Us capitalistic orphans are, as we discussed in a previous post, a small faction. We are unwelcome among the Democrats and rarely a priority with the GOP. Over the last forty years the GOP had capitalism as a goal although action was less regular. Now that is changing as contenders for the 2024 GOP presidential nomination like Marco Rubio and Josh Hawley are disavowing capitalism. Marco’s speech on what he calls Common Good Capitalism has been a lightening rod. Some folks like it while others, including MWG, don’t. In the last post we discussed the principle. Today we take up Ramesh’s nine questions about Marco’s proposal.
First: Should government intervene in markets to advance the common good?
We have a hard time believing it but Ramesh seems to have made an article error. We wish we had a sidekick to confirm this because somebody at NRO should have noticed. It would be like confusing a doctor with The Doctor. Ramesh gives highways as an example of an indefinite common good. We can debate if the government should build highways but that is not what Marco is talking about. From Marco:
What we need to do is restore common-good capitalism – a system of free enterprise in which workers fulfill their obligation to work and enjoy the benefits of their work, and where businesses enjoy their right to make a profit and reinvest enough of those profits to create dignified work for Americans. [Emphasis added.]
We don’t see why Marco is worried about reinvestment. When money is distributed to stockholders it is not lost. Those humans are unlikely to bury it in their backyard. They will invest it or spend it.
Marco says The common good requires firms to reinvest profits to create dignified work for Americans. We have been a laurel picker (you don’t pick it when it is flowering), newspaper deliverer, egg collector, and live chicken handler as well as a professor We are not sure if any of those jobs are dignified work.
We vote no on the first question.
Second: How badly has our economy been performing?
We think Ramesh’s answer is about right but we think he misses something although he gets at it in question four.
This question isn’t decisive: Even if the economy has enabled many blessings, it might be possible to undertake reforms that would yield more of them; and even if our performance has been as bad as Rubio suggests, it does not mean he is on the right track in fixing it. But an accurate assessment of the economy is necessary to get a sense of the scale and nature of our problems, and Rubio’s is too pessimistic.
What Ramesh misses is the title of Jonah’s article, Opponents of “Unfettered Capitalism” Are Fighting a Phantom. We are, as Heritage says, a mostly free economy. The bigger question is what direction should we go.
Our answer is that the economy has done well in the long term and OK recently. We think it is likely that The Donald’s more (nowhere near entirely) capitalistic approach has helped.
Third: How important is economic growth anyway?
We can answer this one by ourselves. It is crucial. It doesn’t fix all the problems but it provides the resources to fix them.
Fourth: To the extent the economy has been unsatisfactory, how many of our dissatisfactions are the result of trusting free markets too much?
This is related to the second question. Our first answer is none. It is possible that there is a specific exception but we would need evidence.
Fifth: Should companies be run for their shareholders?
Yes. The fact that there is lots of evidence that shareholders worry about a variety of things doesn’t change this. It is their choice. They might be trying to con us or they might be trying to help. It is still their shares.
Sixth: How should economic policies change to promote the common good better than they currently do?
Well, that and the related what is an economic policy, is the question. Some Marco’s items like the child credit and timing Social Security benefits are transfer schemes. The economic impact is uncertain and perhaps none. Writing off the cost of investment (we think they mean the cost of plant and equipment) immediately suggests that economic growth improves the common good. Nurturing a domestic rare-earth (or any other) industry is a bad idea.
The problem is that defining the common good is troublesome. Finding priorities within the common good is even more daunting.
Seventh: Assuming that in principle the federal government has a broad role in pursuing the common good, is it prudent to grant it that role?
No. Ramesh notes that Kevin D. Williamson scorches Marco for his previous behavior on sugar quotas (Ramesh doesn’t offer a link so we won’t but scorch is a fair description). Ramesh puts the problem for conservatives:
But notably absent from [Marco]’s speech is the notion that what we know about government should make us cautious and restrained with respect to government power.
If we agree with Marco in principle then all is lost? Perhaps.
Eighth: How many of our problems are economic to begin with?
We agree that there are economic aspects to problems like opioid abuse but these problems are not primarily economic.
Ninth: Is this really the future of the Republican party? Republican voters have never been the dogmatic free-market fundamentalists of caricature — which is why all those previous attempts to redefine the party were conceivable and sometimes partially successful.
We have included the sentence after the question because it summarizes our thoughts. We know that we will be conservative orphans. We have never controlled the GOP and it is unlikely that we ever will. We doubt Marco will change his mind before 2024. We hope there is a market champion out there that we can support. Otherwise we will confront the dilemma that led folks to decide Never Trump. We haven’t gone Never Marco yet and we hope we don’t need to consider it.