[Tolerance Sucks Rocks]

No, I personally don't believe protectionists are Luddites, unlike the author, but I do believe protectionist policies will hurt small businesses and consumers by making imports more expensive.

[Pearls Before Swine]

The case against protectionism is based on the theory of comparative advantage.

Mathematically, that theory is hard to refute, unless there is something wrong with the assumptions, to wit:

- Free mobility of labor
- Costless and easy retrainability

I don’t think either of those things are always true. If you’ve been trained to do a job for 25 years, settled in an area and have a family, it isn’t going to be easy for you to relocate, and it may not be cheap or quick to retrain you to a new skill. Further, that new skill—which will be in the areas which would have comparative advantage going forward—may not be immediately evident.

If the users of the theory incorporated some of these issues—which show up as socialized costs—into the cost of the items being made, I think that sometimes protectionist policies, or at least a multi-year taper into the new production regime, would be cheaper. The displacement costs are never considered, it seems to me.

[marron]

You may assume that the centerpiece of a protectionist policy is the tariff. The tariff is just the blunt object meant to enforce the overall agreement.

The most important piece isn’t protectionist at all except in spirit, which is to address the reasons companies leave. In a world of automated manufacturing, wages aren’t the key issue, the regulatory and legal climate is. Go after the reasons companies leave, clearing away the regulatory threats and hurdles and companies are less inclined to leave. Working in Mexico or China carries with it another set of problems that you wouldn’t choose if you didn’t have to.

The other part deals with the target country’s own protectionist policies, opening them up to your products. That is something that has been ignored until now. A lot of these countries have hidden tariffs that keep our products out, while our markets are open to them.

When Trump talks about making the markets fair, people just hear “tariffs” and “protectionism” but don’t hear the details which are quite free-market.

Another thing to remember, is that the economy isn’t healthy if you can get it cheap at Walmart, but your brother-in-law is living on your couch because they closed the factory here.

[ctdonath2]

“labor-saving innovation rather than trade is overwhelmingly responsible for the loss of manufacturing jobs.”

And that labor-saving innovation birthed by the necessity of productivity made illegal by ill-advised “minimum wage” laws.

[Stingray51]

The author does not mention taxes or regulation (labor, trade, etc.) of any kind. Yet both (vast categories each) are critical to comparing the costs of manufacturing between locations.

[Alberta's Child]

There's a lot of truth to what the author says, but he overlooks a very important point. What we have come to accept as "free trade" in this country has basically become a mechanism for getting around legal, moral and regulatory issues here in the U.S. that prevent us from operating the same way our trading partners do.

For example ... we don't hesitate to take on trading partners whose industries operate under environmental standards and using employee pay scales that would be illegal here in the U.S. Am I really a "protectionist" if I recognize the stupidity of outlawing slavery here in the U.S. while trading with countries where it is (for all practical purposes) a common practice?

[allendale]

The only thing virtually certain in economics is change. There will always be innovations, declines, new or depleted resources and these changes will inevitably cause disruptions to people who had been previously content and comfortable. Either you adapt, or you live with what wealth you accumulated or receive from generous people. Whether it be nations or individuals, everyone is subject to inevitable changes and shifting comparative advantages. Protectionism is a losing strategy. Innovative, free thinking, unhindered capitalism creates the wealth and the social justice that follows. The degree of social justice in any culture correlates directly with the wealth that culture generates. Trump will be successful if he unleashes capitalism rather than trying to “protect” it.

[Just mythoughts]

Minimum wage set by government is a protectionist policy. Rag on that policy. These so called ‘free trade’ deals have created a welfare class.

[Iron Munro]

This is misdirection and half truth.

Note that the population if 1977 was about 220 million compared to the population today of 324 million.

That is a population increase of 47%.

As shown in this chart, manufacturing jobs in 1977, comprised about 22 percent of all nonfarm payrolls.
But manufacturing jobs today only comprise 9% of nonfarm payrolls.

That is only 40% of the 1977 level.

So not only has the population gone up by 124 million, the percentage of the working population engaged in manufacturing is less than half of the 1977 level.

Certainly automation plays a major role, but all of those cars, trucks, tractors, electronic devices, appliances and garments coming here across borders and oceans didn't manufacture themselves in totally automatic factories.

[chajin]

Protectionism in the 2010s is a reaction, not to global trade, but to the mercantilism of many if not most of our major global competitors. For example, if we could meet China on a level playing field, we could clean their clocks; it is only because China is a pseudo-Marxist nation parading itself as free market that it gets away with what it has. (Bribing the Clintons didn't hurt either.)

There is also one other aspect, which is a catch-22 of sorts. Technological innovation has made it such that, in any developed society, there is for all practical purposes no poverty, as poverty has been defined throughout human history. As Robert Rector has pointed out on numerous occasions, 'poor' people in America have lifestyles very similar to the rest of America, with housing, food, and clothing, along with access to the commonplace technology, everything from radios and TVs to microwave ovens and refrigerator/freezers to the internet, smartphones, and video games. Historically, the disincentive to poverty was its life-crushing aspects of hunger, nakedness, and the cold (or heat), but that is no longer the case in any of the developed world.

In such a cornucopia world, there are only two incentives to work and succeed: to have *better* goods and services (bigger houses, newer cars, designer clothes, faster internet), or an ingrained work ethic. But an ingrained work ethic only "works" where there is work to be had, and global mercantilism has taken away much of that opportunity-to-work, which is why some level of protection is necessary. Just how much is anyone's guess, and if history is any indication we will go too far in the protectionist direction, just as we went too far in the globalist direction, but where we are is untenable.

[Vaquero]

When dealing with protectionist nations, leverage is needed to even the playing field. This can work as a threat or if the nation is not budging on their stance, then real action is necessary.

[JPJones]

“Trade by its very nature is labor-saving. I could bake my own bread with my own hands and my own pans in my own kitchen. “

No you can’t. This article conveniently leaves out all the ridiculous regulations, fees, and taxes that shut down thousands of factories and prevents new ones from forming.

Free Traders are essentially Marxists.

[Tax-chick]

I agree with you. The author is talking apples and oranges.

[Mariner]

I guess the founders and every generation that followed them until 1945 were Luddites.

[Pollster1]

Protectionism is not as simple a debate as the purists would like it to be. In theory, free trade is good, but consider steel as just one example:

Suppose the rest of the world modernizes their steel foundries, so that Chinese steel is not competitive, but China can subsidize steel workers for a lower net cost than they can support unemployed former steel workers. China then dumps this cheap steel on the global market to recoup some of the costs of subsidizing those workers to keep their jobs. Ignoring the quality issues with most Chinese steel, should we take advantage of the cheap Chinese steel, to lower consumer costs here, and accept the lost steel jobs in America?

I see some manufacturing jobs, particularly the low-end garment industry, as permanently gone, as they should be. I see other manufacturing jobs as recoverable, and some of those should be returned to the United States. Protectionism is a tricky question based on practical considerations and sometimes subtle details, not just abstract theory.

[Gaffer]

“Luddites” Way to go Mr. Boudreaux! How to win friends and influence people. He is partially right about advances in technology and innovation leading to increased production but that isn’t the whole of the story.

Further, his analogy of two means of auto production - Detroit (simplistically) and Iowa (grain) - where the grain goes out on ships and comes back on cars is also rather Ludd-ish in nature. It neglects taxpayer subsidies to corporations, entitlement payments to displaced potential autoworkers, and a host of other things.

It’s nice to sit on your keester in a college or university and wax professorially about how the manufacturing world works but the waxing would carry more weight if he ever manufactured anything but words and papers published.

[RFEngineer]

“No, I personally don’t believe protectionists are Luddites, unlike the author, but I do believe protectionist policies will hurt small businesses and consumers by making imports more expensive.”

Let’s just get it out in the open - this is just another article trying to underscore the “Trump is soooo stupid” meme.

Let’s define “Fair Trade”. In my opinion, this is where two countries trade with roughly similar bilateral regulations/limitations.

Sanctions on countries with whom we do not have “Fair Trade” are the only lever we have to achieve “fair trade”, so - let’s remove the “Luddite” moniker from policy with that aim. That’s my read on Trumps trade objective.

Now, lets accept that US regulators put unreasonable demands on domestic production - and lets, for the sake of argument/discussion posit that the regulations are for the “good” of everyone. Shouldn’t foreign producers also be subject to such “goodness”? If not, remove the “goodness” from domestic producers.

No, this article is all about proclaiming the intellectual superiority of all things anti-Trump. Labeling Free, fair trade as the stuff of Luddites is all about the “Stupid Trump” meme that is the last rampart of globalist/big government types that are the only Luddites to be seen on trade, and just about every other issue.

[odawg]

“...but I do believe protectionist policies will hurt small businesses and consumers by making imports more expensive.”

But it is nice to have a job in order to purchase anything. And you will notice there is no reduction is cost for most items by American companies for items made overseas.

The author still cannot find it within himself to factor into his delusions the fact that American factories have moved out of the country and taken jobs with them.

Ford had intended to take a factory out of the country, which requires employees to operate.

Mexico did not like the fact that Ford canceled its plans for the plant in Mexico. Wonder why, since, in the professor’s world, where the jobs and factories are located matters not one wit. Maybe he should go to Mexico and tell the upset people down there to chill.

Colleges have professors that teach on the internet now. I wonder what he would think if his job were outsourced to an economics professor, say, in India.

[central_va]

This is silly.

The author is committing journalistic malpractice. Luddites are against automation, protectionist are against off shoring. The two things are not related. In the former case jobs are lost to robotics which is good thing in the long run but as long as the factory remains in the USA. In the latter case, jobs are lost due to transfer across international borders which in fact prevents automation because cheap 3rd world labor is still better than spend millions on robotics.

Basically the author is full of < expletive deleted >

[DesertRhino]

And yet, manufacturing jobs have exploded in Mexico and China some 1977, and their products are sent here, deflating his globalist argument.

[TADSLOS]

“Free” Trade doesn’t mean Fair Trade. Free traders have the same unicorn mentality as the left does about building utopia.