Citing Alexander Hamilton’s influence on early American finances, Thomas G. Donlan of Barron’s devotes much of his latest column to making the case for American ideas that might help Europe boost its economic fortunes.
In the Constitution, the states agreed to completely free internal trade — no tariffs, quotas, or restrictions on the movement of people among the states, and no taxes on imports or exports except federal taxes applied equally in every state. Although states habitually attempt to circumvent it, and Congress legislates a multitude of subsidies, the Supreme Court generally defends commercial liberty. That has done more for American prosperity than centuries of governmental efforts to promote it.
Founded as a Common Market, the European Union provides free trade and free movement in form, but often not in substance. National governments favor local businesses and industries; citizens of one country encounter immense difficulty in procuring services and even goods from neighboring countries. Prices vary widely — a sure sign of market manipulation.
Donlan cites as a second example President Martin Van Buren’s “selfless heroism — denounced as stubborn ideology” in refusing to bail out profligate, debt-ridden state governments in the 1830s. Van Buren’s decision frced states to reorganize their own finances.
Nearly all restored their credit by enacting constitutional promises to avoid debt without a vote of their citizens.
By now, of course, many states have evaded those promises, but they still work for those that use them, and they would work for European countries that need them.
