Lord Liverpool 2016

How the U.S. could enjoy a second Industrial Revolution

Lord Liverpool 2016

With the U.S. primary season approaching, and the quality of debate showing the flaws in the existing candidates, I thought it worth pondering how a truly superior statesman, Robert Banks Jenkinson, second Earl of Liverpool (British prime minister, 1812-27) would set about winning a U.S. Presidential election (assuming he had the necessary birth qualification to participate.) It is easy to say that a statesman with Liverpool’s beliefs could not win a modern election, but nevertheless useful to ponder how much and in what directions he would have to change his approach to have a sporting chance.

Ben Carson has shown the merits of Liverpool’s likely approach to the Presidential debates. While he would regard the moderators’ questioning as grossly impertinent, Liverpool had plenty of experience in House of Commons debates which were not entirely decorous, and would use a Carson-like refusal to insult the other candidates together with a very un-Carsonian mastery of detail and the issues to turn in an impressive performance. He would not provide the verbal fireworks of Donald Trump, Ted Cruz or Marco Rubio, and would therefore not “win” the debates in the eyes of the media, but would nevertheless more than hold his own.

Liverpool would have more difficulty with the other aspects of campaigning. He would survive the travel perfectly adequately, since a few hours in airline First Class or a private jet would seem luxury indeed compared with the rigors of multi-day stagecoach trips. However fund-raising would be both alien and deeply repugnant to him. Early nineteenth century politics was not without its need to fundraise, at both a personal and party level, but personally Liverpool, being fairly wealthy, was spared the need to raise the cost of each election (and after 1803 sat in the unelected House of Lords). The modest necessary party fundraising was handled by specialists and was certainly not considered part of the job of a potential national leader.

Liverpool would find the potential glad-handing of modern electoral politics understandable, and not particularly unpleasant, since the crowds at party meetings would be much better behaved (and better smelling!) than the Eatanswill mobs of his day. The need to cultivate popularity, and the obsessive following of opinion polls, would not come naturally; as his colleague Robert Stewart, Lord Castlereagh said after an uptick in their government’s fortunes: “I am grown as popular now as I was unpopular formerly, and of the two, unpopularity is much the more convenient and gentlemanlike.”

Apart from fund-raising, the most difficult obstacle to a Liverpool candidacy would be the minefield of political correctness. Liverpool’s political positions of the 1820s would provide opposition researchers with political dynamite. In particular he did not support the abolition of slavery (which came in 1833, six years after his retirement) although he was active in using the Navy to suppress the slave trade, which had been made illegal for Britons in 1807 and, through Castlereagh, in using Britain’s strong position at the Congress of Vienna to ensure that other countries, notably France, Spain and Portugal, suppressed it also. He would also be in trouble for having opposed Catholic Emancipation (which came after his retirement in 1829) even though his opposition to it was not due to anti-Catholicism, but to worries about the effect emancipation might have on the Anglican Established Church.

Given time to study up on the precise requirements of 21st Century political dialogue, Liverpool could probably in other respects meet them. He could counter the inevitable accusations of being a dead white male by pointing out his modest admixture of Indian blood on his Anglo-Indian mother’s side. He would find it difficult to accept that the United States lacks an Established Church (even though that lack dates back to his day) but his Evangelical brand of Anglicanism, with its rejection of Regency high living and immorality and its advocacy of state support for Church-building would probably prove highly appealing to the Evangelicals in rural areas. He was a famously careful speaker, aware from unpleasant experiences in his early Commons years of his opponents’ tendency to use misguided phrases against him, so could probably navigate successfully the even more ferocious tendencies to wrenching out of context produced by ubiquitous cellphone cameras.

In terms of platform, Liverpool’s would not resemble that of any of the current contenders. In foreign policy, he would follow the principles enunciated by Castlereagh and Metternich at the Congress of Vienna, codified in the subsequent Troppau Protocol. In particular, he would make it clear that armed intervention was to be considered only to prop up existing regimes, not to overthrow them. The objective of intervention should be to prevent the destabilization and chaos that popular revolutions generally produce.

Under this principle, over the past 40 years only two interventions would have been certain, to prop up the Shah of Iran in 1978 and to prop up Egypt’s Hosni Mubarak in 2011. Two others, to eject Saddam Hussain from Kuwait in 1991 and to prop up Bashir Assad in Syria in 2011, would have been marginal; Liverpool might have gone either way on them. He would certainly not have intervened in Somalia in 1993, in Afghanistan after 2001, in Iraq in 2003 or in Libya in 2011, and he would not have supported in any way the rebels against Assad after 2011, who offered no prospect of settled government and every prospect of the violent anarchy that has in fact occurred.

On other international issues, Liverpool would eliminate the U.S. contributions to the United Nations, the World Bank and the IMF, all of which he would regard as hugely damaging and self-perpetuating international bureaucracies. On the other hand, he would continue funding the World Trade Organization since its objectives, policing the agreed rules of international trade and promoting further trade liberalization, he would regard as benign and legitimate.

Liverpool would oppose the Trans Pacific Partnership, seeing its excessive protection of patents, copyrights and trademarks as rent-seeking, as Adam Smith did, and favoring drastic rewriting of copyrights to a maximum of 15 years and patents to prevent abuse by “troll” lawyers and companies and provide for compulsory licensing. He would also revive the Doha round of global trade talks, believing that without excessive U.S. demands for intellectual property protection, a new global trade agreement freeing up markets in agriculture and services and opening poor countries as well as rich to international competition should be readily available within a single Presidential term.

Like Cruz and Rand Paul, Liverpool would support a U.S. return to a Gold Standard and the drastic reform of the Fed, eliminating its meddling with monetary policy and allowing it to play only a supporting role in the monetary system (he supported the Bank of England in the 1825 financial crisis and regarded modest prudential regulation of bank activities as necessary.) He would also push for much higher interest rates, knowing full well that a deflation and tight monetary policy could reinvigorate the economy in the right circumstances, as it did in Britain in 1815-23. However he would violently oppose Cruz’s extreme tax cut and insouciance about the Federal deficit, recognizing them as completely incompatible with a Gold Standard monetary policy.

Balancing the Federal budget would be Liverpool’s top priority, believing as he did that truly sound money without a properly balanced budget is likely to lead to debt default down the road. He would take Pitt’s approach to entrenched subsidies, for example in agriculture and energy, removing crony capitalist subsidies and structures such as the U.S. Eximbank.

Liverpool would favor a bonfire of regulations in general, with the EPA, the Energy Department and the Education Department being abolished, and the remnants of their functions being absorbed into other departments or returned to the states. Even though Liverpool was himself conventionally religious, there would be no question of regulating genetic engineering; he would encourage its development, wherever it might lead, just as he frowned on Ned Ludd’s anti-industrialization machine breaking campaign. In Liverpool’s time, large infrastructure projects were frequent, largely constructed by the private sector, and brought in on budget; Liverpool would cut through the regulatory, trial lawyer and union thicket so we could return to this.

From the experience of his own time, Liverpool would regard unfettered capitalism, in a Gold Standard system that discouraged speculation, as far less damaging than it was beneficial. His policies as President would reflect this belief.

Liverpool would also reform entitlements so that the books balanced, primarily by cutting away the jungle of federal mandates and laws that have grotesquely escalated medical costs and made it impossible for Medicare and Medicaid to manage their outlays. He would not however be fanatical in depriving the poor of their economic safety net; the 1834 Poor Law, which invented the notorious “workhouses” and Scrooge-like destruction of the poor’s dignity was a Benthamite creation of the Whig government which succeeded him. Nevertheless, he would regard an increase of the Social Security and Medicare retirement ages as necessary and appropriate.

Liverpool would favor much tighter immigration controls, with a reduction of around 50% in the total number of immigrants admitted, most of those blocked being from the lower skill levels. He would regard the cheap labor lobby that seeks to maximize both skilled and unskilled immigration as the socially destructive economically rent-seeking entity that it is, and would prioritize the preservation and enhancement of social and economic stability through a substantial slowing of the influx of foreigners.

On tax policy, Liverpool would move the system sharply towards a flat tax, and would abolish the tax deductions for housing, state and local taxes and above all for charitable donations – he would see the non-profit sector for the nest of political subversion and anti-economic market distortion that it is. However no net tax cuts would be permitted until the budget was balanced, and indeed Liverpool would probably favor a modest temporary tax increase to cover the period while economic growth was resuming and government departments and waste were being eliminated.

Liverpool’s program would initially seem far too anti-populist and hair-shirt to succeed in a democratic franchise. However he would be able to point to the superb economic track record of his 1812-27 British government as evidence that, if his policies were followed, the U.S. could enjoy a second Industrial Revolution, partly based on the genetic engineering he would welcome, raising long-term living standards to levels unimaginable at present.

Lord Liverpool 2016. You know it makes sense!

November 09, 2015

© 2024 Martin Hutchinson