Recently, free-market skepticism seems to be on the rise amongst young conservatives. One only has to look at popular conservative personalities like Fox News’ Tucker Carlson, American Compass’ Oren Cass, and of course, the 45th president of the United States, who advocated many protectionist policies aimed at protecting American manufacturing jobs. While much ink has been spilled on the myriad benefits of the free market, my goal with this article is not to rehash such viewpoints which have been meticulously articulated by the likes of Adam Smith, Friedrich Hayek, and Wilhelm Röpke. Rather, it is to respond to common objections that conservatives have recently raised against the free market and to critique the policy suggestions or implementations that are the fruit of such objections.
A common motif of the last four years is the plight of the manufacturing industry. Supposedly, manufacturing jobs are being lost at least in part due to being outsourced to foreign countries, and thus should be protected through promulgating protectionist policy initiatives. While this is a genuine concern that should not be taken lightly, manufacturing remains one of the top five employers of Americans. Additionally, the industrial policy which has been advocated for and implemented these past four years has had unintended consequences. For instance, Professor Douglas Irwin noted that the Trump administration’s 25% levies on imported steel and aluminum did not only hurt consumers who inherited the cost of those tariffs (a commonly acknowledged drawback of tariffs), it also reduced overall employment in manufacturing by 75,000 jobs. This occurred because a large number of steel-using industries incurred higher costs due to the resulting increase in steel prices. Tariffs generally cause consumer prices to rise, and therefore causes real household income to decrease. The same article notes that the Congressional Budget Office estimated in January of 2020 that increases in tariffs would not only decrease real GDP by 0.5% but also decrease average real household income by $1,277. In other words, steel tariffs hurt consumers, manufacturing firms, and jobs. Also, Pew research shows that U.S. manufacturing output as a whole has nearly doubled since 1987. This evidence flies in the face of the populist claim that “America no longer produces its own goods.” On the contrary, according to Pew, “manufacturing output in the first quarter of [2017] was more than 80% above its level 30 years [before 2017]”. Even sectors of the economy conventionally thought to be outsourced to foreign lands, such as computer and electronics production have “ soared more than 2,600% since 1987.” U.S. manufacturing, on the whole, is far from dead.
Another common concern is rapid technological growth and its effect on the labor market. This fiery exchange between Tucker Carlson and Ben Shapiro is a clear example of the debate surrounding technology and jobs. Carlson emphatically states that he would be in favor of restrictions on trucking companies being able to employ self-driving vehicles “in a second” for the sake of truck drivers. Again, this concern should not be taken lightly. Carlson correctly states that driving for a living is the most common job for high school educated men throughout the United States. It is out of this concern that drives Carlson and others to support technology slowing measures. It stems from a common fear of technology replacing human jobs and thereby eliminating not only their means to make a living, but their purpose and drive in life. Professor Jay Richards’ recent book “The Human Advantage” offers a hopeful look at the future of human labor in light of technological advancement. Richards argues that aspects of human ingenuity, namely courage, antifragility, altruism, collaboration, and creative freedom are uniquely human traits that no machine can embody. This argument does not make the cringey suggestion that blue-collar workers ought to drop everything, go to Silicon Valley, and “learn to code.” It does suggest a trust in the potential for intellectual and creative virtue of humans that can and should be harnessed in the information economy. Technology can be harmful to particular jobs, but human ingenuity can overcome these particular problems, and it does not even have to turn to a one size fits all solution. Goods and services can be categorized as substitutes or complements — they can either cooperate or compete with each other. The key is tailoring the human service of labor to be a complementary, rather than a substitutionary, service to the technologies that are being developed. New technologies can create new opportunities for labor that simultaneously increase productivity
Oftentimes, calls for industrial policy and other anti-market measures are defended by the need to pursue the common good. It is said that the proper role of government should be positively pursuing the good of its citizens instead of stepping outside of their lives, in line with the great ancient Greek philosophical tradition. I wholeheartedly agree with this – conservatives are not libertarians. However, careful consideration ought to be given to the detrimental consequences of industrial policy – oftentimes hurting those they purport to help.
The recent conservative tendency to be skeptical of a free market economy stems from genuine concern for the common good of society. Unfortunately, many of these skepticisms have led to the proposal or implementation of policies with unintended consequences. Conservatives (and indeed all policymakers) need a certain epistemic humility to recognize that economic issues cannot always be rectified by policy fiat.
