More on the Fence

Also yesterday I listened to the Econtalk podcast with Peter Boettke trying to explain Austrian economics. That school starts with Karl Menger and other more famous economists like Von Mises and Hayek. Boettke came up with a quip which I thought was very applicable to the debate about the fence. He argued that advancement depends on the three "s's" - Smith, Schumpeter and Stupidity.

Adam Smith wrote about the gains from trade in The Wealth of Nations. We benefit from economic systems that encourage interchanges, not under the stifled rules of mercantilism but trade which is robust. Both the left and the right, in different ways, want to "perfect" trade by adding a couple of rules that will actually inhibit it. We need to resist those cunning arguments.

Schumpeter wrote in Capitalism, Socialism and Democracy about innovation, about creative destruction. The ability to innovate is key to growth and prosperity - and as Virginia Postrel has argued innovation disperses the benefits to a wider range of societies that accept its benefits.

Stupidity is the third issue. Boettke argues that the counter balance to Smith and Schumpeter is government stupidity. If our government adopts policies which inhibit innovation or trade their effects can be diminished or eliminated. The fence qualifies on several counts here. It would be very expensive. It would not be effective and yet at the same time, the very nature of the fence would diminish our relations with one of our closest neighbors. But Ingram, like Lou Dobbs and Tom Tancredo, are more interested in yammering for ratings than in trying to address broader policy issues. At least Tancredo has realized (somewhat) how foolish his yammering is.

Ingram constantly says that 58% of the American voters want our laws enforced. I am surprised by that number, but not in the way that Ingram suggests. I suspect that asked in one way 58% of our voters want something done - but the hearts and minds of the voters are evidenced in a lot of other ways. I suspect that an even higher percentage of voters, if asked in a non-reflexive manner, would support sound laws which encourage expanded benefits of trade, more innovation and less stupidity.