Jon Hartley and Glenn Hubbard lament at National Review Online that the two presidential candidates with the most media buzz appear to have little grasp of key economic principles.
This month marks the 240th anniversary of the publication of Adam Smith’s The Wealth of Nations, the watershed rationale for a free-market economy. Today, in the 2016 U.S. presidential race, populist candidates including Donald Trump and self-described socialist Senator Bernie Sanders are running against many of the central tenets of Smith’s ideas — and with considerable popular success.
The Sanders and Trump platforms range from protectionist anti-trade measures to expanded entitlement spending. Such policies are more popular than in previous elections and in some cases even pushing other candidates, especially Hillary Clinton, to grudgingly endorse them. Yet centuries of economic research have demonstrated that on a host of issues, from trade to taxes, economic policy that fosters free markets is critical to economic growth.
Our presidential candidates in 2016 should remember that Adam Smith’s key insight was that individuals working in their own interests are led by “an invisible hand to serve public interest” and benefit the broader society. In particular, Republicans should be reminded of the domestic economic benefits of free trade, particularly those that would come from prospective trade agreements with European and Asian nations.
