Power & Market
Mises Institute Associated Scholar has been named the BB&T Professor of Economic Freedom within the Johnson Center for Political Economy at Troy University. Dr. Manish, a former Mises Research Fellow, has been a member of the Troy faculty since 2012. His research focuses on Austrian economics, macroeconomic theory and development economics, and teaches a course on Advanced Austrian Economics for the university's Masters program.
His Mises Institute work can be found here.
Dr. Manish and his wife, Dr. Malavika Nair, are regular members of the Mises University faculty.
Donald Trump renewed his attacks on trade this week, announcing new tariffs with China and extending his steel and aluminum tariffs to previously exempted Europe. Since this is Trump, it’s certainly possible that this is another example of “maximum pressure” designed to get some sort of concession. Should this represent a genuine long-term embrace of protectionist trade policy though, American consumers will pay the price.
Of course none of this is surprising; it’s what he explicitly campaigned on. (Unfortunately he’s been more willing to deliver on these promises than his attacks on the Fed.) It’s worth pointing out, however, that Trump’s critics – though correct in their criticism of his tariffs – often over-romanticize the global view of free trade pre-Trump. Nothing illustrates this better than the reaction to Trump’s moves.
After all, for all the flowery talk of leaders like Xi and Merkel of their dedication to free trade, their reaction to Trump’s tariffs have been to push tariffs of their own. China has tailored their retaliation to impact Trump’s voter base, while European Commission President Jean-Claude Juncker has threatened to make American icons like blue jeans and bourbon victims in an escalating trade war. Their willingness, however, to respond to bad policy with more bad policy highlights the truly shallow grasp of the benefits of trade.
Just as it does not benefit a country to respond to a neighbor increasing its own taxes to follow suit, retaliating to a new US tariffs by implementing one of their own only serves to hurt their own citizens. This is why Austrians have long lauded the benefits of unilateral free trade, while acknowledging the long term goal is genuine global free trade among all. To quote Louis Rouanet:
Instead of a top-down promotion of “free trade” driven by supranational institutions, we should consider unilateral free trade as an important part of a liberal political agenda. Sir Robert Peel, when announcing the repeal of the Corn Laws in the House of Commons in 1846, brilliantly warned: “I trust the government ... will not resume the policy which they and we have found most inconvenient, namely the haggling with foreign countries about reciprocal concessions, instead of taking that independent course which we believe to be conducive to our own interests. ... Let, therefore, our commerce be as free as our institutions. Let us proclaim commerce free, and nation after nation will follow our example.”
Unilateral free trade is a boon for both parties involved in trade regardless of whether or not one of them continues to impose tariffs. For those engaged in unilateral free trade, free trade means they need to export less to import more. In other words, it makes the free traders richer.
Naturally the global reaction to Trump’s tariffs is as unsurprising as the tariffs themselves. After all, while Merkel may have saw herself as the defender of the “liberal world order,” what she and the “globalists” Trump loves to rail against was really a “neoliberal” status long departed from the ideas of true classical liberals like Ludwig von Mises. For them, and their preferred presidential candidate, the aim is not “free trade” but managed trade – and the differences there are significant.
Of course, that powerful governmental bodies are acting hypocritical to their stated values is the least surprising move of them all.
President Trump declared last week that the law enforcement should “take the guns first, go through due process second.” But the history of federal firearms enforcement shows that due process is often a mirage when federal bureaucrats drop their hammer. Before enacting sweeping new gun prohibitions, we should remember the collateral damage and constitutional absurdities from previous federal crackdowns.
Gun control advocates have called for prohibiting possession of AR-15 rifles — a ban that could create five million new felons overnight, since most owners would not meekly surrender their firearms at the nearest federal office. Others advocate outlawing all semi-automatic firearms — an edict first floated by the Clinton administration that would create tens of millions of new offenders.
But before vesting vast new power in federal enforcers, the record of the Alcohol, Tobacco and Firearms (ATF) agency must be considered. A 1982 Senate Subcommittee on the Constitution report on ATF concluded, "Enforcement tactics made possible by current firearms laws are constitutionally, legally, and practically reprehensible.” Outrageous abuses have continued to the present day. An analysis conducted for the University of Chicago found that ATF heavily targeted racial minorities in its entrapment operations. And across the nation, ATF has been caught using mentally handicapped individuals in sting operations.
Sweeping new firearms prohibitions would enable the feds to selectively target unpopular offenders. The biggest debacle resulting from prior such targeting occurred 25 years ago last week outside of Waco, Texas. The federal Alcohol Tobacco and Firearms (ATF) agency saw the Branch Davidians — a fringe Protestant group that quickly became maligned as a cult — as the perfect patsies for a high-profile raid that would make G-men look like heroes.
January 20 marks the first anniversary of Donald Trump’s swearing in as the 44th person to succeed George Washington as President. Looking back, we can see that not only were the principles of civility that animatedWashington as America’s “indispensable man,” in historian Forrest MacDonald’s words, missing from the electoral process, neither our President nor his often harsh critics (particularly those who have given rise to what is now called Trump derangement syndrome), has since reflected the demeanor that helped make Washington “first in war, first in peace, and first in the hearts of his countrymen.”
We see this in the tooth-and-nail verbal melee the beltway is today, where even basic civility is routinely violated between members of opposing factions. Given the importance of comity to every form of social cooperation (supposedly advanced by the gargantuan Washington apparatus), perhaps a somewhat different approach may help. The hordes of finger-pointers and rhetorical bomb-throwers there could all benefit from reading GeorgeWashington’s Rules of Civility and Decent Behavior in Company and Conversation. Written before Washington was 16, it summarized important facets of necessary for him to behave “according to the custom of the better bred.”
Consider some of George Washington’s advice to himself and its relevance today for our current President, his admirers, and his attackers.
- Every action...ought to be with some sign of respect to those that are present.
- Speak not when you should hold your peace.
- Show not yourself glad at the misfortune of another.
- Always submit your judgment to others with modesty.
- Undertake not to teach your equal in the art [he] professes; it savors of arrogance.
- In reproving, show no sign of choler but do it with all sweetness and mildness.
- Take all admonitions thankfully.
- Mock not nor jest at anything of importance.
- Wherein you reprove another be unblameable yourself.
- Neither curse nor revile.
- Let your conversation be without malice or envy...And in all causes of passion admit reason to govern.
- Utter not base and frivolous things amongst...very difficult questions or subjects.
- Speak not injurious words, neither in jest nor earnest.
- Detract not from others.
- Be not obstinate in your own opinion.
- Reprehend not the imperfections of others.
- Think before you speak.
- Undertake not what you cannot perform.
- In disputes, be not so desirous to overcome as not to give liberty to each one to deliver his opinion and submit to the judgment of the major part.
- Contradict not at every turn what others say.
- Be not tedious in discourse, make not many digressions, nor repeat often the same manner of discourse.
- Speak not evil of the absent, for it is unjust.
George Washington’s commitment to decorum has been thoroughly trampled in America’s ongoing political uncivil war whose post-inauguration phase is now celebrating (or, more frequently, denigrating) its first anniversary. Americans could benefit greatly from deflating the incivility that besets us, in his honor. However, even more important to our well-being would be once again looking to the principles Washington articulated for governing.
- The cause of America [is] liberty.
- Express your utmost horror and detestation of the Man who wishes, under any specious pretenses, to overturn the liberties of our Country.
- Liberty will find itself...where the Government...[will] maintain all in the secure and tranquil enjoyment of the rights of person and property.
- Under [government’s] protection; everyone will reap the fruit of his labors; everyone will enjoy his own acquisitions without molestation and without danger.
- [Government] has no more right to put their hands into my pockets, without my consent, than I have to put my hands into yours.
- Government is not reason. It is...a dangerous servant and a terrible master. Never for a moment should it be left to irresponsible action.
George Washington’s character was important to our founding, but even more so, his actions were essential to our revolution’s success and the creation of America as “this land of equal liberty.” Both helped provide America with what he celebrated as “the fairest prospect of happiness and prosperity that ever was presented to man.” His core principles would provide a far more useful model for the city named for him than what we are witnessing today.