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Glenn Hubbard tried to dissuade President George W. Bush from putting tariffs on imported steel. As chairman of Bushâs Council of Economic Advisers, he told the president in 2001 that the harm from tariffs suffered by consumers of steel would vastly outweigh the benefits to steel makers. He argued that trying to preserve steel jobs through tariffs would be like trying to save farm jobs in the early 20th century, when farms became more productive and people went to work in factories instead.
For Hubbard, the trickiest challenge is differentiating his stance from that of those fellow conservatives who agree with him on many issues but not on free markets. One such is Oren Cass, whose name appears in the book 39 times. Cass is the executive director of American Compass, a think tank that âemphasizes the importance of family, community and industry.â He is a leader of the newly christened national conservatism movement, which rejects globalization in favor of nationalism.
Hubbard argues that in the name of workersâ dignity, Cass is bent on preserving jobs, especially in manufacturing, that have become obsolete. He says Cass is trying to ârestrict the evolution of workâ while engaging in protectionism and picking winners and losers.
Cass has already issued a partial rebuttal in the form of an articlein the journal American Affairs that appeared even before Hubbardâs bookâs publication date. Itâs slyly titled âHave I Got a Bridge to Sell You: The Limitations of Econ 101.â Cass writes that civilizations require walls as well as bridges. As for Hubbardâs argument that countries should specialize in what theyâre best at, known as the theory of comparative advantage, Cass responds that âtodayâs debates concern how comparative advantage is created, rather than discovered.â That is correct and important. Japan and South Korea, to name two examples, did not become world leaders in electronics based on natural endowments. They created their advantages.
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Tariffs and Market Power with Michael Lind
Michael Lind joins Oren for a wide-ranging discussion of the U.S. economy, the merits of tariffs, and the public purpose of markets.
The Future of Capitalism: A Conversation with Glenn Hubbard
This special episode of the American Compass podcast features a wide-ranging conversation between Oren Cass and Glenn Hubbard on the future of capitalism.
Why Trump Is Right About Tariffs
Taxing imported goods is unpopular with economists, but it could help the U.S. lower the trade deficit, strengthen its industrial base and safeguard national security.