Partly Right

STELZER, IRWIN M.

Partly Right Taking Buchananism Seriously By Irwin M. Stelzer The reaction of the political establishment— Democratic and Republican—to Pat Buchanan’s decision to have another run at the White...

...But time and the great American assimilation machine marched on...
...Treasury, rather than in the coffers of Arab sheiks...
...But they are probably more likely to emulate earlier waves of immigrants and assimilate into American society if we make it necessary for them to learn English, if we do not respond to aberrant behavior by ordering our police to take sensitivity training, and if we resurrect the oldfashioned notion that it is our responsibility to provide opportunity and nothing more...
...Nor is Buchanan entirely mistaken when he calls into question the benefits of free trade...
...What troubles him is that these immigrants have helped to keep wages in manufacturing below what they would otherwise be, and have taken jobs from native-born Americans, most notably black men and women...
...Were America to announce to the world that its trading partners are free to impose any restrictions they choose on our goods and services, without fear of retaliation, we would soon find ourselves locked out of the world’s major markets...
...We might drop leaflets containing Adam Smith’s maxim that neither a family nor a nation should “attempt to make at home what it will cost . . . more to make than to buy...
...In short, if the demand for all of these workers— unskilled and talented—continues to rise, and the supply is curtailed by restrictions on immigration, wages will rise faster than would otherwise be the case...
...What Republicans have to come up with is some alternative to yet another batch of government jobtraining programs, all of which have pretty much failed to train or retrain workers for real jobs...
...the Japanese have ingenious ways of keeping out American cars...
...And the media and many mainstream Republicans dismiss Buchanan as a nasty nativist at best, and a racist at worst...
...Only 16 percent of those men born between 1916 and 1925 completed a bachelor’s degree, as did 23.5 percent of men with British roots...
...But Buchanan has a point...
...But that is as unlikely to persuade the world’s protectionists of the virtues of free trade as our rapid growth and low unemployment rate are to persuade them that the hated “Anglo-Saxon model,” as they call it, is superior to their sclerotic managed economies...
...It also produces losers...
...In his most recent book, Buchanan concedes that the “immigrants who poured into the United States between 1890 and 1920 . . . enriched our country...
...it would curtail as well the supply of highly trained people we need if our recent productivity gains are to be maintained...
...The proof of the pudding is in the eating, and Americans are eating very well indeed...
...As W. Michael Cox and Richard Alm demonstrate in their new book, Myths of Rich & Poor, “The freeenterprise system continues to deliver prosperity...
...Result: The excess over the competitive price ends up in the U.S...
...Pat Buchanan may be wrong about the effects of free trade and the free movement of capital, but he is not the economic illiterate that the media would have us believe...
...One need not approve of Buchanan’s overwrought rhetoric—“free trade is shredding the society we grew up in and . . . is truly a betrayal of Middle America and treason to the vision of the Founding Fathers”—to recognize that free trade and immigration do not enrich the lives of all Americans...
...the European Union uses bogus health concerns to keep out American farm products and concocts so-called noise regulations to disadvantage Boeing in its competition with Airbus...
...Buchanan wants a moratorium...
...All at a time when international trade is at record levels, and capital is moved at dizzying speeds to places where it is most productive...
...As with immigration, so with free trade...
...And, in the end, Buchanan misses the main point of globalization and free trade: the enormous efficiency that trade and capital flows produce...
...First, the amusing part...
...Those who favor free trade, oppose a moratorium on immigration, and also profess to be in the camp of the compassionate conservatives, will need a response to the losers in the transition from a manufacturing-based to a service-based economy...
...New immigrants have indeed kept wages down in some occupations, although by how much is a subject of dispute...
...Buchanan’s second worry is social, rather than economic...
...America is in the midst of a period of reasonably rapid growth, nil inflation, rising productivity, and a widely shared prosperity...
...So much for the amusement, wry though it may be, provided by Buchanan’s decision to saddle up once more and ride to the sound of the guns...
...So, too, in the computer industry, which is continuously pressing Congress to increase the number of highly trained staff that it is permitted to bring into this country...
...This may not be the best of all possible worlds, but it is darned close to whatever is...
...Then there are circumstances in which the imposition of trade restrictions is useful to make credible the threat of retaliation...
...Recent academic studies suggest that Buchanan is at least partly right...
...For which Al Gore will try to take credit, making him a formidable candidate and forcing the Republicans to make some hard choices...
...Moreover, even though protectionist candidates have never had much success in presidential campaigns, a refusal to develop policies that respond to the real needs of those adversely affectIrwin M. Stelzer is a contributing editor to THE WEEKLY STANDARD and director of regulatory studies at the Hudson Institute...
...Living standards are steadily improving for all segments of society...
...Walk down any corridor in the laboratories of the National Institutes of Health . . . and you’ll meet the best young minds from every corner of the globe...
...The worry— and this from one who disagrees with the columnistturnedcandidate on such hot-button issues as trade, globalization, and immigration—is that by failing to treat Buchanan’s positions in an intellectually serious way, Republicans are likely to end up with the same sort of vacuous campaign that brought down the elder Bush and the male Dole...
...So to cut off immigration would be to cut off not only the supply of unskilled labor that has helped to fuel the recent economic expansion...
...Not all immigrants are unskilled workers competing for entry-level jobs...
...For example, when a trading partner has monopoly power, it might well be in our interest to impose a tariff on imports...
...We are better off than in the past, and the next generation of Americans will be even better off than the current one...
...The advantages of immigration and of free trade are to him what trade unionists of yesteryear described as “pie in the sky in the sweet by-andby...
...Perhaps the answer is the one Margaret Thatcher developed for Britain’s redundant coal miners: lump-sum payments that could be used to finance a business, or supplement funds available to finance a decent retirement income...
...So it would have to lower its price...
...But it is not impossible, as shown by the happiness of Hispanic parents with California’s new policy of teaching their children in English...
...The cartel couldn’t let the price go up to $35 per barrel—customers would be driven to use substitutes...
...Developing such programs, while at the same time attracting the Hispanic voters who are so important in the key states of Texas and California, will be no mean chore...
...After months in which political discourse consisted of discussing what the meaning of “is” is, it is a relief to see and listen to a candidate who tells it like it is, or, in the case of his historical narratives, like he wishes it had been...
...Bob Dole labels his one-time challenger an “extremist,” as others in the party once labeled the now-sainted Barry Goldwater...
...George W. Bush and the “big tent” Republicans who are flocking to a succession of ring-kissing ceremonies in Austin are asking those who believe abortion is murder and a sin to accept as tentmates those who favor the practice, or at least refuse to condemn it...
...It is one at which the California Republican party failed miserably, with dire consequences for it and for the national party, as Ron Unz pointed out recently in these pages...
...still others will find it both expedient and intellectually honorable to favor continued legal immigration but only if accompanied by what Buchanan calls “a national campaign of assimilation...
...Worse still is when those immigrants who want to be Americans receive no encouragement from an establishment that no longer has the cultural self-confidence to assimilate newcomers...
...So argues Buchanan...
...But some workers lose, as domestic manufacturers either move to where the cheaper labor is, as Levi Strauss was recently forced to do, or shut down entirely...
...Presidential politics, alas, is neither a Chinese restaurant, where you can order some items from column A and others from column B; nor an ? la carte menu...
...The adoption of multiculturalism as official policy gives immigration a dimension it did not have in the past...
...Investment bankers in New York and computer programmers in New Delhi gain from the internationalization of the markets for their services...
...And many of them stay...
...others will pander to immigrant activists by avoiding the questions of English-only and bilingual education and assimilation vs...
...He might speak his native language at home, or in the neighborhood in which he lived, but he had to learn English to become a citizen, and his children learned English in school...
...It’s bad enough when tens of thousands of recent arrivals from Mexico boo the American flag and cheer Mexico’s, as they did at a soccer match in Los Angeles last year...
...Start with immigration...
...For that, and because of his position on the socalled social issues, the Washington Post’s Colbert I. King accuses Buchanan of “preaching against everything that threatens all that is white, Christian and straight” and carrying on a “war against immigrants of color...
...Upward mobility remains within the grasp of a large majority of Americans...
...Buchanan, of course, is not instinctively given to nuance, and so does not confine his opposition to free trade to the special circumstances in which some economic theorists would judge opposition to be theoretically correct...
...As Charles Krauthammer has pointed out, “We import many of our best brains...
...Buchananism as a whole is unappetizing, but it can’t be ignored...
...And he has a point...
...That’s a big tent, indeed— yet apparently not big enough to include a candidate who disagrees on the less morally fraught issue of free trade...
...the inevitable slowdown in the rate of innovation when the “best young minds” referred to by Krauthammer can no longer ply their trades in this country...
...Consumers gain from the more abundant array of well-priced cars, TV sets, T-shirts, and sneakers...
...The theoretical reasons are tedious, but to summarize: Robert E. Baldwin of the University of Wisconsin and other skeptical economists point out that the perfectly competitive conditions that underlie the traditional academic case for free trade rarely exist in the real world...
...And those who would cut off the flow of newcomers scare me, not least because their language resembles that used by those who would have turned the likes of my father away from Ellis Island and barred him from seeking opportunity here...
...So far, Buchanan is alone among the candidates in unashamedly worrying about the economic losers...
...The immigrant of yore came to an America eager to assimilate him, and was himself eager to be assimilated...
...That is a mistake...
...There is pleasure, as well, in watching Buchanan expose the hypocrisies of liberals and conservatives, in about equal measure...
...Buchanan’s run is a challenge to Republicans to come up with policies more substantial than “let’s pass fasttrack legislation...
...But many of those who are affected adversely by immigration and by free trade—the losers in the race towards globalization—have abided by the rules of the American game: Work hard, and material rewards will be yours...
...Free trade—an evil as great or greater than immigration in Buchanan’s eyes—produces not only the winners that the free trade advocates like to talk about...
...In a sense, that is true...
...Of course, the trade unions, whose cause Buchanan has taken up in the steel, auto, textile, and other industries, were not exactly hospitable to the black wage earners whom Buchanan now champions...
...But, then, a majority of academic economists rubbished Reaganomics—just as it was about to produce one of the longest economic expansions in the nation’s history...
...True, some of those displaced workers may seem undeserving of sympathy, having long reaped the monopoly wages extracted by Luddite trade unions that opposed new technologies and artificially restricted the available supply of labor...
...Buchanan is fond of quoting former AFL-CIO president George Meany, who declared that “Free trade is a myth...
...He is concerned with the here and now, adopting the time frame of the objects of his populist affection, those on the low end of the wage scale...
...Partly Right Taking Buchananism Seriously By Irwin M. Stelzer The reaction of the political establishment— Democratic and Republican—to Pat Buchanan’s decision to have another run at the White House is both amusing and worrying...
...On the liberal side, those who respectfully report the rantings of Al Sharpton and treat the economic theories of Jesse Jackson with the same seriousness as those of Alan Greenspan, now deem Buchanan’s challenge to free-trade orthodoxy and globalization an affront to reason...
...Globalization also produces both winners and losers...
...In short, the foreigner became an American...
...For one thing, economists point out that there are circumstances in which it is not in a nation’s interest to pursue a policy of completely free trade...
...Conservatives don’t come to the bash-Buchanan party with clean hands either...
...Some will decide to ignore or finesse it...
...ed by globalization is a sign to blue-collar Reaganites that the Republican party is insensitive to their concerns...
...True, these opinions are not those of a majority of academics...
...Where Buchanan is wrong is in painting with such a broad brush...
...The first is about economics...
...Of course, we can’t know whether the experience of the European immigrants is relevant to the non-Europeans now coming into America...
...Added to that has been a belated but nonetheless welcome shift to policies that increase the incentives to work, rather than to rely on welfare...
...The French limit imports of American audiovisual products...
...the more rapid substitution of capital for higher-priced labor here...
...Now I happen to be one who thinks that immigration, not least that from Ireland (although the proliferation of Kennedys sometimes gives me pause), has helped to make this country great...
...Whatever the answer, it should not be to ignore Buchanan: He may be wrong in calling for an end to immigration, but he is not wrong in saying that conservatives owe something to the deserving among those who have been adversely affected by market forces over which they have no control...
...And it sure would be nice if some of the other Republican candidates raided Pat’s kitchen for a little spice...
...That much, Buchanan has right...
...What he misses are the corresponding effects: an increased flow of capital and jobs to lower-wage economies abroad...
...When we look at those born between 1956 and 1965 we find that 33.8 percent of groups Alba identifies as “of mainly peasant origins in Europe” won bachelor’s degrees, as did 31.8 percent of those of solely British origin...
...But shoemakers in New Hampshire and garment workers in South Carolina lose, because they must now compete with low-paid workers in Latin America and Asia...
...For even if all of those labels apply—and Buchanan’s friends vehemently deny the charges—immigration remains an issue to which any serious Republican candidate will have to speak, for Buchanan’s presence in the race ensures that it will be brought up in all of the debates...
...Richard Alba, a professor of sociology and public policy at the State University of New York in Albany, writing in the Public Interest, points out that Americans whose ethnic ancestry traces to southern and eastern Europe—Jews, Italians, and other groups looked down upon by WASP America because of their nonBritish origins—once lagged far behind those of British origin...
...No longer...
...You can’t take one candidate’s appetizer and another’s dessert: They all come prix fixe with a set menu...
...Two, actually...
...These unintended consequences are of little concern to Buchanan...
...If a cartel of oil producers, for example, decides to manipulate supply so as to maximize its profits at a price of, say, $20 per barrel for oil that would sell for $5 in a competitive market, it would pay for America to impose a $15 tariff...
...Never mind that there is a respectable body of economic literature that demonstrates that free trade does not in all circumstances enrich nations, and that a number of quite good economists, among them MIT’s Paul Krugman, have begun to wonder whether unlimited capital flows— which is what globalization is all about—indeed contribute to the efficiency with which the world economy operates...
...And he characterizes those who arrived in the past three decades as “hardworking men and women...
...multiculturalism...

Vol. 4 • March 1999 • No. 26


 
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