No one hates Vice President JD Vance more than the editorial board at the Wall Street Journal, although this time, someone at least signed its latest attack on him.
Matthew Hennessey published a piece on Memorial Day, taking issue with Vance’s recent description of “the market” as “a tool” and not “the purpose of American politics.”
In the piece, Hennessey criticizes Vance’s claim, saying, “In the beginning was the Market, and the Market was with God, and the Market was God.”
No, I’m sorry, that is the Gospel of John.
Here is what Hennessey actually says, “Long before recorded history, long before people settled in cities and started building fruit stands, before Adam Smith, before Wall Street, before dating apps, before crypto — before all that, there was trade: I give you this, you give me that. Simple exchange is what makes a market. Not faith, not mantras, not brick and mortar. Wherever people come together to trade is a market.”
In the Gospel according to Hennessey, markets have always existed where people are. There is no existence of humanity without markets. Markets, according to Hennessey, “facilitate the free exchange of goods and services. They are mechanisms for shared prosperity based on freedom from coercion. They don’t enslave us, they liberate us.”
All hail markets, humanity’s only path to prosperity and freedom.
If only it were true.
The reality is that in the real world, different communities of people have very different ideas about what is and what is not property. Markets are impossible without a common understanding of who owns what. And the way these disagreements have always been settled through violence and war.
In fact, the very definition of who owns what depends on state actors winning wars. In Johnson v. McIntosh, Thomas Johnson, a Supreme Court justice, bought land from the Piankeshaw tribe, which was awarded the land in 1763 as part of a peace treaty between it, Great Britain, and France. However, after the American Revolution, the new U.S. government awarded the same land to William McIntosh.
The Supreme Court held that McIntosh was the rightful owner of the land since the Virginia Colony renounced Great Britain’s authority in 1776, and then, after the war, transferred title of the land in question to the U.S. government.
Contra Hennessey and his libertarian utopians, markets do not exist in nature. They require solid definitions of property and an entity that can enforce contracts. Those services have always been provided by the state. No state, no markets.
Markets are just one tool humans use to manage cooperation. Governments that have embraced market principles have proven to be far more effective at producing armed forces capable of expanding and defending their borders. However, note that none of these armies are ordered by the market.
Markets exist to serve the ends of governments that support them, and those governments are, in turn, controlled by the people, at least in a democratic republic such as ours. If markets are failing to meet the needs of the people, the rules can be changed.
There is nothing natural or self-regulating about the market. Corporations are creations of the state. Investors cannot enjoy limited liability unless it is granted to them by the government. Inventors cannot enforce patent rights without a definition of what can be patented and for how long. Should software be patentable? Should seeds? For how long? There are no “laws of economics” that govern these questions the way the laws of gravity govern the natural world.
JAMES LANKFORD HAS LEARNED NOTHING ON IMMIGRATION
The answers to these questions, indeed the answer to all public policy questions, are not determined by the laws of economics but by the preferences of the people who are using the market as a tool to ensure the best way of life for their nation.
Vance understands this fundamental reality. And for that, the free market utopians at the Wall Street Journal will forever hate him.