The Economic Nationalist

L. Gordon Crovitz, former executive vice president of Dow Jones and past publisher of the Wall Street Journal, opines in the newspaper he once published,

At the dawn of the Industrial Age, in 1719, the British Parliament passed a law banning craftsmen from emigrating to France or other rival countries…. “At that time the chief concern was the loss of iron founders and watchmakers,” Gavin Weightman writes…. Spies from around the world tried to uncover the secrets of British engineering…. This attempted protectionism of ideas was doomed by easier travel and communication.

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News: As of Friday morning, December 19, the U.S. Treasury had not burned through quite the entire $ 350 billion fund Congress had appropriated for it to bail out Wall Street. At least $ 17.4 billion evidently remained. The outgoing George W. Bush administration has decided to exercise the discretion the bailout statute affords it to redirect this last remainder to rescue Detroit.

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Some fret that the auto-industry bailout bill delivers operational control of the U.S. auto industry to a federal government that knows little or nothing about making cars. This concern is proper, it is right, and the Economic Nationalist shares it—for the federal government indeed should not be trying to operate car manufacturers—but the concern entirely misses the bailout’s point. The point is not to make America’s auto industry more efficient, for the industry itself has already done that. The point is to ensure that America still has an auto industry at all.

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If any of Congress’ anti-bailout Republicans can produce a concrete plan to guide Detroit’s Big Three auto makers through Chapter 11 bankruptcy toward future vigor without compromising the actual Americanness of the American auto industry, then Congress ought to consider such a plan on its merits. In the meantime, however, Tom Piatak is right when he writes, “But even if the attempt to save the Big Three ultimately fails, both prudence and patriotism suggest that it is worth trying.” On unapologetically conservative grounds, the Economic Nationalist believes that Congress should appropriate from the Treasury the needed billions to bail out the U.S. auto industry.

Now, whether you agree or you disagree, the present public discourse on the topic nevertheless suffers an extremely serious flaw, a flaw which makes it nearly impossible to reach rational public conclusions in the matter and a flaw of which all this blog’s readers should make themselves acutely aware. The flaw: there is no such person, there is no such corporation, as “the American auto industry” or “The Big Three.”

It does not exist.

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America’s material wealth consists not of the things we finance, communicate, administer and trade. It consists, largely, of the things we manufacture, grow, mine and build. The Economic Nationalist thus wonders how it comes to pass that the United States can spare $ 2000 billion to bail out Wall Street, which makes nothing, but, seemingly, not $ 50 billion to bail out Detroit.

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If you have children (or maybe you remember your own childhood), then you will have seen a child try to force something, like a key in a lock or the buckle on a belt, or a door when something is caught in the frame below the hinge. When the thing does not go, you and I stop, back off and reassess, but the child applies more force until the thing bends, warps or breaks. Crack! Oops.

It seems to me that our nation’s leading free traders increasingly approach U.S. trade policy in such a manner. The thing the free trader forces however, is not a key, a buckle or a door, but an economy and a nation. One wonders what it would take to teach today’s free trade theorists the simple wisdom to stop, back off and reassess. What exactly is so important to them about the theory, anyway, that for its sake they insist on pounding every last millimeter of the square national peg into the round international hole?

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