The Trump Presidency will be a race between two gigantic opposing forces. On the one hand, the lunatic asset prices that now prevail, both in stocks and real estate, have a very long way to fall – in the Austrian economic sense, there is a gigantic amount of malinvestment that must be liquidated. This fall will be a huge drag on the general economy. There will also be a modest deflationary force from ending the absurdly bloated government spending and handouts of the Biden years. Protectionism will raise prices and produce positive economic effects only in the long term. Only deregulation offers big short-term gains. The key question is whether those gains will be sufficient to ensure that the electorate grants us a further term of sound economic management after 2029. Based on the Biden-era experience, the alternative would be true long-term disaster. Continue reading →

H1B visas are not slavery. However, they place their recipients in an inferior, immobile tier of the labor force that by preventing them from moving freely between employers, allows employers to exploit them at wages below the U.S. market level. In this respect, they serve the same economic function as antebellum slavery, providing a non-market rent to their users, reducing employment opportunities for the domestic “free” population and incidentally raising the capital values of the properties where they are used. Whatever one’s views on the optimum overall level of immigration, the H1B program should be abolished, as should its H2 and H2B sisters. President George H.W. Bush, who introduced them, was an economic illiterate. Continue reading →

Emerging markets were huge beneficiaries of the fall of Communism and the globalization trend that followed it in 1991-2008. Since then, the story has been much darker for poor countries in all regions of the world, with many “emerging markets” ceasing to emerge and relapsing back into long-term poverty. With President Trump’s advent, more protectionism seems likely, and emerging markets may become collateral damage in what will mostly be a battle between the rich. There are however ways forward to prosperity, which emerging market governments must follow, as they have notably not done recently. Continue reading →

The European Union was always a somewhat anti-free-market association, one reason why the then more liberal United Kingdom should not have joined it. In recent years, however, it has gone beyond the mild social democracy baked into its constitutional arrangements, and has become more authoritarian, more oriented towards central planning through its regulations, and recently in its nullification of the Romanian election outright anti-democratic. In Europe, the age of neo-Communism is upon us; non-European countries and companies would do well to give the region a wide berth. Continue reading →

The Biden Administration has generally been startling in its lack of originality on economic policy, with one exception: Federal Trade Commission chair Lina Khan. Khan has reversed the FTC’s long-standing positive attitude to mergers and acquisitions, taking a highly skeptical attitude to them, based partly on her own anti-capitalist ideology. While the incoming Trump administration should reject the ideology, they should continue the merger-skeptic approach. In general, corporate bigness is bad, mergers subtract value, oligopolies rip off consumers and the innumerable studies showing that a particular merger will not harm consumers are bought and paid for by lobbyists. One can hope that Trump’s new FTC chairman Andrew Ferguson, currently a Republican representative on the FTC, has learned much from his chair. Continue reading →

George Dangerfield’s 1935 “The Strange Death of Liberal England” set out how increasing unrest and inept government in 1910-14 led to the collapse of the Liberal Party that had ruled Britain for most of the 19th century. A similar book could be written today about the collapse since 2000 of the centrist, well governed “Liberal” polity that President Bill Clinton bequeathed to George W. Bush in January 2001. Whether President-elect Trump now succeeds or fails, there is no chance of a return to that liberal consensus. Instead, a choice will be made in 2028 and thereafter between authoritarian progressivism and a new populist conservatism. It is to be hoped that the American electorate chooses wisely. Continue reading →

The background of Scott Bessent, President-elect Trump’s nominee for Treasury Secretary, contains warning signals for fans of Trump and the U.S. economy, in that he worked for George Soros, for whom he was instrumental in the highly profitable 1992 trashing of the pound. For Trump, he must pursue an anti-Soros agenda, sweeping away the remnants of globalism, central planning and wokery in favor of William McKinley’s tariff-driven nationalism and hard-money policy, and Calvin Coolidge’s severe pruning of overgrown government. If at his retirement the Financial Times praises his “moderating influence” he will have utterly failed, subverting the Trump promise and blocking the long-term prosperity which the American people have voted for and deserve. Continue reading →

One enormous potential advantage of President Trump’s re-election is that it may enable the United States to end the perpetual war in which it has been engaged since 2001. That war has caused U.S. public debt to spiral from 30% of GDP to over 100%, destabilized large sections of the world turning them into unproductive wastelands, and killed or maimed large numbers of Americans and even larger numbers of other nationalities. While peace will never entirely reign in this imperfect world, a U.S. policy of non-intervention will at least keep the conflicts localized and unimportant to those not involved. Achieving this would be the greatest possible achievement of Trump’s second term, provided the U.S. electorate does not thereafter foolishly repeat its gross error of 2020 and repudiate his good work. Continue reading →

The great Ron Paul is associated with Elon Musk’s Department of Government Efficiency and is well known for wishing to abolish one of the least effective government entities: the Federal Reserve. As the Department of Education and other hallowed government entities become one with Nineveh and Tyre, Paul’s question should be asked, whose answer bears on the whole question of U.S. and global monetary policy: Should we End the Fed? After the last two decades, I believe the Fed’s overall track record is now bad enough that the answer to Paul’s question is “Yes”. This column will suggest why and how. Continue reading →

Before President Donald Trump’s substantial re-election, Elon Musk had promised to head a “Department Of Government Efficiency” that might cut $2 trillion from the Federal budget, and even floated the idea of bringing in the great Dr. Ron Paul, who at 89 is an encouragement to us all. That seems an eminently attractive goal, entirely in line with traditional Republican policy, although traditional Republicans (at least since President Ford) always turned out weak and backsliding when it came to implementing spending cuts. In the hope that Musk means it (his success in cutting waste at X/Twitter is at least encouraging) I thought it worth presenting some ideas of activities that could be axed. I focus here on cash savings rather than quality improvements; even in agencies one might keep (such as the Federal Emergency Management Agency from recent news) there are clearly many “bad apples” and an appalling management ethic; these must also be remedied. Continue reading →