Saturday, April 12, 2008

Day of Reckoning, Part III

After my two previous posts on Pat Buchanan’s latest book, I’d like to briefly discuss the trade issue.

I’ve written elsewhere that as a younger man I hoped to one day become an economist. Over time I was tempted by the siren song of libertarian thought unconstrained by God’s law and become a methodological individualist.

But even as a student I was perplexed by the general ignorance of economists who have a very limited analytical tool kit and are often more impressed by theoretical abstraction and mathematical mumbo jumbo than history and human nature.

As I have drifted into Calvinism, I have become a Christian covenentalist. Ultimately, I concluded, free trade is the economic component of the liberal ideology, and more a religion than anything else. At the heart of free trade doctrine is the notion that all things work together for the good of those who eliminate tariffs.

In Day of Reckoning and more thoroughly in The Great Betrayal, Buchanan traces the origins of the free-trade cult to 19th liberal thinkers Richard Cobden and Jean-Baptist Say. It was the in the stew of Enlightenment thought that free trade developed into what Rushdoony has called a "god-concept."

In 1846, the year of repeal of the Corn Laws, Cobden rose to defend free trade:

I have been accused of looking too much to material interests...I believe that the physical gain will be the smallest gain to humanity from the success of this principle. I look farther; I see in the Free-Trade principle that which shall act on the moral world as the principle of gravitation in the universe, drawing men together, thrusting aside the antagonism of race, and creed, and language, and uniting us in the bonds of eternal peace...I believe that the effect will be to change the face of the world, so as to introduce a system of government entirely distinct from that which now prevails. I believe that the desire and the motive for large and mighty empires; for gigantic armies and great navies...will die away; I believe that such things will cease to be necessary, or to be used when man becomes one family, and freely exchanges the fruits of one's labor with his brother man. I believe that...the speculative philosopher of a thousand years hence will date the greatest revolution that ever happened in the world's history from the triumph of the principle which we have met here to advocate.

According to this apostle of free trade, it is commerce, the free and unhindered movement of consumer crap across borders that has the power to cause men to lay down arms, cast aside envy and greed and embrace one another in the bond of unity, fellowship and brotherhood.

Cobden’s rendering of Luke 18-18-20 might read like this,

A certain ruler asked him, "Good teacher, what must I do to inherit eternal life?" "Why do you call me good?" Jesus answered. "No one is good -- except God alone. You know the commandments: 'Do not establish tariffs or prevent the free flow of commerce across borders.'"
In the vision of Adam Smith’s Wealth of Nations, it is the love of self and self-interest that drives all men to an enlightened interest which creates prosperity and the good society. There is some truth here. Indeed, a benevolent creator has ordered the universe in such way as to produce human happiness. Upon this foundation, it is true that there is a natural harmony of interests, exchange is beneficial for both parties and men are chiefly responsible for self-government, and the governing of family and other spheres within their proximity, rather than being rigidly responsible for the welfare of all men.

Sin, however, here as elsewhere creates division among men. Smith’s vision of the "invisible hand" owed much to an assumed understanding of divine providence and he wrote in a cultural context greatly influenced by Puritanism and Calvinism. This was not a non-Christian people nor were they modern men for whom “freedom” means drugs, booze, easy sex, and entertainment all around.

Where freedom is prior to a biblical morality grounded in gospel truth, all practices from narcotics to unspeakable perversion are subject to no controls other than personal preference and whim. This is the logical outgrowth of a system grounded on the premises and presuppositions of radical libertarianism.

There are also far reaching political consequences to free trade ideology as well as economic costs. According to David Ricardo’s principle of comparative advantage if nations specialize in the production of goods where they have some natural advantage and trade for other goods than gains from exchange will improve economic conditions in both countries. Thus Ricardo says all nations can benefit from the principles of specialization, division of labor and free trade.

The problem is that Ricardo’s theory is applicable to a world where the factors of production might be mobile nationally but breaks down in our time when production can readily move to nations with an absolute advantage.

In 19th century Britain, productivity was largely based on factors such as climate and geography, which cannot migrate. But in our time the collapse of socialism has created vast pools of cheap and willing labor. Meanwhile technological advances, particularly the internet, has either made physical location unimportant or allowed for the easy transfer of capital to nations with low labor costs.

The benefits of free trade in the form of cheap consumer goods are immediate, but the narcotic of effect of dependence on other nations will only become visible over time.

"What...the free traders fail to understand or ignore is that the transfer of production abroad is not free trade" writes Buchanan. "Unlike the export of goods, which adds to GDP, the transfer of factories subtracts from U.S. GPD and ads to Asian and Chinese GDP. When factories closed in the North and reopened in the Sun Belt, the North became a Rust Belt. The same happens to a nation when production is transferred overseas."

As the trade deficit explodes and our currency collapses the wages of Americans are lower than thirty years ago and we increasingly take on the export profile of a Third World country. We are increasingly dependent on foreign goods for the necessities of life, and on foreign banks to pay for them. The chickens are coming home to roost.

The public policy apparatus is in the hands of globalists—Democrats and Republicans, conservatives, liberals and libertarians. Their loyalties are international rather than regional, national, or local. They are anti-traditionalist and their one-worldism is the heresy of Babel.

At bottom, Pat Buchanan says, we need a new nationalism with foreign, immigration and trade policies that put American first.

"Is America on a path to national suicide?" Buchanan thinks that the twilight of America is at hand. "Our day of reckoning is at hand. Time to mind our own business. Time to lay down the burden and come home. Time to put America first."

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