(This article originally appeared in The Wanderer and is reprinted with permission. To subscribe call 651-224-5733.)
Workers’ and human rights are not to be sacrificed for the sake of an ideological commitment to what Pope John Paul II has labeled “economic individualism.” The Church has always taught that there are times when government regulation of the economy becomes necessary. The question, of course, is when?
Not that long ago one could assume that the leading commentators on the right would propose free-market answers to that question; that they would insist, for example, that free trade leads to an increased standard of living for the average American. Not so these days. Respected conservative pundits such as Patrick Buchanan, Phyllis Schlafly, Paul Craig Roberts and Charley Reese now routinely propose protectionist measures to deal with the loss of American jobs. That is not what would have been proposed twenty years ago in the pages of conservative publications such as National Review and Modern Age.
What would the conservative gurus of the past have said about the modern loss of manufacturing jobs? We can’t be sure, of course, but I suspect that William Rickenbacker and Henry Hazlitt would take a position much like that taken nowadays by Thomas Sowell. Sowell argues that it is short-sighted to turn to the government to save jobs because “every modern economy is constantly changing in technology and organization. This means that resources human resources as well as natural resources and other inputs are constantly being sent off in new directions as things are being produced in new ways.”
What of the Americans whose jobs are being shipped overseas? Sowell understands their plight, but insists that we must look at the big picture: “At the beginning of the 20th century, 10 million American farmers and farm laborers produced the food to feed a population of 76 million people. By the end of the century, fewer than 2 million people on the farms were feeding a population of more than 250 million.” What happened to all the farm jobs that were “lost”? “People moved on to other jobs,” he answers. The economy grew. New jobs opened up. “Unemployment rates in fact hit new lows in the 1990s.” He insists the same pattern will take place in our time; that the jobs that have been lost to foreign workers will be replaced by new and better jobs inside the United States, in large measure because of free trade.
He quotes Peter Drucker in Fortune magazine to underscore his point: “Nobody seems to realize that we import twice or three times as many jobs as we export. I’m talking about jobs created by foreign companies coming into the U.S.,” such as those in the Toyota and Honda plants on American soil. “Siemens alone has 60,000 employees in the United States,” Drucker continues. “We are exporting low-skill, low-paying jobs but are importing high-skill, high-paying jobs.”
Sowell does not harbor a let-them-eat-cake attitude toward the plight of American workers who lose their jobs to foreign competitors. He understands that “none of this is much consolation if you are one of the people being displaced from a job that you thought would last indefinitely. But few jobs last indefinitely…. Progress means change, whether those changes originate domestically or internationally.”
What is the response of the conservatives who now take a protectionist stance? They argue that times have changed; that the old free-trade logic no longer applies. Paul Craig Roberts is a case in point. He maintains that we are not talking about a few farm laborers or buggy whip manufacturers losing their jobs. He contends that “we are witnessing the redistribution of First-World income and wealth to developing countries blessed with excess supplies of labor,” noting that despite “25 months of ‘recovery,’ the economy has 2,944,000 fewer private sector jobs than in January 2001,” and that “American manufacturing has experienced the largest job loss, with 2,559,000 fewer jobs today than 35 months ago when President Bush took office.”
Will this situation improve as the economy recovers? Roberts says no; that this is what is different from the past. “Every day, we read about another corporate giant replacing thousands of American jobs by moving operations to India, China or another foreign country where skills equal to those of Americans can be purchased at a fraction of U.S. wages and salaries. Economists, determined to keep their heads buried in the sand, dismiss report after report as ‘anecdotal evidence,’ as if facts don’t count unless they are in an economist’s study.”
He insists that current trends point to steady erosion of the American standard of living: “The new global mobility of capital and labor has stripped away the protection that high productivity gave First-World wages. Indian and Chinese labor employed by First-World capital and technology is just as productive as First-World labor.” The result? Says Roberts: “First-World labor is being substituted out of First-World production functions by outsourcing, offshore production and Internet hires.”
A decade or so back it was easy to dismiss attacks on free trade as being part of the left’s agenda to socialize the economy. We cannot say that about Paul Craig Roberts and Patrick Buchanan. They are men of the right. They have turned to the central government not for ideological reasons, but because of what they see happening to American workers in the real world.
Buchanan is a devout and informed Catholic. It seems to me that he has applied the principle of subsidiarity, as outlined in the papal encyclicals, in making his judgments about the economy. He was a free-trade advocate for most of his life. He turned to a big government solution only after deciding that the private economy and lower levels of government were inadequate to the task at hand. Is he right? Or are the free-market theorists correct? Is the current loss of manufacturing jobs just a momentary dip on the graph of an ever-increasing standard of living for Americans brought about by the free market? The conservative pundits fighting out this issue have access to the same economic data. Buchanan and Sowell are good men, with the best interests of the American people at heart. Yet one sees free trade tossing the average American into dire economic straits; the other, an expanding economy offering increased opportunities and a higher standard of living because of open markets.
Maybe time will tell who is correct. Maybe in our lifetimes. Maybe. But for the time being this dispute among conservatives illustrates why the papal encyclicals have stuck to general principles and never endorsed any one remedy for economic dislocations. Advocates of big government solutions for our economic ills are able to offer high-minded rhetoric to demonstrate their commitment to economic justice. But good intentions are not enough. The question is whether their proposed programs will do what they claim, whether they will do more harm than good. This is why the American bishops made clear in their 1992 pastoral letter Economic Justice for All that the Church “does not embrace any particular theory of how the economy works, nor does it attempt to resolve the disputes between different schools of economic thought.” The bishops recognize that Catholics must be left free to debate the debatable.
James Fitzpatrick's new novel, The Dead Sea Conspiracy: Teilhard de Chardin and the New American Church, is available from our online store. You can email Mr. Fitzpatrick at fitzpatrijames@sbcglobal.net.