Glenn: I had an e-mail from a friend last night who said that they were in an argument with somebody over “economic patriotism,” the idea of loyalty oaths, and he said I proudly stood beside you the whole time on this one because that’s not a solution to anything good. The idea of loyalty oaths and being patriotic by staying in a country is a way for us to build a virtual Berlin Wall. When a country says you’ve got to stay here, you’re forced to stay here or we’re going to penalize you or destroy you, that is in effect a Berlin Wall, and that’s not American principles.
We have Patrick Byrne here. He is from Overstock.com, rather outspoken. Thought I would pick your brain on this because I think that what everybody is looking at, it bothers me, and it’s always bothered me when the right has done it. If you go back and look at all of my sets, I’ve never had a flag on the set. I don’t like flag-waving. And we’re talking about economic patriotism, and we’re not talking about solving the real solutions.
So tell me, we have the highest income taxes in the world now for corporate income tax, but we also have other problems. I think we’re starting to look unstable to the rest of the world even though we are still probably the most stable or going instable. What should we be doing?
Patrick: As far as?
Glenn: Keep people here, to keep companies here?
Patrick: Well, you know, you’re a businessman. I’m a businessman. I’d love to be able to raise my prices and say no one can leave, no one can defect. This country was built on exactly the opposite principle, that we were going to have the most competitive environment. And you know, now our corporate tax rates are basically 40% federal and state, and we’re up against people who are taxing at 15%.
And it’s just natural, people, you know, you raise the price of something, people buy less of it. People forget that taxes are not, you know, chiseled on stone and come down from the gods. Taxes are just the name for the price that government charges for their services. And when you raise your prices, people buy less of your service, and that includes the government. So they’ve made it really uncompetitive for multinational companies to stay. It’s becoming more and more irrational.
Glenn: They will try to say that companies don’t have a responsibility to their shareholders, they have a responsibility to their country.
Patrick: This whole talk frankly of economic patriotism scares me. I’m as patriotic as the next guy, but it’s nut-job talk. And loyalty oaths, I see Jonathan Alter did some story about –
Glenn: It’s crazy.
Patrick: The actual intellectual roots of this stuff is in Benito Mussolini. That’s where that –
Glenn: Can I tell you something? I know this sounds horrible to say, we just talked about it, that is what the FDR administration said. With the blue eagle, they said it is fascistic. That’s before we thought Mussolini was a bad guy, and they’ve erased all of that now. But that’s on the record, it’s fascistic to do that. That’s not in line with our principles.
Patrick: Well, people forget the far left and the far right meet at the bottom. Benito Mussolini was a hard left socialist in Italy. He was a prominent, not just prominent, he was one of the leaders of the, he was part of the Marxist communist takeover of the socialist party, and then he came out of World War II still a hard left socialist but decided, you know, he came up with this new theory that included nationalism, a very nationalistic version of socialism. But he was very popular in the United States in the 1920s and 30s. You probably know that Cole Porter song, 'You’re the Top'.
Patrick: If you look up the lyrics, it includes you’re the top, you’re the great Houdini, you’re the top, you’re my Mussolini. And Mussolini was very well-regarded in this country until 1935 when he invaded Ethiopia. And FDR, Franklin Roosevelt, consciously modeled the New Deal and the National Recovery Act on the state corporatism that Benito Mussolini was arguing for.
I know this all sounds so weird to Americans now, but go back, and there’s a book by David Boaz at the Cato Institute about the link, the deep intellectual link and the influence that Mussolini had not only on Hitler, of course, but Roosevelt.
Glenn: I will tell you, you know, what frightens me is we look at what’s happening here, communism was a global takeover, you know, the international communists. Fascistic tendency was a national, but it was both socialism, both socialism –
Patrick: Well, Nazi-ism, it’s an abbreviation for National Socialism.
Glenn: Right, so you have that. We’re looking now at a world that in some ways is parallel. We had to pick, do we like the fascist or do we like the communist? We picked, well, we like the communist better, so we’ll get into bed with a communist to defeat the fascist. That’s World War II. We’re now looking in the Middle East, we like Saudi Arabia better than we like Iran, but they both want to control with a religious ideology that we reject, but yet we’re going to get in bed with one of them. We have to be careful on what our values are.
Patrick: They’re both anti-liberal. Believe it or not, you know, as you know, what you and I are are actually liberals, classical liberals. That’s the correct Milton Friedman, Thomas Jefferson, that’s classical liberalism, the idea that you don’t have an over-powerful state. Now, the word liberal got hijacked in the 1930s and 40s and has come to mean in the United States just the opposite, but in Europe, liberal is still used to mean what we are.
Patrick: But you’re absolutely correct. It’s a part of history that is neglected, but the deep intellectual connection and common roots of the fascistic tradition and the socialist or communist tradition, and when I hear talk of economic patriotism, I’m hearing Mussolini. The whole corporatism philosophy that he preached used terms like that.
Glenn: In that particular article by Jon Alter, he mentioned, you know, even McCarthyism, that the GOP should be, you know, looking at McCarthyism. No, we shouldn’t be. Nobody should be. And I don’t think the GOP would be all that different than the Democrats. They’d just take it in a different direction, but they would both be…the Patriot Act, wrap yourself in the flag, and you can get away with just about anything.
Patrick: I can’t believe some of this stuff is happening in our country, that we’re seeing that the discourse has taken this turn really in the last 20 years and that there aren’t more people understanding, you know, the historical roots of what it is we’re doing.
Glenn: But don’t you think that, and it’s like this with, I mean, how many times has communism tried and been failed? Everybody says well okay, yeah, but Mussolini went bad, yeah, but, you know, Stalin went bad. And so it’s always it’s not going to be that way, because people want to believe in a utopia. They want to believe that that stuff would work, that we could all live like it, but it doesn’t, it doesn’t.
Patrick: There’s a great quote from Adam Smith about how the man of systems, what he calls meaning a heavy ideologue, people who have like systems they want to impose on society, they seem to imagine society like it’s a great chessboard and that they can just move the pieces around. They forget that in the case of humans, those pieces have their own internal motivations, and they want to, you know, they can’t just be shuffled around like pieces on a chessboard.
And so these heavy ideological approaches, really they look very similar to me. And the liberal, the traditional classical liberal or what’s sometimes called libertarianism now, they’re pretty related, was the idea that no, we won’t have this overpowering government that’s demanding. We’ll form a government that serves us, not that we serve it. Anybody who is talking about economic patriotism is taking as their background assumption that it’s our function to serve the government rather than forgetting, you know, or they forget that no, we’re the primary –
Glenn: So the government comes to you and says we need you to sign this loyalty oath.
Patrick: I won’t sign a loyalty oath.
Glenn: They threaten to close you down, whatever pressure they would have to, you ever sign a loyalty oath?
Patrick: Never, never, never. No, I would laugh them out of the office.
Glenn: Does that make you un-American?
Patrick: No, I think I’m patriotic. I remember what the organizing principles of our republic are, and they include that, you know, we form, Milton Friedman had a great saying on this. Remember John F. Kennedy said something about in his inaugural address ask not what your country can do for you, ask what you can do for your country.
Milton Friedman, greatest friend of freedom in the 20th century, said that that would be, something like that could never be said in a state that still understood what freedom was because in our tradition we are, you know, we’re the primary actors, but we form this entity, the government, in order to secure our freedom.
So that’s like a plumber, you’ve hired a plumber to come and do something, the plumber does a lousy job, costs a lot of money, and when you try to criticize him says hey, don’t ask what I can do for you, ask what you can do for me. You’d say this plumber had gotten too big for his britches.
Glenn: Can I tell you a better way of saying it then…not that, that’s a great explanation, I mean but to change what John F. Kennedy said? Because I think what most people think is don’t keep taking, let’s figure out what we can do for each other, not the country but each other. It’s more of the idea of Ben Franklin, there is a God, he’s going to judge us, best way to serve him is to serve our fellow man. That’s the American religion. That’s the American ethic, let’s help each other.
Patrick: And to do that we needed government, and we needed limited government that’s going to perform certain functions we can’t do individually. We can’t defend our borders individually. You know, you don’t want to be your own policemen and court system.
So you need a government to do things, but let’s remember, it’s just this entity that we created, and to have it say oh no, you don’t understand, you’re supposed to be, you know, happy to pay us 40% of your income, corporate America, and if you don’t, you’re not patriotic, you have forgotten that you serve us.
That betrays that this worldview has gotten so skewed that they think, they’ve just gotten big for their britches. They’re like the plumber who’s saying, you know, don’t ask what you can do for me, ask what I can do for you.
Glenn: Thank you very much.
Patrick: Oh, thank you, Glenn.