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.”
You've yet to tell me why freedoms have limits. At least why the freedom to trade should have limits. The drug analogy is silly when the libertarians make it and it's silly tonight. It's silly because there is nothing productive that comes from injesting mind altering drugs. There's no compelling reason to do drugs. There's no compelling reason to possess child porn or molest children, yet there are libertarian factions that believe those activities should be allowed. Let me ask you this, do you think there should be a limit on rich someone can be?
Well, let's just remove such wonderful human traits as greed, lust, power, envy and revenge. Take all that out, and voila!, an instant workers paradise. Oh, that's right. No need to remove them. The world is basically a harmonious place. I keep forgetting.
Second, the division of labor can best be managed by private enterprise pursuing its own ends without being held accountable for any larger consequences.
And we all know international corporate executives can be trusted to be fair, just, even-handed and always do the right thing. < / sarcasm>
If policies don't change millions more high paying jobs are outta here, even the government admits to that. Coupled with massive illegal immigration it's a recipe for third world status.
True imo.
Also coupled with isolationism. As with The Roman Empire, the day we stop meeting the barbarians at the outside fringes [the front line] away from our homeland, will be the day they will begin to hit us harder inside, and eventually defeat us.
Bush's strategy of hit them where they are now, is ingenious. We can not afford to fight them on our own territory. By then it will be too late for our nation state to survive. [martial law, no more Republic, unrecoverable physical and systemic damage]
Pray to God in Heaven the moronic breeding machine cultures of our country do not gain the upper hand and elect a Rat to the Presidency. [sorry i wandered]
Free trade bump.
Rush, is that you?
And when the all assets are sold to the foreigners the dollar value will fall low enough to make foreign products and services too expensive for American consumers. Thats the way the market works man.
Just damn...
What gives private corporations the right to expect services from the government like police/legal/military protection, stable currency, taxpayer founded roads etc?
How about because they pay taxes just like I do. Corporations are not your private piggybank that you and your lib friends can confiscate for your socialist agenda.
I FULLY AGREE!!!
While my Father preached fiscal responsibility when I was a kid, it was not until I worked as a "Repo Man" upon graduating from college that I truly appreciated his economic advice . While I didn't spend long in that endeavor, I stayed long enough to see and, more importantly..., learn enough about self-induced economic misery to fully reinforce my Father's teachings...
Best "real world" educational experience I ever had!!
Really? If the citizens pay taxes on their income without deducting their living expenses, why the corporations deduct their costs? They should be taxed on the gross revenue same way as everyone else.
Wonder what sacrifices investors are making for the 'war effort'? Tax increases to pay for the war and protecting the jobs for returning vets before sending them the credit bill would be patriotic.
"Middle-class" used to mean the group of people whose paychecks pretty much met their needs --- who had to work for a living but could live with their income and even have a few luxuries and accumulate some savings. With the high debt many people are living in, I don't think they are really what you could call middle class anymore --- they have the lifestyle and the few luxuries but they're unable to save and many are at the edge of financial disaster.
And some of that is the fault of our society --- people see status in things and that seems more common today than in the past. A $21,000 car that by the time they actually own it, they will be ashamed to be seen driving it --- and start all over.
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