Is Bernie Sanders whispering in the ears of Trump, Navarro, and Lutnick?
A GOP president and his advisors are sounding more like the self-described Democratic Socialist rather than limited government advocates. Is Trump et.al., Bernie bros?
Bernie Sanders campaigned twice for the Democratic nomination for president (2016 and 2020). His campaigns focused on “working people,” asserting that unions are mainly responsible for prosperity. This is economic nonsense. Prosperity depends on capital.
The following graphic explains how an economy creates prosperity.
Production of goods and services
(created by savings and investment)
Purchase of money…
Sale of money for consumer goods
Source: Murray Rothbard, The Case for a 100 Percent Gold Dollar
Workers cannot be productive, unless they have the tools to produce goods and service. Labor is “useless” without factories, buildings, machinery, transportation, farm, and construction equipment, computers, software, etc.
Where do the tools of production come from? Capital formation. Investment in the initial stages of “structure of production” is the first step in creating intermediate goods and finally consumers goods. And without entrepreneurs who “put everything together” humans would live at the subsistence level. This is Economics/Business 101.
The great achievement of the free enterprise system is the lifting of the masses out of poverty. This is the history of the human race for the past 200 years.
As Murray Rothbard observed: “… the natural lot of mankind, at least, since our expulsion from Eden, is mass starvation – starvation that only can be overcome by steady, hard work, by productive capital investment, and by creating the conditions and social institutions guaranteeing private property free of depredation” (emphasis added.)
In short, a free market will “lift all boats” and do more to increase income and wealth than unions, protectionism, and tariffs.
Bernie, Trump, Navarro, and Lutnick believe that the federal government must “protect” American companies and workers from inexpensive foreign goods being imported into our country, because there is a $1.2 trillion trade deficit with the rest of the world. So what?
We all have trade deficits with our local supermarket and Amazon or other e-commerce site. Do you complain that you have “trade deficits” with these merchants? Of course not.
When individuals have income—from work and/or investment— they spend it as they see fit on domestic goods and/or imports. That is economic freedom.
Peter Navarro, Trump’s trade guru, was on CNBC this morning decrying the sourcing of goods from around the world that go into US “assembled”goods. He sounded more like a Soviet economic commissar than an economic advisor to a supposedly “America First” president.
The first economic policy of the government should be Don’t Screw the Public! A “managed trade” policy is anti-consumer and anti-business.
Trump and his advisors look at the world in terms of nation-states when the most important “actors” are individuals, families, communities, and businesses.
If they want to “Make America Great Again” and increase manufacturing jobs (which is not the responsibility of the federal government by the way) Trump should advocate the abolition of the corporate income tax. Businesses from around the world would flood into America. That would a peaceful and non-disruptive method to boost the US economy.
In the meantime, the Fox News talking heads have bought in to Trump’s tariff nonsense and are suffering from TSS—Trump Sycophant Syndrome. They reveal an incredible lack of economic understanding.
The battle lines in America have been drawn—TDS vs TSS.
We need another loud voice in the media—a voice for a constitutional federal budget, sound money, deregulation, and a noninterventionist foreign policy.
Anything less will maintain the statist quo—big government at home and endless wars.
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Dave Campbell and I discuss MAFI on the Clarity and Chaos podcast.
Col. Mike and Dr. Mike and I discuss Trump and his promises on the National Security Hour.
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Restoring free enterprise, medical freedom, and a constitutional federal budget.
The insufferable Jim Cramer reveals his economic ignorance in a recent CNBC rant.
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Joseph Cotto and I discuss the economy on his podcast.
Tom DiLorenzo’z pamphlet, Axis of Evil, is now available at the Mises Institute.
Order a free copy of Rothbard’s money and banking classic monograph. Or, you can read it online here.
My December 10 talk on medical care.
Bob Murphy interviews Dr. Keith Smith of the Surgery Center of OK.
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Murray Sabrin, PhD, is emeritus professor of finance, Ramapo College of New Jersey. Dr. Sabrin is considered a “public intellectual” for writing about the economy in scholarly and popular publications. His book, The Finance of Health Care: Wellness and Innovative Approaches to Employee Medical Insurance (Business Expert Press, Oct. 24, 2022), and his other BEP publication, Navigating the Boom/Bust Cycle: An Entrepreneur’s Survival Guide (October 2021), provides decision makers with tools needed to help manage their businesses during the business cycle. Sabrin's autobiography, From Immigrant to Public Intellectual: An American Story, was published in November, 2022. He is also the author of Why the Federal Reserve Sucks.