November 16, 2008

Save the Auto Workers?

There’s an inbuilt tension, not just on the Right but pervading the West, between two important goods: the efficient production and rational distribution of wealth provided by the Market economy, and the social stability and cultural continuity that come with enduring institutions. There’s no easy way to reconcile the two. With Tom Piatak, I mourn the destruction of the communities built up by the auto industry—while remembering that they themselves are the result of mass-production, which lured men off their family farms and made them wage-earners dependent on the caprices of the international market. The standard free market reply to his plaint about the devastation of the auto industry suggests that these men will, in time, find “more productive” jobs that meet market needs. Of course, the Market is far from free; our safety and wage laws, designed to protect social goods and promote that lost ideal, the “family wage,” make our workers uncompetitive with foreigners who are unprotected by such regulations (in China, Mexico, etc.). Nor would we wish to overturn such laws. The seemingly obvious answer is protectionism—except that such a policy raises prices across the board, the effect of which is felt most by… ordinary workers. Essentially, less-skilled workers must choose between higher wages and higher prices, or lower wages and lower prices. If we act as economic materialists, and pretend that all human beings are interchangeable—such that the descendants of slaves or war veterans or Founding Fathers mean no more to us than men waving newly minted green cards—then mass immigration is just another form of diluting the price of labor. Immigrants may run down our wages, but they lower our prices (if you leave aside the government benefits they demand—a BIG if).

A deeper question is raised when we remember the whole point Charles Murray was trying to make in The Bell Curve—95% of which had nothing to do with race: We have for the past generation at least allowed those on the right hand side of the Bell Curve—knowledge workers, bureaucrats, rhetoricians, journalists, sophists, etc—to shape policy and the economy to their own benefit. Not too surprisingly, there isn’t a large scale, self-identified, Low IQ Lobby to counter this trend. We must engage in a bit of paternalism, and say that it’s essential to preserve the human dignity and family stability of those less able to compete in a knowledge economy, to maintain a large range of jobs they can do at a decent wage inside the country. If we expect such people to pay taxes, act patriotically, and fight in our armies, we cannot allow the economy to freeze them out. They have the right, as citizens, to expect that the government will act to preserve their ability to work and support themselves. Does this mean full-scale protectionism? No, because that would raise all the prices they pay. Can we jigger protectionism so that it only affects the rich? I doubt it. Can we offer subsidy checks, drawn from progressive taxes, to supplement the incomes of the working class?  Degrading, and politically corrupting.

Remember that the basis of liberty is a citizenry which largely possesses either the skills or the property to support itself; that means a large body of independent farmers, craftsmen, shopkeepers, to counterbalance those dependent on wages or government benefits. That was Wilhelm Ropke’s insight, based on his study of European history. Switzerland developed and maintained its truly democratic, libertarian society because its culture valued the yeoman and the burgher over the lord and the serf. Jefferson hoped we could do the same. Of course, in an increasingly high-tech economy, not everyone is cut out (see The Bell Curve) for such economic independence. There will have to be wage earners, and wages.

What can the State do? How about this: Enforce Protectionism on the State, but not on the private sector. Mandate that all government expenditures must go to domestic producers—and wherever possible, to smaller companies or family farms. All military equipment should be domestically produced. Everything used in a school, or federally-funded hospital, or for civil engineering. This would make government projects more expensive, and somewhat less efficient, but it would maintain many jobs for less-skilled, less cognitively able workers. The public sector would be directly proportionate to the protected sector of the economy, allowing weaker citizens to benefit from the State, requiring elites who benefit from government intervention to subsidize the employment of less able citizens, and reasserting a certain patriotic solidarity among social classes. It might also lead to the shrinkage of government—which would free up more capital to fuel economic growth.

Not a perfect solution, but there aren’t any.

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