How Do We Re-Industrialize America October 7, 2011
Posted by Dr. Robert Owens in Uncategorized.Tags: Capitalism, Dr. Robert Owens, Mercantilism, monopolies, Report on Manufactures, subsidies
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Manufacturing in America peaked in 1979 when 19.5 million Americans actually produced durable goods. In the last 30 years our manufacturing sector has declined by 40% losing almost 8 million jobs. Nearly 6 million jobs have been lost since 2000 and since the Great Recession began we have lost an average 89,000 manufacturing jobs every month for the last two years. Due to this dramatic constriction America has fallen below 12 million workers employed in manufacturing for the first time since 1946 and is now below levels not seen since 1941. This dismal record portrays the stunning decline of America as a manufacturing superpower. And while a rise in productivity has helped America maintain a prominent position in the world this has not resulted in manufacturing continuing to be an avenue for upward mobility for Americans.
So how do we re-industrialize America? How do we get back all the jobs that have been exported in the last 30 years? What will be the consequences of taking the bold steps necessary to make America once again the engine that drives the world’s economy? What will be the result of failing to do so?
To set this discussion into its proper context first we must look at how America grew from a rustic agricultural nation on the edge of Western civilization into the greatest industrial superpower ever known.
In the interest of full disclosure I must confess that I am a life-long capitalist. I believe that capitalism is the only economic system ever devised by man that requires free choice as a necessary requirement. Every other system is either more or less a command economy. The defense and restoration of America’s capitalist economy is today a hallmark of the conservative movement. Many study the works of Milton Friedman and Friedrich von Hayek. Those of us who want to see economic opportunity unshackled espouse the principles of both the Chicago and the Austrian Schools of economics as opposed to the theories of the Frankfurt School which have moved America in the direction of a centrally planned economy.
Flying in the face of this conventional wisdom for the purposes of this discussion we must ask the question, was it capitalism that provided the environment which set America on the road to material riches and industrial power? Culture to humans is like water to a fish. It is everywhere. It provides the medium through which we move. However, since it is ever present it is not something we constantly notice or concentrate on. Most of those who read these words were raised in a time or by people who taught American History as a positive, ever improving saga. We were taught that America never started a war and never lost one. We were taught that rugged individualism carved out an empire from a raw wilderness. We were taught that capitalism paved and paid the way.
At the hazard of being branded an apostate to conservatism I must continue to ask the question, was capitalism the catalyst for America’s industrial power or do we labor under the after-glow of a time when American History was taught in such a way as to magnify present circumstances by projecting them into the past? Are we looking to a myth of free enterprise to recreate what it didn’t create in the first place?
Was it capitalism that fostered the founding of the colonies which became the seedbed of the United States?
Mercantilism was the economic system that proceeded capitalism in western civilization. This was a system of economic nationalism which sought to build a strong country by maintaining a favorable balance of trade and by being self-sufficient. This was one of the primary reasons why the sea-going European powers sought to establish colonies. They wanted to secure sources of raw materials for their developing industrial sectors and to control external markets allowing them to produce and sell products all within their domestic economy, keeping all the gold at home.
The term mercantilism was coined by Adam Smith the philosophical father of capitalism, but it was not capitalism. Inherently Mercantilism necessitated a centrally planned and controlled economy. What benefitted the nation was permitted and encouraged. What didn’t was prohibited and discouraged. It was under this system that the English colonies were founded. The first viable English colony in the New World, Virginia was founded by the Virginia Company a joint stock company which was given a charter by James I. This charter, like subsequent charters given to the Massachusetts Bay Company and proprietary charters given to individuals such as William Penn and the Lords Baltimore gave these companies and individuals monopolies within specific geographic areas. Government imposed and enforced monopolies are a restraint of trade and by nature incompatible with a free capitalist system.
The colonies founded upon this restraint of trade followed suit giving monopolies to companies and individuals to do everything from making iron to importing. Government planning and control of the economy did not stop there. The colonial governments also granted subsidies, bounties, land grants, loans and money prizes to encourage the birth and prosperity of the industries and services desired. Through these actions the precursors of modern America were doing what is today reviled as inherently un-American, picking winners and losers.
If we fast forward to the founding of the United States do we find the unbridled free enterprise seen today to be the natural state of the Republic?
In 1791 Secretary of the Treasury Alexander Hamilton issued his third path-breaking report to Congress the Report on Manufactures. Of all his reports this one is considered the most innovative. It provided a stark revelation of Hamilton’s and his Federalist compatriots’ vision for America and its economy. So did this report outline an economy based upon capitalism and free enterprise? No it did not. This report envisions an America “independent of foreign nations for military and other essential supplies” this is the heart of a mercantilist program. Hamilton proposed subsidies to encourage industry. Some of the mercantilist policies advocated by Hamilton encouraged the central government:
- To constitute a fund for paying the bounties.
- To constitute a fund for a board to promote arts, agriculture, manufactures, and commerce. Hamilton wanted the fund to:
- to defray the expenses of the emigration of artists, and manufacturers in particular branches of extraordinary.
- to induce the prosecution and introduction of useful discoveries, inventions, and improvements, by proportionate rewards.
- to encourage by premiums, both honorable and lucrative, the exertions of individuals and of classes.
The historical evidence of America’s reliance upon protectionist and economic interventionist policies as tools in the building of our greatness can be found everywhere. The central government built, licensed, and encouraged roads and canals to foster interstate trade by providing monopolies, subsidies and grants. It fought wars to safeguard sea lanes and to expand territory and markets. And it birthed, regulated and controlled the financial industry from its very inception.
The incontrovertible evidence points to the fact that America was founded, launched, and nurtured as the successor to and the continuation of mercantilist not capitalist policies.
If these were the policies of economic nationalism which helped foster America’s rise to industrial greatness wouldn’t it seem appropriate for these policies to be the ones that would help it rise again? There is only one national figure who has consistently urged a return to economic nationalism, Patrick Buchanan. He has pointed out for years that our rush to embrace so-called free trade has put American workers at a decided disadvantage. The dissolution of tariff protection forced our workers to compete against people who will work for a small percentage of what Americans can afford to work for in societies with little or no regulation.
How do we get back all the jobs that have been exported in the last 30 years?
If we want to re-industrialize America we have to protect our markets and support our industry otherwise we will soon sink to a supplier of raw materials and a market to China and the other rapidly rising industrial powers of Asia.
What will be the consequences of taking the bold steps necessary to make America once again the engine that drives the world’s economy?
Such a policy calculated to re-build our industry and re-capture our domestic markets from China, Japan, and the four tigers of Asia will carry as many risks as it does benefits. Just as any predator will react to resistance on the part of its prey so to if we enact tariffs on Chinese goods it may well ignite a trade war. Then again anything worth having is worth fighting for. If we want to once again rise to the top of the industrial world to once again have a favorable balance of trade we need to look to what is best for America not what is best for the U. N. or what is best for the globalization lobby.
What will be the result of failing to rebuild our industrial sector?
Some may deride this proposed return to mercantilist policies as isolationism. However, just as a nation without borders will soon cease to be a nation any nation that fails to protect and encourage its industry will find itself an agricultural and raw material colony in all but name for those nations which do.
Dr. Owens teaches History, Political Science, and Religion for Southside Virginia Community College. He is the author of the History of the Future @ http://drrobertowens.com © 2011 Robert R. Owens drrobertowens@hotmail.com Follow Dr. Robert Owens on Facebook or Twitter @ Drrobertowens
Freedom is as Freedom Does August 26, 2011
Posted by Dr. Robert Owens in Uncategorized.Tags: Capitalism, democracy, Dr. Robert Owens, free enterprise, Representative republic
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Is there any one political or economic system that God wants everyone to follow? I do not believe God has ordained any one type of government or economy as the divinely ordained path.
The only government He ever instituted was a kingdom with Himself as the king and that was rejected by His own people when they instead wanted to be like the people who surrounded them. And even though God had His prophets warn them that this earthly king would take their lands, their children, their goods and their freedom they persisted in rejecting a divine King for kings who would claim divine rights.
The only economy God has instituted is the divine economy where there is never a lack and always abundance. With cattle on a thousand hills God does not participate in recessions and He has promised many times that those in His hands cannot be plucked out. He promises that though a thousand fall on one side and ten thousand on the other destruction shall not consume those who trust in Him. And though in the eyes of this world it may appear that the evil often triumphs and the good are forsaken He tells us, “Those who wait on the Lord shall renew their strength; they shall mount up with wings like eagles, they shall run and not be weary, they shall walk and not faint.”
Free choice is a major part of God’s plan. As a matter of fact that is His plan. He could have just as easily created humans who had no free choice, could not disobey, never fall and always remain just as He designed them. But instead He desired the loving family that can only come about from love freely given and freely received.
Individually God has given each of us free choice. Therefore, I believe freedom to make choices unencumbered by outside interference is a fundamental building block of human nature and thus a required element of any society which matches the reality of the human condition. Each of us gets to decide which we are going to believe, our eyes of flesh or our eyes of faith. Is the world true or is God true? As for me and my house, we will serve the Lord. That is my free choice and you are free to make yours.
I believe that God desires us to make free choices with regard to faith and lifestyle. Therefore, personal freedom is necessary for life as God intended. And this has a great impact upon the first half of our question, is there any one political system that God wants everyone to follow?
It is apparent that the only form of government ever devised by man that requires personal free choice as a prime component is democracy. All other forms of government are some variation of the divine right of somebody to tell everybody else what to do. By the way, that’s democracy as in one-citizen-one-vote not as in Democratic People’s Republic. And since all forms of direct democracy eventually devolve into a tyranny of the majority the only thing that works over time is a representative republic which operates on democratic principles. Meaning a system wherein the people have the opportunity to select their own representatives as long as those representatives actually represent the people and do not become the pawns of powerful special interests.
Also based upon the fact that personal freedom is a fundamental component of life as God desires for humanity which brings us to the second half of our question: is there any one economic system that God wants everyone to follow? It is apparent to even a casual observer that free market capitalism is the only economic system ever devised by man that requires personal freedom to operate. All other economic systems ultimately translate into some variation of a command economy. Some bureaucrat somewhere decides how many widgets to make and that’s how many widgets are produced regardless of need or demand. Command economies foster disequilibrium and maladjustments. There are always either too many widgets or not enough. In a fee market capitalist system demand always dictates production and inherently guides supply.
America was originally launched as a representative republic based upon democratic principles with a free economy which based upon the above exemplifies the ideal for a nation-state. This is what we have known. If the Progressives continue to succeed in their efforts to fundamentally transform America what can we expect?
Look at the areas of American life so far transformed, massive government take-overs either through outright purchase or indirectly through regulation of industry, insurance, and finance. Taking this as a guide we should expect further intrusion of the central government into the economy thus transforming America into a command economy with all the problems inherent in that type of system.
The health care take-over which is scheduled to phase in like boiling water phases in for a frog, feeling so comforting until it’s too late to jump out. Using the need to modify our behavior to cut health care costs we should expect the central planners to inch-by-inch transform our daily routines of eating and exercise until they are telling us when to jump and how high. It is often the unintended consequences which have the greatest effects as a result of the Progressive impulse to create a Utopia.
The only way Utopians ever try to create a heaven on earth is to build nanny-states to protect us from ourselves with no thought of how the unintended consequences actually harm the people the intention was to help. Eventually there is also no limit to the amount of force it takes to compel compliance once the bureaucracy has decreed something is good for the collective. An example from Obamacare is the provision forcing insurance companies to accept pre-existing conditions for all children insured. This sounds great. And it will surely protect the Kids. But what it really does is prompt many insurance companies to quit insuring children because they realize this government mandated provision will cause them to lose money, and despite the progressive belief that people should open and maintain private businesses as non-tax supported social agencies people who own businesses do so to make money.
Another example is businesses either dropping insurance for their employees because the fines imposed will be cheaper than the insurance or seeking an exemption. It is projected that 30% of employers will drop their employee healthcare once Obamacare is fully instituted. So much for “If you have your plan and you like it,… or you have a doctor and you like your doctor, that you don’t have to change plans.”
The Financial take-over through regulation has not been unwrapped yet and even the politicians most involved in writing it say they don’t know what’s in it so its long term impact can only be imagined. Does anyone imagine it will be good for free-enterprise, competition, and capitalism? As the Progressives continue to experiment looking for some way to accomplish the impossible, heaven on earth, the uncertainty keeps people from investing, businesses from growing and the economy from recovering. After two and a half years it should be apparent the current administration has successfully turned a recession into a new normal of lower expectations and a loss of hope.
But then again my hope was never in the government to begin with, and since they didn’t give it to me they can’t take it away. My hope is in Jesus and He never fails.
Dr. Owens teaches History, Political Science, and Religion for Southside Virginia Community College. He is the author of the History of the Future @ http://drrobertowens.com View the trailer for Dr. Owens’ latest book @ http://www.youtube.com/watch?v=_ypkoS0gGn8 © 2011 Robert R. Owens drrobertowens@hotmail.com Follow Dr. Robert Owens on Facebook or Twitter @ Drrobertowens.
Whose Responsibility is It? August 21, 2010
Posted by Dr. Robert Owens in Uncategorized.Tags: Capitalism, Dr. Robert Owens, Internationalists, Natural rights, Progressives
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Having spent time describing the three unalienable rights of life, liberty and property upon which our Republic was founded and from which all others flow it is necessary to speak of the natural responsibilities which form their inverse image. Peering through the looking glass at original intent we try to make sense of the present wonderland where rights and responsibilities are never what they seem.
There are five natural responsibilities. First, we’re responsible for our actions. No one can make us do anything. Even when forced it is still us who must make our muscles move and make our voices speak. We are responsible for the validity of our word and it should be our bond that we will do what we have said we will do when we have said we will do it. Second, each person is responsible for their own sustenance. We should provide for ourselves not expecting others to meet our needs or supply us with the comforts we desire. Third, we are responsible for our children. It is the duty of every parent to provide for the physical, emotional and spiritual support of our children until they are old enough to care for themselves. Fourth we are responsible for the fulfillment of all contracts we have freely accepted. And fifth, everyone has a responsibility to a social system which provides them freedom to use their own talents and energy for their own goals.
As stated earlier these natural responsibilities are directly linked to the natural rights of humanity to life, liberty and property. A person’s right to life inherently carries a responsibility to provide for them self and for their family without making demands upon the goods or time of others. This responsibility to care for our family extends existentially in both directions. Just as it is incumbent upon all of us to care for our own children, each of us, initially claims the support of our parents, therefore it is equally incumbent upon us to care for our parents if they can no longer care for themselves. As we have the liberty to use our time and talents for our own improvement we are inherently responsible for how we use them and for any consequences that flow from their use. And since legitimate government exists to protect our natural rights we are responsible for contributing to its ability to fulfill this function. This would include reasonable taxes and public service.
This is the extent of our natural responsibilities. Once we move beyond these we enter into the realm of moral or religious responsibilities. While natural responsibilities like natural rights are objectively arrived at by the nature of humanity moral or religious responsibilities are by their nature subjectively learned. Consequently the fulfillment of natural responsibilities flow logically from life while in most cases unless moral or religious obligations are personally perceived and agreed upon they must be fulfilled through the application of law and its ability to compel compliance.
As these secondary type responsibilities are most properly the purview of a moral code or religion and as each moral code or religion may carry different obligations it is presumptuous of government to impose upon its citizens what should instead be a free choice. For, the imposition of one moral code or religion could possibly transgress or ignore the moral obligations of another the sanction of one moral code or religion over another inherently restricts the citizen’s enjoyment of their unalienable rights.
Today our ever-expanding government invents new responsibilities and then force feeds them to a powerless public. These include responsibilities to the nation and the world. On a daily basis we hear of our responsibility to the poor, the uneducated, or the uninsured. And these new responsibilities do not just extend to our fellow Americans. Through the continuous imposition of these constantly proliferating rights internationalists seek to transfer the wealth of the United States to the third world as their open borders policy invites the third world to come here to claim it. Using our tax money the government seeks to care for everyone’s needs from cradle to grave. The inefficiencies of bureaucracy ensure that a large percentage of these resources get flushed down the sewer while we fall deeper into debt.
These newly invented responsibilities are not natural and our government must violate the natural rights of its citizens to fulfill them. They do this by expropriating our property and the enjoyment of the fruits of our labor which diminishes our lives from all they could be to what they allow them to be. In addition, the only way the government can expropriate these things and distribute them from who earned them to who they believe deserves them is to increase their power by diminishing ours.
If not from nature where do these government enforced responsibilities originate? They spring from ideology and the quest for power. By preying upon the gullibility of the uninformed, the culpability of the greedy and the lethargy of the uncaring the Progressive clique has gained control of the American experiment. It has used the ideology and terminology of extreme socialism, “From each according to their ability to each according to their need” to construct a conveyor belt transferring wealth from producers to consumers. The Progressives buy votes and continued support by dividing the swag from their plunder of American capitalism. Even though the government’s propaganda arms drone constantly about these enforced responsibilities still the majority of Americans instinctively know the difference between natural responsibilities and government mandated ones. If we don’t demand a stop to this proliferation of imagined responsibilities and the expropriation of resources needed to fulfill them we will lose our natural rights and the ability to fulfill the natural responsibilities which flow from them.
Dr. Owens teaches History, Political Science, and Religion for Southside Virginia Community College and History for the American Public University System. http://drrobertowens.com © 2010 Robert R. Owens dr.owens@comcast.net
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