Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on “Policy Positions: Free Trade vs. Political Ignorance.”
In this year’s campaign for the U.S. presidency political ignorance and policy stupidity is abundant on both the Democratic and Republican party sides of the battle for the White House. This is especially true when it comes to the benefits of free trade and America’s participation in the global economy.
The total market value of imports into and exports from the U.S. is greater than $5 trillion, or more than 25 percent of 2015 U.S. Gross Domestic Product. In addition, one out of every five jobs in the U.S. is connected with international trade and foreign investment.
Yet, the competing presidential candidates give the impression that all international trade is virtually a zero-sum game, from which the American consumer and worker comes up short.
When free from government intervention, regulation and restriction, market-based trade, both domestic and international, is always a positive sum game in which all participants view themselves as better off.
An expanding arena of trade that incorporates more people and more areas of the Earth offers the opportunity for greater gains from division of labor, increased human creativity and productivity, and wider circles of more, better and less expensive goods and services. Human standards of living rise.
Foreign competition does not threaten to steal jobs and leave a growing number of Americans unemployed. Being able to purchase less expense foreign-made goods raises the real income of American consumers as they can now buy other things they previously could not afford. Furthermore, foreign sellers desire to earn dollars preciously to have the financial wherewithal to purchase goods available for dollars.
Both this increase in real income through lower cost goods and the demands of foreigners for American goods as ultimate payment for what they have sold in the U.S., create more than enough alternative employments for those who may be initially displaced from the foreign competition.
Nor can trade retaliation against foreign countries that impose their own trade restrictions benefit American consumers or workers. This merely raises the prices of goods in the U.S. compared to what they could be under a free trade regime, and reduces employment opportunities in both the import and export sectors of the American economy, thereby potentially lowering the wages of some workers who lose jobs in these sectors of the economy.
The best policy for the United States is unrestricted freedom of trade, regardless of the ignorant and misplaced trade policies of other countries.
http://www.epictimes.com/06/13/2016/free-trade-policy-positions/
Best,
Richard
─ Yet, the competing presidential candidates give the impression that all international trade is virtually a zero-sum game, from which the American consumer and worker comes up short. ─
ReplyDeleteThere is also another component which is not openly promoted today but that originally fed the anti-capitalist and anti-laissez faire mentality of the American Progressives and which probably feeds the anti-commerce and even the anti-immigrant mentality that people like Trump take advantage of, and that is the 'race suicide' theory that was so popular among the old Progressives and which justified everything from immigration policy to minimum wage laws. The theory goes that the lesser races or minorities, and women, tend to be hired by unscrupulous capitalists who don't want to pay 'living wages' to the more deserving and (ostensibly) superior Anglo-Saxon men. Minimum wage laws were expressively *designed* to screw these lower-class workers by increasing their cost artificially. The 'race suicide' theory is very akin to the 'race to the bottom' argument still favored by the Left which they use to justify their anti-free market arguments. The same logic is applied when it comes to free international trade which is made by protectionists, since the availability of cheaper goods would mean a lower level of wages for the superior Anglo-Saxons (i.e. whites) for the benefit of lesser races (Chinese, Vietnamese, etc.) The 'race to the bottom' trope is also used to justify imposing artificial limits on immigration, as critics tend to center their criticism on an alleged lowering of wages that immigrants provoke.
Thus the irony lost to the modern Left is that their chosen battles have an ugly racial background. Besides this, they live in a schizophrenic world where they fight for living wages while at the same time they rail against consumerism and exuberant materialism: they want wages for the poor so they can purchase goods which are killing the planet through global warming. It is quite telling that some conservatives, especially those who favor Trump's candidacy, share the same anti-laissez faire mentality of the Progressive Left.