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Economic Rivals Given “Go-Ahead” to Destroy Rest of Domestic Manufacturing by Bush’s Stand on Trade
Trade Alert.us ^ | 1/30/04 | William Hawkins

Posted on 01/31/2004 2:47:00 PM PST by madeinchina

In his State of the Union message, President George W. Bush devoted only a single sentence to international trade: “My administration is promoting free and fair trade to open up new markets for America's entrepreneurs and manufacturers and farmers -- to create jobs for American workers.” With the country facing another record trade deficit around $500 billion, the dollar losing between 20 percent and 40 percent of its value against other major currencies in the past two years, and some 3 million jobs being lost in the manufacturing sector since 1997, the trade issue deserved much greater attention. Indeed, the Bush Administration had unveiled a new Manufacturing Strategy only days earlier. But failure to call for Congressional action to implement the new strategy enhanced perceptions that the White House was not really taking the issue seriously. Consider the use of the empty phrase “free and fair trade.” Not since the Portuguese inaugurated the modern global economy by shooting their way into the Indian Ocean to grab control of the Asian spice trade five centuries ago, has anyone been successful by an adherence to “free and fair trade.” Instead, they have played to win by using every advantage they could find or create. No one wants a “level playing field” if they can gain a “home field advantage” tilted in their favor. Indiana University professor William R. Thompson has spent his career analyzing international competition in all its forms. He has found that “waves of political leadership, order and large-sale violence [are] closely linked to processes of long-term economic growth.” Yet, he has observed that among too many analysts and policymakers “this set of activities remains underappreciated despite its close links to some of the most vicious wars of the past half-millennium and the political-economic restructuring that occurred in the midst and the aftermath of these contests.” This lack of interest is certainly evident among top U.S. decision makers. The idea that trade should be “free” of government involvement or simply made “fair” without concern for the outcome, implies that either trade is of too little consequence to require state supervision – a clearly disingenuous and thus untenable position, or that private “market” results will automatically provide the best outcome for society. It is this last notion about a benevolent “invisible hand” that has paralyzed U.S. policy. It is the wishful thinking of liberalism masquerading as theology. It has two basic tenets. First, the world is basically a harmonious place where conflict can be avoided by a mutually beneficial division of labor that integrates the world. Second, the division of labor can best be managed by private enterprise pursuing its own ends without being held accountable for any larger consequences. The noted realist thinker E. H. Carr demolished the harmony thesis by observing that the division of labor seldom creates a world of equals. Instead, there are “haves” and “have nots” or as foreign policy experts denote them, “satisfied” and “unsatisfied” powers, with the latter group bent on overturning the status quo in order to improve their place in the world. This unequal division is revealed in the classic example used by David Ricardo to teach the principle of comparative advantage: the cloth-wine trade between England and Portugal. In this example, the Portuguese should accept England’s lead in the industrial revolution, which in Ricardo’s day was best represented by the mass production of textile goods, and be content to export wine to pay for imported manufactured items. Portugal should not seek to industrialize itself to compete with England. This lesson quickly earned the title “free trade imperialism” as it would condemn Portugal, or any non-industrial society, to subservience. It should be recalled that one reason the American colonies revolted against England was that they did not like their assigned place in the imperial division of labor. The independent United States became an industrial competitor of the British Empire and eventually surpassed it. Reports from the recent World Economic Forum held in Davos, Switzerland indicate that a host of powers are working in the same way to undermine America’s economic leadership and overthrow its status as the only global superpower. Zhu Min, general manager and economic adviser at the Bank of China, predicted his country will become the main challenger to U.S. economic power, surpassing Japan to become the world’s second largest economy by 2020. Russian Finance Minister Alexei Kudrin said his country “has economic potential comparable with the United States.” Brazil is also making a bid. It led the block of developing nations in opposition to the U.S. agenda, bringing to an impasse the Doha Round World Trade Organization talks. Under left-wing president Luiz Inacio Lula da Silva, Brazil is forging closer ties with China. And India’s leaders are very sensitive to any implication that they are not keeping up with the ambitions of the other rising nation-states. Thompson’s research shows that “commercial challenges are aimed immediately at the leading commercial power.” In today’s case, that means the rich American market is the target, and domestic American firms are to be swept away in the struggle for economic dominance. Private firms are unable to meet this challenge on their own. Domestic American firms cannot stand against overseas rivals backed by their governments, who use all the tools and tactics learned from centuries of trade warfare. Many of the largest “American” firms in leading industries now see themselves as being “transnational” and owing no allegiance to the United States. This means they have been easy converts to the mercantile strategies of the rising states. Washington needs to take action to rein in these global mercenaries and channel their energies back to the advancement of American economic preeminence. In his study The Emergence of the Global Political Economy, Thompson warns of the cost of inaction: “If the declining leader’s deteriorating position accelerates due to its own choices, perceived vulnerability will increase and so, too, will the scope of the challenger’s attack.”


TOPICS: Business/Economy; Editorial
KEYWORDS: economicrivals; manufacturing; stateoftheunion; trade
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To: jayef
Do you really think de-industrialization is a good idea? Why do we have to tolerate their protectionism. Don't you think the 3 nations I named are protectionist, to our detriment? If they want to keep selling here then they must start buying from us. What's wrong with that? I believe in fair trade. I think there's an undeclared trade war against the U.S. and we should fight back. We always win when we fight, so let's win now.

BTW, I think a lot of statistics are, if not phony, then wildly inaccurate. This is not a disinterested, unbiased group we're talking about. This is a political agency with an agenda, which is to put the president's trade policy in the best possible light. Unfortunately, the policy of this president and all presidents is to export as many industrial jobs as possible, as fast as possible. If you tell me that's not the policy, then I'll tell you that that's what is happening anyway. Something has to be done.

The trade deficit is not an empty number, and it's probably worse than they say.

161 posted on 02/01/2004 12:07:04 PM PST by Batrachian
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To: ClintonBeGone; WayneM
You've yet to tell me why freedoms have limits.

Because there is this thing called "Right & Wrong". If your definition of "freedom" is expressed with the phrase "every man does what is right in his own eyes", then you have anarchy. If you are an anarchist, then there is no point in reasoning with the insane and delusional.

At least why the freedom to trade should have limits.

Because "Free Trade" is a Utopian fantasy. It defies clear definition so that it is utterly impossible to implement. It is made up of selfish, materialistic and power seeking men who would just as soon use treachery and deceit than honest hardwork and creativity. Water seeks the path of least resistance, and so do those engaged in trade. If I could spend a lifetime to acheive a certain measure of prosperity under the guise of cooperative and honest "free trade", or I could achieve my material, financial, and power goals in one year of backroom deals and cheating; guess which one wins out? For "Free Trade" to actually work, each and every participant must want and value "Free Trade" more than any other lust or felt need. Only the invincibly naive and ignorant would feel that such an environment is begging to be formed.

162 posted on 02/01/2004 12:14:32 PM PST by Dr Warmoose
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To: Dr Warmoose
Because "Free Trade" is a Utopian fantasy. It defies clear definition so that it is utterly impossible to implement. It is made up of selfish, materialistic and power seeking men who would just as soon use treachery and deceit than honest hardwork and creativity.

Words like these can only find germination in the mind of a selfish, lazy government or union worker who's never tasted the slighted success. No one who has ever worked an honest day in his life would share such thoughts as yours.

163 posted on 02/01/2004 12:19:56 PM PST by ClintonBeGone (<a href="http://www.freerepublic.com/~clintonbegone/">Hero</font></a>)
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To: InABunkerUnderSF
The free trade policies of the 1980s did NOT include "free trade" with countries that were trying to destroy us. Reagan embargoed the sale of virtually all high technology to Russia, China and the Warsaw Pact countries.

If we were to follow his lead today we would still have embargoes in place with China and most of the Middle East.

This needs repeating.

164 posted on 02/01/2004 12:33:20 PM PST by LibertyAndJusticeForAll
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To: jayef
We had all of those things before 1913, why wouldn't we be able to have them now without income taxation?

But before 1913 we HAD taxation. It's just that most of the taxes levied by the federal government were in the form of TARIFFS. We can't have those today because of GATT restrictions.
165 posted on 02/01/2004 12:48:19 PM PST by InABunkerUnderSF ( Come down out of the clouds and watch the game)
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To: jayef
I can't speak for everyone, but for the things I know how to do, wages are falling. Engineering, construction, aerospace...

My peak earning years were in the early 80's, and it's been downhill ever since.

I was making $40/hr as a power plant engineer back then. Now they make closer to $10, if you can find any jobs.

I was making $22/hr as an electrician back then also. Now the rates are $9-$15, again, if you can find any jobs.

Maybe I'm living in a bubble, but I don't see any wages going up except lawyers and politicians.

166 posted on 02/01/2004 1:05:34 PM PST by snopercod (When the people are ready, a master will appear.)
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To: jayef; A. Pole; jpsb; Batrachian
Ummm, those agreements China sign to get to WTO status...those same agreements China then ignore to use slave labor, to use child labor, to loose 10,000 fatalities each month, to dump into rivers till people can not drink and Bejing disappear from sight of satellite for 3 months each year, to pay 27 cent per hour to worker with no compensation with arm lost or eye lost, to make all worker live in open bay shack or army to work half year for free in factories, that giant sucking sound you hear is the First World Economy going down toilet and your wallet emptying as you get bargans at store that you no longer afford do to no job or pay check.

But don't worry about vote, poor people vote left, very poor Vote Communist...US on way to personal Communist experience, one China trade deal at time.

167 posted on 02/01/2004 2:47:05 PM PST by RussianConservative (Xristos: the Light of the World)
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To: ClintonBeGone
I might say that your words could only find germination in the mind of someone whose only concern is with self.

If it benefits self, then it's OK, regardless of the harm it does to any person or worthwhile institution. Conversely, if it does not benefit self, it is of no value.

It is to be expected that such a mind would equate success solely with material possessions and power, and for such a mind to believe that anyone with a different set of values is lazy, idealistic, and dimwitted.

I suspect such a person would not have even the slightest grasp on the true concept of the word selfish, much as a sociopath cannot comprehend evil.
168 posted on 02/01/2004 3:02:28 PM PST by WayneM (Cut the KRAP (Karl Rove Amnesty Plan). Call your elected officials and say "NO!!")
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To: WayneM
If it benefits self, then it's OK, regardless of the harm it does to any person or worthwhile institution.

How does success in business, say, Bill Gates creating a computer operating system, do anyone harm?

169 posted on 02/01/2004 3:04:22 PM PST by ClintonBeGone (<a href="http://www.freerepublic.com/~clintonbegone/">Hero</font></a>)
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To: snopercod; RussianConservative
"I was making $40/hr as a power plant engineer back then. Now they make closer to $10, if you can find any jobs."

Not long ago I made a similar comment and was jumped on for being anecdotal. During that same 20 year period though, the cost of a new pickup truck has tripled, housing in our area has more than doubled, while the costs of microwaves and television sets has gone down.

Having grown up in the 50's and 60's and having started a business in the 70's and enjoyed the prosperity of the Reagan years, I find it insulting when people tell me real wages have gone up. Lies, damn lies and statistics.

Words once commonly associated with totalitarian and communist regimes are now all too common in corporate boardrooms, political conferences as well as many of these threads. The term "indoctrination" has now replaced "training and orientation". Twenty or thirty years ago we were referred to as citizens, not the third party "workers." The dehumanizing effect of substituting "workers" for "citizens" allows the chosen or elite to satisfy their desire to control. I find this very disturbing.

Although this trend has not yet effected me in a large way, it has effected my neighbors and family. I see a downward mobility. It is real and it is happening to us, as citizens and as a nation. I could choose to turn a blind eye and distance myself by claiming the workers need re-education. I would be a liar.

170 posted on 02/01/2004 3:33:15 PM PST by Ches
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To: gawd
gawd; would you have the numbers for the manufacturing job decline in Canada. Thanks
171 posted on 02/01/2004 3:51:42 PM PST by biffalobull
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To: WayneM
To: ClintonBeGone

...I'm beginning to suspect you are a rabidly, all-out free trader. Are you by chance a libertarian, also?

Hey! I resent that.

Some of us libertarians know that "free trade", as practiced, means unlimited access to the US market by foreign companies, with little or no reciprocity.

Some of us know that it isn't fair to US firms and their workers to make them conform to, and pay for, the myriad of rules, regulations and laws that go with operating here, while allowing free access to competing companies that produce in areas that impose no such costs (many in fact subsidizing those foreign companies' operating costs).

Some of us libertarians know that the true cost of an imported product must include the additional tax burden imposed on the taxpayer to support and re-train workers whose jobs are sent overseas.

Some of us libertarians know that liberty is more important than free trade, and that liberty can't survive without a strong middle class, and that the middle class can't survive without the manufacturing and engineering jobs we're sending overseas by the tens of millions.

Some of us libertarians can see that the structural changes to the economy, and the loss of whole industries, is different than the past transformation of US buggy-whip manufacturers into US auto manufacturers.

Some of us libertarians know that the real price of that expensive toyota or that cheap chinese TV set is this nation's future, and I'm one of 'em.

172 posted on 02/01/2004 3:56:57 PM PST by LIBERTARIAN JOE
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To: Reaganwuzthebest
With declining real wages there will be less consumer spending....

So true. Now that I took early retirement, I account for every dollar, and my spending is way down. It's a different ballgame now. Don't depend on ME to spend the economy to prosperity.

173 posted on 02/01/2004 4:00:16 PM PST by Ciexyz
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To: RussianConservative
But don't worry about vote, poor people vote left, very poor Vote Communist...US on way to personal Communist experience, one China trade deal at time.

You are right. It is actually funny how the lemmings cannot learn from history. At least we have an advantage that we know what is coming.

174 posted on 02/01/2004 4:13:34 PM PST by A. Pole (pay no attention to the man behind the curtain , the hand of free market must be invisible)
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To: Ciexyz
It's a different ballgame now.

Sure is. I don't think our economy will ever be the way it used to be. Many are now being forced to work two jobs to support themselves and their families.

175 posted on 02/01/2004 4:31:41 PM PST by Reaganwuzthebest
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To: biffalobull
gawd; would you have the numbers for the manufacturing job decline in Canada. Thanks

here.

176 posted on 02/01/2004 4:57:47 PM PST by gawd
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To: Reaganwuzthebest
source

• In the past 25 years, the number of families in bankruptcy has increased 400 percent, and housing foreclosures are up 350 percent.

• The average middle-class family can no longer buy a house without putting both husband and wife to work.

• Parents with young children are more than twice as likely to go bankrupt than any other segment of the population.

• More than 90 percent of those in bankruptcy would qualify as middle-class.

If these trends continue, the authors contend, more than 5 million families with children will file for bankruptcy by the end of this decade.

177 posted on 02/01/2004 7:04:13 PM PST by sarcasm (Tancredo 2004)
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To: gawd
gawd; would you have the numbers for the manufacturing job decline in Canada. Thanks

Thanks gawd, appreciate the help.

178 posted on 02/01/2004 7:10:01 PM PST by biffalobull
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To: RussianConservative
[But don't worry about vote, poor people vote left, very poor Vote Communist...US on way to personal Communist experience, one China trade deal at time.]

Do you mind if I quote you one this?

179 posted on 02/01/2004 7:52:03 PM PST by jpsb (Nominated 1994 "Worst writer on the net")
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To: Don Corleone
Ah, the "whale oil" argument.

Totally uninformed and deceptive--but some will buy it.

Wanna see 'whale oil?' How about H-P? AON? Motorola? Ford Motor? GE?

Yeah, whale oil.
180 posted on 02/01/2004 8:44:28 PM PST by ninenot (Minister of Membership, TomasTorquemadaGentlemen'sClub)
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