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Hannity and Goolsbee in the Statist Box


Yesterday I happened to tune in on the radio to a fascinating and boring exchange between conservative talk-show host Sean Hannity and a liberal economist named Austan Goolsbee, who used to serve on President Obama’s Council of Economic Advisors.

The exchange was boring, for me as a libertarian, because it involved the standard solution proposed by liberals and conservatives to America’s economic woes. At the same time, it was fascinating because it perfectly epitomized the mindsets of conservatives and liberals on economic matters.

The two of them were going at it over whether a Republican or a Democrat president would be better at managing the economy.

Hannity kept exclaiming that Obama had broken promises that he had made while campaigning for president four years ago, such as his promise, if elected, to cut the deficit in half and to reduce unemployment.

Goolsbee would repeatedly respond in the predictable fashion — that Obama could not be held responsible for breaking his promises because he inherited a horrible economic situation from the Bush administration.

They just kept going back and forth with the same basic argument — that Romney would be a better manager of the economy than Obama and vice versa.

There is no doubt that both of them considered their exchange to be a very exciting debate and, for all I know, your standard liberal or conservative would agree. But for me it was tremendously boring. The only reason I kept listening was because I was so fascinated over the fact that they obviously thought that their debate was substantive and exciting.

What fascinated me was how they both operated under the assumption that their mindsets were fundamentally different, owing to the fact that each of them took opposite positions over which presidential candidate would make a better manager of the economy. The last thing that would ever occur to either of them was that they actually share the same fundamental mindset when it comes to economic principles.

What do I mean by that?

Imagine a great big box in which everyone in society is living, including Hannity and Goolsbee. Society inside the box consists of a massive welfare state, government-regulated economy, and warfare state, where the president is charged with running and managing the economy. On the outside of the box is written “This is a statist box” but Hannity and Goolsbee can’t see that sign because they’re inside the box. On the walls inside the box are signs that say, “This is a free-enterprise system.” Since Hannity and Goolsbee are born and raised within the box, their mindsets are formed by the signs on the inside of the box, not by the sign on the outside of the box.

So, for Hannity and Goolsbee, the economic system under which they live is free-enterprise in nature, one that needs to be run and managed by the head of the government — the president. If things go wrong within the box, that’s because the wrong man is in charge.

“Elect my man,” exclaims Hannity, “and golden days will be here again because he’s better able to manager our free-enterprise system than his man.”

“Not so,” responds Goolsbee. “His man’s management of the economy would be a disaster. Elect my man because he knows how to create jobs better than his man does.”

But within the context of their heated exchange, notice something important here: They both operate under the same fundamental principle — that the president of a country should be managing the economy, including creating jobs for the populace, and that such a system is “free enterprise” in nature.

Why do I find their exchange so boring? Because like other libertarians, I have broken free of the box. Unlike liberals and conservatives, whose mindsets are formed by the “free enterprise” signs inside the box, libertarians see the sign that appears on the outside of the box, the one that says, “This is a statist box.”

In other words, libertarians have a grip on the reality of the situation while liberals and conservatives operate under a delusion. Ever since America adopted the welfare-state, regulated-society, warfare-state way of life, Americans began living within a statist box. But the statists who foisted this alien way of life on America figured that if they could convince Americans that all this statism wasn’t really statism at all but rather a simple reform of America’s free-enterprise system, all would be okay.

But as any psychiatrist will tell us, clinging to a delusion doesn’t alter reality. Just because a person who jumps out of a 20th story window is convinced that nothing will happen to him when he hits the ground, that’s not going to alter the outcome when he ultimately hits the ground.

By the same token, the welfare-state, regulated-economy, warfare-state way of life has profound economic consequences. Over time, it reduces economic prosperity and plunges people into lower standards of living, regardless of how convinced people are that this is all really “free enterprise.”

When liberals and conservatives see those bad economic conditions, it never occurs to them that the root cause of such conditions is the system itself — the system of welfarism, regulation, and warfarism. In their minds, the economic problems are rooted in the fact that the wrong manager is in power. All that people have to do, they think, is elect “better people” to public office — i.e., government officials who are better able to manage America’s “free enterprise” system.

Thus, if America is ever to get back on the right track, it’s imperative that we confront reality. The welfare state, the regulated economy, and the warfare state are not free enterprise. They are not free market. They are not private property. They are statism. An economic system based on free enterprise, free markets, and private property is one in which there is the absence of a welfare state, regulated economy, and warfare state.

Thus, Hannity and Goolsbee have it all wrong, and their heated “debate” over which presidential candidate would make a better manager of the economy is a total waste of time and energy. It doesn’t make any difference whether Obama or Romney is elected. No matter which one is elected, the economic problems will continue because the root of the problem is the system itself — the system of statism that statists foisted on America in the last century.

The only solution to that problem is not finding a better manager of the statist system, as Hannity and Goolsbee both believe, but rather to dismantle and repeal the statist system itself.

This post was written by:

Jacob G. Hornberger is founder and president of The Future of Freedom Foundation. He was born and raised in Laredo, Texas, and received his B.A. in economics from Virginia Military Institute and his law degree from the University of Texas. He was a trial attorney for twelve years in Texas. He also was an adjunct professor at the University of Dallas, where he taught law and economics. In 1987, Mr. Hornberger left the practice of law to become director of programs at the Foundation for Economic Education. He has advanced freedom and free markets on talk-radio stations all across the country as well as on Fox News’ Neil Cavuto and Greta van Susteren shows and he appeared as a regular commentator on Judge Andrew Napolitano’s show Freedom Watch. View these interviews at LewRockwell.com and from Full Context. Send him email.