Buchanan's grocer


WASHINGTON -- A man of laughter and passion, Pat Buchanan brims with the cheerful pugnacity of a one-man church-militant in an unconverted world. Unfortunately, he currently overflows with nonsense.

Recently this column noted, with reference to, among other things, his advocacy of protectionism, that he resembles high-tax statist liberals, advocating industrial policy, economic planning and favor-dispensing by a paternalistic government that knows better than consumers do what consumers ought to consume. He has fired back, arguing this:

"America's conservatives -- Washington, Hamilton, Clay, Webster, Coolidge -- all believed in a tariff wall to protect the standard of living of workers and ensure our independence from foreign countries for national needs. . . . Every nation to rise to industrial power in modern times . . . did so by first protecting the home market. . . . [Cities are in crisis] because the good jobs that were once there have been exported to Mexico, Taiwan, Korea and China."

But those conservatives did not pursue the chimera of autarky -- national self-sufficiency, independent of the interrelations of trade. And note who is missing from Mr. Buchanan's list of conservatives: Ronald Reagan, a passionate believer in free trade.

Even if Mr. Buchanan were right that protectionism was the crucial ingredient in every industrial nation's rise, he surely would concede that the United States has risen already, so the hoary arguments for protecting "infant industries" hardly apply. Today's relatively infant industries -- Microsoft, Intel and the like -- have flourished under free trade.

But Mr. Buchanan is not right about protectionism's role in American growth. Refuting him in National Review, Ramesh Ponnuru argues that much more important was America's huge continental market. And the most protected industries, such as sugar and textiles, have become uncompetitive and dependent on purchasing political influence.

It is peculiar for Mr. Buchanan, ostensibly a "populist" favoring Main Street rather than Wall Street, to adopt protectionism, which aims to correct consumer preferences that the government deems incorrect. Protectionism, Mr. Ponnuru writes, "invites Big Government, Big Labor and Big Business to form a coalition to socialize the economy; free trade protects ordinary citizens from all of them."

Mr. Buchanan proposes a 10 percent tariff on Japanese goods until the trade deficit with Japan disappears, and says tariff revenues will be used to reduce other taxes. But before spending your Buchanan Dividend, check his arithmetic.

He says his tariff on Japan's $125 billion of exports to America will yield $12.5 billion. Under his static analysis, American consumers will not alter their $125 billion behavior because of his tariff. This is the sort of analysis that Mr. Buchanan's kindred spirits -- congressional Democrats -- use to justify tax increases and oppose tax cuts: They assume increases will not decrease wealth creation, and that cuts will not increase it. And he evidently assumes that our trading partners will not retaliate against U.S. tariffs.

Japan's surplus dollars

Why such a fixation on bilateral trade balances? The United States is not injured by its unavoidable trade deficit with Saudi Arabia. And Japan uses its surplus dollars to buy U.S. goods and services, invest in U.S. firms and help finance the U.S. budget deficit by buying U.S. Treasury bonds.

Mr. Buchanan runs a chronic trade deficit with his grocer. He constantly buys things from the grocer, the grocer never buys anything from him. The grocer gets currency, Mr. Buchanan gets groceries, and the economy hums.

Mr. Buchanan assumes, as do many congressional Democrats, that the crisis of inner cities has a simple material basis (scarcity of jobs) that government can cure. Conservatives, noting that many people immigrate across the Pacific and find jobs in the inner cities, have moved beyond that 1930s materialist paradigm, to a more complex appreciation of moral and cultural factors.

With his protectionism, Mr. Buchanan would give Washington an even more swollen role in the allocation of wealth and opportunity. He is the first presidential candidate born and raised in Washington (Al Gore almost was), but that is no excuse.

George F. Will is a syndicated columnist.

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