In our administrative duties at the university we often found it useful to have a third person in the room during contentious meetings. The reputation of faculty members for nasty rhetoric is not unwarranted. The faculty lounge was Twitter before it was invented. The third person in the room would deflect the rhetoric because we would not be forced to respond directly to the rhetorical charges.
We felt that way about Ryan Streeter’s “The New Forgotten Man” in the National Review. From the title on down it is, at best, a misleading criticism of capitalism and what us capitalistic orphans stand for.
Sidebar One: We know Ryan’s article was a long time ago pundit-wise. It was in the 3/9/20 issue. We wanted to try and be as calm as possible. End Sidebar One.
Ryan’s title, of course, is from Amity Shlaes’ great book. You should read it. Amity is welcome at the orphanage. Here is a summary from Wikipedia:
The book begins with an anecdote of the 1937 recession, eight years after the Depression began, when Roosevelt adopted budget-balancing policies indistinguishable from the stereotype of what Hoover supposedly did. Shlaes presents her arguments in part by telling stories of self-starters who showed what the free market could have accomplished without the New Deal.
A better title for Ryan would be forgetting the forgotten man. Ryan starts out well when he is first describing the forgotten man as:
These are the shop owners, self-employed workers, small-scale entrepreneurs, and salaried employees who save their money and improve their credentials hoping to branch out and move up. They have long been at the heart of American economic growth, collectively creating massive numbers of jobs every year and keeping the American dream alive for themselves and others.
It is nice to see Ryan agree with us that innovation and economic growth are important. This clip would make him welcome at the orphanage. Unfortunately, for us orphans, he soon reverses course and smears the orphanage by saying:
The aftermath of the Great Recession, followed by Trump’s 2016 election, produced a new group of pro-worker conservatives [let’s call them reform cons] who advocate a combination of protectionism and industrial policy, expanded wage subsidies, new forms of unionizing, and new family benefits such as paid parental leave and more generous child tax credits and cash allowances. They have arisen in opposition to those—let’s call them the “traditional Reaganite conservatives” [the capitalistic orphans]—who endorse low taxes, limited government, and other policies [we are unsure what these other policies are but the previous sentence suggests free markets and free trade] that favor CEOs and managerial elites ostensibly in the name of economic growth. [Emphasis added]
This is the paragraph that took us weeks to get over. We haven’t read every issue of the National Review but we doubt there was ever a paragraph quite this misleading in the history of that august journal. And, yes, that is our reaction after calming down.
Sidebar Two: Reagan, like all politicians, is not a pure free marketer. He is, however, fairly regarded as a free marketer despite his occasional lapses. We think Ryan fairly identifies him and his followers as free market and free trade folks we call capitalistic orphans. End Sidebar Two.
The third person we have invited into the room is Richard M. Reinsch II from National Affairs. He sets the story straight in his published comments from debating another reform con, Oren Cass:
We are all consumers, but we are not all manufacturing workers [or any other favored group]. The need to serve the consumer is key to the dynamism and creativity that epitomizes a market economy. While meeting this need can be challenging — and the price can be steep for those who fail — a market economy nonetheless provides the best jobs program on offer. After all, the choices of consumers determine which products or economic actions will work to our comparative advantage and which will not. Through this process of discovery, investors ultimately learn where to invest, workers learn where to work, and producers learn what resources they will need to bring goods and services to the market. This is how millions of new jobs are created — jobs in industries that previously did not even exist. This is not a neoliberal conspiracy or a degraded form of American consumerism, but a crucial feature of how trade increases the wealth of a country.
As Richard’s comments show, Ryan mischaracterizes both his group, reform cons, and the orphans in one short paragraph. The reform cons are not pro-worker. They are strongly supportive of a few workers while harming most of them. They also have little to offer the entrepreneurs that Ryan extolls in the first quote. Protection and industrial policy hurts most workers while helping some. Contrary to what Ryan says protectionism and other market restrictions are exactly what the CEOs and managerial elite want. That is one of the reasons they spend so much money trying to influence governmental policy.
Free markets and free trade is what consumers want. CEO’s and the managerial elite fight against them both because they don’t want it. Capitalistic orphans want free markets and free trade because it helps consumers. Yes, it also leads to economic growth that Deirdre reminds us is crucial to our current well-being and that of our children and grandchildren. We should see the reform cons like Ryan for what they are. They are trying to build a majority by giving big benefits to some while hoping that the damages to the majority will go unnoticed. It is an old formula and one that, unfortunately, often works.