Biden Draws Bipartisan Cheers for Undermining US Economy

That most politicians have only a passing familiarity with economics, it’s understandable that a lifelong pol like President Joe Biden wouldn’t know competition unless it ran against him in a primary.

In his State of the Union speech, Mr. Biden declared, with the confidence common among the ignorant, that “capitalism without competition is not capitalism, it’s exploitation.”

Again, setting aside that Biden has spent his adult life as a politician, what does he mean by “competition?” As Reason’s Eric Boehm writes, Biden’s definition of competition – when not obviously statist – is downright incoherent:

…the best illustration of this contradiction is Biden’s “Buy American” rules for federal infrastructure jobs. “When we do these projects, we’re going to Buy American,” Biden said Tuesday, before promising “new standards to require all construction materials used in federal infrastructure projects to be made in America. American-made lumber, glass, drywall, fiber optic cables.”

There’s no denying the fact that Buy American rules increase the cost of construction projects. The particular political benefits and economic drawbacks of these rules might be interesting, but somewhat beside the point here. What matters is that Buy American laws are fundamentally anti-competitive. In the marketplace for government procurement, Biden is saying, less competition is desirable. There’s nothing wrong with drywall made in Canada, but we’re going to exclude it from consideration anyway.

In part that’s because the federal consumer is the one Biden is most familiar with – and the only one he can (generally) control. Outside of the Leviathan, there’s a much bigger, broader and dynamic private market that is (generally) outside Biden’s reach. Here, the old maxims of competition apply. But they are not those Mr. Biden or his cohorts understand, nevermind embrace. Adam Smith articulated them more than 200 years ago:

Adam Smith described the opposing, but complementary forces of self-interest and competition as the invisible hand. While producers and consumers are not acting with the intent of serving the needs of others or society, they do. When you work, your goal is to earn money, but in the process you provide a valuable good or service that benefits others and society. The amazing part of this process is that there is very little government control. The bread you buy at the store arrived as the result of hundreds of self-interested people cooperating without a government bread agency managing production at each step along the way. The farmer grew the grain, the mill prepared the flour, the bakery produced the bread, the truck driver delivered the bread to the grocery store, the grocer stocked the shelves and sold the loaf to the consumer all without a Government Secretary of Bread Production telling any of them what, where, when, or how much to produce. It’s as if they were being guided by an invisible hand that guided resources to their most valued use. In the words of Adam Smith:

“by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.”

Funny how self-interest – none dare call it selfishness – can create broad prosperity. And all without a government’s dead hand demanding a piece of the action.

The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.

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