THE CASE FOR FREE TRADE

Hoover Digest (1997 No. 4) ^ | 1997 | Milton Friedman and Rose Friedman

[1rudeboy]

For you? Probably not. I am not in a head-long rush backward.

[underbyte]

Ha, yo got me. That's why I log on to free republic. I angry at the natioal direction.

Interesting that 1200(attending) outsourcing rally last weekend in CT. That's good number for CT,lots of anger in that one , If some Democrat were to run with a high emotional issue like Lieberman who is strong on defense they would give Bush a Run for the money

although for Lieberman to win he would need some speech therapy to remove the whine from his voice to be considered competitive

[1rudeboy]

No worries, friend. My position is that we should be making it easier to do business, and not trying to protect those businesses that already exist.

[narby]

And we are all far more in debt..

Heard the same argument 30 years ago. So when is the end-of-the-world coming?

I had $70k of credit card debt 6 years ago as the results of trying to start a business. I've since paid it off.

People have been attempting to generate crowds of follwers for centuries with end-of-the-world predictions. The economic end-of-the-world predictions don't impress me any more than the past predictions of planetary calamity.

[N3WBI3]

So lets see, you say free trade makes us the biggest economy in the world, I point out to you that were were the biggest economy beofre free trade. You have no explination for this..

[Willie Green]

How come none of you trade restrictionists want to answer the question about why restrictions are good around the US border. But not good around state borders?

I've answered it many times, narby. Where've you been?

Within our domestic borders, our domestic industries compete against each other on a level playing field, all subject to a common set of laws and regulations defined by the jurisdictional boundaries of our Constitution. Industries in other nations are not bound by those same constraints. Indeed, they seek to turn those regulations against us for their own profit. Why is it that you seek to undermine our domestic industries as well?

[american spirit]

Well if all your info comes from the basic network approved talking heads and other assorted "mediots" it's easy to see why you might have these conclusions. However, I'd suggest paying closer attention to even many FR threads that detail issues like the trillions of "unfunded fedgov liabilities" that are conveniently side-stepped by the politco's in budget discussions, huge corporations way behind in their pension funding, county hospitals on the verge of bankruptcy due to the strain of huge numbers of illegals streaming across the border with a number of maladies because they know us suckers will pay for their care, etc.

I'm a business owner and by nature a real optimist on many issues however we will someday pay a heavy price if issues such as debt, immigration, dissolution of of our high tech job base, etc. are not resolved and if you don't think it's a possibility then you haven't been paying attention.

[Willie Green]

And please, refrain from making the illogical and utterly laughable argument that "Karl Marx 'approved' of free trade, therefore Milton Friedman is a Marxist."

I don't believe that I've ever claimed that Milton Friedman was a marxist.
But if you wish to make that comparison, I won't debate against it.

As for Marx's attitude toward free trade, Engels explains it quite well:

If there is anything clearly exposed in political economy, it is the fate attending the working classes under the reign of Free Trade. All those laws developed in the classical works on political economy, are strictly true under the supposition only, that trade be delivered from all fetters, that competition be perfectly free, not only within a single country, but upon the whole face of the earth. These laws, which A. Smith, Say, and Ricardo have developed, the laws under which wealth is produced and distributed — these laws grow more true, more exact, then cease to be mere abstractions, in the same measure in which Free Trade is carried out. And the master of the science, when treating of any economical subject, tells us every moment that all their reasonings are founded upon the supposition that all fetters, yet existing, are to be removed from trade. They are quite right in following this method....

Thus it can justly be said, that the economists — Ricardo and others — know more about society as it will be, than about society as it is. They know more about the future than about the present. If you wish to read in the book of the future, open Smith, Say, Ricardo. There you will find described, as clearly as possible, the condition which awaits the working man under the reign of perfect Free Trade. Take, for instance, the authority of Ricardo, authority than which there is no better. What is the natural normal price of the labour of, economically speaking, a working man? Ricardo replies, “Wages reduced to their minimum — their lowest level.”...

Either you must disavow the whole of political economy as it exists at present, or you must allow that under the freedom of trade the whole severity of the laws of political economy will be applied to the working classes. Is that to say that we are against Free Trade? No, we are for Free Trade, because by Free Trade all economical laws, with their most astounding contradictions, will act upon a larger scale, upon a greater extent of territory, upon the territory of the whole earth; and because from the uniting of all these contradictions into a single group, where they stand face to face, will result the struggle which will itself eventuate in the emancipation of the proletarians....

~Frederick Engels, The Free Trade Congress at Brussels, October 9, 1847

[SouthParkRepublican]

"How come none of you trade restrictionists want to answer the question about why restrictions are good around the US border. But not good around state borders?"

Do you mean in the sense of "international commmerce" or "interstate trade"?

[narby]

Within our domestic borders, our domestic industries compete against each other on a level playing field,

In no way is the US a "level playing field". Try and make money growing a crop in New York City and make money after paying billions for the land. Try and start a software company that needs employees in Guymon Oklahoma. You wouldn't be able to pay enough people enough money to live there and still compete.

So, to make "fair trade" in the US, we would have to heavily subsidise crops grown in New York City so farmers there have a chance. And we would have to place tarriffs on software written in NYC to make software written in Guymon Ok competitive.

Get it?

[GraniteStateConservative]

I'm waiting for someone to ask at a WH newsconference why we shouldn't farm out our government to the Chinese or to India-- they'd do it for half the cost now. If it's good enough (and good public policy) for corporate America to do it, why not the government?

If we don't have a problem with countries being able to use their opposition to our foreign policy to jar our economy by cutting off supplies of goods or resources or to stop production on "war" parts that they produce, why not just hand over the DOD to foreign powers? It's all hypocritical.

[underbyte]

How about Tarrifs between towns?

With a USA 500 billion trade deficit it is not free.

What I would favor is something like this :

China Ships us 100 billion worth of goods but we can only ship them 50 billion. we lose 50 billion US wealth

Well after they ship us the first 50 bill. free we put a 100% tarrif on the second 50 Billion as compensation. Equal transfer of goods and money FAIR & FREE TRADE.

470 Billion US Goverment Deficit. 500 billion Trade deficit we just gave the goverment a surplus

[GraniteStateConservative]

We're all humans on this planet. Set us free.

We aren't all on the same side, though. Scorpions will sting you no matter how nice you are to them.

[N3WBI3]

If we are going to bring up history lets look at powerful nations that began to import more than they exported, Rome for example.

Empires rise and fall the US will not remain forever but I think we should try to prolong it...

[narby]

As for Marx's attitude toward free trade, Engels explains it quite well:

And Marx and Engels were the brains behind the worst economic failure of the 20th century, communisim. Anything they might say, pro or con about the issue of free trade is no better than toilet paper. They have zero credibility.

[Willie Green]

The United States had tariffs throughout the nineteenth century, and they were raised still higher in the twentieth century, especially by the Smoot-Hawley tariff bill of 1930, which some scholars regard as partly responsible for the severity of the subsequent depression.

LOL! It's really quite hilarious how Milton Friedman tries to shield his own reputation by attributing this blatant, political misinformation to "other scholars". And even then he tries to minimize the association with the use of the word "partly". He knows darn well that Smoot-Hawley had little, if any, effect on the Great Depression. International Trade constituted a negligible portion of GDP back then. And while Smoot-Hawley raised the tax of some items that were already on the tariff list, it actually expanded the number of goods that were permitted to enter our domestic market duty-free.

[underbyte]

"""I'm waiting for someone to ask at a WH newsconference why we shouldn't farm out our government to the Chinese or to India-- they'd do it for half the cost now. If it's good enough (and good public policy) for corporate America to do it, why not the government?"""




Good IDEA!!! We can start with the IRS and the Dept. of Education

[DannyTN]

"We have got to start Outsourcing these economists ASAP !!

LOL I with you!!! They don't produce anything but hot air anyway. And it's not even hot, more like tiped.

The reason people become economists, is they don't have the personality to become accountants.

[narby]

We aren't all on the same side, though. Scorpions will sting you no matter how nice you are to them.

Define "same side". You mean labor and management? You mean American vs Oriental?

Sorry, I will never buy that concept that government controls ever do anything positive over the long run. No matter whether you're talking about tax regulations or trade barriers, they're all bad.

Government needs to protect our streets, protect our shores, and get the h@ll out of the way. Free economic systems are always the best, whether between US vs. Japan, or Guymon Oklahoma vs. New York City.

[narby]

If we are going to bring up history lets look at powerful nations that began to import more than they exported, Rome for example.

Rome had plenty more problems than trade.