Three Cheers for Free Trade

The American Specator ^ | March 16, 2016 | Ross Kaminsky

[Cincinatus' Wife]

Donald Trump and his fellow liberals Hillary Clinton and Bernie Sanders are lambasting free trade as the scourge of the American working man. How odd it is that an economic activity so beneficial to almost every American, indeed to the vast majority of the human race, suffers such attacks with only half-hearted defenses raised by politicians who should know better and economists who do know better.

I stipulate: in trade, as in any economic endeavor, there are losers in the short run. Capitalism is, after all, fundamentally a system of creative destruction. But if there is any area of agreement among economists of all political stripes — a group among whom finding agreement is exceptionally difficult given their unique decision-making anatomy — it is that free trade provides large net benefits to the societies that engage in it, even if other nations do not lower trade barriers to the same degree.

Furthermore, the benefits of trade accrue in large measure to the lower economic echelons of society in an extension of Schumpeter’s profound observation that “the capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within the reach of factory girls in return for steadily decreasing amounts of effort.”

Allow me to offer a few quotes (emphasis added) from one prominent economist, at the time a professor at an elite university, who was lamenting the poor understanding of international trade in the United States:

[Greetings_Puny_Humans]

Kaminsky is stupid. Obama campaigned against NAFTA too, but then pushed TPP. Hillary was for TPP before she was against it, and even suggested she might change her position on TPP again later.

The Uniparty is all in favor of “free trade” because that is what the money interests demand, regardless of what they say to get elected. Cruz included. He campaigned for TPA, and only turned against it at the last minute.

[DoughtyOne]

Three cheers for 40 million out of work U. S. Citizens.

Hip hip...

Hey, wait a minute!

[Jim Robinson]

Yeah, I know. It’s only been 30 years of short runs and 19 trillion in debt.

[Mr Ramsbotham]

As I pass through my incarnations in every age and race,
I make my proper prostrations to the Gods of the Market Place.
Peering through reverent fingers I watch them flourish and fall,
And the Gods of the Copybook Headings, I notice, outlast them all.

We were living in trees when they met us. They showed us each in turn
That Water would certainly wet us, as Fire would certainly burn:
But we found them lacking in Uplift, Vision and Breadth of Mind,
So we left them to teach the Gorillas while we followed the March of Mankind.

We moved as the Spirit listed. They never altered their pace,
Being neither cloud nor wind-borne like the Gods of the Market Place;
But they always caught up with our progress, and presently word would come
That a tribe had been wiped off its icefield, or the lights had gone out in Rome.

With the Hopes that our World is built on they were utterly out of touch,
They denied that the Moon was Stilton; they denied she was even Dutch;
They denied that Wishes were Horses; they denied that a Pig had Wings;
So we worshipped the Gods of the Market Who promised these beautiful things.

When the Cambrian measures were forming, They promised perpetual peace.
They swore, if we gave them our weapons, that the wars of the tribes would cease.
But when we disarmed They sold us and delivered us bound to our foe,
And the Gods of the Copybook Headings said: "Stick to the Devil you know."

On the first Feminian Sandstones we were promised the Fuller Life
(Which started by loving our neighbour and ended by loving his wife)
Till our women had no more children and the men lost reason and faith,
And the Gods of the Copybook Headings said: "The Wages of Sin is Death."

In the Carboniferous Epoch we were promised abundance for all,
By robbing selected Peter to pay for collective Paul;
But, though we had plenty of money, there was nothing our money could buy,
And the Gods of the Copybook Headings said: "If you don't work you die."

Then the Gods of the Market tumbled, and their smooth-tongued wizards withdrew
And the hearts of the meanest were humbled and began to believe it was true
That All is not Gold that Glitters, and Two and Two make Four —
And the Gods of the Copybook Headings limped up to explain it once more.

. . . . . . . . . . . . . . . . . .

As it will be in the future, it was at the birth of Man —
There are only four things certain since Social Progress began: —
That the Dog returns to his Vomit and the Sow returns to her Mire,
And the burnt Fool's bandaged finger goes wabbling back to the Fire;

And that after this is accomplished, and the brave new world begins
When all men are paid for existing and no man must pay for his sins,
As surely as Water will wet us, as surely as Fire will burn,
The Gods of the Copybook Headings with terror and slaughter return!

[fortheDeclaration]

These deals aren’t free trade, they are managed trade!

[amihow]

So silly. Tariffs serve multiple goals when used wisely.

Have watched the problem on the border since the ninties and have brokers in the family.

Trump is correct. NAFTA is a globalist tool to establish the NAU.

[Trumpinator]

If free trade worked as advertised this would not be happening in America right now with Trump or Sanders. It has been around for like 30 years or so we real world data to reflect on.

[Cincinatus' Wife]

Government regulations, lawsuit abuse, taxation - the march toward toward socialism and Big Government control and Crony Capitalism (the pattern of business going hat in hand and on bended knee - eventually moving beyond a Stockholm Syndrome relationship to bankrolling politicians for favored market status) have torqued free trade.

Who’s history foretells their willingness to change this?

Trump’s or Cruz’s?

I say Cruz’s.

[nathanbedford]

PRO HOC PROPTER HOC

In the predawn glimmering this morning here in Germany my neighbor's rooster stepped out, ruffled his feathers, puffed his chest, and let go with a cock-a-doodle-doo (although I'm told they do it differently here in Germany, at least the Germans have a different onomatopoeic for it). Shortly thereafter, the sun rose. Satisfied, our rooster retired to the henhouse no doubt with the intention of rendering the hens equally satisfied.

The question is not whether the American economy in certain sectors have been harmed coincidently in time with trade agreements but whether there is data which demonstrates cause and effect.

Even when cause-and-effect are demonstrated in certain sectors, the next question which must be addressed is whether, on balance, the whole economy has been advantaged or disadvantaged by these trade agreements. To answer these questions we must have resort to more than the bombast of Donald Trump, we must actually see data.

And when we make these judgments we must ask ourselves are we advantaged or sometimes disadvantaged by our own protectionist measures? Is the American consumer advantaged because a very few families in Florida are in effect subsidized by the American consumers for growing sugar cane? Donald Trump tells us that our problem is that we make "stupid" deals because our negotiators are "stupid."

The reality is that some sectors are sacrificed by our trade negotiators to advantage other sectors. This is not stupidity but cupidity. When Donald Trump enters the picture we will have a different brand of cupidity but that does not make him smart.

Finally, we should ask ourselves whether the fault lies with the trade agreements or with the sweep of technology and the span of globalization. IBM today as literally tens of thousands of Indians sitting before computer monitors in India doing IT work for American and European companies. They are getting in salary a fraction of what it would cost to put an American in front of that computer monitor. It might well be that your next x-ray will be read by a physician in India instead of a doctor in America.

We should ask ourselves whether our educational establishment, our regulations, our tax policy, our intrusive environmental bullying are more responsible for the weakness in the American economy than the trade agreements. We should ask whether those deficiencies can be repaired by "smarter" trade agreements? Above all, we should have resort to data rather than bombast to answer these questions.

[Jim Robinson]

I’ll let someone else point it out to you.

[donna]

If free trade is so good how come China poisoned our dogs?

[Jim Robinson]

Yeah, I know. It’s always best for us peons if we allow politicians and governments to pick the winners and losers among industries. Government of, for and by the elite. Please pass the peas.

[Read Write Repeat]

“Trade should be debated in terms of its impact on efficiency, not in terms of phony numbers about jobs created or lost.” - Paul Krugman, 1993

I’ll text this to my husband as he boards a plane to India where he will train double the amount of Americans his company laid off.

[nathanbedford]

I would certainly prefer Donald Trump to pick winners and losers instead of the likes of Barack Obama who will exploit TPP to implement radical leftist domestic policies many of which have little to do with trade or economics. But let us not kid ourselves, if Donald Trump is making these choices it will still be an elitist imposing his values on us except that Donald Trump will tell us that his values are "smarter."

There is no indication that he will come to the people with data and inform the electorate.

[Cincinatus' Wife]

What you said.

bttt!

[Read Write Repeat]

Who’s history foretells their willingness to change this?

Trump’s or Cruz’s?

I say Cruz’s.

A lawyer and lifelong politician. Pretty sure a lot of those got us into this mess to begin with. I guess you'll call him a community organizer next.

[monocle]

Free trade theoretically has its merits. But when free trade is coupled with ill-conceived legislation and regulation a country’s workers pay the price. Furthermore, when free trade which is also fair impairs the viability of industries vital to the national defense, free trade must move to the rear of the bus.

[toddausauras]

Because trade is going so well for us. Even when I was a kid I new Nafta was fishy.

[Jim Robinson]

We’re going to pay the tax. Whether it’s in the form of tariffs or welfare checks for the unemployed, we’re going to pay it. But there’s a lot more damage done to society if it’s welfare checks vs paychecks.

On the other hand, they’re not raising the tax, they’re raising the national debt. But there will be a day of reckoning on that bubble.