Samuel Gregg - The Next American Economy: Nation, State, and Markets in an Uncertain World

Nation, State, and Markets in an Uncertain World

SAMUEL GREGG

2022 by Samuel Gregg

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FIRST AMERICAN EDITION

LIBRARY OF CONGRESS CATALOGING-IN-PUBLICATION DATA

Names: Gregg, Samuel, 1969- author.

Title: The next American economy: nation, state, and markets in an uncertain world / Samuel Gregg.

Description: First American edition. | New York, New York: Encounter Books, 2022. | Includes bibliographical references and index. | Identifiers: LCCN 2022000078 (print) |

LCCN 2022000079 (ebook) | ISBN 9781641772761 (hardcover) | ISBN 9781641772778 (ebook)

Subjects: LCSH: United States--Economic conditions--2009- | United States--Economic policy--2009- | United States--Commerce. | Economic stabilization--United States.

Classification: LCC HC106.84 .G75 2022 (print) | LCC HC106.84 (ebook) | DDC 330.973--dc23/eng/20220114

LC record available at https://lccn.loc.gov/2022000078

LC ebook record available at https://lccn.loc.gov/2022000079

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The greatness of America lies not in being more enlightened than any other nation, but rather in her ability to repair her faults.

ALEXIS DE TOCQUEVILLE

In December 2016, I was speaking at a conference in London and the discussion inevitably gravitated towards the topic of Donald Trumps election as forty-fifth president of the United States of America. It meant, I commented, that a free trade skeptic would be in the White House. At that point, a young French economist turned to me and said, Mon ami, I thought that free trade was a done-deal. Apparently, it isnt. We took far too much for granted.

As it turns out, it wasnt just free trade with which many Americans were expressing frustration. A systematic questioning of the emphasis placed upon free markets in the American economy since the 1980s was underway, and not simply from progressives who looked to the New Deal or European social democracy for inspiration. Some of the market economys most articulate critics were to be found on the American right. In some instances, positions being advocated by some conservativesimplementation of industrial policy, mandating seats for employees on company boards, expanding the use of tariffs, etc.bore more than a passing resemblance to stances adopted by progressives like Senators Bernie Sanders and Elizabeth Warren.

This corrosion of a pro-market consensus once shared by many American politicians, opinion-shapers, and citizens meant that the U.S. economys future was now up for discussion to an extent that had not been evident since the 1970s. That future forms the subject matter of this book.

For good reason, the words America and Capitalism are synonymous in many peoples minds. Yet some Americans today plainly doubt that the market economyeconomic arrangements characterized by entrepreneurship, free exchange, competition at home, free trade abroad, strong property rights, robust rule of law, and a constitutional order that defines and limits the governments economic responsibilitiesis the optimal way forward for the U.S. economy. Other Americans say that they want less government in their lives and that markets should be allowed to work their magic, but then insist in the next breath that their particular community, business, town, or state merits federal assistance.

Since the mid-2010s, I have found myself embroiled in debates with people across the political spectrum who hold that Americas economy requires even more regulation and intervention beyond the already extensive role played by government in that economy. Sometimes the conversation has been with younger Americans who think that some type of socialism must be Americas economic future. But I have also had Wall Street executives tell me that stakeholder capitalisman idea that draws upon an older economic model known as corporatismshould replace what they regard as an economy too fixated on profits.

In other instances, some conservatives have informed me that the time has come for interventionist measures, often labelled populist or economic nationalist, to be used to deliver specific economic outcomes. Such goals range from helping specific groups who, such conservatives claim, have been left behind by economic globalization, to bolstering Americas place as a sovereign nation in a world in which great power competition is magnifying. They and others are especially troubled by the rise of a China governed by a nationalist-communist authoritarian regime intent on displacing America on the international stage. This alone, many Americans aver, necessitates a serious rethink of economic policy in general and trade policy in particular.

This skepticism about free markets could not be more removed from the atmosphere which prevailed in America following Communisms fall in Eastern Europe and the Soviet Union. The great rival to capitalism had failed comprehensively, and the subsequent rhetoric of many American thinkers and policymakers of the time suggested belief in a certain irresistibility to the advance of free markets. Many were also convinced that the case for mixed economies associated with the British economist John Maynard Keynes was faltering, perhaps in a decisive fashion.

That world seems very far away today. Instead advocates of market economies find their ideas subject to fierce critique on economic, political, and moral grounds, and they are derided by some of their opponents as market fundamentalists. Many defenders of markets have indeed couched their responses primarily in economic terms. Much of the debate, after all, pivots arounds questions of economic cause-and-effect and disputed facts about what is happening in the American economy and society more generally. But for all its force, the economic case for free markets cannot resolve all the apprehensions that many Americans have about their countrys futureone which cannot and should not be reduced to economics. Alas, when some free marketers do attempt to inject more explicitly normative and political dimensions into their defense of free economies, many of them seem unable to move beyond frameworks which absolutize individual autonomy and see no common values beyond utility or ever-expanding rights grounded in self-expression.

Yet however insufficient such answers may be to the criticisms expressed by assorted progressives, economic nationalists, and other advocates of greater state intervention, I regard the diagnoses of the economic problems facing America and the proposals for change offered by market skeptics as flawedoften deeply so. In some instances, implementation of their preferred policies would worsen some of the problems they seek to address. Considerable space is given in this book to explaining why.