Do You Even Empire, Bro?

I would like to send Peter Navarro or some other daffy representative of the Trump administration back in time to sit down with Augustus or Henry VIII and try to explain U.S. trade problems:

Navarro: “Well, Augie (or Hank), here’s the thing. We’re pretty much the richest country in the world—the richest big one, anyway—and, as a consequence of that, everybody wants to sell stuff in our market, because it is a big marketplace full of rich people. And the world in our time is incredibly rich compared to your time, so the quantity and quality of stuff being produced is just mind-boggling. I mean, if an American family tried to raise its children in material conditions similar to what you typically see in the households of your aristocracy, the government would come in and take their children away because of neglect. True fact. Crazy rich world. And so, all of the best and most prolific producers of goods from around the world—from wine to books to silver to … I’m trying to keep it to things you’ll understand … but, anyway, it’s all the best stuff, from every corner of the world. And what happens is, the people who produce all that stuff bring it to our shores, at their own expense, and lay it down at the feet of our people. And the problem we’re trying to solve is that the prices aren’t high enough.” 

Augie (or Hank): “Bro, do you even empire?”

Henry VIII founded the British navy in 1546 to protect trade routes—and he also reduced tariffs on imported goods and negotiated trade agreements with such occasionally hostile forces as Spain and France. But he was a newcomer to that game: Egyptian reliefs document a royal trade mission to Punt (probably in the neighborhood of what is now Somalia) in the 15^th century—B.C. 

From time immemorial, kings, princes, sultans, pharaohs, and emperors have built armies and—especially—navies to keep trade routes open. They built roads to enable the movement of goods into their capital cities. The pharaoh Hatshepsut herself led a trade delegation to Punt, an event considered consequential enough to be memorialized in her temple, and she also built a fleet to carry out trade on the Red Sea. By land and by water, the Egyptians traded bitumen, copper, naphtha, manufactured goods, ebony, incense, and cattle, among other products. That is what great leaders of antiquity did: Rome’s interests in Egypt, Carthage, and Sicily were trade-driven: Even though Rome was surrounded by plantations, it was an essentially urban power that could not hope to feed its teeming population without importing food. Henry VIII wasn’t doing anything new. In the novel Wolf Hall, the king receives some counsel from Thomas Cromwell regarding his envy for his French counterpart: “Take no lessons from King François. He likes war too much, and trade too little.” It is excellent advice and, if the historical Henry VIII ever received similar counsel, he did well to heed it. 

Donald Trump has a good deal in common with Henry VIII (“Hyperion to a satyr,” you say?  Trump is only halfway to matching the lusty monarch on the wife count!) but his retinue is far inferior: The Tudor court had Thomas Cromwell, Thomas More, and Cardinal Wolsey—with Thomas Tallis providing the soundtrack. Trump has J.D. Vance, Dr. Oz, and various Christian leaders who make the worldly Wolsey look like Polycarp—with a soundtrack by Kid Rock. (The great artist of the Tudor world was Hans Holbein the Younger—the great artist of Trump’s world is that guy who made the picture of Trump riding a T-rex.) Trump does not have a More or a Cromwell (pledge your allegiance: A Man for All Seasons or Wolf Hall) to advise him about what he should cherish. There’s a wondrous irony in that: Trump cares more than anything else in the world about being rich, but he has absolutely no understanding of how the country that made him rich got rich in the first place.

That’s why Ontario Premier Doug Ford’s threat to put a 25 percent surcharge on electricity exports to the United States was so amusing. “You want tariffs? Fine—we’ll put our own tariff on our own exports. You don’t have to do it—we’ll do the work for you. And maybe that will help you idiots understand why these tariffs are such a dumb idea.” It almost worked—for a second. Trump got very pissy over the fact that the Canadians were planning to put a 25 percent tax on exports from Canada to the United States instead of waiting for the Trump administration to put a 25 percent tax (enabled by … no particular law) on exports from Canada to the United States. Trump is like a toddler who refuses to eat a chicken nugget that a parent tries to give him—but as soon as somebody else tries to eat his chicken nugget, he suddenly wants it and will have nothing else. From a purely protectionist point of view, there’s no difference between a Canadian tax on Canadian exports and a U.S. tax on imported Canadian goods, but as soon as Doug Ford lifts a finger, Donald Trump wants tariff-free trade. It is daft and imbecilic and utterly predictable. 

These are, as I keep repeating, a flock of extraordinarily odd ducks. Trump is, of course, a pure ignoramus, and Peter Navarro somehow managed to get a doctorate in economics from Harvard without knowing what GDP is, but J.D. Vance is not stupid—Cleetus the Gap-Toothed Twitter Troll is just a character he plays. Ted Cruz isn’t dumb—servile, yes, but not dumb, and neither is his fellow Princeton-to-Harvard chum Pete Hegseth. Somebody could probably explain this stuff to Trump, assuming the removal of two insurmountable barriers: 1. Nobody wants to tell Trump anything he doesn’t want to hear; 2. Trump doesn’t want to hear anything. He is the textbook case of the guy who doesn’t know what he doesn’t know–and likes it that way. 

One of the most misunderstood concepts in the discussion of trade is comparative advantage. Comparative advantage is not a question of what Bubba is good at compared to Scooter; it is a question of what Bubba is good at compared to Bubba. Comparative advantage doesn’t require you to have a real advantage over any other competitor in anything—it is only a question of what you are relatively good at, or, to put it pessimistically (these are pessimistic times) what you are least bad at. If you are part of an economy with 100 workers and you are the No. 1 fisherman but the No. 88 basket weaver, you make your living as a fisherman; and if you are the No. 98 fisherman and the No. 99 basket weaver, you still choose fishing between those two occupations. You may not be a very good fisherman or a very good basket weaver, but you are a relatively good fisherman—meaning good relative to your performance as a basket weaver. Comparative advantage is not about getting a leg up over the other guy—it is about how members of a community grow collectively better off by putting resources to their most profitable use. Free exchange—between individuals in the same village or across a dozen time zones—enables economic cooperation that liberates us to put resources to their most productive use.

Forgive the simplification here, but this is basically how it works: If you can spend your time fishing (your top skill) instead of weaving baskets (your weaker skill) and trade some fish for baskets when you need them, then the basket weaver can concentrate on his top skill and not waste time on his weaker skill—because even if he is a better fisherman in absolute terms, he still will be better off doing the thing he does best and trading instead of investing time and resources in less-productive activities. If you have a large and complex economic community, with lots of different kinds of productive activities, then people have lots of different ways to contribute, and they can (to paraphrase F. A. Hayek) experiment in order to find the most valuable ways to serve one another—which, as Adam Smith noted, is the real genius of the competitive market system, because the best way to make a living is also, perforce, the best way to provide other people with what they need. “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.” As Say’s Law instructs us, we produce in order to consume. 

The story of increasing human prosperity is a story of ever-increasing, ever more complex division of labor and specialization. We see this in international economic relations, we see this inside factories and firms, and we even see it in nature, in the division of labor within bodies and within cells. It is easy to get too poetic about that, but there is something at work there that is a little bit more than an analogy. Trade enables the widespread division of labor and specialization, which means that we can muster a great deal of intelligence to throw at specific material problems facing our communities: We have the modern internet in part because Tim Berners-Lee and Marc Andreessen and Vint Cerf and a bunch of other people didn’t have to spend all day growing their own tomatoes, raising chickens, digging wells or purifying their own water, generating their own electricity, grinding up their own pharmaceuticals with little stone mortars and pestles, etc. We got more Saul Bellow novels than we would have if he had had to manufacture his own typewriter ink or launder his own shirts. Henry Ford’s housekeeper probably did a fair bit for the development of the automobile without ever thinking about it, and so did the guy who sold him his eggs. Henry Ford did a lot for the housekeeping business and the egg business when they could start using trucks and vans instead of horse-drawn carts or wearing out their shoes. Prosperity is a group project that doesn’t need anybody—even Ezra Klein!—to organize it. 

Comparative advantage works in different ways for individuals than it does for firms or countries. That is, in fact, one of the reasons we had to invent the firm—individuals can’t be liquidated (in the civilized world) and countries don’t go out of business (though goodness knows Argentina keeps trying). The corporation exists as a vehicle for holding capital (money and knowledge and people) together long enough to do something useful and then serves as a kind of platform for exit when the business doesn’t make economic sense anymore (all businesses fail eventually, and average corporate lifespans have been declining for decades), at which time the money and the knowledge and the people can be dispersed to find new useful things to do. (People who complain about “corporate personhood”—and when they do so, they usually do so ignorantly—rarely consider what the alternatives are. Do you know what preceded the limited-liability corporation? Debtors’ prisons.) Individuals can modify their economic capabilities by means of education, training, experience, the acquisition of equipment or other capital, etc. Firms can and do modify their capabilities in much the same way, though it is easier for a business to acquire knowledge than it is for individuals: An individual has to read some books and go to some classes or learn on a job, whereas a company can just write a check to an individual who already has done the work.

Countries can change the economic facts on their own ground, too, and that happens all the time: There’s a pretty solid argument that the economic history of India is a lot more complicated than the political history of the United States—from cinnamon to fintech is quite a story. There’s an equally solid argument that the economic history of India since the 1990s is a lot more complicated than the political history of the United States since the 1990s. Hong Kong—the free-trading, free-enterprise Hong Kong of old—went from being one of the poorest places on Earth to one of the richest and most economically sophisticated in a shockingly brief period of time. When Ayn Rand published Atlas Shrugged in 1957, she wasn’t entirely bananas to assume that railroads were still going to be a central part of the economic conversation in the sci-fi future. Railroads were a big, big thing for a long time, and they’re still a big thing, and maybe a big, big thing, but not as big (not as big big?) as they were not all that long ago. 

Free exchange—between individuals, between individuals and firms, or across borders in the form of international trade—is a big part of how that works. Prices and business failures are how the world tells producers what is working and what isn’t, and a big part of how we liberate capital—including human capital—to find its best use. And all this J.D. Vance and Michael Brendan Dougherty horseshit about deindustrialization amounts to very little more than neurotic resentment and nostalgia in defiance of the facts—including the fact that there has been no deindustrialization: Manufacturing output in the United States today is two-thirds more than it was in the 1980s; industrial production in the United States is seven-and-a-half times what it was in 1950. Some people point to the decline in the prominence of manufacturing jobs as a sign that something has gone terribly wrong. I will pass lightly over the fact that Vance is a Yale-trained lawyer married to a Yale-trained lawyer and not Joe Sixpack married to Rosie the Riveter while none of Trump’s ghastly spawn works in a carbon black plant in Borger, Texas, and never will, and I will instead emphasize two points: 1. Service sector jobs pay on average more than manufacturing jobs do, and are generally safer and more pleasant, too, which is why so many people choose them; 2. The fact that we’re building so much more stuff with fewer workers is a sign of success, not a sign of failure—more output with fewer inputs is how you get richer. Policies that inhibit gains in efficiency in order to maximize employment make everybody—including the employees in those make-work jobs—poorer. That’s why we dig the foundations for skyscrapers with big machines and not spoons. 

People working on Wall Street or in Silicon Valley run a trade deficit of right around 100 percent with the world’s banana producers, and do you know what they do not want to invest their marginal unit of labor doing? Trying to grow bananas in Manhattan or San Francisco, even if Mr. Tally Man is stealing Americans’ good-paying banana-quant jobs. 

It may be true that money cannot buy happiness—but poverty is misery. We have good economic solutions to economic problems, and, while economic problems are not the only kind of problem, economic problems have economic solutions. One of those solutions—and even Ezra Klein has stumbled on this!—is abundance. More is more. And the way you get more is by letting people do more—by doing what they’re best at, or at least what they’re least-worst at. All kinds of people: People who work with their hands and their backs, people who manipulate symbols, people who juggle or walk dogs or manage databases—even Canadians!

In the same way that one has to be very expensively educated to believe the dumb things you’ll hear said on the campus of Columbia University, you have to be very, very rich to forget the basic facts of economics understood hundreds and even thousands of years ago. What Donald Trump and the rest of the anti-trade clowns propose to do is to, in effect, blockade our own ports. It would be an act of war if we did it to another country—do it to your own country and it’s “economic nationalism” or “economic patriotism” or whatever. But trade wars are like the regular kind of war in that they have similar if less dramatic consequences: They destroy wealth and immiserate populations. 

Words About Words

These people cannot figure out why they keep losing intellectual and political market share. From the (non-pornographic) advice columns over at Slate:

I am a teacher. Several very racist teachers work in my school. Last year, two white teachers used the N-word while speaking with students, another teacher had the N-word written on their door during Black History Month (purposefully). We have a history teacher who thinks (and has said to students!) that Black people need to “get over” slavery. We have Trump supporters who hang signs about the importance of borders in their classrooms. My administration will do nothing about this. They coddle the racists and keep their heads down.

That isn’t even particularly clever sand-bagging. But you see this form of argument all the time. Using racial slurs while speaking with students? Probably racist, though one can imagine circumstances in which it wouldn’t be, e.g., a discussion of the controversies surrounding the use of such words in the works of Mark Twain. Writing racial slurs on a teacher’s door? Sounds like a firing offense to me. Being a Trump supporter who wants our immigration laws enforced and says so? Not racist. Not in and of itself. There are people who are racists who believe that and people who are not racists who believe that. Being a Trump yahoo doesn’t necessarily make you a racist—it just makes you a Trump yahoo. Trying to lump all that stuff together is dishonest and ought to be treated as intellectually contemptible. 

And then what follows is another letter along the same lines, arguing that “professionalism is a bigot’s complaint.” 

I cannot stand a lot of the rules of “professionalism.” They all seem so arbitrary! Why does one expensive t-shirt count as business casual and another, cheaper one doesn’t when the only difference is fabric, which isn’t even visually obvious? Why do you have to pretend to want a job for anything other than a paycheck? Why does it matter whether or not I have tattoos, piercings, or dyed hair? How do I navigate the work world when every time someone says the word “professional” I want to scream about how discriminatory against women, POC, queer, poor, and disabled people these arbitrary rules are?

This person apparently works in an office with a dress code that feels cumbrous and capricious, and it very well may be that—but is it inherently racist, anti-gay, anti-poor, anti-disabled, etc.? I do not think that very many sane people take such claims very seriously.

The phrase “selling wolf tickets,” first attested to in African American vernacular, means to oversell a claim and calls to mind (and possibly comes from) the story of the boy who cried “Wolf!” There is plenty of racism and other kinds of bigotry in this world and in these United States. There also is a lot of nonsense being sold as evidence of racism. The right has its own version of this lately, too, with “communism.” Some doofus over at RedStateAR15PutinJesusAmericaBurger.com will denounce some bog-standard Democrat as a “communist,” and your thinking-type person will be tempted to ask: “Really? Mark Kelly wants to institute collective ownership of the means of production and a dictatorship of the proletariat?” “No, it’s worse than that! He once went to a mandatory DEI session at NASA!” “Cultural Marxism” is the Republican answer to Democrats’ “racism”—it means: “This person disagrees with me, and I hate him.”

So, office dress codes are racist?

True story: When I first went to work for the Lubbock Avalanche-Journal many years ago, I got my first paycheck and took it to the bank. If memory serves, I needed to open a new account, having recently moved and not having a local one. It was summer in Texas, and Lubbock is a college town on top of that, and so I was directed to a cheerful young man wearing khaki shorts and a polo shirt. And I said: “I’m sorry, this is my paycheck, and it is all the money I have. I’m going to need to talk to somebody wearing pants.” Racist? No, that young man was white and also a Texas Tech student or recent graduate, I assume, which is a very white kind of white person. Classist? Not really—we had our lights turned off too many times when I was a kid for me to pretend to be of a different class than the one I’m from. I’m not particularly uptight about dress, though I probably own more ascots than, say, Jonah Goldberg does. (I’m guessing Jonah’s ascot inventory consists of 0.00 ascots.) And I kind of like dress codes: The only golf course I’ve ever played on (I’m not much of a golfer, especially for an Eisenhower man) insists on collared shirts and forbids shorts, and I endorse that. Men who show up at black-tie events in blue blazers are disappointing. 

And maybe I do live in a slightly rarefied world, but the notion that dress codes are racist and anti-gay kind of runs up against my (admittedly nonrepresentative) personal lived experience, which is that the black guys and the gay guys in my world are a lot better dressed than your median American straight white guy. 

Yeah, I know, it’s a stereotype—that doesn’t mean it isn’t true.

Elsewhere

You can listen to me guest-hosting The Remnant Podcast here.

You can buy my most recent book, Big White Ghetto, here. 

You can buy my other books here. 

Please subscribe to The Dispatch if you haven’t. 

You can check out “How the World Works,” a series of interviews on work I’m doing for the Competitive Enterprise Institute, here.

In Closing

Speaking of Sen. Mark Kelly, Shadow President Elon Musk, a totally normal guy who doesn’t have a super-obvious drug problem or 14 children with four different mothers, denounced him as a “traitor.” Sen. Kelly’s politics are not my politics. And Elon Musk’s politics are not my politics. But, between the two of them, maybe the astronaut with the Legion of Merit and the three dozen combat missions on his résumé is the one who deserves the benefit of the doubt when it comes to the question of where his allegiances are to be found.