Convincing Thomas Massie That Some of What He Knows Isn't So

Outgoing Rep. Thomas Massie would arguably agree with the critiques you’re about to read. That’s what’s disappointing about his departure from Congress.

In a recent Tweet, Massie hit hard against a Republican Party that has plainly lost its way. Republicans are in the midst of a recession, which on its own is a priceless economics lesson that Massie would seemingly appreciate. Recessions are recovery, they're the realization of and fixing of past errors.

Hopefully Republicans will learn from their own recession why it’s so foolhardy for governments to “fight” them. Recessions are the health of the economy in exactly the way they’re the health of the GOP, and that’s because they force pivots away from all the wrongheaded actions that brought on the depressed state.

Later in Massie’s Tweet he argues that the U.S. should “put America before Israel.” Perhaps he means something different, but the Tweet suggest the political class should work on doing for the American people over Israel. No thanks. Particularly if Massie is implying that aid for Israel could be better spent here. No.

Government spending is harmful because central planning of precious resources is harmful. Taxation is burdensome enough, so let’s not compound the horrors of taxation with government spending. Put America first by spending less here? Yes.

Still, it’s possible Massie means the U.S. should focus on national defense over defense of nations not the U.S. If so, there’s agreement alongside wonderment that Massie would single out Israel. It seems the U.S. provides defense for a lot of countries not the U.S.

Massie wants Republicans to “put farmers before corporations.” Massie doesn’t mean that! Really, what does he have against corporations? Implied in the Tweet is that there’s nobility in what’s small, much less profitable, that's of the land. In the Jeffersonian era, the farm-reverential were the physiocrats. Thomas Jefferson et al disliked banks, Wall Street, etc. It’s populist stuff that’s beneath Massie’s genius.

Furthermore, farmers are awash in subsidies. Does Massie want more, and less for corporations? Really, what’s his point? Big corporations are the driver of American progress. See the stock market. See shopping malls. The anchor tenants make it possible for all manner of small businesses to catch the eyes of shoppers who would otherwise be blind to their existence. Massie knows this.

He Tweets that Republicans should “reduce spending to control inflation.” Government spending is doubtless the biggest, most economy-sapping tax of all. But government spending doesn’t cause inflation. See the stupendous growth of the federal government from 1980 to the present. Were those 46 years inflationary?

Or, if Massie thinks government spending increases demand on the way to inflation, he should think again. It doesn’t. Only production increases demand and governments produce nothing, which means they can only spend insofar as we have less to spend.

If Massie thinks “money printing” is powering the demand, see above. Governments can’t print consumptive ability.

If Massie thinks government spending powers growth, thus causing inflation, then he’s embracing Paul Krugman mysticism about government spending multipliers. There’s no such thing. Production precedes all demand.

Inflation is a shrinkage of the monetary unit. Nothing else, but for one thing: governments prone to devaluing logically have less money to spend. That's because it saps economic growth that governments shamefully tax to fund their waste, plus by its very description devaluation deters savers from lending to the borrowing government. If Massie doesn’t agree with these truths, he could be convinced.

That’s once again why it’s so disappointing he’s leaving Congress. Massie knows things, and since he does he could be convinced that some of what he knows isn’t so.

Originally published on Real Clear Markets.