Tuesday, February 14, 2017

John T. Harvey — Scoring President Trump’s Economics

Although we don’t talk about it much, capitalism is fundamentally about power and who should wield it. The general idea is that it should be diffused among all the average folks in society. We don’t want particular firms or individuals accumulating power because then the economy is run for them and not us. Implicit in all this is the idea that the average person is important and has rights. That probably sounds familiar and, indeed, there is a reason why the language is so similar in the Declaration of Independence (1776), the French Declaration of the Rights of Man and of the Citizen (1789), and Adam Smith’s Wealth of Nations (1776). All were a product of the political, social, and intellectual revolution wherein the focal point became the individual. Individuals should be allowed to make their own choices and shape their own future.
Whether or not capitalism is really capable of this is a point of controversy. Regardless, there is no question that it is philosophically committed to breaking power into tiny packets and preventing elites from taking over. If the latter does occur, then the positive outcomes we associate with capitalism are no longer guaranteed. They become increasingly unlikely because we can’t trust that those elites will really act in our best interest. With respect to businesses, for example, Adam Smith wrote,
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.
What I am getting at here is that rejuvenating the middle class is not just about jobs. It’s also part of a larger project aimed at wresting power away from economic and political elites and returning it to Americans. The latter appears to be what the President means by “draining the swamp” and I totally agree. This was a key part of both his and Bernie Sanders’ campaigns and it must be a priority lest we lose forever the opportunity to reverse this trend.
With that in mind, I have reviewed a number of President Trump’s policies asking generally, “Does this drain the swamp by empowering the average American?”
Balancing economic and political liberalism — reconciling capitalism and representative democracy in a republic.

Forbes — Pragmatic Economics
Scoring President Trump’s Economics
John T. Harvey | Professor of Economics, Texas Christian University

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