Posted on 03/02/2004 3:55:47 AM PST by ZeitgeistSurfer
1) US tariffs invite retaliation.
2) If not the WTO, some organization would need to be created to negotiate lowered tariffs. .
3) Tariffs are obstacles to commerce. (like any other tax) .
"Please restate the question, I don't understand what you are asking. "
How did the North prosper despite ultra cheap labor in the south? You say that creep labor in Asia will destroy us, but historically, we’re able to thrive despite it.
1) US tariffs invite retaliation. ... Yes they do, but remember very few of our trading partner are low tariffs nations. Most (Japan, India, China, EU) have high tariffs that are protecting their markets and their producers. That we have now is a far cry from free trade. But to your main point, yea, if we impose a tariff then we can expect others to do so too. And yea, world trade will suffer. But as long as the tariffs aren't to high then the effects will not be all that bad. Remember we were a high tariff nation up until the 60's or 70's and did just fine.
2) If not the WTO, some organization would need to be created to negotiate lowered tariffs. . ... Absolutely correct, if we want a level playing field in trade then some kind of world government will have to have the power to impose a level playing field. This is one of the things that I most fear, a world government.
3) Tariffs are obstacles to commerce. (like any other tax). Correct again, (you are getting better) but taxes are a fact of life, tariffs make importer pay for the cost of the federal government. I kinda like that, the jewel of the world is the American market, why shouldn't the rest of world have to pay a price to partake in it? And remember I want to use tariffs NOT the progressive income tax to fund government so for you and me this is a win/win/win. We keep more of our money (no income tax), foreign manufacturing pays the cost of our government, and the size of government is limited to only what a tariff can support.
How did the North prosper despite ultra cheap labor in the south? You say that creep labor in Asia will destroy us, but historically, we’re able to thrive despite it.
Somehow I keep thinking that I have answered this question but for some reason you are not understanding. I'll try again, the north did not use the labor of the south directly, like todays corporations use out sourcing, yes they benefited indirectly with cheap cotton and cheap tobacco but that's about all. The northern states were not slave states and the people of the north would not "out source" to the south. They had a moral objection to slave labor. Remember in pre civil war America they were no corporations, no board of director to hide behind. No stock holders demanding higher returns on investment. In those days the owner of a business was the owner of a business and was held to the same code of conduct that was expected of ordinary citizens. Using slave labor to produce a product for sale in the north was unacceptable, and would get the individual that did it run out of business.
Everyone thinks they have a jewel. India thinks their refined English speaking middle class willing to work for $1000 a month is a jewel. We think our market is a jewel. And as people respecting liberty, we realize that two jewels left to their own, to work and trade in freedom find a way to become much more than just two.
"I want to use tariffs NOT the progressive income tax to fund government so for you and me this is a win/win/win. "
Surely you don’t think there would be income tax reductions proportional to any new tariffs. I’m sure government would use tariffs and the progressive income tax for funding. Oh great, another revenue source. Thanks!
"Using slave labor to produce a product for sale in the north was unacceptable, and would get the individual that did it run out of business. "
As much as I’d like to find a Clean answer like the one you suggest, this does not explain the labor imbalance.
There’s no evidence that business in the North refused to trade with the South. No evidence that widgets produced with cheap Southern labor were refused. Yet there it was, as you say, cheap labor just south of the border for more than half a decade. Not just cotton and tobacco, any crop could be produced by Slaves. Those were just the big money crops. Yet despite farming employing most of the population, cheap Southern labor did not ruin the economy of the North. And because both people were Americans, there were no tariffs. If cheap labor in the South was really dangerous to the North’s economy, the North would have failed. But the North’s economy surpassed that of the South. Why is that?
It’s because humanity is at its most productive when it is educated, cooperative and free. We’re not the strongest species. Horses make much better slaves. They pull a plow with much more endurance than us. India and China have many more people than us. Chinese suffer from fascist oppression, and Indians from a backward ignorant culture.
Both have billions who are willing to climb up a mountain of broken glass for a chance at a better life, for hope. But protectionists here want to deny them that. They deny them that through tariffs, with the objective of achieving some kind of wage equality. As if IBM, or Bell South would open an office in India if they had to pay them $15 per hour like here. Protectionist ensure that there will never be opportunity there.
We have an entrepreneurial culture, efficient utilities, advance cities, effective government, adjacent industry, universal education, rapid transportation and high technology right in the middle of the jewel that you speak of, the American market. We have the greatest advantage in the world, worth much more than some 20% labor rate on the opposite side of the world. Paying a programmer or accountant $1000 a month may be advantageous for some well defined tasks that require lots of people, but the cost of managing them far out way any cost saving when tasks change, relationships are strained, departments are interdependent, people float though positions, and cross training is necessary.
India may take a percent of our high tech, but nowhere near the majority. I read a recent report, by Gartner I think, that said that 10% of IT would be outsourced by the end of the decade. 10%. That’s not a threat. No telling how much more competitive that makes our businesses to those in other nations. Other nations who outsource their repetitive tasks. No telling how much we’ll sell to India. No telling how many barriers they’d put in our way if we prohibited them from doing business with us through high tariffs. But that’s the nature of freedom, liberty, and capitalism. Despite people’s attempts to regulate it, capitalism has a life of its own, and there’s no telling what it will produce.
Our Constitution does not direct us to equalize wages through tariffs. India is not our enemy.
I've been through business school (MBA) and one of the things I learned is that outsourcing your core competencies is a path to business failure. Since the pay of the CEO isn't tied to anything but short-term profits, why should they care if the company goes downhill in the long-term?
These CEO's kow exactly what they are doing. Lining their own pockets at the expense of their fellow citizens and their own stakeholders.
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