March 21, 2006

Who said this in 1995?

The greatly increased ratio of low-cost labor to capital has raised the wages of highly skilled labor and the return on physical capital but has put downward pressure on the wages of low-skilled labor. The result has been a sharp widening in the differential between the wages of highly skilled and low-skilled labor in the United States and other advanced countries.

If the widening of the wage differential is allowed to proceed unchecked, it threatens to create within our own country a social problem of major proportions. We shall not be willing to see a group of our population move into Third World conditions at the same time that another group of our population becomes increasingly well off. Such stratification is a recipe for social disaster. The pressure to avoid it by protectionist and other similar measures will be irresistible.

He went on to argue for reforming education by implementing a voucher system. While that's probably a good idea, the obvious first step for fixing public education is to stop making it worse. Our education problems would be more manageable if we cut down on the number of illegal aliens imported, which would reduce the number of Spanish-speaking students from a culture that doesn't care much about education.

In general, this is a good argument for my "libertarianism in one country" theory -- that, politically speaking, you can choose to have either a globalized market for low wage labor within your country or you can choose to have relatively few restrictions on the free market within your country, but you definitely can't choose both.

I wrote in 2001:

This is what libertarians must realize: There is staggeringly too much inequality in the world for America's love affair with capitalism to survive importing massive amounts of it...

It's crucial to understand that a hankering for equality is not some fad instigated by Marxist college professors. It is deeply rooted in human nature. Just see what happens when you try to give one of your kids a smaller slice of the pie than you give the others.

America's exceptional devotion to free enterprise was based on our being blessed with a nearly empty continent, populated only by Indians who, while brave and tenacious, were ultimately too thin on the ground to hang on to their property. Throughout American history, cheap land and high wages made possible a degree of equality of land ownership impossible to achieve in Europe without heavy government intervention. Even though 19th Century Great Britain enjoyed a higher degree of social mobility than was typical in Europe, around 250 families owned about 3/4ths of the real estate in the entire country. Today, after generations of punitive death duties, the Duke of Westminster still owns about 10% of London.

Socialism didn't happen here because we didn't need it to happen.

The eternal temptation of the wealthy, however, is to try to acquire cheap labor in order to grow even richer.

Answer: Milton Friedman. (Via Catallaxy).

My published articles are archived at -- Steve Sailer

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