The Triumph Of Democratic Capitalism: The Threat of Global Governance

Conservative Political Action Committee Conference, January 21, 2000

I am particularly proud to be here this morning, among the men and women who helped make the triumph of freedom and democratic capitalism possible these past two decades, and make no mistake, it started right here in 1980, with the election of Ronald Wilson Reagan. It was your tireless efforts over these decades that helped restore America’s belief in markets over bureaucratic manipulation, individual liberty over collective repression, and a dedication to the virtuous and dynamic society over the stultification of the welfare state.

But we can’t relax now because we have so much more to do and many new challenges to face to bring about the American Renaissance.

Every victory brings new risks, and the biggest risk today is a statist counterrevolution that is being engineered by the architects of a “Third Way Movement”—of which Tony Blair, Gerhard Schroeder, Bill Clinton, and most assuredly Al Gore, are at the center.

The Third Way offers the allure of a so-called middle path between freedom and statism and between socialism and capitalism. It is a “new-age” political and economic philosophy that promotes socialist principles and ideals behind a mask of markets and capitalism. Unlike the socialists of old, the Third Way doesn’t attempt to destroy free markets. It tries to harness them, to manipulate, to direct and regulate them. But behind the mask of Third Way capitalism, are the children of the Left who persist in the delusion that bureaucratic planning is the way of the future. Remember what economist Lester Thurow said about Soviet planning in 1989, just six months before the collapse of Communism? “Can economic command and controls significantly…accelerate the growth process?” Yes, he answers! “The remarkable performance of the Soviet Union suggests that it can….Today it is a country whose economic achievements bear comparison with those of the United States.”

Words matter; ideas matter. Indeed, they rule the world, as Victor Hugo said. So when national leaders like Deputy Secretary of State Strobe Talbott predict (as he did in 1992) that in this 21st century “all states will recognize a single, global authority … ‘citizen of the world’ will have assumed real meaning,” I not only take him at his word, I believe he means to use the power of his position to advance us toward that goal of a “single, global authority.”

When a respected figure like Walter Cronkite is honored by the World Federalist Association for his long dedication to the cause of world government, I feel confident that the drive toward global governance is well-advanced and that we are very late indeed in recognizing its consequences and implications for American and global liberty. Listen to what Mr. Cronkite said at the World Federalist Association on receiving its Global Governance award last October: “If we are to avoid the eventual catastrophic world conflict we must strengthen the United Nations as a first step toward a world government patterned after our own government with a legislature, executive and judiciary, and police to enforce its international laws and keep the peace. To do that, of course, we Americans will have to yield up some of our sovereignty.”

The Third-Way Global Governance Movement is not a backroom conspiracy, but a frontroom, high-visibility campaign by sincere but misguided, well-placed, and influential Americans, Brits and European politicians and academics who truly believe that we must and should surrender some of our independence and sovereignty as a free people in order to advance the cause of a greater, more powerful, centralized world order. I’m here to say we vehemently disagree with that goal—reject it categorically as a threat to our liberty and the biggest challenge to economic and political freedom the world may face in our immediate lifetimes. But I respect it enough to take it seriously.

Most of our political leaders, sadly, do not seem to take it seriously. And among those who do, too many of them—like our friend Pat Buchanan (who on this issue is right)—are in danger of being seduced by the very fallacies put forth by global government folks themselves—for example the fallacy that free trade must be managed. In my opinion, Pat would like the US government to manage trade. The Third Wayers want the WTO to manage it; while I don’t believe anyone needs to manage the freedom of people to exchange goods and services freely across their borders.

Winston Churchill best articulated the virtue of free economic relations, as against the risks of Third Way global government. In 1904, before he left the Tory Party to join the Liberal Party to protest Tory policy, Churchill noted that “there came last year into [our country] from every land and people under the sun, millions worth of merchandise, so marvelously varied in its character that a whole volume would scarcely describe it….Was it to crush us, or conquer us, or to starve us, or was it to nourish and enrich our country? It is a sober fact that every single time … all that vast catalogue of commodities came to our shores because some [citizen] desired it, paid for it, and meant to turn it to his comfort or profit.”

Ronald Reagan echoed Churchill’s words when stated “We who live in free market societies believe that growth, prosperity and ultimately human fulfillment, are created from the bottom up, not the government down. Only when the human spirit is allowed to invent and create, only when individuals are given a personal stake in deciding economic policies and benefiting from their success—only then can societies remain economically alive, dynamic, progressive, and free. Trust the people. This is the one irrefutable lesson of the entire postwar period contradicting the notion that rigid government controls are essential to economic development.” Later he added, “As the leader of the West and as a country that has become great and rich because of economic freedom, American must be an unrelenting advocate of free trade.”

There is a critical difference between the globalization of freedom and free markets and the globalization of big-government bureaucracies.

Let’s get this straight from the beginning: The globalization of freedom is good. The globalization of government controls and regulation is bad.

The globalization of freedom and opportunity empowers people and allows entrepreneurs to take risks to create and innovate, to improve their own lives and the lives of others. The globalization of government retards entrepreneurialism and promotes bureaucracies that inhibit people’s quest to achieve their highest aspirations.

Let me give you some very real, and deeply disturbing, examples of how the drive for global government is manifesting itself beyond the rhetoric of Lester Thurow, Strobe Talbott and Walter Cronkite. The first is the Kyoto Protocol on global warming—really a prototype for centrally planned management of the world’s energy supply and economic relations. This unratified treaty—the Senate went on record against it so overwhelmingly (a 95-0 vote on the Byrd-Hagel resolution) that President Clinton refuses to even submit it—purports to deal with the highly speculative subject of global climate change. Now the science of climate change remains a hotly-debated topic within the scientific community; the cause of ground warming which we have measured in recent decades is not at all well understood; and most of the measured warming in the past century occurred before the 1940’s, casting serious doubt on the hypothesis that snow is caused by global warming, that driving our cars and SUVs has somehow caused coastal flooding and drought in Texas or fires in Florida.

In short, global warming is an open issue, but Kyoto assumes our use of fossil fuels (that’s coal, oil, and gas) is causing warming, and that we have to cut back drastically (reduce energy consumption in the US alone by 30 to 40 percent!) in order to avert climate catastrophe. And yes, we will have to account to the UN and related authorities to show we aren’t burning too much fuel, or ‘growing our economy’ too fast. And you thought Alan Greenspan had a lot of power! Even NASA’s Dr. James Hansen—one of the gurus of the global warming crowd—now admits that when he recently said “our understanding of…greenhouse gases is not all that good.” Dr. Hansen conceded that “it’s nearly impossible to predict future temperatures with existing climate models.”

It's not acceptable for the US to subordinate its economic autonomy, our citizens' choice of what cars to drive, what appliances to use, whether to provide heating aid to the poor on cold days like today, to an international bureaucracy, well-connected to the media and the Third Way intellectual power elites, but unaccountable to the American people. By all means let’s use energy more efficiently, which the free market and technology is driving us to do anyway. Let’s not use a massively-hyped, pseudo-scientific issue like global warming to put in place the building blocks of the Third Way new global order (NGO)!

And Kyoto is just one of many fronts where our sovereignty as a free people faces serious challenge. One that may still be fresh in your minds is the fight over the WTO, the so-called Battle of Seattle, where the WTO failed to agree on launching new trade- and market-opening talks among its member nations.

The naysayers claim this means free trade is out and street theater is in, energizing a powerful new coalition against 'globalization'; by which they mean the spread of capital, markets, and private corporations to all corners of the globe. But the powerful tide of economic freedom can't be stopped so easily, and it's still the last, best hope for worldwide prosperity, the ecological health of the planet, and peace among nations as we enter the 21st century and the Third Millennium.

Both free trade and American sovereignty did take hits in Seattle, when President Clinton tried to shove an aggressive regulatory labor and environmental agenda on the WTO, especially the developing world. In so doing he triangulated himself out of opening new markets for American agriculture and our high-tech industries, among others.

But we will live to fight those battles another day, whereas the real threat from Seattle is that global government will gain new momentum from the effort to link trade, environmental, and labor policy in an unholy bureaucratic alliance. Ironically, that would give massive new powers to the WTO, which supposedly is the 'enemy' the folks in the streets were exorcised over.

But the elites in the streets really want control of the WTO, using labor standards and eco-regulation. Their WTO would become a building block of global government, using trade negotiations to impose the highest level of eco-restrictions on world commerce. They even came out against “never-ending resource supplies, never-ending growth, ever-expanding markets, and constant supplies of cheap labor” in a stunning November 22 ad in the New York Times! These self-appointed agents of compassion really want scarce resources, less growth, and smaller markets—thus poorer people, more despair and ultimately, as George Gilder pointed out, more wars.

It's a stark reminder that the extreme elements of the 'green movement' ignore life-and-death issues of hunger, disease, and malnutrition that much of the world still faces. To deny those people access to wealth-enhancing, and truly life-saving, global markets under the guise of labor and environmental regulation, is simply wrong. It's the reason why, if we are vigilant, the attempt to turn the WTO into a global regulator will self-destruct in the end.

It cannot be an agent of social change except by allowing free people and free markets to flourish and raise living standards, combat poverty and fight malnutrition and diseases like AIDS in the Third World. Turning the WTO into a super-EPA will end up restricting trade, entrenching poverty, and leaving the environment dirtier: growth is green, and we can't improve the environment by impoverishing the people.

I have dwelt on the issues of global regulation of energy and economic policy (the Kyoto Protocol) and of world trade (the WTO fiasco in Seattle) because they are of concern to me as a citizen, and particularly in my capacity as a Fellow with the Competitive Enterprise Institute. My hat is off to Fred Smith of CEI and Steve Moore of the Cato Institute for carrying on the work of

the late, great Julian Simon. But this danger to American self-government extends to our ability to defend ourselves as a nation, and to secure the right of our citizens to be held to the rule of law as American courts define it.

The Comprehensive Test Ban Treaty, fortunately rejected by the Senate because it threatens the viability of our nuclear deterrent force, is a troubling example. The Clinton administration forced Senator Lott to bring the CTBT to a vote by implementing the agreement de facto, and by arguing that we were indeed compelled to do so by international law! This notion–that Presidents can bind us with treaty obligations without the advice and consent of the Senate (as with the Test Ban Treaty) or even submitting a treaty for ratification (as with Kyoto)–is pernicious, and poses a serious threat to our system of ordered liberty. Similarly, the ABM revision negotiated by this Administration have not even been sent up for ratification, yet they seriously impede our ability to defend our citizenry–in this case by slowing and obstructing the deployment of a full-fledged (or even partial!) system of national defense against ballistic missiles. It is deeply troubling for the Clinton-Gore administration to do this without allowing the Senate to offer its advice and consent. But when high-ranking administration officials express fealty to the cause of world government, why should we be surprised?

Even when this administration declines to sign a treaty, like that creating the International Criminal Court, we have to ask what they are doing behind the scenes. There is no indication that we have pressed the 92 signing nations for assurances that the Court will lack jurisdiction over American citizens. This is not an abstract concern, because as many of you know the UN's High Commissioner for Human Rights is “looking into” the actions of American soldiers acting under NATO auspices in Kosovo.

Kyoto, the Test Ban Treaty and ABM accords, the WTO—there is every indication the incumbent administration sees these as exactly the kinds of precedents that, in the long run, it expects to become standard operating procedure.

Treaty obligations, constitutionally entered into, are vital to minimize economic friction among nations (the ultimate cause of most warfare) and keep the peace through the common consent of nations. But the Clinton Administration’s presumption in favor of intervention within sovereign borders, in defense of global regulation, cannot become the norm rather than the exception. To do so would reject centuries of precedent in international law and postulate an unending, unpredictable series of military adventures, regulatory interventions, and legal mischief under the auspices of international bureaucrats, unknown and unaccountable to the American citizen. To do so would mean establishing the Third Way vision of world government, either heavily armed itself or heavily dependent on our military assets—including the blood, sweat, and tears of our men and women.

Whether by custom or international law, the rules of international relations have always embraced the belief that sovereign nations may regulate their own affairs within their borders. Egregious offenses against standards of civilized conduct, whether Sudanese slavery of Christians, apartheid in South Africa, or the plight of Jews in the late Soviet Union, have been dealt with through moral suasion, international condemnation, diplomacy and sanctions. To respond to these tragedies with a show of multinational force will bring more conflict, not less; more displacements of population, not fewer; more lives lost, and more livelihoods disrupted. Too many so-called humanitarian interventions—just think about Kosovo—are more a matter of power politics than the new global interventionists would have us believe. If it were otherwise, NATO would now be in Chechnya, Turkey, and perhaps the Middle East.

Abraham Lincoln said “I have never had a thought politically that did not spring from the sentiments embodied in the Declaration of Independence”—We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the Pursuit of Happiness. That sentiment, he said, is what “gave liberty, not alone to the people of this country, but hope to the world, for all future time.”

Unashamed optimist that I am, I suggest we reject the Third Way and return to the First Way. That way is the way of our Declaration—freedom first, governance second. It is the vision followed by entrepreneurs and inventors who are creating the 21st Century internet economy at breakneck speed, creating jobs, achieving new medical miracles through genetic research and biotechnology, who are making energy cheaper and cleaner without the prod of international bureaucrats. It is the vision that says people around the globe, black and brown and Asian and white men and women, are capable of handling their own affairs, and should be allowed to do so short of the point where they may injure their fellow man. It is the vision that says every child can learn, succeed, earn wages, create wealth, and grow up to raise a healthy family in a world that will be freer, more productive, and more peaceful as we live by the Golden Rule.

The global spread of economic freedom, decisively propelled by free trade and entrepreneurial vision, is truly the triumph of ordinary mean and women free to do extraordinary things: the workers and laborers who are becoming savers, investors, and consumers, truly empowered by economic freedom and in charge of their own destinies at last. This must be our legacy of the 21st century. We can do so, but only with a unified front in favor of freedom, and against the intrusion of global governance on our economic, political, and intellectual liberty. We must do it, and so we will, all of us gathered here today and likeminded folks around the world. Not for ourselves alone, but more importantly, for our children and our grandchildren.