In a WSJ article Vivek Ramaswamy tries to distinguish between protectionism that is just for National Security, and protectionism for favored economic interests. It’s a fools’ errand when it will be the political process that determines what interference in the economy is for National Security.
I suggest:
Those who want to eliminate U.S. dependence on China in critical areas for U.S. security should consider an alternative to tariffs and trade restrictions. All that needs to be done is for the U.S. military to only obtain supplies and weapons from U.S. producers. If that requires the military to pay more, than at least the burden would fall on all Americans. Whether it be rare earth materials, antibiotics, or flags, if the military thinks it needs them then they should pay for a supply chain to produce them in the United States. If the military supply chain manufacturers are able to compete with global producers, then civilians would also purchase items from U.S. sources. Rather than have centrally planned subsidies to specific industries like chip manufacturers, the cost for U.S. military independence would be visible in the military budget.
Here is his article:
https://www.wsj.com/opinion/the-america-first-divide-protectionism-vs-libertarianism-trade-economy-policy-election-d5a6d91c?mod=commentary_article_pos3#comments_sector
The America First Divide: Protectionism vs. Libertarianism
On immigration, trade and the regulatory state, deep divisions underlie the Trump coalition. By Vivek Ramaswamy Sept. 20, 2024, 5:27 pm ET
What made Donald Trump so compelling as a political leader in 2016 was that he didn’t blindly parrot the GOP’s economic orthodoxy. He rejected the idea that immigration and trade are inherently good, instead asking what policies would maximize the well-being of American workers and manufacturers.
It’s now fashionable for Republicans to say things like “we need to make things here,” and “we’re the party of the working class” without stopping to ask what these phrases mean or why we’re saying them. That isn’t good. An important reason why the old consensus failed was intellectual laziness. For the America-first movement to outlast Mr. Trump, it needs to think through the principles that underlie its policies.
Are we protectionists or economic libertarians? The protectionist approach recognizes the security risks of increased dependence on adversaries like China, but commingles these risks with concerns about price competition for American manufacturers. In this view, we need less international trade altogether; we should use tariffs to stop even friendly countries from “flooding our markets” with their products; and we should use taxpayer funds to subsidize American producers to be more competitive with international competitors.
The national libertarian objective is to eliminate U.S. dependence on China in critical areas for U.S. security. Doing so, at least for the foreseeable future, requires expanding trade relationships with countries such as Japan, South Korea, India and the Philippines. If your top objective is to protect American manufacturers from foreign competition, you necessarily delay the national security objective vis-à-vis China.
On immigration, the historical neoliberal consensus was that if a company can hire foreigners for $10 an hour to do the same job at the same quality that an American would demand $20 an hour to do, the government should design policies that allow companies to hire the cheaper workers. The protectionist position is that the government should favor American workers earning the higher wage. Whereas the old neoliberal position viewed immigration policy as economic policy, the protectionist position views immigration policy as labor policy. Republican senators who support raising the federal minimum wage have stated that one reason is to prevent companies from replacing native-born workers with less expensive foreign-born ones.
The America-first libertarian position rejects the old consensus on different grounds: that the U.S. isn’t merely an “economic zone” but a nation of citizens bound by a shared civic identity. This view favors more-stringent screening of immigrants for knowledge of civics, fluency in English and loyalty to the U.S. through renunciation of foreign citizenship. That means turning many immigrants away, but not because domestic labor unions are afraid of foreign competition.
The deepest divide between protectionism and libertarianism is over the regulatory state. The protectionist camp believes in redirecting the regulatory state to advance policies that favor the interests of U.S. workers and manufacturers. The libertarians think this goal requires sharply curtailing the regulatory state’s power.
Protectionists seek to expand the scope of administrative agencies like the Federal Trade Commission. They believe the FTC’s job isn’t simply to promote consumer protection, but to focus more broadly on “fair” competition—a view Kamala Harris shares. Libertarian conservatives reject the idea that government regulators should pass judgment on what is or isn’t fair—especially if Congress hasn’t expressly authorized them to do so.
The same goes for other less-discussed agencies like the Transportation Department. Protectionists believe that the failure of poorly-run companies in regulated industries like aviation and railroads demonstrates the need for more regulation to protect workers and customers. Libertarians see the regulatory state as the root cause of those failures.
Libertarians oppose expanding the authority of the Consumer Financial Protection Bureau, as a Republican senator proposes in the Capping Credit Card Interest Rates Act. The CFPB recently started demanding small-business loan applicants disclose their race, ethnicity, sex and even sexual orientation. Do America-first conservatives want the CFPB to have such power? America-first libertarians say hell no.
Or take the Education Department. Protectionists argue that education subsidies should be expanded to cover trade and vocational schools along with colleges and universities. Libertarians think the answer is to shut down the department and return the subsidies to states and their citizens.
The conditions have never been riper to curtail the regulatory state, following the Supreme Court’s rulings in West Virginia v. EPA (2022), Loper Bright Enterprises v. Raimondo (2024) and SEC v. Jarkesy (2024). That project would require an amenable U.S. president.
Donald Trump masterfully bridges the divide between these two policy camps within the America-first right: favoring federal intervention to halt Nippon Steel’s acquisition of U.S. Steel on one hand while committing to dismantle the U.S. Department of Education on the other; fighting to protect the wages of American workers while also proposing automatic green cards for foreign graduates of U.S. colleges. But his leadership of this coalition doesn’t permanently close the chasm between the protectionist and libertarian worldviews on legal immigration, trade and the regulatory state. For now it lurks beneath the surface of a presidential race, but the future of America first is still yet to be determined.
Mr. Ramaswamy is author, most recently, of “Truths: The Future of America First,” forthcoming Sept. 24, from which this was adapted. He was a candidate for the 2024 Republican presidential nomination.