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From decidedly different ends of the political spectrum, Paul and Kucinich both represent a decidedly defiant economic protectionist strain in American politics today.
Oh how the dollar has fallen. At a time when Halliburton moved its headquarters to tax friendly Dubai, Americans continued to rack up a massive trade deficit with China, and Middle East turmoil has contributed to climbing oil prices, both dark horse candidates for the 2008 presidency both reject internationalism in some form or another. Their stances are remarkably similar and may be a telling sign of a large hunger of American protectionism, something that many establishment candidates are working hard to reject in both the Democratic and Republican parties. While Paul, a staunch libertarian, strongly supports free market economics, he believes institutions like the World Trade Organization have no constitutional authority and that "...our economy and very independence is increasingly in the hands of foreign governments such as China and Saudi Arabia." He believes the WTO is no friend of a true free market. For different reasons, Rep. Dennis Kucinich wants to cancel NAFTA and the WTO as well. He also believes we have ceded too much power to international trade agreements and that they have hedged our ability to remain a moral compass in the world by supporting, for example, loose labor and environmental rules. Together, the strength of these two unlikely allies may underscore a strong protectionist sentiment in 2008.
| "He [Paul] believes the WTO is no friend of a true free market." |
Paul argues that the Republican Party has lost its way. He calls for repealing the 16th amendment of the Constitution, which established the Federal Reserve in 1913. This concept is one gravely dismissed by many interests, especially those who staunchly protect the Fed's independence from political motivations. Paul believes that the Fed unfairly taxes poorer Americans by means of an "inflation tax." Each time the Federal Reserve decides to inject more money into the money supply, the money that already exists in your bank or your hands becomes less valuable. Think of if this way: you are very hungry and that piece of pizza your friend has becomes very attractive. Suddenly, a new friend shows up with a whole pizza. That one piece of pizza your other friend had is no longer as valuable to you. The same goes for Paul's inflation tax and our money. The problem may lie in the details, though. He believes that Wall Street, and moneyed interests, are some of the first to know that prices will become inflated and reap more rewards than repercussions. The rest of us are subjected to, for instance, sticky wages that take time to adjust to the new inflated prices. This proposal is definitely worthy of a dark horse but might need to be more closely examined. Paul, for instance, also believes that capital gains taxes are useless and distort labor activity. There is some truth to this argument, but there is also an indication that the distortion is a lot smaller and therefore deserves less focus than distortions to individuals earning a minimum wage who probably do not even know what a capital gain is. Instead of abolishing the Federal Reserve, Ron Paul might look at only increasing the taxes on the moneyed interests who he claims pocket from it.
| "Kucinich seems to want to federalize nearly everything." |
Kucinich seems to want federalize nearly everything. He calls strongly to end "the drive to privatize." He calls for government financing of municipal power systems and other municipal programs. He believes that public works programs need to be brought back with vigor and funding. One of his key initiatives calls for a Federal Bank of Infrastructure Modernization, which would provide 0 interest loans to states. Kucinich believes that this kind of funding helps both our communities and our nation's security. He believes that we must build upwards again to regain true strength in the world. Following the high profile collapses of bridges and other roads in America this year, Kucinich's program is appealing to populist interests. His call, however, to make a federal financing instrument, reminiscent of Roosevelt's New Deal era is stirring. What is more stirring is that we find the proposition shocking. It's indicative of how far rightward our country has shifted on economics since the 1930's. Kucinich's plan likely has many flaws. Oversight, equality of distribution, and assessment of who gets what are just some key operational problems such a plan would have. Kucinich also plans other new spending that, at the very least, come into direct opposition to Paul's ideas as one would expect.
Threaded between these two different approaches are some very serious concerns: concerns about what really makes American strong in the international arena, concerns about our infrastructure, concerns about the dollar itself. The dollar's presence in world foreign exchange reserves recently fell again. While the percentage is still large {63.8], there is no question something seems to be going wrong in America's economic policy. While entrenched interests are for further globalization, Paul and Kucinich's supporters may very well represent the strongest evidence yet of organized protectionism.
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