Sunday, March 13, 2016

Smacking Trump Over the Head on Free Trade

From page 79 of Daniel Griswold’s 2009 book, Mad About Trade: Why Main Street America should Embrace Globalization:
The good news for Americans is that the U.S. trade deficit reflects a continued willingness of savers around the world to put their money to work in the U.S. economy….  U.S. real estate, U.S. Treasury bills, bank deposits, and corporate bonds and stocks have remained relatively attractive to world savers.  In our globalized world, Americans enjoy a comparative advantage not just in a range of high-end services and products but also in offering attractive investment assets.  Why is that such a bad thing?
(via Cafe Hayek)


  1. Robert, I was with you for decades on the idea of free trade, but the practical reality is that wealthy western countries opening the doors to unfettered trade with countries whose per-capita GDP is a fraction thereof is a bad deal for the western countries. I know you don't believe me. But someone has done the math and logical analysis and proven the point quite cogently. Read chapter 7 (Immigration and Economics) of Vox Day's and John Red Eagle's Cuckservative: How "Conservatives" Betrayed America. Trump's positions on the issue, such as they can be understood, are closer to the truth.

    How does it feel to be on the same side as Karl Marx?

    If the free-traders cannot understand how one nation can grow rich at the expense of another, we need not wonder, since these same gentlemen also refuse to understand how within one country one class can enrich itself at the expense of another…. But, in general, the protective system of our day is conservative, while the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favor of free trade.
    —On the Question of Free Trade, Karl Marx, 1848

    1. @Shimshon Do you also advocate purchasing all of your groceries and services from the highest bidder in your personal life? Or do you only recommend that for other people?

      Comparative advantage is real, dynamic and yes, in a sense, is revolutionary...or at least evolutionary. As people choose to trade with different partners around the world depending on the advantage to each partner, things will change.

      The conservative/protectionist tendancies Marx is commenting on are the mark of entrenched interests who tend to utilize any means, political and economic, to retain their position.

      Those protectionist interests rightly deserve our disdain for utilizing political means (violence) to achieve their ends (endless "free" trade agreements which are anything but are just one example).

      However, I dont think their is any reason to begrudge their savvy trading any more then coupon clipping. It is dangerous to confuse the savvy, moral, businessman with those who exist only on their political power.

    2. @Randy, did you read Chapter 7 of Cuckservative like I suggested? If not, you're reacting to a straw man of your own building.

    3. @Shimshon. I am somewhat hesitant to spend time on a text which, at least based on your comments, attempts to disprove the case for comparative advantage and truly free trade between peoples in different nations. I would think such arguments tend to prove too much. Why stop at dictating an end to "unfettered trade" at international boundaries. Why not end "unfettered trade" for every household? Authoritarian dictates must be the solution. Are those the next logical? Am I still making strawmen?

      Is there some non-arbitrary concept Day and Eagle have discovered which legitimizes dictating to men who they should be free to trade with? If that is not their basic conclusion, then I might give it a read.

  2. @Randy if you don't want to spend $5 on the book to see for yourself that's your choice. I'm not going to do the job for you. If you'll notice, I said "unfettered trade with countries whose per-capita GDP is a fraction thereof." That's pretty qualified, is it not?

    1. @Shimshon So the authors are specifically making the case for barring trade between a people who are relatively wealthy and a poeple that are relatively very poor?

    2. @Randy Who said anything about "barring" (presumably all) trade? Are you capable of understanding the meaning of "unfettered?" Why do you keep asking me instead of reading a few pages of an excellent and highly recommended book? He is making the case that free trade is a bad deal for most countries (rich and poor) in that it destroys sovereignty. He also makes the case that free trade is a bad deal for rich countries (the US in particular) economically due to inevitable impoverishment using the same sort of numbers that Robert himself uses.

      Further quote:

      The chapter is actually title Immigration and Economics. But the authors also make the point that it is impossible to separate trade and immigration.

      To understand this chapter, it is first necessary to understand that the arguments for immigration are the same as the arguments for free trade, because, technically speaking, immigration is a subset of free trade. While the most famous arguments for free trade have been made in terms of goods, they have nevertheless always necessarily included the free movement of capital, services, and labor as well. In fact, two of the Four Freedoms of the European Union refer implicitly to immigration by establishing the right of the free movement of workers as well as the freedom to provide services in addition to the two other components of free trade, goods and capital. The Four Freedoms are:

      Free Movement of Goods
      Freedom of Movement for Workers
      Right of Establishment and Freedom to Provide Services
      Free Movement of Capital

      American conservatives have had a strong affinity for free trade for decades. Some of the most revered intellectual figures on the right have historically been among the most influential voices in favor of free trade. Milton Friedman’s Free To Choose had a tremendous impact on millions of Republicans in the early 1980s. More esoteric, but highly influential economists such as Ludwig von Mises and Henry Hazlitt provided the foundation for intellectual arguments that were very nearly as convincing in their support of international free trade and the free movement of peoples as they were against government intervention in the domestic economy.

      And so forth.

  3. Bob and Randy, here's your chance to ask Vox Day himself. You can spare yourself the $5 cost of the book and simply address your questions on free trade directly to him. Although you are always free to write him directly or comment on his blog.

    Vox Day, Trump supporter and author of Cuckservative: How "Conservatives" Betrayed America will be doing an AMA TOMORROW 3/17 @ 2:30PM EST

    Many of you are already familiar with Vox as he is a major figure in the "alt-right" movement, as it is sometimes called, and a pro-nationalist. He's an American currently living in Europe and he is insightful and well versed in numerous topics including (but not limited to): politics, economics, immigration/refugee crisis, gamergate, and publishing.