 This is Mises Weekends with your host Jeff Deist. Ladies and gentlemen, welcome to Mises Weekends. We are in the midst of our annual Austrian Economics Research Conference, so our show this weekend features a talk delivered today on day one of that conference by our good friend, the libertarian muckraking journalist Jim Bovard, who is someone I'm sure many of you know. I've known him for many, many years since I lived in Washington, D.C. You may know his name from publications like The Wall Street Journal, The Hill, USA Today. He gave a great talk today on the follies of Washington, D.C., especially the regulatory regime, things like the FDA, farm subsidies, and white steel tariffs, for example, just don't work. So it's a rollicking speech, and I'm sure you're going to enjoy about the next 25 minutes with the great Jim Bovard. It's interesting that the things I've been investigating over the years, it's often fascinated me to see that the government policies are far more wasteful and irrational and often more oppressive than they're wildly perceived. One example on that is agriculture programs. I've been sniping in D.C. at federal agencies for a couple of years before I went out to pick up the Washington Post one morning in early 1983 and saw a headlight announcing that the feds would be shutting down 78 million acres of farmland that year. And this was a mystery because everybody knew Ronald Reagan was a champion of free enterprise, and here he's going to shut down all this farmland. Now keep in mind, federal farm programs have been started 50 years early because of market failure. It was back when FDR's brain trust decided that there was something intrinsic in markets that prevented them from working, and the evidence that they didn't work was that prices weren't high enough. Crop prices weren't high enough, and so what FDR did was basically make a farm dictator and invest all this arbitrary power in the USDA secretary of agriculture, and that was supposed to fix things. They didn't fix things, but they kept doing it every year for 50 years. By early 1983, the programs were a train wreck. In 1981, Congress had passed a four-year farm bill to govern agriculture. Now, Stalin had his five-year plans for the steel industry. Why not have a four-year plan for American agriculture? But Congress made a couple of details wrong. For instance, it assumed inflation would keep roaring along, and so price supports for each crop were scheduled to rise a lot each year. Well, inflation slowed almost faster than almost anybody but Ron Paul and maybe Lou Rockwell expected, and all of a sudden, by late 1982, you had the biggest U.S. government crop surpluses in history, U.S. government grain surpluses. Farm program costs were doubling, and exports were collapsing because Congress and USDA had priced U.S. crops out of world markets. So the obvious answer was to shut down the farms. Well, it was obvious in Washington. So the Reagan people launched the Payment in Kind program to counteract the boneheaded signals by other farm programs. This program gave farmers $25 billion worth of surplus crops, in addition to $50 billion worth of other federal benefits. Now, 78 million acres, that's more than double the entire landmass of Alabama. This is more than shutting down the entire states of Ohio and Indiana. This is how badly the federal farm policy had failed. I mean, it was astounding, and yet, according to Agriculture Secretary John Block, he said that PIC was the most successful farm program in history. You know, it was fascinating to see stuff like that, and nobody in D.C. paid attention to the victims of this government intervention because you had the government shutting down all this cropland. And what that did was wipe out a quarter million jobs at a time when the nation was still recovering from the worst recession since World War II. It was devastating. Hundreds of fertilizer and seed dealers had to close up shop because PIC cut their sales by, you know, 50%. And you had the cut back in harvest and a drought devastated, bankrupted a lot of unsubsidized poultry, cattle, and pork producers. Because, okay, the government drives up feed grain prices, what could possibly go wrong? I mean, this is the attitude in D.C. on ethanol because, I mean, the ethanol policy completely screws the pork and cattle industry and the poultry industry. But anyhow, so I got an assignment to write about this PIC program for Readers Digest and got an interview with John Block. And Block was, he's like a nice guy. He's a West Point graduate hog farmer. Block had once described himself as just a country boy on loan to the Department of Agriculture. I thought about starting the interview by telling him I was a country boy on loan to Readers Digest. But I said, no, I don't need to use that joke, so good thing I didn't. Block was a nice guy and he was using the general vague talking points. I said, well, how come the feds are shutting down so many acres? He said, well, it's important not to start farmers off the land. Apparently in contrast to the farm workers who were put out of work. Block said that the program was necessary so the government could move to a more market-oriented agriculture policy. This is a line that has been echoing for many decades in D.C. So I asked, so how come Reagan signed the bill in late 1982 boosting the crop price supports even higher after it was obvious the program was all screwed up? And Block was puzzled and said that there was no such bill. President Reagan didn't do that. And sitting next to him on his right hand was his portly press secretary who at that point kind of squirmed as if someone had just broken wind. And he leans towards Block. He says, I think he's referring to the provisions of last September's Omnibus Budget Reconciliation Act. Block said, yeah, okay. And I pause and I was expecting an answer and can we explain this and nothing. But maybe it's possible that Block was appointed to that job because he didn't understand the contradictions. I mean, there were some people in the USDA who did and they were like, oh, what are we doing? But not Block. So this program didn't make any sense. But instead of being a monstrosity, it became a prototype. And so almost every year in the 1980s, USDA was paying farmers to shut down 70 million acres or more. And mind you, farming is an export industry. And so you shut down the markets here. It's like subsidizing the farmers in Argentina and France. But it was easier for the politicians to shut down American agriculture than to untangle self-defeating farm policies. But, you know, okay, so from the start of Reagan's time to 1995, consumers and taxpayers spent so much on farm subsidies that for the same amount the government could have bought all the farm land in 41 states. That was a level of subsidies. And of course, you know, that was unsustainable. It had to change. So in 1996, the GOP had taken over Congress and part of the Gingrich Revolution, they pushed through their Freedom to Farm Act. And what that did was end federal farm subsidies handouts to farmers. Well, it didn't exactly end them. It changed them to market transition payments. And then the market transition payments worked out really well, so they perpetuated them. And in order to make farmers happy with their Freedom to Farm Act, the level of subsidies was three times higher than what had been under the previous farm programs. But, you know, it was a nice title. I mean, it sounded good. It was able to snow some editorial writers who I will not name. But so it's interesting. People say, does Washington ever get anything right? And, well, let's talk about trade. Trade is an area where you would think that the government would be, that it's so obvious that trade barriers are foolish. You would think some more on that. I was doing a lot of trade writing back at the end of the Reagan era, from there to the Clinton era. And Pat Buchanan was pushing the protectionist line back then. A lot of the Democrats were gung-ho on that. President George H.W. Bush was doing and saying a lot of stupid things. A lot of their writing on trade back then had more heat than light. There were lots of folks who were shouting about the benefits of free trade, but very few were exposing the actual grizzly details of how the federal government created trade barriers. Now, there's a wonderful line from Ralph Waldo Emerson. He said that a writer should put an argument into a concrete shape, into an image, some hard phrase, solid as a ball, which people can carry home with them. And that was what I aspired to do when I wrote about trade policy and a lot of other areas. So I got out my calculator and tried to translate some of these vague federal restrictions on trade into vivid imagery. And for instance, we had a lot of import quotas for farm stuff. And at that point, the quotas permitted each American citizen to consume the equivalent of one teaspoon of foreign ice cream per year, one pound of imported cheese, and two foreign peanuts per year. These were very strict quotas, very, very strict. On textiles, they were even more stringent. They had 3,000 different quotas, including quotas on tampons, tarps, twine, towels, and ties. And a lot of these quotas dictate exactly how much a foreign country could sell to American consumers. For instance, in 1989, Mexico was allowed to ship the US only 35,292 bras, which was not even enough to cup the city of Brownsville, Texas. But the biggest issue back then was dumping. I mean, this is an issue that Trump is picking up now. And dumping supposedly meant that the foreigners were acting in a predatory manner. You had a lot of allegations that Japanese were trying to take over. But the formal definition, dumping simply says foreign companies are selling their goods here for less than fair value at an unfair price. It means less in the lower price here than in their home market or less in the cost production. Commerce Department was running this, and they were able to convict 97% of all foreign companies of dumping who they investigated. So you would think that there was so much cheating and conspiring going on abroad. But that's not quite how it worked out. So keep in mind, this is a fair trade law, but let's see how the Commerce Department found foreigners guilty. For instance, the Commerce nailed Japanese forklift producers for dumping after it compared the price of brand new forklifts in Japan with the price of three-year-old forklifts in the US. The same thing happened with Mazda when Mazda was convicted for selling new vans in Japan compared to the price of new vans there with used vans here. It gets better. In a flower dumping case, this is one of my favorite examples. Commerce compared the price of wilted flowers in New York City with the price of fresh flowers in Amsterdam. Since the wilted flowers sold for less, the Dutch were scoundrels. Foreigners also got nailed because Commerce would compare wholesale prices and retail prices. For Swedish steel, Commerce compared Swedish steel sales are less than 500 kilograms with more than 5,000 kilograms. It was a higher price for the large quantities, for the small quantities, so that proved that the Swedes were cheating. Another favorite example is Commerce would penalize any company that appeared to be failing to charge American consumers the highest prices in the world. This is actually in their regulations. This is how dumping is defined. It's being unfair to the American businesses, basically. There was a case in which Commerce convicted farmers in New Zealand who were growing kiwis what Commerce did was compare the price of small kiwis from New Zealand sold to the U.S. with the price of larger kiwis from New Zealand sold to Japan. Since the small kiwis cost less than the large ones, New Zealand was guilty. These are things that don't make any sense, but this is what drives trade policy. Most of the journalists don't understand how these laws work. Journalists usually don't have a lot of intellectual curiosity, and that's part of the reason why the federal agencies can pull off one PR scam after another. But looking at things like dumping and the import quotas, it's a good example of how the government cannot make trade more fair by making it less free. Another topic of trade policy, three years ago I was doing a debate on trade policy in St. Louis sponsored by a group known as the Discussion Club, which had great neckties, not as nice as the Mises, but so now the audience at St. Louis, very conservative, they were hostile. They were hostile and I didn't make many converts that night, and I started out my usual litany. I talked about peanuts, ice cream, bras, dumping, and the first question from the audience, the guy gets up really horny and he says, this debate was supposed to be about free trade versus protection. How come you didn't say nothing about tariffs? And I'm thinking, eh, you know, you got all these trade barriers. I said, okay, all right, I'll talk about tariffs. Hecklers. So tariffs have always struck me as so self-evidently idiotic, and you see how they're set and the strings that are pulled. I mean, you know, the case against tariffs is so obvious that even Trump would, well, actually maybe not. So I was writing a book about trade policy a couple of decades ago, and when I was doing that, I dove into the two volumes of the U.S. tariff code, and it was, you know, they had 8,753 different taxes on imports, and each tax was very wise and omniscient, but, you know, the average American tax tariff at that point was about 5%, but a lot of them were in the stratosphere. And back then, congressmen kept saying that the U.S. was victimized by its free trade policy, and my attitude was, look at the tariff code. So, and a lot of these tariffs were class warfare, looked like that, and it's worse. Mink furs were duty-free, but polyester sweaters for babies were tariffed at 40%. Lobster was duty-free, orange juice was 40%. If you're importing fancy French water, it was the Perrier less than 1% tariff. A tariff on cheap shoes, 67%. These are devastating for poor people. Worst of all, cheap cigars were hit by a tariff three times as high as fancy cigars. I mean, this is an anti-Redneck bias in the tariff code. So, a lot of these tariffs, you know, were nasty and some prohibitive, but my hunch was there were a lot higher rates hidden in that tariff code, because many of the tariffs were based not on price or percentage, but on the weight or the count of a product. And so, it makes it a lot more difficult to expose what the government's up to. I mean, it's hard to get people excited about a tariff of 17.4 cents per kilogram. You know, people aren't going to the barricades for that. So, as a researcher, I contacted a number of federal agencies seeking to find out, okay, what's the percentage tariff on these items? These items are kind of cryptic. I was told again and again that information did not exist. You know, nobody has it. Anyhow, so a few months later, I was taking a break from the book. I was traveling around Europe. I had a year rail pass. And one of the places I stopped for tax write-off purposes was in Geneva, Switzerland, the headquarters of the general agreement for trade and tariffs. Now, Gad headquarters back then, it was right close to Lake Geneva. And it looked like a mix between a fortress and a castle for international bureaucrats. As I was entering, they had security as tight of not worse than TSA. I was double searched. I had my bike carrier bag, which they opened up and checked through and just practically everything. I felt like a client, like a lawyer going to visit a client on death row. I had an appointment that morning for some honchos who were running the textile import quotas office. And their office was at the far end of a very long building. It seemed like it was longer than football field. So I went there, had a nice chat with those guys. As I was leaving, I was walking down that endless hallway. I saw this rickety card table was sitting there and it was stacked high with really thick documents. And I got a little closer. I noticed that the door next to the table was labeled tariff negotiations. And those big thick documents, they were titled US proposal for market access negotiations. Now, it would have been unsamely to stop and peruse a US government document with a big stamp of secret on the top of it. But, you know, I was thinking, you know, there were like 20 copies on that table. I mean, these were extras, right? I mean, these were heading to recycling and baby, right? So, you know, I kept walking but I slowed down a little bit. And I just kind of like, you know, it was almost a mystery. One of those documents practically tossed itself into my courier bag as I moseyed on down that hall. 700 pages, that shit was heavy. So anyhow. But I was wondering, I was wondering if the guards would search me on the way out like they did on the way in. Because that was confidential information. It might have been covered by national security type stuff because of trade negotiations. And so it might have been a really interesting conversation. So, but I was walking up to the guard desk and I, you know, said something to them and garbled German or even worse French. The guards are used to Americans butchering all the languages in Switzerland. So they just kind of waved me on. And I was heading back to the hotel and I opened up that document. And it was clear that it was the Rosetta Stone for US protectionism. Because it had all the numbers. It had all the numbers I was looking at. It was like, oh my goodness. So, but I was concerned that someone at GATT might have noticed me taking a loaner copy. And so, and since the GATT folks knew where I was saying, you know, I had phoned them from the hotel to arrange the interview. So I got back to the hotel room and I, you know, my wife, my then wife was sitting there puffing nervously on a Marlboro. And I said, we're leaving the country right now. I'll explain at the train station. And she says, ah, do leave a handle. So was a just a response. Actually it was a little more profane than that. But it was, you know, it was, it was not a surprise that my frown was always kind of jumpy when she and I traveled together after that. But part of the benefit of your real passes, if you've ever had them is you show up at the train station, you flash the pass, you jump on a train, which is what we did. So once I got back to DC, I called the chief tariff official at the US Trade Representatives Office. I never met this lady in person. I only knew her as someone, as a telephone voice who always sound peeved when I called. Because I've been writing about this stuff. And so I, you know, I get her on the line and I says, I need to confirm some data on US tariffs. Huh, she replied. Okay, for tariff code 9108, tariff code flying 9108, 9120, low price watches, the tariffs 151%, right? I paused, she said nothing. I said, I says for tariff code 24013060, that's tobacco stamps, that tariff is almost 500%, right? And then she says, where'd you get those numbers? So I said, from the US government's March 15th GATT proposal. And she says, that's confidential information. And I said, I reckon the word secret is stamped on every page. The word secret is on every page, but I still have to confirm it, you know? And, you know, the sad thing is, she slammed down the phone before I could tell her, have a nice day. But it was great to have those numbers because it helped me hammer US trade policy, to hammer the hypocrisy and the frauds, and the outrages that have been going on. And, you know, some people criticize me for, you know, taking the document, but it was a US government document, my tax dollars paid for it, Americans had the right to the information. And it wasn't like it had the details of CIA torture or NSA wiretapping. I mean, you know, who could object? But, you know, and it's interesting because I tried to get the information and told it wasn't exist. But this goes back to the basic rule in DC. And that is, if government officials lie to you as public service, if you lie to them, it's a felony. And keep that in mind when the FBI knocks on your door. So, you know, it was, this is a fun topic and there's a lot of other outrages and scandals which I get hammered, but I mean, I hate to exhaust people here. A couple of general themes here, most, on why things don't get better, one reason is most government cover-ups succeed. You know, I've worked as an investigative journalist off and on for decades. Sometimes I can find good information, sometimes not. I often know that, okay, you know, I've hardly even seen the tip of the iceberg. And there's, you know, the politicians and some of the mainstream editorial papers like to assure people that the truth will out. Well, my attitude is that's BS. Most of the time it doesn't. I mean, think of the Warren Commission. The Warren Commission appointed by Lyndon Johnson was supposed to find the truth on the Kennedy assassination. And so they rushed the report. It came out before the 1964 presidential election. And it had a little caveat. It said, well, you know, we found a lot of other stuff, but we aren't going to release it until 75 years from now. And the government tells you to trust it 75 years from now. I mean, the person would be a fool to trust it. One of the frustrating things is to see how quickly people forget, even people who are supposed to be intelligent. And I was, you know, there was a big one-year anniversary for the Pussyhat March in D.C. back in January that had a huge rally on the day after Trump's inauguration. They had a smaller rally on January 20th or 24th of two months ago. I went down to photograph that and talk to some of the people. And it was interesting. You had a number of, I guess, super liberal women. They're wearing these hockey shirts or whatever saying, it's time for Mueller, the former FBI Chief Special Counsel. And they were holding up signs. Mueller was going to save us and all this stuff. And, you know, and they were planning, the women did a little march to show how upset they were with Trump and all that stuff. And they're carrying their pro-FBI stuff. And I was thinking, you know, it's really too bad that the march route did not go past the Martin Luther King statue. Because the FBI had vilified and tried to drive Martin Luther King to death, to suicide. And it was horrendous what the FBI, COINTELPRO, did to the black activists, not just Martin Luther King. They also targeted the anti-war people, left us a lot of other groups. The FBI had a reign of terror as far as American civil liberties. But all it takes for a lot of liberals, a lot of the media, a lot of the New York Times coverage, for instance, forget everything is to have Donald Trump as president and have the FBI as a great hope for toppling him. And it's like, okay, why would you put all your chips on an agency that has a horrendous record? Just horrendous. And that was something that conservatives understood for a while under Obama. Liberals understood when Ronald Reagan was president, when Nixon was president. But it's like, it's push-button amnesia. And people forget, well, okay, it's almost like the only thing it takes for people to forget everything that they ever knew, and allow them that they don't know much, is to have a shift in who's on your side. But nothing has happened since 9-11 to make the government more trustworthy. It's frustrating to see so many lessons that should have been learned forever quickly forgotten. I mean, it's interesting to think how the lines of politics in this country would be different if Hillary Clinton had won in November 2016. Worse in a lot of ways, better in a few. But there would be a whole different set of lessons that people would be waving in the air. But it's hard to have a lot of faith in the survival of democracy when so many people have got attention deficits or else, or just utterly, if you have so many people acting as knuckleheaded as TSA agents. And it's almost impossible to overstate how knuckleheaded that is because you've got an agency that's done it that's been systematic for making mistakes and perpetuating larger budgets. There's a lot of other details, a lot of other horse stories. I don't want to exhaust people. There was a wonderful line from H.O. Mek and I read that made a big impression on me, and he said that one horse laugh is worth 10,000 syllogisms as far as waking people up to the danger of government and to the absurdity of government. And it's so important to take government off that pedestal. And most people don't realize how much of a pedestal they have government on. But if you can say something or write something that causes that flash in your mind, that may start them on the road to freedom. So at this point I'll draw the curtain of mercy and go to questions.