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Less Is More in Buchanan's Conservatism : * In the name of helping small business, he's calling for Big Government as intrusive as any favored by liberals.

February 18, 1996|BENJAMIN ZYCHER | Benjamin Zycher is vice president for research at the Milken Institute

It is really quite amazing. Conservatives are supposed to stand for the constitutional vision of limited federal powers, for limited local government using means that are necessary and proper, for unlimited and equal opportunity, for economic growth, for government neutrality among interest groups. That is the American ideal, that is what the Founding Fathers envisioned and that is what Americans voted for in 1994. Don't tread on me.

Unfortunately, truth in advertising does not apply to political labeling. We now have a self-proclaimed "conservative"--Pat Buchanan-- advocating something called a "conservatism of the heart," the details of which reveal it to be nothing more than a call for Big Government just as intrusive as that favored by liberal interest groups, although for different purposes.

Consider, for example, Buchanan's latest economic "program," the central feature of which is a series of stiff tariffs on Japanese, Chinese and "Third World" goods, with the revenues used to offset reductions in some taxation of capital. Buchanan actually seems to believe the nonsense that a bilateral trade deficit with another nation somehow hurts America. My bilateral trade deficit with the local supermarket is enormous, in that I buy all my groceries there and sell them absolutely nothing. So what? And let us hear no more silliness about low Third World wages; American wages are higher precisely because Americans are better educated, have more capital equipment, in short, are more productive.

In any event, let us consider the inevitable effects of the Buchanan proposal. The tariffs represent a major tax increase, pure and simple. Some of his other proposed tax reductions and reforms are hardly original: Real conservatives have advocated them for years, but they would have the salutary effect of strengthening the dollar. Does Buchanan understand that a stronger dollar would tend to make the reported trade deficit larger, that is, that his tax proposals are inconsistent with his proclaimed trade goals? There is little evidence that he does. And the tariffs--let us be blunt--would raise prices for both foreign and domestic goods in U.S. markets, thus making the American people as a whole poorer in real terms. But because much government spending is adjusted upward in light of measured inflation, the tariffs would make the federal government bigger, hardly an outcome consistent with conservative principles.

Moreover, Buchanan wants to penalize American firms moving overseas as a means of avoiding regulatory intrusiveness; thus will his "reforms" hurt American business in favor of American bureaucrats.

Buchanan wants tax policy to favor "small" business over "big" business, the definitions of which inevitably are arbitrary; in any event, such meddling cannot be consistent with the traditional neutrality demanded by true conservative principles. Buchanan wants government bureaucrats rather than market processes to determine which goods are available to Americans. One set of trade policies would be applied to some nations and another would be applied to others. This necessarily means that the State Department will play an important role in the course of American economic performance, and that the Commerce Department will be given a new (and huge) lease on life. This is "conservatism"?

The basic problem with Buchanan's "conservatism of the heart" is both economic and political. It is economic in the sense that we cannot expand opportunity and national wealth by giving the federal government vast new trade powers that inevitably would make the economy smaller. It is political in the sense that the distortions attendant upon such new federal power will lead the private sector to seek ways to avoid those distortions. But then the bureaucracy will impose more restrictions to prevent such market responses, and so on. Over time, the more power that the federal government is given, the more it must take, and there is no evidence whatever that Buchanan is uncomfortable with Big Government as long as it pretends to pursue his goals.

Ronald Reagan understood this well. If we are to return to a real conservatism of limited government--the kind for which Americans voted overwhelmingly in 1994, the kind for which Reagan stood throughout his entire political career--we must reject Big Government masquerading as conservatism.

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