President Trump has upended the liberal/progressive policy of Diversity, Equity, and Inclusion by decreeing its immediate end within the federal government. Is that a good thing? Conservatives sure think so. My position? I don’t really care how presidents run their welfare-state, warfare-state departments and agencies. I’m with Murray Rothbard when he was asked about the importance of ferreting out communists in the federal government. He responded — just abolish the jobs and the problem goes away. By the same token, dismantle all the agencies and departments relating to the welfare state, the managed economy, the national-security state, the drug war, and the war on immigrants, and you don’t have much left over to be too concerned about with respect to how the federal government is being run.
What is concerning, however, especially insofar as dictatorship is concerned, is Trump’s efforts to rid private-sector entities of DEI. What authority does a U.S. president have under the U.S. Constitution to dictate the policies of private-sector companies?
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In a genuinely free society, a private company has the right to run its affairs any way it wants. If it wants to establish a policy of DEI, it has the right to do so. If it wants to adopt an anti-DEI policy, that is its right too. It’s a privately owned company. As such, it has the right to adopt whatever policies it wants.
Insofar as libertarianism is concerned, it’s important to keep in mind that a pro-DEI policy for a private sector company is no more libertarian than an anti-DEI policy. The libertarian position is that everyone in the private sector should be free to adopt its own policy, whether it’s pro-DEI or anti-DEI.
By the same token, people are free to avoid or boycott private establishments because of the policies they adopt. That includes both consumers and employees. If a company begins losing market share or is unable to employ competent employees, that’s a signal to the company that it might want to change directions. But in a free society, it isn’t required to do so.
It’s worth asking: Why are so many private companies suddenly deciding to abandon the DEI policies that they have worked for years to adopt? The most likely reason is the power of Trump to do bad things to them and good things for them.
What are the bad things? For one, cancelling their dole. Many private-sector entities are on the federal dole, either directly or indirectly. Consider, for example, universities. Many of them receive millions of dollars in grants and other federal assistance. If they don’t go along with Trump’s anti-DEI program, he can cancel their dole. Most of them are unwilling to pay that price. Thus, to keep their dole, they have quickly moved in the anti-DEI direction that Trump wants them to move.
The libertarian position is in opposition to government doles to universities, corporations, and all other private entities. With the cancellation of all the doles, neither Trump nor any other president could threaten a cut-off of doles to induce them to do what the president wants them to do. A termination of the dole system would restore a sense of independence to the private sector.
Along these lines, there would also no longer be any state colleges and state universities —they would all be privatized— and free to independently manage their own affairs. Neither the federal nor the state governments have any more business in education than they do in religion.
What are some of the bad things that Trump could do to induce private-sector companies to adopt his anti-DEI policies. As everyone knows, we live under an economic system in which the federal government regulates and controls economic activity. Thus, every business knows that if it fails to go along with the new official program, it could suddenly be visited by a team of government regulators who could easily find enough violations to shut it down.
A good example of the regulation phenomenon is banking. Whenever any banking inspector walks into a bank, everyone in that bank, from the president on down, quivers and quakes. That’s because they all know that if the inspector wants to be nasty, he can find any number of violations he wants to even shut them down.
Moreover, there is always the IRS that private-sector entities need to be concerned about. How can we be sure that some fierce MAGA IRS agent doesn’t take it upon himself to enforce Trump’s anti-DEI edicts with audits and harassment? It’s worth reminding ourselves that our American ancestors established a system in which there was no income tax or IRS for more than 100 years, and so they didn’t have to be concerned about potential IRS retaliation.
Big companies also sometimes are seeking mergers and acquisitions that need to be approved by federal officials. They know that if they take a particular stand now that is contrary to that of the president, they might be denied an important merger or acquisition request later on. But the question has to be asked: Why should anyone have to get the permission of the federal government to merge with or acquire another company?
The libertarian position is simply to remove the power of regulation from the federal government entirely — i.e., the separation of economy and the state — a genuine free-enterprise system, one in which economic enterprise is totally free of government control, management, and regulation. That would leave private-sector companies free to manage their affairs with the certainly that the government could not do bad things to them or good things for them.
One thing is certain: Under our current system, the next time a Democrat is elected president, we are likely going to see things quickly moving in the opposite direction — where the private sector is scrambling to rid itself of Trump’s anti-DEI policies and quickly adopting a new president’s pro-DEI policies. That’s because under our system, a president wields the power to do good things for people and bad things to people.
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