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In Defense of Economic Nationalism

A libertarian approach to trade embodies a specific industrial strategy and it’s the wrong one for America.
George Washington

Teddy Roosevelt once quipped, “Thank God I’m not a free-trader.” I agree. What was once considered a prudential question between free trade and protection depending on circumstance and national interest has now ossified into an ideology. Any attempt to direct the economy, or the country for that matter, towards specific ends is written off as socialism, full stop.

This was the subtext of a piece written by Don Devine at TAC that attempted to refute the core tenets of economic nationalism defended by our editor-at-large, Dan McCarthy. Devine’s thesis: “Who is the genius that will devise a plan…?” Since any industrial strategy, especially in light of advances in technology, would need to be complex, it’s better, he argues, to let the market sort it out instead of bureaucrats in Washington. If we try to shift our economy from services back to manufacturing, we may end up with something that “make[s] the original New Deal or War on Poverty or even Green New Deal look like child’s play.”

My response to this is simple. We need to stop pretending that libertarianism, which he credits for all the “effective actions” taken by the Trump administration, is neutral. A libertarian approach to trade embodies a specific industrial strategy and worldview, and it’s the wrong strategy and worldview for America today. Furthermore, it’s no less of an attempt at social engineering than the economic nationalism he deplores.

The libertarian strategy is clear. The goal of all its policies is the creation of an unfettered global market. The means for achieving this end is the free movement of labor and capital driven primarily by the interests of multinational corporations. The result of this strategy will be the weakening and eventual collapse of the nation-state and the demise of local and traditional institutions. The chief beneficiaries will be massive, socially progressive, unaccountable non-state actors like Google and Amazon, who will rule the world without the consent of the governed. I’m sorry, but “voting with your dollar” counts for neither citizenship nor economic freedom once corporate monopolies establish global hegemony.

Their aims can be summed up in one word: entropy. And like cancer, it will kill America. The real question is how much entropy can a nation endure before it’s no longer really a nation. Do we have a foreign policy that serves the interests of Americans, or is our empire permeating the four corners of the globe, at the extraordinary cost of American blood and treasure, to make the world safe for the global market to come? And what about a shared culture, language, and religion? The faster libertarians and the elites can eviscerate any semblance of particular attachments to place, family, or creed, the faster they can achieve their goal of a world without limits—that is to say, a world without human beings or a creator.

When this magazine was founded in 2002, one of its explicit purposes was to “question the benefits and point to the pitfalls of the global free trade economy.” Why would we do this? Because “we believe conservatism to be the most natural political tendency, rooted in man’s taste for the familiar, for family, for faith in God.” And these deep conservative commitments, with the institutions that make them possible, can and do suffer when the market is allowed to permeate every facet of human life.

The answer to the question of industrial strategy cannot be summarized with a one-size-fits-all answer, as the free-traders would like us to think. Industrial strategy requires prudence and a clear sense of our vital national interests at a particular place in time. Sometimes that will mean that free trade or fair trade is the right strategy. At other times, protection might be the answer, especially in situations where we must maintain the independence of our manufacturing sector from rival powers, particularly for military supplies, as George Washington advised.

Having an industrial strategy is inevitable. The question is not yes or no, but which one. Opponents like to downplay the concerns of those who lose out from free trade as long as GDP is growing and we have jobs in the service sector driving for Uber, working at Walmart, or, if you’re lucky, pushing papers for the government or big finance. In his magisterial book on political economy, however, economist Friederich List criticized those overly reliant on theory and science when devising economy policy, saying that the “best work on political economy which one can read in that modern land is actual life.” He urged people to open their eyes, visit the places affected by economic policy, and learn the lessons about what’s happened in our once great cities and nations. 

If you walk through the ruins of Detroit, Flint, Cleveland, and Dayton, you’ll discover what President Donald Trump accurately described as “American Carnage.” The jobs have left town, suicide rates are up, out-of-wedlock births are rampant, and there’s an opioid epidemic whose impact will last generations. Most of the financial costs of this downturn will be carried by the taxpayer, but the social costs cannot as easily be repaid.

The crisis of the heartland, created by specific policy decisions in the nation’s capital, is morally reprehensible and poses an existential threat to the foundations of our political union. It’s time to Make America Great Again, and Dan McCarthy’s blueprint for a new conservative economic program is the best place to start.

John A. Burtka IV is executive director of The American Conservative. He has appeared on Fox Business and written for The Washington Post, Richmond Times-Dispatch, American Theological InquiryFirst ThingsThe American Mind, The Intercollegiate Review, and Touchstone. You can follow him on Twitter @jburtkaIV.