The Greatest Trick 'the Swamp' Ever Pulled

Why are anti-establishment Republicans embracing the special interest racket of Washington, D.C.?

In 2016, candidate Donald J. Trump ran on a promise to drain ‘the swamp’. Since then, the term has become an all-purpose epithet, used by the MAGA faithful to flay elites of both parties, the special-interest groups that rule Washington, and government in general.

According to Pew, public trust in government has been at or below 20 percent since the end of the George W. Bush administration. Like earlier dips, the current one began with a combination of foreign war followed by recession at home, but this time there was no recovery. America’s democratic institutions may be suffering the worst crisis of legitimacy in the modern era.

Why this has happened is anyone’s guess, but a good place to look is the constitutional transformation that a century of progressivism has wrought. In the New Deal, progressives jettisoned the Constitution’s framework of limited and enumerated powers for a national government of consolidated and virtually unlimited powers. That has not only made every issue a matter of national majority rule, it also maximized the number of people who are unhappy with the end result.

Worse, in order for government to be able to redistribute wealth among various groups, it has become a free-for-all of rent-seeking special interests whose general preference is for government-created cartels designed to transfer wealth from unsuspecting working families to themselves.

That truly is an apt definition of ‘the swamp.’ Curiously, however, the very Republicans who tend to most bewail ‘the swamp’ are increasingly prone to embrace the policies that created it in the first place.

Their fatal error is to think that creating cartels for American companies helps American workers and puts ‘America First.’ It is the same misdiagnosis that leads people to blame the Rust Belt and dying communities of Appalachia on globalization and free trade when the real culprit was progressive regulation and taxation that chased both capital and labor away.

Hence the spectacle of supposedly anti-swamp Republicans shilling for every special interest racket with lobbyists in Washington. Consider the Jones Act, the sugar program, and the ethanol program, to name just three. These programs, all of which would be criminal violations of the antitrust laws if the government wasn’t part of the conspiracy, are simply frauds on the public. To defend them on ‘made in America’ grounds is to aid and abet a fraud against working class people who don't realize they're being taken advantage of.

The Jones Act has ruined America’s shipbuilding industry, for the benefit of a dwindling number of decrepit shipyards. It deprives the Navy of the vital benefit of an industrial-technological base, forcing it essentially into Soviet-style procurement where everything needs to be designed and built from scratch.

The sugar program’s throttling of production is so effective in transferring wealth from consumers to sugar producers that the law’s backstop appropriations are never triggered, with the result that the Congressional Budget Office is able to score the bill as costing taxpayers nothing, when in fact it costs them far more than if the subsidy for sugar producers were actually in the budget.

The ethanol program has led to an area the size of the state of Michigan being devoted to the production of corn ethanol instead of food, producing a fuel that is terrible for cars and for the environment and raises the cost of both food and gasoline.

Similar examples are increasingly common. Antitrust enforcement has become a favorite new Republican weapon, to be used to punish the invariably progressive elites of corporate America. In this, they are returning to the quaint mid-20th century economic nonsense of the Brandeisian era in antitrust, with its insistence on regulators knowing better than the public what constitutes public necessity and convenience. In so doing, they risk abandoning the enormous benefits brought to America's competition policy by the Chicago School of law & economics, which demonstrated that consumer welfare is the only standard by which competition policy can or should be judged, and that antitrust in the service of other goals can only hurt consumers and society as a whole. 

To advance this dubious agenda, Republicans are also increasingly happy to expand the powers of the administrative state and even independent agencies accountable to nobody. Hence they are putting at risk the multi-generational effort to put the unlimited progressive one-party state back into the Constitution's framework of separated and limited powers, at the worst possible time. Just when the most constitutionally conservative federal judiciary in 100 years is ready to join the fight against the progressive swamp, Republicans – of all people – are riding to that swamp's rescue. 

In 1960, Friedrich Hayek, who spent his life showing how progressive policies lead to socialism, wrote an essay entitled ‘Why I am Not a Conservative.’ In it he described the conservatives of landed aristocracy and autarchic nationalism, who preferred crown monopolies to competition, and tariffs to free trade. Like the socialist, he wrote, that “conservative does not object to coercion or arbitrary power so long as it is used for what he regards as the right purposes.”

That conservatism was discredited by the Great Depression whose trade wars it did so much to exacerbate – and by the world war that followed. Hopefully, this time around the conservatism of constitutional government and free markets can win the argument without such a costly demonstration. 

Mario Loyola is professor at Florida International University and senior fellow at the Competitive Enterprise Institute.