Rothbard on Wenzel on Rand on Free Enterprise Zones, Lowering Taxes

By Walter E. Block

My support of Rand Paul for president is a measured one. I do not think that Rand is as solid a libertarian as is Murray N. Rothbard, nor his father, Ron Paul. Indeed, I could name dozens, maybe hundreds of people who adhere more consistently to pure libertarian principles than the junior Senator from Kentucky.  In any case, Dr. Rand Paul has never claimed the mantle of pure libertarianism. Very much to the contrary, he has explicitly eschewed it. Instead, he has characterized his political philosophy, variously, as U.S. constitutionalism, Republican libertarianism, libertarian Republicanism, constitutional conservatism, or some such. As I look around at the other likely candidates (GOP: Jeb Bush, Ben Carson, Chris Christie, Ted Cruz, Bobby Jindal, Sarah Palin, Rick Perry, Marco Rubio, Paul Ryan, Rick Santorum, Donald Trump; Democrats: Joe Biden, Jerry Brown, Hilary Clinton, Andrew Cuomo, Al Gore, Bernie Sanders, Mark Warner), Rand Paul nevertheless stands head and shoulders above all of them in terms of libertarian concerns. Indeed, the comparison is almost insulting. It would be like comparing my own abilities as a chess player (ranked in the 1700s) to a grandmaster. The latter could beat me spotting me a queen and maybe even a rook or two.

My latest reason for again (Block, 2013A, 2013B, 2013C) taking up this issue is Wenzel (2014). I quote him in full, but in italics, and intersperse his remarks with my own:

1. Al Sharpton

You have to hand it to Rand Paul, who heads the Al Sharpton wing of the Republican Party, he has one thing figured out. If you are going to go after the Urban Primitive vote, you need to give the impression that you want to stop them from getting thrown in jail.

The comparison of Dr. Paul and Al Sharpton, while superficially clever, is misleading. The latter goes to the black community to unjustifiably rile up the people there (e.g., Tawana Brawley). He offers socialism, interventionism, welfarism as nostrums. The former also goes to the inner cities, and the solutions he offers are very, very different.


2. The beltway

Rand told Politico that the Republican presidential candidate in 2016 could capture one-third or more of the African-American vote by pushing criminal-justice reform, school choice and economic empowerment.

But, there is simply too much need for tinkering by government in Rand's positions, rather than real solutions. He is a beltarian wet dream.

There is no one more critical of “beltarians” than me. I have long been a critic of the Cato Institute, of Milton Friedman, of David Boaz, of Charles Murray, etc. But, I do so in the context when they improperly claim the mantle of libertarianism. Yes, Rand Paul’s views may roughly be described as similar to beltway “libertarians.” But is this so bad? Joke: the economist was asked, “How is your wife?” Came the response: “Compared to what?” Precisely. Context is very important. Who would we libertarians rather have as president in 2016? Someone like Milton Friedman, David Boaz, Charles Murray, or, wait for it, Hillary Clinton?  Criticize Friedman, Boaz and Murray, all you want; but, please, realize, there is no comparison with the former Senator from New York. She would be a horror; they, along with Rand Paul, would be pretty good, at least relative to her.


3. The drug war

What does Rand mean by criminal-justice reform? According to a Rand Paul press release, along with a bunch of gibberish centering on expungement of youth criminal records, he is calling for (sit down libertarians before you read this) [Lifting a] ban on SNAP and TANF benefits for low-level drug offenders: The REDEEM Act restores access to benefits for those who have served their time for use, possession, and distribution crimes provided their offense was rationally related to a substance abuse disorder and they have enrolled in a treatment program.

This is a bit of a surprise to me. Surely, Bob Wenzel and I can agree that “low-level” or non-violent drug “offenders” are victimless criminals. Of course, all libertarians in good standing, such as the two of us, me and my friend Bob, must oppose welfare programs such as Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF). But, contrary to fact conditional coming up here, please watch for it, IF these young black kids who have been victimized by drug laws are really innocent under the libertarian code, it is not really pellucidly clear that they should be discriminated against by the state in this regard.  This is a highly complex issue, the solution of which would take me too far afield in the present essay. All I am saying is that it is not immediately and obviously clear that Rand’s position on this matter is not compatible with libertarianism.

4. Criticizing silence

Got that? There is no call for real reform from Rand. There is, for example, no call for ending the criminalization of possession and distribution of ALL drugs. He is tinkering and abusing the term "criminal-justice reform," and at the same time paying off the Urban Primitive crowd with SNAP and TANF money.

Note that Wenzel is here criticizing Paul for not for what he has said, but for what he has ignored. According to the “logic” of this critique, we might as well as vilify the National Organization for the Reform of Marijuana Laws (NORML) for failing to mention heroin or cocaine. One might as well denigrate Doctors without Borders for failing to call for free markets in used human body parts. One might as well malign the Institute for Justice which quite properly calls for an end of licensing for hair braiders, for not doing so for physicians too (if this is indeed the case). Extrapolating, we could belittle Murray Rothbard when he calls for an end to the minimum wage, for not attacking unions too in the same breath. Heck, we can disparage any libertarian when he opposes imperialism, for not calling, also, in the same essay, for tax reduction. It is simply not fair to deprecate people, Rand Paul or anyone else, for things they did not say.


5. School vouchers

It's the same thing with his school choice plan. It's not about returning education to the private sector. He is simply calling for a new structure for government money to be funneled into the education sector. That is, he continues to be supportive of government involvement in education:
 I propose that we allow school charters, school choice, vouchers, competition...My kids went to great public schools. I went to great public schools. The president's kids go to great private schools. There are a lot of choices out there. I want to make it where all American get the option of choosing the best schools for their kids. Note to Rand: You never end up with competition when government is paying the bill and therefore, by necessity, setting the rules.

Ok, ok, school vouchers are a snare and a delusion for libertarians. Again, I am second to none in condemning them. But a little context here, please. Milton Friedman favors educational vouchers. It takes a very, very consistent and sophisticated libertarian, such as Bob Wenzel, to see the flaws in this program. It sounds good, superficially. Free choice, competition, yada yada.  There are many people Wenzel and I would both call libertarians who have been taken in by the siren song of school vouchers. Can we not cut this man, who was until just a few short years ago an ophthalmologist, a little slack on a contentious issue within libertarian circles? Yes, in an ideal world Rand would have hired true blue libertarians who would have set him straight on this issue, but we do not live in such a world. Rather, we inhabit the real one, where Ron’s son is not a pure libertarian.


6. Tax cuts

As for Rand's economic empowerment zones, it calls for a lot of tax cuts, but who actually needs tax cuts in the zones?  Does he seriously think that Urban Primitives pay taxes?

There is nothing wrong with tax cuts, but when tax cuts are limited to certain geographic areas, they distort the natural flow of urban development. Just who is Rand to say what types of development should occur in an area? Gentrification is taking care of this on its own, without any help from Rand.

There is no need, as Rand proposes, to increase "Section 179 of the tax code [that] allows businesses to deduct 100 percent of the purchase price for qualifying equipment and other goods."

Qualifying equipment? Other goods? This is simply more opportunities for beltarian technocratic masturbation.

Further, Rand's skeleton plan, if ever put before Congress would have so many attachments and clauses that it would for certain come out of Congress in such a manner that the zones would be more appropriately called Pork Zones.

When it comes to reducing taxes and government regulations, I am all for it. But singling out a zone, with all types of rules surrounding these zones, is signalling (sic) that government needs to play a detailed role in economic development, when the real answer should be the shrinking of government across the board, cuts in taxes across the board, and the removal of government regulations across the board.

On this issue, Wenzel is really on thin ice. No less a libertarian than Mr. Libertarian, Murray N. Rothbard, would appear to support Rand Paul on this business of non-general tax cuts. States Rothbard (2014):

“… we might well conclude that the most tyrannical and destructive tax in the modern world is the income tax, and therefore that first priority should be given to abolishing that form of tax… Libertarians must, in short, hack away at the state wherever and whenever they can, rolling back or eliminating state activity in whatever area possible.

“As an example, during every recession, Keynesian liberals generally advocate an income tax cut to stimulate consumer demand. Conservatives, on the other hand, generally oppose such a tax cut as leading to higher government deficits. The libertarian, in contrast, should always and everywhere support a tax cut as a reduction in state robbery. Then, when the budget is discussed, the libertarian should also support a reduction in government expenditures to eliminate a deficit. The point is that the state must be opposed and whittled down in every respect and at every point: in cutting taxes or in cutting government expenditures. To advocate raising taxes or to oppose cutting them in order to balance the budget is to oppose and undercut the libertarian goal.

“But while the ultimate goal of total liberty must always be upheld and the state must be whittled down at every point, it is still proper, legitimate, and necessary for a libertarian movement to adopt priorities, to agitate against the state most particularly in those areas that are most important at any given time. Thus, while the libertarian opposes both income and sales taxes, it is both morally proper and strategically important to select, say, the income tax as the more destructive of the two and to agitate more against that particular tax. In short, the libertarian movement, like everyone else, faces a scarcity of its own time, energy, and funds, and it must allocate these scarce resources to their most important uses at any given time. Which particular issues should receive priority depends on the specific conditions of time and place.”

In effect, Senator Paul is saying that at this particular “given time” an issue that “should receive priority” are taxes in inner cities as “more destructive” than others of their ilk. Is the Kentuckian correct in this? I don’t know. That is a very complex empirical issue. But Wenzel makes it out as if this is per se incompatible with libertarianism. Not so. Not at all so. The “shrinking of government across the board” is by no means a libertarian requirement. We libertarians should take whatever “whittling down” of the state we can manage, and offer no apologies for so doing.

7. Conclusion

Bottom line: "Libertarian" Rand Paul is a very useful tool of the establishment because whether it is criminal justice reform,. education or land development, the establishment can count on Rand to talk in libertarian terms, but deliver proposals that always keep the coercive rule of the crony state in charge. And that will always keep the urban primitive sector primitive.

I think we all in the libertarian community should be grateful to Mr. Robert Wenzel for his running critiques of Dr. Rand Paul. He often succeeds in pointing out the latter’s deviations from pure libertarianism, and this is important. But, sometimes, as in the present case, he fails. Well, that is par for the course. None of us are perfect. However, looking over this entire genre what I find missing is any sort of perspective. Yes, Rand is no Ron Paul or Murray Rothbard.  But that does not at all account for the vituperation, for the unceasing attacks.

Walter Block earned his PhD in Economics at Columbia University. He is an author, editor, and co-editor of many books which include Defending the Undefendable; Defending the Undefendable II: Freedom in All Realms; The Privatization of Roads and Highways: Human and Economic Factors; The Case for Discrimination.

References:

Block, Walter E. 2013A. “On Rand Paul and David Boaz.” August 25;
http://www.economicpolicyjournal.com/2013/08/walter-block-on-rand-paul-and-david-boaz.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+economicpolicyjournal%2FKpwH+%28EconomicPolicyJournal.com%29

Block, Walter E. 2013B. “Thank God for Mr. President Obama, and for Senator Rand Paul Too.” Casey Research, September 6; http://www.caseyresearch.com/cdd/wars-and-rumors-of-wars

Block, Walter E. 2013C. “Should Rand Paul and Milton Friedman Be Considered Libertarians?” November 6; http://www.economicpolicyjournal.com/2013/11/walter-block-responds-to-bionic.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+economicpolicyjournal%2FKpwH+%28EconomicPolicyJournal.com%29

Rothbard, Murray N. 2014. “What Libertarians Should Learn From the Abolitionists.” May 24; http://mises.org/daily/6761/What-Libertarians-Should-Learn-From-the-Abolitionists

Wenzel, Robert. 2014. “Rand Paul's Plan to Capture the Urban Primitive Vote.” October 18; http://www.targetliberty.com/2014/10/rand-pauls-plan-to-capture-urban.html