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Yes, there are losers, but we all gain from free trade
Indianapolis Star ^ | 14 January 2004 | Peter Z. Grossman

Posted on 01/14/2004 8:29:38 AM PST by Viva Le Dissention

Edited on 05/07/2004 6:27:02 PM PDT by Jim Robinson. [history]

There is one subject that truly separates professional economists from everyone else. Nearly all economists -- conservatives and liberals alike -- agree that free international trade is good, and the freer you make trade the better. But polls often show the public at large supports trade barriers.


(Excerpt) Read more at indystar.com ...


TOPICS: Business/Economy; Editorial; Foreign Affairs
KEYWORDS: freetrade; nafta; tariffs; trade
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To: Viva Le Dissention
This will be a quick post in advance, because I have to run--but I agree with you that corporations do not have a right to cheap labor, but they DO have the right to bid for labor in the market without any governmental restrictions.

When the government steps in and says that certain labor is "off-limits" in the labor market, it side-steps laissez-faire economics in favor of a model that creates inefficient markets and waste.

The main restriction that the government puts on labor is that thingy called the border. Since the federal government does have the enumerated power [To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;] and

To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;]

, and duty...

[To provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and repel Invasions;]

...to protect that border, employers don't have an absolute right to bid for labor in the market free of governmental restrictions.

Labor is a good, just like steel, subject to laws regulating commerce between foreign nations. If the congress simply does it's duty and regulates commerce and establishes uniform laws of naturalization, we can throw the illegals out, thus necessitating employers to bid for labor at American market value.

Get rid of minimum wage and seal the borders.

Vote Tancreo in 2004.

101 posted on 01/14/2004 1:26:16 PM PST by Jim Cane
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To: Protagoras
I have paid tariffs directly many times.

What are the tariffs? What are the rates? As a businessman it should be easy for you to put down some solid examples.
102 posted on 01/14/2004 1:27:45 PM PST by hedgetrimmer
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To: Cacique
ping
103 posted on 01/14/2004 1:28:24 PM PST by nutmeg (Is the DemocRATic party extinct yet?)
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To: hedgetrimmer
There are many people in this country who would like to set up the same sort of for-profit-penal-system here. I am not one of them.
104 posted on 01/14/2004 1:32:02 PM PST by sixmil
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To: hedgetrimmer
Irrelevant questions do not interest me. My personal experience matters not to the concept. I care about concepts and ideas.

If you tell me where this is going it might be interesting.

105 posted on 01/14/2004 1:32:35 PM PST by Protagoras (When they asked me what I thought of freedom in America,,, I said I thought it would be a good idea.)
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To: Viva Le Dissention; sixmil
If someone is willing to perform a job, at the same level of quality for a lower price than someone else, why shouldn't I, as an employer, hire that person?

As long as that person is in compliance with U.S. laws, including UNIFORM Rules of Naturalization as proscribed by the Constitution, then nothing.

But...

If Canada can manufacture drugs more cheaply than US companies, why shouldn't I, as a patient, purchase that medicine?

If Chipirates can copy and sell Microsoft more cheaply than Bill Gates, why shouldn't I, as a businessman, purchase that OS?

106 posted on 01/14/2004 1:32:55 PM PST by Jim Cane
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To: Protagoras
The final cost of subsidies is borne by everyone. In many ways. Some of which are seeming invisable.
Are we talking about tariffs or subsidies, or do you believe they are the same thing? With respect to taxes, there is a world of difference between direct and indirect, so much so that our own Constitution specifically banned direct taxes without apportionment. Of course this was later amended, but the question remains: what has changed that makes it OK for the government to turn its subjects into personal tax collectors?

107 posted on 01/14/2004 1:37:32 PM PST by sixmil
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To: Protagoras
Your personal experience matters a great deal since it evidently is being used to formulate your opinion on the topic. You should be able to pull from it for your discussions without qualifying the answer for information from someone else.

So, tariffs on what products and what rates?
108 posted on 01/14/2004 1:39:06 PM PST by hedgetrimmer
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To: hedgetrimmer
"Even though the American people grant them their charters for their corporations, give them tax breaks for R&D, give them 100% insurance coverage if their business in a foreign(communist) country fails(OPIC), give them low interest loans and other incentives to move off shore(INF)protect their interests overseas with the US Military. Protects their intellectual property rights with our legal system."

Well said, and a hat-tip to you. This is an argument I have been making in other fora. There is a 'tragedy of the commons' effect at work, whereby each company's decision looks correct on the profit/loss ledger, but degrades the 'commons': our legal, political, and econonomic infrastructure. There are externalities to each decision made which may not be small enough to be overlooked.

109 posted on 01/14/2004 1:40:15 PM PST by NukeMan
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To: Jim Cane
If Canada can manufacture drugs more cheaply than US companies, why shouldn't I, as a patient, purchase that medicine?
Damnit Jim, you're not supposed to ask questions like that! Free trade is not really about saving consumers' money, it is about saving money for producers. That is the direct benefit, and you are supposed to be happy with your indirect theoretical beneift whether it materializes or not. So, how can you too directly benefit from free trade? Become a shareholder and hope you do not get screwed by the board.

110 posted on 01/14/2004 1:47:35 PM PST by sixmil
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To: Viva Le Dissention
Read later.
111 posted on 01/14/2004 2:12:44 PM PST by EagleMamaMT
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To: hedgetrimmer
Tell me about your childhood and how you relate to your wife and family, since that evidently is being used to formulate your opinions.
112 posted on 01/14/2004 9:12:03 PM PST by Protagoras (When they asked me what I thought of freedom in America,,, I said I thought it would be a good idea.)
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To: Protagoras
You say you're a businessman, you claim to pay tariffs, so which ones and what percentage were they?
113 posted on 01/14/2004 9:27:49 PM PST by hedgetrimmer
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To: x
And that is precisely the point, I am glad to know I am not the only one that sees it. I am no fan of Chuck Schumers but he and Paul Craig Roberts authored a document that outlines this problem very well. It is simply undeniable that we are working in a new model that has no historical precedent.

Todays economists are working on yesterdays assumptions.

In the past, labor and capital were largely contained by borders. Nations specialized in areas that other nations had a market for.

That model no longer exists for America.

The end result of the current old model thinking for most economists is that America becomes a third world country in about 20 years.
114 posted on 01/15/2004 6:32:00 AM PST by Pylot
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To: hedgetrimmer
You say your a human being, you claim to have been born, so which one of your parents was human?
115 posted on 01/15/2004 6:33:57 AM PST by Protagoras (When they asked me what I thought of freedom in America,,, I said I thought it would be a good idea.)
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To: Protagoras
Don't waste your time. Unless you scan an invoice with the word "TARIFF" in red lettering, hedgetrimmer will simply claim that tariffs don't exist, and that you are unqualified to discuss them at all.
116 posted on 01/15/2004 6:55:02 AM PST by 1rudeboy
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To: Pylot
The end result of the current old model thinking for most economists is that America becomes a third world country in about 20 years.

Of course, people were claiming that 20 years ago.

117 posted on 01/15/2004 6:56:45 AM PST by 1rudeboy
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To: 1rudeboy
Don't waste your time.

One of the more inane posters I have encountered. More interested in a flame war than discussing the question. As if it matters to the subject how I formulated my beliefs and the details of my business life.

118 posted on 01/15/2004 6:59:13 AM PST by Protagoras (When they asked me what I thought of freedom in America,,, I said I thought it would be a good idea.)
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To: Viva Le Dissention
We get more goods at lower prices than we could possibly get in a world of high barriers to trade. As a result, the standard of living of every consumer is higher since each dollar, euro, peso and pound buys more.

But aren't there losers? Yes, there are losers: firms and workers in some import competing industries. There's no doubt that trade hurts those who can't compete.

What BS. I am for free trade, but this is stupid. Its like talking to a brick wall with these people.

America needs free trade...on a selective basis. Emphasis on the "selective basis".

Almost all of corporate America are in some ways big losers when we try to be everything to everyone. We should by all means have free trade, but we should also discriminate against certain countries on a case by case situation by situation basis.

If I were to describe our current economic funk, it is brought on by trade. Yes.

I have been saying it for years and months.

When we let whoever come into our markets, we end up with several negatives. First off the fact that prices are SO low is a negative. Corporate profits shrink right along with it. Employment drops and hence the market for goods shrinks. Because those jobs are exported overseas, companies have to fight massive trade barriers for people to buy their goods.

Any idiot knows the CRUX of free trade for us is not cheap labor but supposedly foreign markets.

Trade as it stands creates a net negative witching effect. Corporate profits shrink and they have to fight like hell to sell things here. They REALLY have to fight like hell to sell things elsewhere. Employment in the consumer market drops especially as corporate profits shrink. This draws profits even lower.

Its true, but hey, there is this ideological thing going about trade. Its more ideology than reality. At some point the cylce must break.

At some historic points argument of bigger and better jobs has applied, but not always. Unfortunately our last bigger and better jobs turned into a massive pyramid scheme. In other words, the bigger and better replacement jobs are not there either.

We sold the farm for the internet and all its masses of over projected jobs and profits, and now we are without any of it. We built our house on a fad and overextended ourselves into 'trade' because of it. Now we have to figure out something.

1. What is going to now replace the internet as our next big fad driven boom?

2. If we can't think of anything then the current trade model and justification for our current style of trade is shot.

3. We also have to realize that our current trade model is sick. Us being everything to everyone while they shut us out is wrong and we should use our power to end it.

119 posted on 01/15/2004 7:01:00 AM PST by maui_hawaii
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To: Pylot
Every country that has risen from poverty to prosperity in the last 50 years has done so through expanded trade and global ties.

Damn lies.

In the 1920's and 1950's, the American economy boomed, and migration before and during those booms was at extremely low levels.

120 posted on 01/15/2004 7:09:47 AM PST by meadsjn
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