Elizabeth Warren Gets Trade Wrong

In addition to struggling to put some distance between her presidential aspirations and her past of lying about her ethnic heritage Elizabeth Warren is working hard to create some space between her campaign and the Democratic Socialism that is taking over the Democrat Party.

Durring an interview with CNN at SXSW Warren had this exchange:

“Bernie has to speak to what Democratic Socialism is,” replied Warren, who represents Massachusetts in the Senate.

“And you are not one?” Giridharadas asked.”

I am not. And the centrists have to speak to whatever they are doing. What I can speak is to is how I am doing,” Warren said

Warren seems to be trying position herself as a champion of markets and trade. The problem with that – leaving aside her “you didn’t build that” nonsense – is that she clearly has no idea what trade is.

“Markets have to have rules. They have to have a cop on the beat,” she said, adding that “markets without rules are theft.”

Markets and trade are by definition not theft. Apple did not steal from me when I gave them dollars for the laptop I am typing this on. I did not steal from Apple when I bought the laptop either. We traded.

Apple was willing to sell the laptop at a certain price, because it was a higher value to them to have the dollars than it was to have a laptop sitting in a box on a store shelf. I was willing to buy the laptop at that price because I believed having the laptop was a higher value to me than having the dollars. Apple won. I won.

THERE WAS NO THEFT.

Now if Apple had taken my dollars and gave me a laptop that was not what they said it was when we made the deal, Apple would have committed fraud. They would soon learn that defrauding their customers is not a viable long term business strategy. (See Enron). Likewise if Apple gave me a laptop and I gave them a stack of counterfeit bills – that would be a crime. What both of these transaction have in common is that neither one represents trade.

Trade is the free and voluntary exchange of value for value.

What Elizabeth Warren wants is to control markets. To have the power to decide what gets traded and by whom. The power to control markets is how people in power get rich and more powerful. The extent to which corporation spend money lobbying Washington for special favors and regulations that thwart competition is directly related to the power of the government to regulate markets.

Warren’s claims to be an advocate of trade and markets are as honest and valid as her claims to Native American heritage.

Author: Stephen Macklin

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