should I not consider all of the baggage that comes along with these so called free trade agreements, when they really have nothing to do with free trade, but more to do with regional governance. Maybe they were labeled “free trade” so that the less than thoughtful will support them blindly simply because of the label. Bush, by the way is a huge proponent of these “free trade” agrrements. Am I to make an assumption about your support of Bush, because of his support for something labeled “free trade”? It would be thoughtless for me to make such a leap.

The trees should be clearing now.

It is amazing how wrong one can be. Your assumption about my support for Bush is so misguided it should make you reflect upon your other statements in relation to my ealier post. Frankly I’m not quite sure how you arrived at that assumption. Maybe it is because you really did not read what I had to say… you just saw …China…trade…bad… and started typing.

If I wasn’t clear about my desire for free markets and limited government, I apologize. I tried to make this point clear several times in my earlier posts. If you still don’t believe me go to my web site… JPRCC.(Link) The real problem may be, however, the fact that I don’t have the same world view as you, eventhough I agree with you economically. This always seems to be a problem for Libertarians. There is an article on this subject just published on the sister sight to mises.org, lewrockwell.com. It’s posted below for your reading pleasure.

Authentic Libertarianism
by Gary North(Link)

When I hear the word, “authentic,” I reach for my pistol.
~ Gary North

This phrase is usually attributed to Hermann Goering, with “culture” substituted for “authentic.” I doubt that he ever said it. He may have said, “When I hear the word ‘culture,’ I reach for the strudel.” I think he spent a lot more time with strudel than with culture or pistols.

Whenever you hear the adjective “authentic” applied to a movement, ideology, or worldview, you can be sure of one thing: the person who just used the adjective has a definition in mind that excludes at least 80% of the members of the group that he imagines himself to me a member of. Maybe it’s as high as 98%. The word “authentic” is a kind of encircling barbed wire barrier that excludes the uninformed barbarians who have surreptitiously weaseled their way into the movement.

The word “authentic” implies that there is an unauthentic version. In usually implies that there are several unauthentic versions. But you can be sure that the critic has a definition of the real thing. This definition excludes not merely the masses but the interlopers. In fact, the masses really do not count, since they have never heard of the movement, ideology, or worldview.

THIS THING CALLED LIBERTARIANISM

I first heard about libertarianism sometime around 1960. I read articles now and then by Murray Rothbard, which were published in obscure newsletters. By this time, I had been reading The Freeman for two years. By 1960, I was already persuaded that the State was far too large and needed a good shrinking.

In 1960, that belief made me a conservative. But it also made me a libertarian. The notion of big government conservatives was as distant as big government libertarians. Those were the days, my friend. We thought they’d never end.

In 1962, I had a verbal run-in with Willmoore Kendall, one of Leo Strauss’s more coherent students. As I recall, I was defending Hayek’s view of free speech. Kendall called me a liberal. By this, I knew he meant nineteenth-century liberal. I had read Hayek’s Postscript in The Constitution of Liberty (1960), “Why I am not a Conservative.” I forthrightly agreed that this was what I was, at least on this particular issue.

Hayek was a Darwinian evolutionist, and this extended to his social theory. This was not clear to me in 1962. Hayek made this point ever more clear as he grew older, until it became the bedrock epistemology in his final book, The Fatal Conceit (1988). In fact, Hayek makes the important point that the Scottish Enlightenment was evolutionistic with respect to the development of society, and Darwin merely applied this view to biology a century later. So, to the extent that nineteenth-century liberalism was Darwinist, I was not a nineteenth-century liberal. Hayek’s social theory was ultimately not based on ethics. It was based on the unplanned, evolving accommodation of the corporate division of labor, hedged in and governed by civil law, in an evolving universe. There is nothing in his social theory to say, “This is wrong, now and forever. Don’t do it.” I make this point in Appendix B of my book, The Dominion Covenant: Genesis (1982), which is on-line for free at http://www.freebooks.com.

I read Ronald Hamowy’s critique of Hayek on the day I received Vol. I, No. 1 of New Individualist Review (April 1961). Hamowy made it clear that Hayek was soft-core in his opposition to the State. Hamowy was a zero-State critic. In this sense, he took Rothbard’s position.

This position was not Mises’ position. Mises, like Leonard E. Read and the writers in The Freeman, believed in limited civil government, sometime characterized as the night-watchman State. The Foundation for Economic Education sold Human Action and The Constitution of Liberty. Had I not received FEE’s catalogue of books, I would not have bought those two volumes. I bought both books in June, 1960. (In those days, I wrote on the front page my name and the month and year that I bought a book.)

Read had written Elements of Libertarian Leadership. I had not read it in 1960, but I knew the term “libertarian” from his book. In 1961, I met F. A. Harper, who had been on FEE’s staff, but who had split with Read over the issue of civil government. Harper opposed it completely. Harper was with the William Volker Fund in 1961, the largest pool of money in the libertarian camp, although I did not know this at the time.

Mises refused to offer a moral defense of the free market. He was a utilitarian epistemologically. Harper had told me of a discussion he had with Mises. He asked Mises, “If socialism were more efficient than capitalism, would you favor it?” Mises answered, “But it isn’t.” After several attempts, Harper dropped it. He said he was not going to get anywhere along these lines.

In 1962, Harper was tossed out at Volker. He set up the Institute for Humane Studies. The man who replaced him at Volker was Ivan Bierly, a former FEE senior staff member. He had been one of Harper’s Ph.D. students at Cornell University. He hired R. J. Rushdoony and several others, including the pro-Hitler revisionist historian, David L. Hoggan [HOEgun] and Thomas Thalken, who later became the senior librarian of the Herbert Hoover library in Iowa. I worked as a summer intern at Volker in 1963.

In 1971, I joined FEE’s staff, replacing George Roche, who had taken over the presidency of Hillsdale College.

In between, Milton Friedman had emerged as the most famous spokesman for reducing the government’s control over the economy. The University of Chicago’s department of economics and parts of the economics faculties at UCLA and the University of Virginia were defining limited government for the academic community.

And then there was the old girl network known as Objectivism.

Each group had its own epistemology. Each group had its own version of the role of ethics in defending the free market. Each group had its own limits of acceptable discourse. All were known as libertarian.

THE QUEST FOR AUTHENTICITY

In 1969, I attended a conference of graduate students and senior professors of economics. It was held at Claremont College. Harper had raised the money for it. The professors were Chicago School men, though not on the Chicago faculty. Armen Alchian was one. Henry Manne [MANee] was another.

Alchian argued, as he had been arguing for two decades, that not only is ethics irrelevant to economic theory, the concept of purposeful action is also irrelevant. The survival of the profitable will produce the same results. (Alchian, “Information, Uncertainty and the Allocation of Resources,” Economic Forces at Work, Liberty Press, 1977). This was a frontal assault against Mises’ concept of human action.

At that conference, there were several Randian attendees. The split between Rand and Nathaniel Branden had just taken place. There were two factions of Objectivists meeting in separate groups. This was all beyond me. I was so far out of the loop that I was unaware of the names of the major Objectivist players. I had not known that some, including Branden, had changed their names to incorporate RAND. His name had been Blumenthal.

The mutual excommunications had already begun. I mean, it was like Luther and the Pope. Objectivists had to take sides or be condemned by both sides. It was Pete Seeger singing “Which side are you on?” Reason apparently was as incapable of settling the dispute as the Nicene Creed had been in settling the Reformation.

So, here I was, a Calvinist, along with Calvinist Doug Adie, lectured to by Chicago School professors, inductivists all, surrounded by Randian grad students, rationalists all, at a conference funded by a Misesian.

In retrospect, I can picture the Philip Morris page, five feet tall in his spiffy uniform and cap, walking into the room and shouting, “Call for authentic libertarian!” Ten people would have rushed him. “Me! Me! I’m your man!”

A TAR BABY STRIKES

I was motivated to write all this by an exchange I had with Eric Z. Eric wrote me: “But how can you consider yourself an authentic libertarian, when the Bible is full of laws that authentic libertarians would vigorously oppose.” Like a dummy, I replied. I should have reached for my pistol.

I replied that “authentic libertarians are at war with each other over what it means to be an authentic libertarian.” Eric shot back: “A true libertarianism cannot be consistent with Biblical Law, because Biblical Law was the basis of the feudal system, and capitalism came into being by replacing that.”

In just one e-mail, he had moved from “authentic libertarianism” to “true libertarianism.” Here was a tar baby. I knew better than to continue, as I have previously written. But I did.

Get more than 2 libertarians in a room and get them to define “true libertarianism.” You get 2 answers. After 40 years, I have seen this every time.
That was not enough for Eric. It never is. “As regards the issue I raised, your answer is that you don’t have an answer, which is what I had expected to be the case.”

Funny thing about tar babies. No matter what answer you give, it’s never good enough, and they knew it wouldn’t be.

Then why do they ask?

Now, for all to see, here is my answer. I have written approximately 8,000 pages of Bible commentaries on 11 books of the Bible: Genesis, Exodus (3 volumes), Leviticus (4 volumes), Numbers, Deuteronomy (3 volumes), Matthew, Luke, Acts, Romans, First Corinthians, and First Timothy. These commentaries deal exclusively with economics. You can download any or all of them free of charge. For their web addresses, send an e-mail to commentaries@kbot.com. You will receive an instant-reply answer. Eric, this includes you.

What I found is this: the concept of the rule of law was Mosaic, not Greek (Ex. 12:49). The concept of private property is supported in the Decalogue’s laws against theft and covetousness. The Mosaic economic law as a whole was pro-market, pro-private ownership, pro-foreign trade, pro-money-lending (Deut. 28:12). The New Testament did not break with most of these laws, and the few that it did break with, such as slavery and the jubilee land law, made the resulting position even more market favorable.

It is my goal in life to do what I can to persuade people to shrink the State. The messianic State is a crude imitation of a religion of redemption. It makes the State the healer and, ultimately, the savior of all mankind. This messianic religion is what the early church battled theologically and risked martyrdom to oppose. Christians refused to toss a pinch of incense onto the altar symbolizing the genius of the emperor. For that seemingly minor resistance to State power, they were thrown to the lions. Both sides knew the stakes of that contest. Christianity was a dagger pointed at the heart of the messianic State.

It still is.

CONCLUSION

As to who the authentic libertarian is, I withhold judgment. When it comes to footnotes, I use Mises, Rothbard, Alchian, Harper, Friedman, and a host of others to document this or that illegitimate invasion by the messianic State. I even use Rand once in a while. I don’t recall ever using Branden, but I’m open to suggestions.

Making a case for rolling back the State is a full-time job for me. In the division of labor, there have been many specialists who have demonstrated that this or that piece of legislation is deserving of repeal.

There is only one libertarian whose books I have never read: James Bovard. Although I have bought several, I have never been able to get through more than 25 pages of a Bovard book. I get too angry.

My attitude is this: turn Bovard loose on the whole damnable system, and let me fiddle with my footnotes. That’s the division of labor I want. When he is finished, the rest of us can argue over what to put back in or take out.

Let me know just as soon as he’s done.

Anon-e-mouse,

I agree in principal with almost everything you presented, and I appreciate your approach as well. You seem interested in finding out what points I was trying to make rather than lodging an attack based on some key words I may have used. I am not opposed to the Chinese people profiting from trade. It is my position, however, that the consumers and businesses on both sides are losing in the long run due to our trade policies and subsidations and their forced or slave labor. If we lose businesses here due to unfair fabricated competition, then we lose jobs spend less and consume less. This is not a natural cycle. It has been unaturally created with the aid of our government. If we facilitate the profitability of slave labor, the Chinese will continue to use it, thereby negating the argument that trade will make China freer and more open. This applies to US taxpayer subsidations as well. Let’s have truly free trade with as many nations as possible, but it has to be free to be considered such and argued for. We can’t argue for free trade and then admit that it really isn’t, but say that this is acceptable because prices are cheaper.

As I said in earlier posts, there are considerations other than apparently cheap consumables when it comes to trade with foreign nations. Eliminate all subsidies and tariffs and you still have to consider such things as national security and morality(facilitating the use of slave labor). For instance, China aside, we cannot simply allow Country X free access to our borders through imports if they are our enemy or if we are at war with them. Country X may have very inexspensive products for our consumers to purchase, but if they are our enemy they may be able to cause harm to us by crossing our borders. These things have to be considered and will ultimately restrict trade. Some, here, have vehemently criticized this position, but under their position in order to facilitate “free trade” our government has no right to keep consumers and sellers from trading with the enemey no matter what the ultimate cost to national security and the freedoms that allows us to trade so freely now.

If we lose businesses here due to unfair fabricated competition, then we lose jobs spend less and consume less

I hope all on this blog who are versed in Austrian economics will have recognized the fallacy in this argument. Take the argument a step further and imagine for a second that Americans were able to get FREE DVD’s from China (or whatever good from whoever) rather than CHEAP DVD’s. Would this still hurt Americans? If you’re unsure, you should read this wonderful piece by Bastiat (“Petition of Candlestickmakers”, 1845):
http://bastiat.org/en/petition.html(Link)

We may regret the subsidies to Chinese businesses (however, are Chinese businesses the only ones subsidized in the world?) but availability of cheap imports certainly does not hurt Americans. Restricting their access would be equivalent to punishing Americans twice.

Surely “free trade” should assume that everyone is playing on a level playing field? If the Chinese state are using what is effectively slave labour in the form of prison detainees to sell goods to the US then they may also be violating Human Rights – Even worse, there is an incentive to detain even more criminals that the state can use as “slave labour” to help enrich itself. I would consider it the US’s moral obligation to place pressure on the Chinese to stop this sort of thing from happening.

At the end of the day if the Chinese state’s ideal is still that of socialism/communism, what is the point in helping the “enemy” to get rich? It would only end up is some massive cold war again.