There are many forms of “protectionism” besides tariffs on imported goods. The consequence of any form of protectionism is higher prices to the consumer. The objective of protectionism is to increase incomes above that of the free market. A labor union for example is a form of “protectionism” as the objective is higher pay and benefits for workers which can only be obtained if the employer is forced to deal with the union. However in many cases the “employer” is not a “business”, but the American people. So instead of forcing an employer to pay higher wages and benefits, the taxpayers as a whole end up being forced to pay higher taxes so that government workers are able to enjoy higher wages and better benefits.
Another group that has “organized” itself against “everyone else” consists of the licensed professions and occupations. Effectively these groups create “price floors” below which no one is allowed to go, thus preventing the operation of the free market in bringing supply and demand into balance. Effectively “price competition” has been rendered “illegal”. Historically this rather parallels the guilds of the European Middle Ages. It is a form of “price fixing” which is of doubtful legality today. However at one time this sort of thing was rather commonplace in the form of “minimum prices” that effectively made it a form of “protectionism” for “Main Street” small business. It appears that the concept of a “free market” price based upon supply and demand is not really desired by many today. Of course if you can control supply to manipulate demand, you can earn higher profits. The US health care industry has been doing this now for the past 75 years since the federal government first handed the industry a legal monopoly over medical drugs.
We also have a number of businesses that have made “agreements” with each other to maintain prices at a desired level (their desired level, not ours). This appears to be the case with the pharmaceutical industry, with one of the highest profit to investment ratios of almost any large businesses. Of course it helps when you can always “buy” the sort of legislation you want from what is increasingly perhaps the most corrupt government of any developed country. Effectively the US federal government only “represents” the wealthy and big business. To whom favorable legislation is now truly a fact of life.
Part of the reason we have such a large national debt as we do is due to the amount of taxpayer money that went for “bail outs” of the “crooks” there on Wall Street. A much better choice would have been prosecution to the full extent of the law, but given “who” really controls the US government, this is for all practical purposes now “impossible”.
Our “overregulated” society adds to our cost of living. One study that I’ve recently seen gave a figure of $1.86 trillion dollars, or $5580 per capita! This is more than what it would cost to give every American adult citizen $10,000 a year as some have proposed. Throughout this blog from the first I’ve been pointing out that we are paying a very high price for “protectionism” or “government regulation” that benefits the few at the expense of the many. That allowing the licensed professions and occupations to create regulation that benefits them while it costs the rest of us more for every service we get doesn’t make any sense. The only reason this sort of thing can exist in the first place is because of the design of our political systems effectively creates a government that is “for sale” to the highest bidder. We have forgotten what the Greeks of Classical Athens found, that if you have an elective government, eventually it will become an oligarchy that answers only to those who have the economic resources to support expensive political campaigns. For a time we thought we could control the political process so such couldn’t happen, but the recent Supreme Court decisions have effectively given us a political system that serves “the highest bidder”. Which is obviously very unlikely anyone who is reading this blog!
The best efforts of the Libertarian Party has resulted in the election of an occasional libertarian leaning Republican. Ron Paul of course is well known to most of us. His son, Rand Paul, is a Senator from the State of Kentucky. There is Justin Amash of Michigan in the House of Representatives. Two out of 538. Neither man so far as I know really is truly libertarian. In any case, one junior Senator and one Michigan Representative isn’t likely to have much influence there in Washington, D.C. Nor did it help when the Libertarian Party came out and said that the Supreme Court decisions were “correct”. That money = speech. True in theory, people can still choose who they want to vote for, but if one candidate has ten times the campaign funds of his opponent, it is more likely that he will win the election. Also, the winner is not likely to “forget” who supplied the money for his campaign. You can also be sure that his “sponsor” favors legislation favorable to his own interests. For a drug company, extension of a patent or copyright. There is no doubt of course that our newly elected legislator will consider the interests of his sponsor as being of far more importance than the interests of the voters who elected him. This is probably why a lot of American citizens don’t bother voting, as they are not likely to be able to elect someone who actually represents their interests as a general rule. Not that it doesn’t happen from time to time, but for the most part, the people we elect do not tend to represent anyone’s interests except those who sponsored their political campaigns. However, on the state and local level, it is possible for a libertarian candidate to actually win an election from time to time. Not that they will have that much power, but it is always helpful to have a “friend” in “high places”….