Kai Weiss: As we speak – in early March, Donald Trump has imposed tariffs on steel and aluminum, and as it stands right now, it looks as if a trade war could be in store. As supporters of the free market, we are obviously opposed to these actions taken, but could you give us a short summary on why a trade war would be bad?
Matt Kibbe: Yes, I’m adamantly against Donald Trump’s general position on trade. No one should be particularly surprised that he is actually doing this: Trump has consistently, since the 1980s, been an uninformed protectionist. He loves the idea that trade deficits are bad, and that America is getting screwed by all our trading partners – he clearly doesn’t understand the notion of win-win trading deals, or comparative advantage. To the extent that he’s sincere about it, he’s a negotiator, he thinks that every person who wins means that someone else loses. So the question is, does he mean it? And this is always the question with Trump: is this a negotiating ploy, or does he actually believe that protectionism is good economics? He says that protectionism is good economics, but is that just saber-rattling? Will he back off if it doesn’t work out well for him? Nobody knows, but in the meantime, you might create a real trade war. As a student of the Great Depression, and of Austrian Business Cycle theory, we know that Smoot-Hawley and protectionism in 1930 very much exacerbated the Great Depression. Obviously, it’s good for the favored chosen industry that’s being protected. But what about those other industries that will be punished by people and trading partners who don’t buy stuff? Protectionism is bad, and in some ways, trade protectionism is one half of a coin, the other half being Trump’s position on immigration: there’s just too much. It’s not really about illegal immigration, it’s really this general idea that there’s too many immigrants coming into this country, only so many jobs to go around, and that they are undermining American workers. It’s a zero-sum economic view that sounds similar to Bernie Sanders’ position. Oddly, Bernie Sanders and Donald Trump have very similar worldviews on both trade and immigration.
So far, excluding his protectionist impulses for a second, what is your view on the first year of Donald Trump? The Heritage Foundation for example says that he has implemented 64 percent of their recommendations on economic policy, in contrast to 49 percent that Ronald Reagan did in his first year.
The Heritage argument is comparing apples to oranges, because Donald Trump has a Republican Congress, he’s inherited Republican victories going all the way back to 2010. Ronald Reagan of course had very aggressive, large Democratic majorities in Congress, and that fundamentally changes what you can and can’t do. The things that Trump has done well: he has pushed for a significant reduction in red tape and paperwork associated with regulations through the executive branch – and without knowing all the specifics of what he has done, that’s a good thing. But it’s kind of a temporary thing, too. Let’s say Elizabeth Warren becomes the next President: she could reverse these things in a day, so unless Congress would actually pass new legislation changing the regulatory laws under which the agencies function, it’s temporary. Same with the tax cuts: the tax cuts are a significant step in the right direction, hardly a flat tax, but a step in the right direction. But they are also temporary. While those are good things, those are also things that you might expect Republicans to do when they control both Congress and the White House. The big thing that they didn’t do, repealing Obamacare, is something that every Republican, including Donald Trump, ran on for the last eight years, and they failed to keep that promise. There are clearly elements within the GOP and the Trump White House who didn’t really want to do it anyway. Republicans are very cozy with the insurance industry and health care interests generally, and those interests kind of like forcing people to buy their products. And then you have the trade protectionism, which I think could easily undermine economic growth gains from these tax cuts. I’m not an anti-Trump hysteric: I think you have to judge Trump the same way as Obama or Bush or Ronald Reagan, there’s pluses and minuses, and now that he is elected President we should measure those things based on a sort of objective criteria. But the one thing that is very dangerous about Trump is his cavalier attitude about the rule of law, and limits on Presidential power, and he demonstrates that on a daily basis. The problem with that attitude, and the problem with him expanding on Obama’s expansive view, is that it will be very hard to get back to a constitutionally limited Presidency. He is going to create a tradition that the Executive is more and more imperial, is more and more “do as I say,” less and less interested in the separation of powers with the legislative branch, less and less interested in upholding the rule of law. And I should step back and say that his Supreme Court nominee was an excellent choice. So whenever someone is defending Trump, they are like “but Justice Gorsuch, but the tax bill, but deregulation.” But you have to look at more than that, and the lasting legacy of Trump is probably this authoritarian impulse that we certainly saw in Barack Obama, that we saw in George W. Bush. When it comes to expanding Executive Branch power, I’ve seen every President standing on the shoulders of the one before. Once you shred those limits of Presidential power, it’s hard to put the cow back into the barn.
Donald Trump campaigned on a protectionist, nationalist platform and won, while four years before we had the Ron Paul Revolution. And even three years ago, Rand Paul was the favorite to be the Republican candidate for the 2016 election. Considering that Trump was voted in often by the very same people that voted for Ron Paul and intended to for Rand, how is it possible that the mood turned around so quickly?
All politics is won on the margins, so it’s a little dangerous to make sweeping assumptions about a fundamental shift. In any national election, Republican candidates seek a coalition of voters. You could break them up into many categories, but for the purposes of this, let’s break them up into three: we have establishment Republicans, country-club Republicans, the ones that are comfortable with power, and don’t appear to be particularly driven by free-market ideology. They are crony capitalists, and the differences between them and the Democratic establishment is not always so clear. Second, there are the liberty Republicans, the Rand Paul/Justin Amash wing of the Republican Party. That block is bigger than it’s ever been in the past. Back when Ron Paul was an elected Republican, he was the only guy, he was the lone voice that really couldn’t have an impact. Now you have this block of liberty votes in the House and Senate in the Republican Party, and they matter. They can quote Hayek, they can quote Ludwig von Mises, they understand Adam Smith, and they understand the power of the market process. And third, now you have this other wing, this Trump wing, which is not really motivated by free-market economics, or presidential limits on power, or the Constitution, or any of these things that animated the Tea Party and the Ron Paul movement before that. It’s nationalism, it’s economic anxiety, it’s concerns that immigrants are taking jobs away. These are natural anxieties that you are seeing all over the world right now. We are seeing a rise in nationalism, a rise in socialism, and I think part of it is the economy, and the other part of it is the way that technology and social media has disintermediated politics. Now you have all sorts of new voices coming out and expressing themselves, coalitions arising outside of formal party structures. And on the left you can say that Bernie Sanders did the same thing with Hillary Clinton. If Hillary Clinton and the Democratic Party hadn’t gamed the system, Bernie Sanders could have well been the Presidential nominee, and he is a fairly unreformed, old-school socialist. Donald Trump dominated the Republican primary strictly because he was anti-establishment. He was the most authentic outsider coming in and breaking up what a lot of voters viewed as a two-party duopoly, the “Washington Swamp.” It’s a collusion of insiders in Washington, and the voters sent a wrecking ball in to smash that. So, is voter support for Trump really about the positions he takes? I don’t think so. I think it’s an ethos, an attitude. He’s what people have decided to support, given other serious attempts to reform government didn’t work.
There are some people who say that if Ron Paul had run again, Donald Trump would have had no chance, because – as you just said, this sort of outsider, anti-establishment guy would have been Ron Paul. Since his son Rand moderated his views, Rand created the opening for Trump. Could this be true?
If you remember when Ron Paul ran for President, he was the only legitimate outsider in the entire Republican field, and so he had lots of running room. When Rand Paul ran for President, it was a very crowded field, including a number of authentic, Tea Party types, even Marco Rubio, certainly Scott Walker, Ted Cruz. Rand was competing amongst a lot of other voices, and you could argue, counter to that, that Rand Paul, Ted Cruz, Scott Walker, and Marco Rubio may as well have split the anti-Trump vote, and if it had been one-on-one Rand vs. Trump, one-on-one Walker vs. Trump, or Cruz, or that kind of thing, it might have been different – so I’m not sure Ron Paul could have beaten Donald Trump in this particular election. You could come up with all sorts of hypotheticals about one-on-ones. However, and I don’t know if Rand would admit this, it’s true that Rand was thinking that his goal, his strategy in running for President, was to convince rank-and-file Republicans, the so-called establishment, that he was “safe,” at the very time when Republican primary voters wanted someone who wanted to break something. It’s easy to second-guess, but arguably Rand was running exactly the kind of campaign that someone who had a serious shot at being the next President would run. In perfect hindsight, I wish he would have run a more aggressively outsider campaign, a Ron Paul-style campaign, but … No one predicted Donald Trump, and we can only look at it now, and say “Well, maybe he should have done it differently.”
You wrote that the Tea Party is dead, and what once constituted the Tea Party is now either just Trump voters themselves, or as a new movement of course, the Alt-Right. And those on the Left, accompanied by many, many articles, claim that the Alt-Right and libertarianism are closely connected, that libertarians can easily become Alt-Righters. What do you think about these accusations?
I think there is a cottage industry now trying to link libertarianism to the Alt-Right. But these worldviews are fundamentally different. A lot of the folks in the Alt-Right who started with libertarianism have actually written that they ultimately rejected these ideas, prefering nationalism and racial identity and resentment instead. But, of course, Ludwig von Mises, in many ways the Godfather of the modern libertarian movement, wrote a book called Liberalism, where he describes our philosophy as fundamentally cosmopolitan, internationally focused, in the sense that all people on a universal basis can cooperate, and can prosper together. That is categorically everything that the Alt-Right is against. But there is a silver lining in this: these efforts by the authoritarian Left to link libertarianism to the Alt-Right tells me that they are still worried about the attractiveness of libertarianism to younger voters. They are trying to smear it, they are trying to tie this albatross around our necks, and we should push back against that, because in many ways, nationalism and socialism, and all these “Isms” that involve concentrating so much power in government, are not so different from each other. Ultimately, whatever your ideological aspirations, concentrating government power is just about brute force, and it manifests itself in very different ways, but Hitler’s fascism and Stalin’s socialism don’t really look all that different in practice. Now, the Alt Right has read different books, and they perhaps appeal to different resentments amongst different blocks of citizens. But ultimately, giving more power to government, to rearrange social outcomes in favor of one group over another, has always led to unhinged authoritarians killing people. Concentrated government power, whatever the philosophical window dressing, is always fundamentally anti-libertarian. Racism, or “racial identity,” as they might say, is fundamentally anti-libertarian – Ayn Rand called it the most brutal form of collectivism. Nationalism is just another form of collectivism: it says that the state is more important than the individual. So I think we need to take all these things on, and we need to challenge this traditional left-right spectrum that says that on the far-right is fascism, on the far-left is socialism. They are really different flavors of the same social experiment – a social experiment that has proven to be a humanitarian disaster again and again and again.
Three years ago – when I first was confronted with libertarianism, there was a lot of hope, people spoke of the “libertarian moment,” Rand was number one in polls, and later on Gary Johnson seemed poised to challenge the other two main party candidates. Rand Paul and Gary Johnson obviously underperformed, and now we have the Trump’s, the Sanders’, and the Warren’s, and in Europe, it’s the same: you have the Le Pen’s, the Corbyn’s, and so forth. What is the way moving forward for libertarians? How can we get out of this mess?
I think it’s wrong to look at political outcomes as the primary measure of the power of ideas and even social movements, because even though Trump won the election, the liberty movement that created Rand Paul, Justin Amash, Thomas Massie, Mike Lee, and a lot of other liberty-friendly candidates, that constituency is still there, those ideas are more vibrant than ever. And – as is the case with all these other movements, the Five Star Movement in Italy, the Pirate Party in Iceland, the neo fascists and strident socialists, they all find new voice in a more decentralized political space. The party bosses used to control politics, they controlled the money, and you were forced to make your choices based on those constraints. Now you can start a Facebook page, and start raising money for yourself by a crowdfunding campaign, you can get your message out without spending a lot of money, and as a result, it turns out that people are different. We are all different and we never fit neatly into some one else’s pre-determined boxes. I’ll use this country as an example: it never made sense that all voters would fit in one of two boxes – it’s ridiculous. They all have a complex set of preferences, beliefs and aspirations, and now you are seeing both the Republican and the Democratic Parties crack up. It’s not at all clear how the Democratic Party moves forward, because the Bernie Sanders wing is still ascendant, Elizabeth Warren and really strident authoritarian progressives have a new voice in that party. Would Hillary Clinton ever win that nomination again? It’s not at all clear if she could. And the same thing is going on in the Republican Party: you have all these different factions sort of vying for a voice. You have more and more young people registering as independents — nobody wants to register as a Republican or Democrat anymore. And of course, Gary Johnson got more votes than any Libertarian before, so you see this emerging crack-up happening. This is a strategic opportunity for libertarians – not big-L Party libertarians, although they might take advantage of this too. But just this idea that more and more people have access to competing points of view, and new, better ideas. Austrian Economics has always been ignored by mainstream economics professors, libertarianism has always been ridiculed as a legitimate social philosophy in the hallowed halls of great universities. But now, when young people hear their Marxist professor telling them that history is a predetermined arc, that inevitability leads to communism, they might skeptically say: “I’m not sure, I’m going to google that.” I love this story from Justin Amash, the liberty Congressman from Michigan: when you go into his office on Capitol Hill, the first picture you see is a picture of Carl Menger, who of course is the founder of the Austrian School of Economics. Amash tells this story of randomly discovering Friedrich Hayek in a Google search after having gotten out of high school, college and law school, and not being taught about any of the classical liberal thinkers. He found Friedrich Hayek’s Wikipedia page, created his own curriculum, and he started reading Hayek, started reading Mises, and eventually, he read Carl Menger. That’s the new normal. Anybody can discover ideas from a multitude of sources, and young people live in this radically libertarian world, where they choose everything. They choose their friends and their ideas, and ultimately have access to knowledge that none of us would have been able to even consider ten years ago. We should embrace this chaos, this beautiful chaos, with an understanding of what Hayek was talking about when he talked about the “spontaneous order.” We have an opportunity to create a global movement based on good ideas, but it’s probably upstream with politics. Politics is a lagging indicator of social change, and we shouldn’t necessarily think that our project is a political one. It’s not about electing John Galt, it’s about creating a mass movement based on a set of ideas, and that should inform our strategy. How do you reach a mass audience? Well, it probably isn’t by mailing out copies of Human Action – don’t expect people to read all the same books we did when we were kids. It is when we create video content, when we find cultural means of spreading ideas in a way that’s consistent with how social media operates – that’s what we are trying to do with Free the People, and I think that’s what everyone should be doing in their own experiments in communicating ideas. We are no longer a cadre of intellectuals like the group that Hayek gathered at Mont Pelerin. We are no longer a few members of Congress flying under the banner of Ron Paul liberty Republicans. We are bigger now, our community is bigger, and we need to figure out a new set of tools to grow even bigger.