Liberty Defined: 50 Essential Issues That Affect Our Freedom

by Ron Paul

  The image of Americans torturing prisoners at Abu Ghraib and Guantánamo circulated around the Muslim world has done unbelievable harm by the hatred it generated against all Americans. It’s going to take a lot of time to alter that sentiment, and it won’t happen without a change in our foreign policy and our assumption that we can arrest anybody anywhere in the world at will.

  General Barry McCaffrey, not exactly an outsider, commented on our torture program: “We tortured people unmercifully. We probably murdered dozens of them during the course of that, both the armed forces and the CIA.” The ACLU and many news sources estimate that at least 100 detainees died as a result of torture while in American custody. Our government has tried to downplay those deaths as suicide. So far there’s been no effort to hold accountable the individuals responsible for this travesty.

  For a society that condones torture of suspects involved in fighting our occupation of their country, it is not a great leap to accept torture of any criminal gang member here in the United States. The door has been opened more than a crack for this attitude to spread. What I fear is if or when the political system deteriorates due to a growing economic crisis, the cries for strong law-and-order policies could cause secret renditions and torture to come to the United States.

  The clandestine activities of the FBI, the CIA, and all sixteen of the intelligence agencies is something that is so massive and secret even presidents have a hard time understanding to what extent they operate. To oppose their authority is considered by many in DC as unpatriotic and un-American. This is not a good sign for America. A better understanding of civil liberties is urgently needed in all levels of our government. The message should be that torture is simply wrong and doesn’t work. Torture is more un-American than those who oppose it.

  Paul, Ron. A Foreign Policy of Freedom. Foundation for Rational Economics and Education, 2007.

  Salon Staff. “The Abu Ghraib Files.” March 14, 2006. Salon.com.

  TRADE POLICIES

  Protectionism is related to military Keynesianism in that many supporters of militarism are also champions of sanctions and blockades. True, a lot of protectionists thoughtlessly push protective tariffs purely as a job program meant to protect noncompetitive domestic industries and do not support them for military reasons. But what they don’t accept is that trade and friendship diminish chances of war with other nations, and protective tariffs are actually harmful to the American consumer. The moral hazard of protectionism is that the less efficient will not be motivated to become more efficient in order to survive. Complacency and inefficiency set in.

  Sanctions and blockades are extremely dangerous and should be considered acts of war. This policy was a prelude to our unwarranted and illegal invasion and occupation of Iraq. There’s reason to fear the same will result from our trade barriers against Iran.

  Blockading the Palestinians in Gaza has proven to be a dangerous and inhumane policy that has precipitated a worldwide condemnation of Israel. The result has been to make the region much more dangerous. It has undermined the Israel-Turkey friendship that has served both East and West for decades. My contention has always been that our interventionist foreign policy in the Middle East is good neither for us nor for Israel. I’m now more convinced of that than ever.

  Sanctions and protectionist measures are always a catastrophe. Believing they are beneficial leads to complacency and false expectations for their success, both economically and for solving geopolitical problems. Many members of Congress falsely believe that strong sanctions are an alternative to war instead of a precursor. Even members who are part of the unofficial antiwar coalition almost always support sanctions, even though they see themselves as strongly opposing war as a solution.

  What they fail to see is that blockades for whatever reason can be enforced only through violence and even killing. This moves the countries involved closer to outright war. Iraq is a good case in point: Sanctions were imposed through the 1990s and then the real war followed. Trade and friendship moves the opposing nations in the opposite direction.

  International trade organizations such as the WTO, NAFTA, CAFTA, and others are supported by many proponents of free trade and are universally opposed by protectionists and labor unions. The stated purpose of these organizations is to set rules and arbitrate trade disputes between members with the goal of minimizing trade restrictions and tariffs. And there is evidence that some tariffs have been lowered through these agreements. There’s also strong evidence that the trade organizations just as often give permission to retaliate against another country for certain trade infractions.

  I consider myself the most “radical” free trader in Congress, but I do not vote for these international trade organizations. The process by which these agreements are passed is flawed. Generally, fast-track legislation is passed by Congress, and congressional authority over foreign commerce is transferred to the executive branch. The office of the President then negotiates with groups of other countries the details of how to lower tariffs or gives permission to retaliate against another member for unfair trade practices.

  The only way the executive branch should be directly involved is to draft a treaty to be ratified by the Senate. Generally, this is an obstacle if the President is required to get two thirds of the Senate to agree. It’s easy to get a majority of each party to give approval to fast-track legislation. Since the Constitution is clear that Congress has the responsibility for foreign commerce, I don’t believe the President should even attempt to regulate foreign trade by treaty. The President already has vast authority with veto power over what Congress might pass.

  These trade agreements become instruments for international government entities to regulate trade without explicit consent of Congress. They literally undermine our national sovereignty, and that of our states as well, with rules. Too often the rules handed down can be beneficial to large international corporations while harming or ignoring the small companies unable to defend themselves against the giant bureaucracy serving the special interests.

  Too many supporters of organizations like the WTO are not true free traders even though some groups who pride themselves on free market economics are strong defenders of these organizations. Countries that won’t lower tariffs hurt their own people more than anyone else, since tariffs are a tax. If a foreign country subsidizes a product and goods become cheaper than our own, it’s an economic boon for the domestic country. Our country then has more money left over to increase our standard of living by purchasing other products. The political challenge, of course, is that our domestic industries must adapt. But in a free market economy they are required to adapt for all kinds of reasons that might enable their competitors to be able to produce at a lower cost and provide cheaper goods for the consumer. The consumer is the “special interest” in a free market—not protected corporations or big labor.

  Many of the professed free traders in Congress who get their credentials by supporting all trade agreements are frequently the strongest supporters for sanctions against countries such as Cuba, Iraq, Iran, and Korea. This position mocks the principle that nations that trade with each other are less likely to go to war. The truth is, some may well understand this and believe in this principle, but it’s war they seek. Too often, that is what they get. Stopping all flow of oil to Japan in early 1941 was a significant factor in the attack on Pearl Harbor later that year—something most Americans are not interested in hearing.

  I personally like to defend free trade in much more direct manner. I believe everyone has a right to spend his or her own money any way they see fit, whether it be on foreign or domestic goods. If tennis shoes from China cost $20 but $100 if manufactured in the United States, why punish the poor for the sake of protecting domestic industries?

  Many will complain that China (or others) uses “slave” labor and for that reason we shouldn’t allow their products to compete with ours. But that is hardly accurate. Chinese production uses low-cost labor for sure, but they’re jobs
that working-class Chinese eagerly seek; they are never forced to work as slaves. All they have to do is compare their current standard of living to the standard of living they had just a few years ago under communism. What many here don’t want to admit is that much of our labor is priced artificially higher as a consequence of minimum wage laws, unemployment benefits, and compulsory unions, while prices are pushed higher as a consequence of excessive regulations, taxation, and government-caused inflation.

  Protectionist measures don’t solve the problems; they only protect the status quo that keeps us from being competitive in many industries.

  UNIONS

  Unions came into being in a significant way during the industrial revolution but gained a major foothold in American economic life during the Depression of the 1930s. The National Labor Relations Act of 1935 was, until that time, the most important labor law passed in the United States. It established minimum wages and maximum hours of work and many government regulations on all businesses and labor agreements.

  This act, also known as the Wagner Act, passed for the purpose of helping labor, significantly contributed to the deepening and prolongation of the Depression. When an economy corrects from a Federal Reserve–generated bubble and malinvestment, all parties involved must retrench, eliminate the mistakes, and cancel out the errors made during the boom phase of the cycle.

  My first exposure to union power came as a young person after World War II. My dad ran a small retail dairy business back when milk was delivered daily to customers’ homes. The maximum number of trucks we ever had was about twenty. Our drivers were nonunion, treated well by my dad, and never agitated to join a union. The fact that we were nonunion allowed my four brothers and me the flexibility to fill in as summer and weekend relief drivers for vacations time and days off—a job that helped us all pay for our college education. A union contract would have never allowed this. Our drivers’ wages were commensurate with union wages, and even then they received medical benefits. At that time, before government-managed care took over, true medical insurance was reasonably priced.

  Even with this good relationship with our drivers, regional strikes by union truck drivers affected our business as well. During the first strike that I became aware of, my dad pulled all his trucks off the road. I couldn’t understand it and thought my dad might be sympathetic, so I quizzed him on this.

  He quickly explained to me that the threat of union violence against us was significant if our trucks delivered milk during the strike. He explained that our trucks could easily be damaged and in some cases turned over and destroyed by union strikers.

  Union power, gained by legislation, even without physical violence, is still violence. The laborer gains legal force over the employer. Economically, in the long run, labor loses. Whether it was featherbedding in the railroads or union intimidation for milk-truck drivers or car workers, the eventual result is the loss of jobs. It continues until this day.

  Today, of course, no one has the service of having their milk delivered to their house, nor do we have any private railroad companies running passenger trains. All this has come about as a consequence of labor laws intended to protect workers’ interests. In fact, the laws do the opposite. If only it were so easy to help the working class. Just dictate wages and everyone will be financially better off. Unfortunately, this leads to disastrous results, whether it’s the prolonging of the economic mess as it did in the 1930s or the tragic results in American industry that we’re witnessing today.

  What good is it to mandate a $75 per hour wage if there are no jobs available at that price? What good is a minimum wage of $7.50 if it significantly contributes to overall unemployment?

  The reaction to the economic argument explaining the shortcoming of labor unions and minimum wage laws is that it’s heartless and unfair not to force “fairness” on the ruthless capitalists. But true compassion should be directed toward the defense of a free market that has provided the greatest abundance and the best distribution of wealth of any economic system known throughout history.

  Once power is given to government to set wages higher than the market rate, it also has the power to fix wages at lower rates as Nixon did in 1971 with wage and price controls. Roosevelt and Truman did the same thing. They claimed it was in the country’s best interest due to the war effort. Think of the absurdity: for ten years during the Great Depression, the government tried to raise wages, and then, when the war came, the government forcibly lowered wages. The whole endeavor is crazy and dangerous. In a free society, setting wage standards is not ever a prerogative of the government in times of war or peace.

  Working people should always have a right to voluntarily organize and negotiate with business owners. It’s the use of force or privileges that militant unions demand from government that distorts the true cost of labor. Compulsory unionism, protected by law by a majority vote, violates the principle of protecting minority rights. Making workers pay dues to be represented by an organization they disagree with is hardly fair or just. Coercing businesses to accept contracts with unions at the risk of being closed down is not a voluntary agreement. Workers who are willing to work at a lower than union wage are subject to violence by militant union workers.

  In a free society unions would not be banned but the employer would only deal with unions voluntarily. In a truly free society there may well develop competing unions (in highly specialized skill areas) to vie for contracts and argue their case for productivity and safety habits. If they prove their case, workers’ wages would be maximized for economic reasons. What many people don’t even realize is that in a free market economy, labor becomes scarce and the businessman must seek the best workers by offering higher wages.

  Even before the current economic crisis, starting in 2008 in certain areas, labor was scarce, which was a great incentive for illegal aliens to come here for construction jobs that were going begging. They were, for the most part, making more than minimum wage but less than the union wage.

  It was not infrequent in my congressional district for farmers, builders, fishermen, hospital administrators, and others to come to my office asking for help to increase the number of work visas to help solve their labor shortages. Many also complained about illegal immigrants being a financial burden on the taxpayers by getting free education and medical care in our emergency rooms.

  It is true that illegal aliens place an economic burden on the American taxpayer, but it’s doubtful that legal or illegal immigration is the cause of unemployment for American citizens. With the recession, illegal immigration is down because the demand for labor is down. Immigrants weren’t undercutting American workers’ salaries; jobs went begging because American citizens either didn’t want or need the jobs badly enough to take the ones that were offered.

  Jobs are always available, even in weak economies—it’s just that many refuse to take them because wages are seen as being too low. And when compared to what one can get from unemployment benefits or welfare, the incentive to take a job is significantly diminished.

  Once labor gets special protection by labor law, we entrench the principle of government interference. This prepares the way for wage control, and the government can also declare wages to be too high. It also invites controls like antitrust, and restriction on campaign participation by both labor and business. If union dues were obtained strictly by voluntary means, this would not be a problem. Unionized workers, getting special favor from federal laws, should never be allowed to hold the taxpayer hostage with threats of a strike or interfering in the election process or lobbying for legislation designed to perpetuate the overpaid and excessive bureaucracy.

  There are, I’m sure, many who support labor unions who would disagree with these points. What they don’t understand is that once special privileges are granted for one group, others will compete for political influence as well, to benefit themselves. In this case, big business will have the funds to influence a pliable system with cash outlays for all forms of corporate
welfare benefits: special loans, grants, contracts, easy money, financing the military-industrial complex, special tax benefits. In the end, the money talks and the principle of intervention endorsed by the pro-union workers is used to a greater extent to subsidize and aid businesses over labor. It would be best to have a government that would cater to neither group.

  In a free society, neither business nor labor gets special benefits from the government; not giving benefits to either equalizes the process, which then would be a benefit to labor. The best way for labor to gain more economic clout is for the free market to thrive and good workers to become a premium, creating a higher demand and higher wages.

  It’s generally thought that big labor and big business are always at loggerheads, but this is not so. When large corporations, especially those in the military-industrial complex, are artificially subsidized, permitting huge profits, it provides an opportunity for unions to maximize their wages. In instances like this, the unions and businesses frequently work together to obtain obscene contracts from the government. These companies rarely go bankrupt, and if in trouble get bailed out. Even before the recent crisis, corporations like Lockheed and others were taken care of by Congress, with pressure on the Republicans coming from the corporations and on the Democrats by the unions.

  The recent bailout of General Motors was a lot messier, but I’m sure there were some who thought the best answer would have been for General Motors to get some military contracts to manufacture tanks or other government vehicles. This was one of the things done in 1979 to bail out Chrysler—the first time—with a contract for the army’s M-1 tank.

  Interestingly, this Chrysler bailout was one of the first real battles in which I became directly involved in Congress. Even earlier, because Chrysler presented a “need,” the Congress responded by taking the contract from General Motors, to whom it had been awarded. The first great switch was pulled off in 1977 by the Secretary of Defense at that time, Donald Rumsfeld.