'National Security' a Lousy Excuse for Lousy Trade and Energy Policies
Extending the justification would allow government intervention into just about anything.
Were he alive today, William Pitt the Younger might say about national security what he once said about necessity: It is "the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves."
It is also the go-to argument for President Donald Trump.
The president has used national security as an excuse to impose tariffs on steel and aluminum. This has fooled exactly nobody. Not even Jim Mattis—who after all works for Trump and who, given his position as secretary of defense, should be especially sensitive to potential security threats—would buy it. Noting that the military consumes only 3 percent of U.S. steel and aluminum production, he disputed the Commerce Department's view that national defense needs justified the tariffs. The Pentagon, he said, just didn't need the help.
Canadian Prime Minister Justin Trudeau was even more blunt about the tariffs, which affect Canadian exports. Trudeau reminded people that Canadian soldiers have shed blood alongside their American counterparts, and said it was "insulting and unacceptable" to imply that one of America's closest allies might present a threat to the U.S. In response, Trump economic adviser Larry Kudlow admitted that yes, Canada is "a fine friend and ally," but "the point is we have to protect ourselves." Oh. That clears everything up.
Now the administration is investigating whether automobile imports also threaten national security. If it concludes they do, it will impose steep tariffs on cars and trucks, which would affect longtime allies such as Japan and Germany. They also would hammer many employers in the United States. As Bill Brebick, sales manager for ZappPrecision Wire, told Marketplace's Kai Ryssdal late last month, "if you look at South Carolina and you look at BMW and Mercedes' and Volvo's presence there, people have built factories near these plants just to better support them. It's the way the business works today. It's truly a global market. … [T]he only thing that makes … a German car a German car, or Japanese car a Japanese car, is where their headquarters is. … [T]he car itself, the components, the assembly, the manufacturing, the subcontractors, the supply chain is often" located in the United States.
How could selling Americans cars that those same Americans (a) want and (b) often help build possibly threaten American security? That is quite the puzzle. Commerce Secretary Wilbur Ross lamely tried to solve it when he asserted that "without a strong economy, you can't have a strong national security."
Good grief. First of all, as The Chicago Tribune's Stephen Chapman has noted, the statement is wrong: North Korea, among others, has a disproportionately large and powerful military despite its wretched economy.
Second, Ross' comment presupposes that a strong economy requires limiting imports. That assumption has no basis in fact. Indeed, the administration argues precisely the opposite at other times—as when it seeks to reimpose import restrictions on Iran, which it claims will hurt the Iranian economy.
Third, and most troubling, is this: Ross' argument provides a justification for unlimited government. If national security requires a strong economy, and the economy is made stronger by whatever intervention the administration prefers, then no amount of economic intervention is ever too much.
The White House seems intent on pushing this theory to its limit. Last week word broke that it will use a 1950s-era law as the basis for dictating how U.S. energy markets should run. The president has ordered Energy Secretary Rick Perry to halt the mothballing of coal and nuclear power plants.
To justify the move, the administration is invoking the Defense Production Act, which Congress passed at the request of Harry Truman. In the words of a Congressional Research Service backgrounder, the law "confers upon the President authority to force private industry to give priority to defense and homeland security contracts and to allocate the resources needed."
In short, the administration will force operators of the electric grid to buy power from coal and nuclear plants whether they want to or not. This diktat is coming from a nominally Republican administration—i.e., from the same camp as all those ostensibly laissez-faire free marketeers who reviled Obamacare's individual mandate forcing consumers to buy health insurance. Republicans finally succeeded in killing the individual mandate. But now Republicans will force consumers to buy energy from coal and nuclear plants. 'Twas a famous victory.
The word "fascist" gets tossed around with ridiculous excess, but the core element of Trumponomics is fascist in the literal sense: It qualifies as "state capitalism," an economic system in which private enterprise is allowed to own the means of production and operate them for a profit—but only so long as their actions serve the interests of the state, as those interests are defined by the head of state. So file this final point under "I," for Irony: That also is the system employed by Trump's nominally communist bête noire, China.