The Free Market

Free trade and peace go together; protectionism is the handmaiden of war. These were key teachings of the early classical economists, as well as the Austrians. Consistent libertarians have never doubted it. But recently the theory has come under fire from all sides—and led to dangerous coalitions pushing for the worst of all worlds, autarky and military belligerence.

As recently as 50 years ago, economists regarded the vitality of the economy as consonant with its ability to produce things people want (and would pay for). Today, the economy has been redefined into something called the Gross Domestic Product, or GDP. It measures all goods and services brought to market in a given year. But is it really an accurate measure of how well an economy is serving people's needs? Here are some outlandish ways the GDP can be boosted.

This summer, the Environmental Protection Agency announced that it had effectively decontaminated dioxin-laced soil from what was once the community of Times Beach, Missouri. But while the dirt of this site may now be certifiably clean, it will take much more than an incinerator to decontaminate the toxic EPA policies which destroyed the town. The experience of Seveso, Italy, clearly demonstrates that it was not necessary for EPA to destroy Times Beach in order to save it.

The 50th anniversary of the Marshall Plan provided another occasion for the media to celebrate the government's good works. The U.S.'s headlong plunge into global welfarism (nearly $100 billion in current dollars), they said, saved European economies after the Second World War. One reporter, Garrick Utley of NBC, even theorized that Marshall aid explains why East Germany was poor and West Germany rich.

Academia has undergone a remarkable transformation in recent years. Take a look at the recent book catalog of Duke University Press, once a prestigious publishing house. Today it features third-rate, race-obsessed, sex-obsessed, solipsistic tirades masquerading as scholarship.

At last, the Republican Congress has proposed cutting death taxes. It wants the exemption to be raised from $600,000 to $1 million. Not bad for a start. But if Congress is serious about reducing the tax, the rate should immediately index the exemption to the inflation rate. If the inflation of the last 10 years continues over the next, the $1 million exemption will be worth a third less. Why should the government get rich by mismanaging the monetary system?

The Clinton administration has targeted a new batch of global enemies. It wants to crush them with the usual mix of negotiation, treaty, and enforcement through spying, fines, and propaganda. It's all in a day's work for the "world's indispensable nation"—the administration's new name for itself.

Our domestic automakers produce fine cars and trucks that people freely choose to buy. They make lots of money doing this. So why is the federal government shoveling hundred of millions of dollars annually in corporate welfare their way?

It is no surprise that a bureaucracy would study itself and conclude that neither its budget nor its policies should change. Neither is it a shock that the Pentagon has bypassed the question of why we need to involve ourselves in any foreign wars. After all, the U.S. long ago abandoned the Constitutional ideal of a strictly defensive military posture.

The rise of home schooling coincides with the general breakdown in the public school system. It began when LBJ, our first "education president," signed the Elementary and Secondary Education Act of 1965, with funding of $1.65 billion. The congressional sponsor predicted, ironically, that the bill would reduce "the cost of crime, delinquency, unemployment, and welfare."

The 5th Street Theater in Seattle, Washington, is one of a dwindling number of houses of its kind. It receives no government money whatsoever. Its revenues come from a permanent endowment and ticket sales to its popular, if small-scale shows. Its charter prevents it from raising money from other private sources. It keeps a low profile in the arts community, but its staff is as loyal and dedicated as its steady stream of patrons.

Jack Kemp, former HUD secretary and failed vice presidential candidate, recently proved that academic leftists aren't the only ones intolerant of politically incorrect ideas. He interrupted a luncheon speech I was giving at an academic conference by squirreling around in his seat, ostentatiously rolling his shoulders and eyes, and loudly and repeatedly moaning, "Jeez!" and "Oh Gawd!"

The glories of private enterprise are most evident in the marvels we take for granted. For example, free enterprise created the marvelous, if much derided, institution of fast food. If there were a bureau of hamburger production, they'd be as scarce as budget cuts. As it is, citizens of every social and economic standing have daily access—in minutes—to a balanced meal denied to kings only two centuries ago.

The World Trade Organization has a fantastic but undeserved reputation in international circles as the world's premier institution of free trade. Despite all of the WTO's pretensions to greatness, this glorified trade-management bureaucracy exists only to promote the interests of well-heeled trade lobbyists and political power brokers.

The most encouraging trend of our time is the widespread loss of faith in government. No longer do people look to the government as the great problem solver, economic planner, social unifier, or cultural czar. The government is more likely to be seen for what it is, a haven for grafters, liars, and would-be tyrants. Americans, like the Russians, no longer believe anything until it is officially denied.

Some scientists boycotted a recent conference that examined the EPA's draconian proposal to regulate ultra-small soot particles. The sponsoring organization, the Annapolis Center, gets corporate money. According to Harvard epidemiologist Joel Schwartz, that makes the event look "like a set-up job."

My Latin professor once taught me the golden rule of Roman emperors, Vulgus vult decipi, ergo decipiatur. It means the masses want to be cheated, so let's cheat them. Machiavelli built his theory of government partially on this credo.

The Dole Foundation is a project of the United Cerebral Palsy Association (operating budget: $540 million). Fully 80 percent of the UCPA's funding comes straight from the taxpayer's wallet. Voluntary contributions are only 11 percent, less than the percentage the UCPA spends on pro-welfare political lobbying. The Doles do not fund the Dole Foundation. Taxpayers do. No wonder he doesn't talk about it much.

Washington's sudden fixation on campaign finance won't bring about honesty in government, and it won't increase anyone's liberty. But it does give the public a real-world civics lesson. For it shows that government is no neutral arbiter of justice, but a corrupt scheme by which the politically powerful enrich themselves at the expense of everyone else.

The Washington Times asked the new UN head why he thinks the agency has a PR problem in the United States. "It is a leftover from the late seventies and eighties," he said, "when there was a lot of talking about getting government off the back of people."