I am deeply grateful for the opportunity to visit Japan and to speak to you, the Japanese people, during my first year as president of the United States. I am here not only to fortify friendships between our nations, but also to announce major changes regarding relations between the U.S. and Japan.
For many years, politicians and bureaucrats have believed that trade is a win-lose situation. We have believed that whenever two people enter into an economic exchange, one of them will win from the exchange and the other will lose. Thus, we have always viewed economic activity as a form of warfare between people.
But politicians and bureaucrats have been wrong. Trade between individuals is actually a win-win situation for the people entering into the exchange. A person will exchange something he values less for something he values more. For example, suppose a person owns ten apples and another owns ten oranges. By exchanging one apple for one orange, both of them give up something they value less for something they value more.
Why is this so significant? Because it shows that people’s standards of living can increase through the simple act of trade! In other words, people can improve their own well-being by entering into exchanges with others. And the corollary of this principle is equally important: to the extent that any government interferes with people’s ability to exchange freely with one another, to that extent the state is interfering with people’s pursuit of happiness and their economic well-being.
Therefore, it is essential that people all over the world have the widest latitude for freely engaging in economic trade.
But I come before you tonight not simply to speak about economic principles. I also wish to do something much more important and profound. I want to make confessions and apologies this evening on behalf of the United States government — to both you and the American people.
Deceiving the American People
Many years ago, governments in the United States began forcing our citizens to send their children to state-approved schools where they would learn only the doctrine which we, the governmental officials, wanted them to learn. And much of the indoctrination that the children received was false.
For example, most Americans honestly believe that they live in a land of “free enterprise.” They believe this because they have been taught to believe it in their state-approved schools. If any of you ever visits our nation, simply ask any American about his “free-enterprise” system, and he will bubble over with enthusiasm as he says, “America is a land where you can enter into any enterprise without regulation or restriction; where you can become phenomenally wealthy by freely selling goods and services to others; where you can travel anywhere without restriction; where you can buy and sell without political interference. America is the land of free enterprise.”
It is a sad sight. The truth — which more and more Americans are now discovering, despite their many years of government-approved schooling — is that America is not a land of free enterprise — and has not been for some sixty years. The truth is that ours is a welfare state and a regulated economy deceptively termed “free enterprise.”
In our land of “free enterprise,” the state takes about forty percent of people’s income. A large percentage of the money is used to support thousands and thousands of public officials; the rest of the money is given to people who have privileged connections to governmental officials. We require people to seek our permission to do business through licensing and permit requirements. We punish them if they travel to nations whose governments are not friendly to our government. And we do not permit them to trade freely with others.
And I confess to you and the American people that this way of life — the welfare state and the managed economy — is a miserable failure. The welfare state was supposed to end poverty. It did not. Our managed economy was supposed to bring safety and security to the American people. It did not. Taxes continue to rise; regulations continue to increase; the number of governmental officials continues to expand; government spending continues to soar.
The truth is that our economic system is a disaster.
Unfortunately, American governmental officials hate the term “responsibility.” None of them has ever done what I am doing tonight — accepting responsibility for what we in the government have done to the American people and their well-being.
Blame the Japanese
What has been the standard response of U.S. governmental officials to America’s economic woes? To blame you, the Japanese people, for our difficulties. We constantly refer to the so-called “trade imbalance” between the U.S. and Japan. But hardly ever do we do the same with respect to other nations. We have found it easier to foment anger and resentment against Orientals than against Caucasions.
I confess that you — the Japanese people — are not the cause of our economic difficulties. It was wrong of our governmental officials not to accept responsibility for the failure of our welfare state and managed economy. It was equally wrong of us to appeal to prejudices against Orientals. And it was wrong of us to deceive the American people about the type of economic system under which they lived.
On behalf of the United States government, I apologize to both you and the American people for the grievous wrongs that we governmental officials have committed.
Actually, you — the Japanese people — are part of the economic solution for America. But before explaining how you hold a key to our economic problems, please permit me to go back in history about half-a-century.
A Back Door to World War II
During the past fifty years, America’s governmental-approved schoolteachers have taught our citizens that for the United States, World War II began with the Japanese attack on Pearl Harbor. On behalf of my government, I publicly confess to you and to the American people that this is false. The truth is that prior to December 7, 1941, the U.S. government, led by President Franklin D. Roosevelt, engaged in several acts of war against your nation.
For example, prior to your nation’s attack at Pearl Harbor, American military forces, led by General Claire Chennault, repeatedly attacked Japanese military forces on the mainland of China. American governmental officials maintained that Chennault’s “Flying Tigers” were simply a private force assisting the Chinese to resist your government’s aggression. This was false, and our public officials knowingly lied about it. General Chennault’s forces were actually U.S. government military forces operating under the guise of a private force, and their operations were funded by our government. These attacks by our military forces against those of your nation occurred prior to your government’s attack on Pearl Harbor. And they were expressly authorized by President Roosevelt.
Moreover, by imposing an embargo against Japan on oil and other essential items, our government engaged in what has always been considered an act of war under international law. And the American government seized and confiscated Japanese assets located in the United States, even though a state of war did not exist between our nations.
Why did President Roosevelt engage in this course of action? Prior to Pearl Harbor, the American people strongly opposed entry into the European war. And although President Roosevelt himself stated that he stood with the American people on this issue, there is now no doubt that Roosevelt was not telling the truth — that, in fact, he wanted desperately to involve the U.S. in the conflict. But due to the American people’s strong opposition to entering the European conflict, Roosevelt knew that he could never achieve this end unless the Germans attacked the U.S. first. Yet, despite repeated provocations by the United States, the Germans refused to take Roosevelt’s bait.
The shameful truth about Roosevelt’s actions toward Japan in 1941 is one which our government has never before acknowledged, even though the circumstantial evidence leads irresistibly to but one conclusion: President Roosevelt sought a “back door” to the European war by doing everything he could to provoke your nation into attacking the United States first.
We must ensure that this type of conduct never happens again. To entrust political leaders with powers to control trade and to confiscate assets during peacetime is much too dangerous. For unscrupulous political leaders are too often tempted to use and abuse such powers. It is a slippery slope to real war when one nation wages economic warfare against another. In the words of Frederic Bastiat, the 19th-century, free-trade leader in France, “When goods are not allowed to cross borders, soldiers will.”
Separating Economy and State
Therefore, upon my return to Washington, I am proposing to the United States Congress an amendment to the U.S. Constitution that reads as follows: “Neither the Congress nor the states shall enact any laws respecting the regulation of commerce nor abridging the free exercise thereof.”
This amendment will result in the elimination of such political controls as licensing and permit laws, import and export restrictions, and all economic regulations. By separating the economy and the state, we will embark on the road to peace and prosperity.
There are those who say, “The U.S. should not free the American people until the Japanese government frees the Japanese people.” But this is false and fallacious. People have a right to be free, regardless of whether others are free or not. Moreover, even if your government prohibits some of you from buying wheat or any other product from American sellers, it would be irrational for our government to prohibit Americans from buying automobiles, steel, and other products from Japanese sellers.
As I have indicated, the more trade, the better. We shall unilaterally drop all trade restrictions, not only because it is the way to economic prosperity, but, more important, because people should be free to do what they want with their own money. Perhaps you — the Japanese people — will be able to enlighten your public officials to do the same.
But there are more confessions and apologies that I wish to make with respect to World War II.