U.S. Chamber of Commerce VP on Rural Growth and the Future of the Free Market

U.S. Chamber of Commerce VP on Rural Growth and the Future of the Free Market

Neil Bradley on his hope for free enterprise, and how that vision could best help Appalachia.

(Neil Bradley, left, discusses with The Spectator’s Alex Kagan, right. SOURCE: Michael Chirico/United States Chamber of Commerce)

Cautious optimism can describe Neil Bradley’s views on the state of the free market and its supporters. Despite challenges like fighting an administration he believes consistently undermines the free market, and a right as emboldened as ever to criticize big business, Bradley still believes in the eventual victory of free market principles.

The Spectator sat down with Bradley, the Executive Vice President, Chief Policy Officer, and Head of Strategic Advocacy for the U.S. Chamber of Commerce, at the West Virginia Chamber of Commerce’s Annual Business Summit at the Greenbrier Resort.

The Summit featured many victories for the West Virginian economy, with Governor Jim Justice announcing over $200 million in new investment during his speech.

Bradley laid out the best practices, in his view, for rural communities like West Virginia and Western Virginia to attract investment and expand their economies.

When asked whether trying to cut taxes and regulations to the maximum extent was a sound strategy for rural regions to attract businesses, Bradley gave a nuanced response “Yeah, as a general matter lower taxes are better for economic growth,” he said, adding that “taxes are kind of a necessity of life, but that doesn’t change the fact that what you tax, you get less of.”

“When you’re trying to think about economic growth and employment, not all tax increases are created equal, not all tax cuts are created equal,” Bradley said. He suggested that policymakers should be focused on forging tax policies “that give us the greatest medium and long-term growth.”

He mentioned that income tax cuts can be relatively unhelpful to growth, saying they “spur some consumption that’s pretty diffuse in the short term.” “What it doesn’t tend to produce is the investment that actually creates new employment opportunities,” he continued.

West Virginia Governor Justice recently received media attention for his vocal support of lowering the state’s income tax.

Instead, rural communities should seek growth-inducing investment, according to Bradley.

“The popular things to talk about often on the campaign trail are… [an] individual tax cut or … a child tax credit,” he said. “It’s not to take away from any of those, but if your goal is … more employment opportunities with rising wages … you really want to be focused on taxes that impact investment.”

Bradley, noting that nearly a quarter of West Virginian workers are employed by large firms, said that those companies’ ability to expand and hire more workers depended heavily on a tax structure that favored investment opportunities.

Bradley drew a line in the sand for when subsidies are effective economically: “The trouble with subsidies in some instances is figuring out what you’re subsidizing.” “Are you subsidizing … the capital investment needed to relocate or are you subsidizing ongoing operations?” he asked.

Subsidizing the actual operations of a company would lead to dependence by an unprofitable business, according to Bradley, while supporting a company's upfront costs makes more sense. Some examples of upfront subsidies include building enhanced infrastructure to service projects, like roads and sewer lines.

When comparing the benefits of remote work programs, designed to draw interest from workers due to the cost of living in rural areas, rather than attract business investment, Bradley saw a clear winner. “There is nothing wrong with attracting people and really advertising lower cost of living, higher quality of life … [things] that are natural advantages to West Virginia and western Virginia.” Nevertheless,  he still “would rather have a natural kind of employment growth” that comes with enticing business relocations.

“It’s really hard, particularly with rural and small towns, to sustain a community when you end up in a population … death spiral and figuring out how you either attract new people in larger numbers or how you keep … the people there becomes really important,” he said.

Bradley had another prescription for fighting decreasing rural populations: “Legal immigration has to be part of that kind of conversation too … historically legal immigration into this part of the country, it’s kind of what created the prosperity.”

“You have to have a policy approach that says, ‘If we’re gonna make it, it’s because we have a growing population base’… once you’re in the population death spiral, it gets really hard to get out of that,” he said.

In comparing the states of Virginia and West Virginia, and how their divergent politics could affect their economies, Bradley extolled the virtues of competition.

“As a general matter competition is good, and competition is good whether that’s … in business or in politics and so I do think public policy tends to suffer when you don’t have a competitive political process because parties and candidates aren’t forced to refine their ideas … with people who may disagree or may have a contrary point of view,” he said.

Much of the historical economic difference between the Republican and Democratic parties has been labor policy, with Democrats often being the party of unions.

Deep red West Virginia embodies this, with its codification of right-to-work and other pro-business policies occurring after its shift from a solidly Democratic state. Yet, as evidenced by the Teamsters President Sean O’Brien’s speech at the Republican National Convention in July, the Republican Party has become more comfortable with unions, and thus labor interests.

In this context, Bradley believed a shift toward labor-friendly economic policies would be “self-defeating.” He asserted that labor-friendly laws often lead to unprofitable firms, such as General Motors, which he claimed became “a healthcare company that happens to make cars” due to enormous, “unsustainable” union expenses.

“I think we should be more focused on having a system that lifts wages by making the pie bigger so that everyone’s slice of the pie gets bigger,” something that could be achieved through traditional Republican free market policies. He opposes the preferences of labor leaders, saying that “labor management today is kind of focused on the reallocation of what they view as a fixed pie.”

Bradley worried that many Republicans also viewed the economy as a “zero-sum game,” saying, “They’ve [forgotten] the idea that the pie should be growing for everyone and that we just think that this is a fixed discussion between whether we give more to workers or we give more to owners.”

According to Bradley, if that idea takes over American politics, then the American dream, which is “driving and motivating our whole economic growth and opportunity,” is lost.

Bradley believed that the recent populist slant in politics and resulting bipartisan distrust of large corporations is “doomed to fail.” Instead, “the real question is: is it doomed to failure before it imposes a really, really steep economic cost on the U.S. as a country and on American families?”

Bradley believes that there have been “concerted efforts to change ... the broad economic consensus that exists and has existed in this country for 50 years and to replace it with something that is much less … free market.”

He argued that bipartisan opposition to free markets is nothing new, bringing up Republican President Richard Nixon’s expansive wage and price controls, which featured a White House official “whose job it was to figure out what they thought the price of bacon should be.”

“I worry that we’ve forgotten a little bit of that history,” he said, arguing that Nixon’s price-fixing and other similar schemes have been a “complete disaster.” Bradley later noted that victory for free market groups would require people “to actually push back,” instead of just going “for a long walk” as anti-capitalists take power.

Regarding the FTC’s attempted ban on non-compete clauses, defended as a move to liberate workers, Bradley said, “I think we win that debate, but if we don’t engage in that debate … something beats nothing every time.”

When asked how those in favor of strict free markets can reach out to poor and rural Appalachians, who often feel as if the economy has left them behind, Bradley was introspective on the free market movement.

“I think we have to get back to talking about what free markets can create in economic opportunity,” he said. “In some ways, the failure that has occurred has been on the part of proponents of free markets … we’ve kind of stopped talking about why they’re important, why they are the best way of lifting people out of poverty, whether you’re in rural America or urban America,” he added.

He argued that proponents of free markets thought they had won the battle in the 1970s and 80s, and had become lazy and allowed the opposition to grow.

Bradley firmly denied that the American people themselves have moved away from supporting capitalism or meritocratic economic structures en masse. He believes Americans still foundationally like the tenets of capitalism, even without supporting the system by name.

“Most people in America, thank goodness, do not wake up every day thinking about what is the right labor policy: ‘Is it right-to-work or not right-to-work? What’s the appropriate tax rate for capital versus labor? Where should we have the next new free trade agreement?’”

Instead, Bradley proposed that “it’s just that the people don’t use the same word” to describe their economic views. He noted that his optimism runs contrary to others in his camp, many of whom have become increasingly nervous about the economic views of the populace as a whole, and the youth in particular.

To defend his bullishness, Bradley discussed a focus group of female college graduates that explored their economic views. According to Bradley, the discussion began “horribly,” with the women largely supporting positions like a human right to healthcare, government-funded universal housing, and guaranteed jobs.

But then Bradley noticed a shift: “All of a sudden, this one young lady said: ‘yeah, it sounds right, but I have this nagging feeling this feels like those group projects in college and there was always this one guy, he never did anything and he never even showed up to the meeting, but he got the same grade that I did.’”

Bradley claimed that the entire group began to be won over by the woman’s invocation of the free-rider problem. “They never uttered the word ‘capitalism,’ but they intuitively understood the idea of work and reward and free enterprise and entrepreneurship.”