Review: Claire Lee Chennault, Way of the Fighter, 1949

Claire Chennault is a grossly under-rated military genius among professional military historians. He was also underappreciated and even denigrated within the US Army Air Force, both prior to and during, his service in China in World War Two. One reason for this was his assertive style that ruffled many Air Force feathers. Another reason was that his unorthodox theories went directly against the received wisdom of his time. 

Chennault's Theories Proven

Perhaps a most important reason for the neglect and even disparaging of Chennault's many great achievements was his close relationship with and defense of Nationalist China's leader Chiang Kai-shek. He better understood the nature of the threat posed to American interests by Mao's Communist insurgency than his superior officers. Chennault's politically incorrect views on Mao's "agrarian reformers" led to conflict with his superiors Generals Joe Stilwell and George Marshall. In fact, Stilwell's delusions regarding the Red Chinese made him the darling of the American Left. Not that Marshall's judgment of the ChiComs was any better. The American people are still paying for their blunders. 

The US Army's Chief of Staff was so hostile to Chennault, and so petty, that the American who had fought the Japanese the longest, since 1937, wasn't invited to attend the surrender ceremony on the USS Missouri. He had been squeezed out of command in China only a few months prior by Marshall and was not allowed to finish the job. As one Air Force general asked on the deck of the Missouri, "where's Chennault?" He was in a doghouse built by over-rated and vindictive superiors. 

In early 1949, the Red Chinese were rapidly advancing and the Nationalists were on the run. At this critical moment, retired General Claire Lee Channault published his magnificent memoirs Way of the Fighter. I am sure that it's no accident that this important historical primary document is a "rare book" that can't be purchased for less the one-hundred dollars. Of course, there are several first-rate biographies of Chennault available. But, it's a great pity that Chennault's book isn't readily available. It is largely devoted his legendary military career and is also his answer to many detractors and smear merchants. 

Chennault joined the US Army Air Service with America's declaration of war in 1917. He finagled his way into the pilot training program. However, he didn't see any action in the First World War. After the Armistice, he remained in the newly established Army Air Corps. It was during the 1920s that Chennault created and flew with the US military's first flying demonstration group. 

Chennault center with his Wingmen

It was in the 1930s at Maxwell Field's Air Force Tactical School where Chennault's hostility to the "Bomber Mafia" ended his career with the Air Corps, at least for several critical years. With the advent of the B-17, Air Corps' doctrine went whole hog with strategic bombing. Briefly, the theory argued that large formations of heavily armed bombers were unstoppable: the bomber will always get through. Chennault countered that new, fast fighters could inflict unsustainable losses on unescorted bomber formations. As he explains,

They were planning the air offensive against Germany long before Pearl Harbor. However brilliant this plan was in many respects, it reflected their blind spot on fighters. Many a B-17 crew had to go down in flames under the gun and rockets of Luftwaffe fighters before the bomber radicals learned that bloody lesson. (p. 27)

Harsh and sadly true. Even after German defeat in the Battle of Britain and the British discontinuance of daylight bombing due to extreme losses, the Bomber Mafia pressed on until the horrific slaughter of B-17s over Schweinfurt in the summer/fall of 1943. 

A key part of Chennault's defensive fighter theories was the use of an early warning system. This system was based on ground observers in this pre-radar era. He also argued for sophisticated radio networks in order to facilitate information flow.

In 1937 Chennault was eased out with a medical discharge after twenty years of service. His health problems did not prevent him from flying combat and shooting down many Japanese aircraft over China (on the down-low) in his legendary Hawk 75. 

Even before his discharge, Chennault had been approached to advise the fledgling Chinese Air Force. He accepted the offer and arrived in China only days before the Japanese invasion in the summer of 1937. He was enchanted by China and its people and quickly acquired a fierce loyalty to the Chiangs:

To this day I remain completely captivated. That night I wrote in my diary, "She will always be a princess to me." Since then I have worked with Madame Chiang through long years of bitter defeat and years of victory that now seem even more bitter because their promise of peace has not been fulfilled. I believe she is one of the world's most accomplished, brilliant, and determined women. (p. 35) 

Chennault began having airstrips built throughout China at strategic points. Simultaneously, he created an early warning network of ground observers who communicated by either land-line or radio. Many of these extremely brave souls operated far behind Japanese lines. Some were placed right next to enemy airfields. Chennault would often receive their reports while Japanese warplanes were still warming up on the tarmac. 

The story of the Flying Tigers has been well told many times. Chennault provides an inside look on how he managed to create and train this fighter group against long odds. He provides much insight on the much neglected China Air Task Force (CATF) that replaced the Tigers in July 1942. He explains how he provided air defense over a two thousand mile front with only a handful of P-40s and B-25s. The addition of the twin engine bombers demonstrates that Chennault wasn't just a fighter guy. He wanted and needed a strike force to take the war to the enemy. 

Chennault explains how the later deployment of B-29s to China was a colossal blunder that ignored logistical reality. He advocated for a balanced air force in China that could both support the Chinese Army and cut up Japanese supply lines. However, his superior Stilwell was more enamored with building roads that would prove useless to the war effort. Stilwell's contemptuous attitude towards the Chinese and neglect of the war in that country was a stupid blunder. Chennault's vociferous arguments to the contrary got him into hot water:

My reasons for retirement were simple. I had made my break with the Army eight years before and returned to it only because of the war. I never had any intention of remaining in the service after the defeat of Japan. Arnold and Marshall had made it plain that one of the prime objects of the policy in China was to get rid of me "regardless of the consequences." (p. 350)

Channault's book is a compelling read and an important primary document on the neglected war on the Asian mainland. He provides an unedifying look at military politics of the era and how it impeded the war effort. Of course, there is some score settling, particularly regarding Stilwell and General Clayton Bissell. But, who can really blame him? His logical and proven theory on air defense was ignored costing thousands of American airmen's lives. He witnessed countless blunders made by his superiors on the war in China that were extremely detrimental to American security and interests. Whatever his faults, he was a military innovator of the first rank and a patriot who spoke his mind when such were most desperately needed. We can use many Chennaults today. 

Review: Ian Fletcher, Free Trade Doesn't Work, 2011

In this book, Ian Fletcher provides an excellent critique of the pre-Trump "free trade" policies of the United States. His argument is backed up by copious amounts of statistics, real world examples and historical data. Happily, his writing style is accessible to the interested citizen who is not an economics geek living on some Platonic plateau. 

I can only hit the central points of Fletcher's complex thesis. One of these issues is the trade deficit. For 2017, the United States had a $566 billion trade deficit. The "free traders" generally argue that it doesn't matter for various reasons. One incredible argument is that the trade deficit with Red China is as meaningless as a trade deficit between Kansas and Nebraska. Contrary to such globalist nonsense, Fletcher argues that the nation-state is still the central political and economic player on the world stage and should remain just that. 

Fletcher introduces the "trade deficits are meaningless" crowd to a tutorial in Econ 100. He notes that as with individuals, there are only three ways for organizations and governments to pay for goods and services: "a) Goods we produce today. b) Goods we produced yesterday. c) Goods we will produce tomorrow." In concrete terms for foreign trade: "a) is when we sell foreigners jet airplanes. b) is when we sell foreigners American office buildings [or Yosemite or port facilities vital to national security]. c) is when we go into debt to foreigners" pg. 38. Obviously, both b and c result from a chronic trade deficit and equally obvious are not in the national interest.  

Fletcher provides a fascinating picture on what happens when a nation with long time preferences engages in "free trade" with a nation of short time preferences. In other words, one country (say America) prefers short-term consumption versus its trading partner (like Red China) that is famous for playing the long game. The long-term result is the hollowing out of the feckless country's manufacturing base: 

The increased well-being of both nations (as they define it, decadently or diligently) depends on the ability of the decadent nation to borrow and sell assets. And it cannot do this forever. Eventually, when it exhausts its ability to sell assets and assume debt, it ends up poorer than it would have been if it had not had free trade with its neighbor. Because it depleted its assets and saddled itself with debt, it must now divert money from its own consumption to give to its trading partner! (pg. 47)

The author observes that this process hits poor, third-world countries particularly hard. The results of evil rulers and the evil doers at the IMF and World Bank can be seen most readily in Africa. Thanks to their own rulers and "free trade" dogma, these countries are doomed to being indebted primary and agricultural producers that provide little "value added" for its workers. Little wonder that third-world activists call such policies "neo-colonialism." 

Free trade tends to mean that the industrial sector of developing nations either "make it to the big time" and become globally competitive, or else get killed off entirely by imports, leaving nothing but agriculture and raw materials extraction, dead-end sectors which tend to not grow very fast. Free trade eliminates the protected middle ground for economies, like Mongolia and Peru, which don't have globally competitive industrial sectors but were still better off having such sectors, albeit inefficient ones, than not having them at all. (pg. 157)

Ghana Gold Mine

An important part of Fletcher's argument is the economic differences between manufacturing and primary production to a nation. Without the "high value" manufacturing base, economic activity that can't be outsourced will be poorly paid and the entire wage rate dragged down to bare subsistence. It is for this reason that free trade often results in the death of the middle class. Politically, it must be noted, all form of "liberal democracy" depend on such a middle class for its long term success.

Fletcher devotes a chapter to debunking the free trade arguments of David Ricardo (1772-1823). He views Ricardo's "law of comparative advantage" as an abstract construct largely devoid of real world referents: 

It enables a lone economist with a blackboard to prove that free trade is best, always and everywhere, without ever getting her shoes dirty inspecting any actual factories, dockyards, or shops. She does not even need to consult any statistics on prices, production, or wages. The magnificent abstract logic alone is enough. It is actually rather a pity the theory isn't true. (pp. 103-104, links added by yours truly)

He examines seven "dubious assumptions" of Ricardo's theory that even if true two-hundred and twenty years ago are no longer operative: 1. Trade is sustainable; 2. There are no externalities; 3. Factors of production move easily between industries; 4. Trade does not raise income inequality: 5. Capital is not internationally mobile; 6. Short-term efficiency causes long-term growth; 7. Trade does not induce adverse productivity growth abroad. Regarding item 7, one example is the "offshoring" of high-tech manufacturing in Red China. The result is a hostile foreign power's ability to "hack" sensitive US industrial and government computer systems. But, the free traders, in and out of government, have a long tradition of selling out the American people to their Red Chinese paymasters.

The author provides much elaboration on each of these points. He also notes that comparative advantage in trade is the exception and that absolute advantage is the rule in trade. He also argues that Ricardo assumed the existence of nation-states with strong borders when formulating his theory. Ironically, it's these same national frontiers (or barriers to capital and labor mobility) that the free trade globalists seek to eradicate. 

Absolute advantage is really the natural order of things in capitalism, and comparative advantage is a special case caused by the existence of national borders that factors of production can't cross. Indeed, that is basically what a nation is, from the point of view of economics: a part of the world with political barriers to the entry and exit of factors of production. This forces national economies to interact indirectly, by exchanging goods and services made from those factors, which places comparative advantage in control. Without those barriers, nations would simply be regions of a single economy, which is why absolute advantage governs economic relations within nations. (pg. 110)

I've only touched on a few of the key arguments made by Fletcher in this excellent book. I have no doubt that free traders will remain unconvinced. However, they should take Fletcher's thesis seriously and seek to provide a coherent rebuttal. Simply reciting Ricardo will not do. 

The author's solution to America's chronic trade deficits and declining industrial base is an 30% across the board tariff. I'm not sure if this is the best policy. But, it may be better than "free trade" agreements between connected cronies on the one hand and hostile foreign powers on the other. Perhaps, President Trump's policy of renegotiating bad trade agreements will be of some benefit. But it is clear that the trade, and other economic, policies of the last several administrations have not been in the interests of the American people.