JONATHAN CHAIT NOVEMBER 9, 2010
President Obama delivered a speech praising India for, among other things, its transition away from a planned economy. Wall Street Journal columnist Brett Stephens is gobsmacked:
[W]orth pondering is how a president who used to routinely inveigh against Bangalore for stealing jobs from Buffalo, who defended the "buy American" clause in the stimulus bill, and whose health-care legislation comes with its own de facto licensing raj, can suddenly talk so much sense. Maybe it's pure double-speak, or maybe the president has emerged from his midterm shellacking with a new religion. India tends to have that effect on strangers: The sensible among them have been known to lose their minds, but the senseless often find their grip.
Mr. Obama, plainly, is a leader who needs to find his grip. In describing the domestic achievements of India, he has at last alighted on a formula that can work for the U.S. while saving his presidency in the bargain. A man who has so often promised to listen to the world rather than preach to it might do well, this time, to listen to himself.
Stephens is exhibiting a common tendency among conservatives to view capitalism as a completely binary issue. (This tendency is on full display in American Enterprise Institute president Arthur Brooks's book.) I think many conservatives genuinely fail to understand that liberals can believe in free markets and free trade in general while also supporting limited government intervention to correct market failures like a recession-induced liquidity trap, adverse selection in health care, global warming, or skyrocketing inequality.
Buy-American provisions were in the stimulus because it's designed to promote consumer demand in the United States. It was clearly not a signal of rolling back free trade. There is nothing in the Affordable Health Care Act that remotely resembles the central planning that once ruled India's economy, unless you think that any kind of government regulation is like every other kind of government regulation. Come to think of it, Stephens probably does think that.