Reason.com

Free Minds & Free Markets

‘National Security’ a Lousy Excuse for Lousy Trade and Energy Policies

Extending the justification would allow government intervention into just about anything.

rolls of steelBen Birchall/ZUMA Press/NewscomWere 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.

Photo Credit: Ben Birchall/ZUMA Press/Newscom

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • Shirley Knott||

    "Nobody is fooled..."
    Really? I suspect a good chunk of Trump's base is, and he might grab some approval from those wavering.
    These are the people the message is aimed at, not the players within the government.

  • Rich||

    Now the administration is investigating whether automobile imports also threaten national security.

    One trusts that the administration is also investigating whether such national-security investigations also threaten national security.

  • Just Say'n||

    "'National Security' a Lousy Excuse for Lousy Trade and Energy Policies"

    This is a rather odd headline to have in a publication that supported tariffs against Russia (and made that article its cover story) over conspiracy theories that have yet to be proven.

  • Just Say'n||

    "Physician heal thyself"

  • Juice||

    Really? Which cover? One of the 2017 covers has Putin on it, but the headline is something about how he's on some anti-libertarian crusade or something.

  • Curt||

    "'National Security' a Lousy Excuse for Lousy Trade and Energy Policies"

    So is "For the Children!". But if our betters in the government don't use one of those, what the fuck will they use?

    "It Actually Makes Economic Sense!" just doesn't have the same ring to it. "Because It's a Free Country; So the People Can Make Up Their Own Damn Minds" would never gather any support. "We Determined That We Don't Actually Have the Constitutional Authority to Enact This Law" won't get you very far. "We Could've Done Something Far Worse" is a little bit too honest.

  • Longtobefree||

    Can you yell "National Security" falsely in a crowded theater?

  • Leo Kovalensky II||

    Depending on the agreed rules of engagement you may have to yell "Fire" first.

  • Curt||

    "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."

    So, just to clarify, is a Dodge Challenger an American car? It's a brand that is normally thought of as American. It belongs to an Italian company. It's assembled in Canada.

    If I'm going to be a good little trooper and Buy American!!!, should I buy stuff with American parts, stuff assembled in America, stuff with an American name, stuff from a company headquartered in America?

    Is there any reason that we should give a shit?

  • Iheartskeet||

    Best I can tell, the most American thing you can do is build a car in your backyard, only from materials also sourced in your backyard, because this will result in full employment across our great land, as everyone spends their time making cars.

  • Leo Kovalensky II||

    This is incorrect. First you have to join the UAW. Even if a car is assembled in America it's not American if the union wasn't involved.

  • Leo Kovalensky II||

    A Barton Hinkle, FTW!

  • BYODB||


    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.


    But it would be totally fine if they just subsidized the shit out of those forms of energy to make the price point better, right?


    Not defending the choice, it's dumb compared to way better solutions, but there is nothing even remotely approaching a 'free market' in energy.


    In terms of the tariffs, once again a Reason author is incapable of positing that maybe it's to bring North Korea to the table via Chinese influence.

  • RCCA||

    As President Trump has repeatedly explained, the dumping of low priced steel into American markets has resulted in the decimation of US steel manufacturing -- and that is the threat to national security. Strange that the article fails to mention this simple notion to understand. The US can not allow itself to be dependent on foreign sources of such a basic building material, regardless of whether we are importing from China or Canada.

GET REASON MAGAZINE

Get Reason's print or digital edition before it’s posted online