Clarifications on the Case for Free Trade

Ludwig von Mises Institute ^ | 4/12/04 | Paul Craig Roberts

[ninenot]

Why "Comparative Advantage" does not work in this world.

[ninenot]

Read it and weep. Roberts is NO leftist, as you can see from the credits.

He addresses the issue of "where does the money go" for you, toddster. And of "labor arbitrage" for YOU, narses (have you read Laborem Exercens yet?)

AmSpir--we are right.

Only problem: Roberts hasn't figured out a solution--yet.

[BrucefromMtVernon]

As Americans, we must learn some hard lessons from our insane experiment with so-called "free" trade. The pseudo-economic philosophy of a certain David Ricardo does not bode well for the economic health of a sovereign nation-state such as the Republic of the United States of America.

Americans already have an economic system which they can rightfully derive pride from, its having worked so well in years past. It's called the American System of Political Economy, as developed by former Treasury Secretary Alexander Hamilton. Protectionism, YES! Along with tariffs to fund the U.S. Federal Government (not the income tax which arrived hand-in-hand with the Federal Reserve System, a privately-held, unaccountable central bank).

I recognize that I'm only scratching the surface with the above notes. It's just that I do not buy-into the kind of market fundamentalism which masquerades as "economics".

[Ahban]

Very thoughtful article. I wonder where all the Free Traitors are tonight? They certainly don't seem to be on this thread refuting Mr. Robert's ideas.

[navyblue]

Exactly! David Ricardo never envisioned a world such as we have today where billions of dollars can be flashed across the world in microseconds and people and goods could traverse the globe in a matter of hours.

Compared to the United States and India today, The England and Portugal of his day had a relativiely even level of economic development. That was fair trade The United States and India of today is anything but fair trade.

[lasereye]

His arguments can't be easily dismissed. However, he's smart enough to know that just doing anything to halt imports won't necessarily make things better. The only thing I can see that would clearly help the situation would be to cut costs at home, e.g., litigation costs, worker's compensation costs, regulatory costs etc. We have the highest costs in the world in those areas.

[kcar]

I see. In fact - I've always seen. I love Mises to pieces! But, that having passed, how does comparative advantage confer its efficiency and sense through politicians bent on its distortion and a Media bending to its every whim?

[fooman]

I am for comparative advantage, but those conditions do not hold here.

Whoever figures this one out without 50%+ tariffs will win the nobel..

[navyblue]

Bruce: Didn't Hamilton say something about this in ...I believe it was Federalist 16 about how revenue was needed in order to support the defense of the republic. I think he referred to the Navy at the time.

[raybbr]

I have asked several of the "free traders" to point out to me where free trade, as they envision it, has been implemented and has proven to be beneficial to all sides. So far none has.

I contend that Ricardo's theory is just that: A theory that has never been applied nor proven. Those who advocate free trade are asking us to accept a theory that has not been applied in over 100 years.

Another question: If Ricardo's theory is what we need to make everyone in the world rich, why has it never been put to the test? We hear endless references to the theory but yet no one has ever fully applied it to any economy. Perhaps wiser heads have prevailed seeing the folly in Ricardo's theory.

They can argue for application of free trade all they want. Until I see a practical application that proves the theory I will always remain against it.

[RaceBannon]

I am for comparative advantage, but those conditions do not hold here.

Whoever figures this one out without 50%+ tariffs will win the Nobel..

Easy. Let all these foreign countries develop technologies with their own money, not the money of American companies.

That is what rugged individualism is about, right? Not the welfare state of technology transfer and socialistic support of industry!

make these countries invest their OWN labor and costs to make or BUY the machines to do labor or manufacturing, develop methods and processes the selves instead of buy it out.

Once they do, the comparative advantage is realistic, and years away, too.

[fooman]

Ricardo works when there are IMMOVABLE attributes to a country. But with education ( which is changable and movable) as the primary factor, a good theory breaks down.

[Havoc]

I wonder where all the Free Traitors are tonight?

Some of them have been busy putting salve on their butts in my thread after the spanking they've recieved there. I'm not an economist; but, I have long retail experience, calculus and physics under my belt - no degree to speak of and am currently waiting to lose my IT job with EDS to a Mexican slave who will be earning 1/3 my rate because American workers are too expensive, stupid and uncontrollable as a member of the oversight panel of Feb 4 related in quoting her company. We're all being disowned because we're Americans. And the disowned are getting restless. I invited a few of the free traitors to speak in front of a packed house of UAW workers; but, I think they took my warnings to heart as they boogied on out lol.

[Libertarianize the GOP]

bump

[fooman]

yeah,

I have thought about this one a lot. One way would be to make companies who do tech transfer to china WAIVE thier US patents...

[underbyte]

"As clear as an azure sky of deepest summer"

Brilliant! Prevent all technology transfers vital to US interests: Computer and chip manufacturing techniques, Biotechnology, Nanotechnology etc.

Have Intel, AMD etc. close all foreign plants and bring the factories back home.

5 year Phase In Once XZ country's imports exceed U.S. export's by 10% all the XZ country's products are stopped at the pier.

etc,etc.

Actually there are a hundred way to approach this, I would like to just see something done, some kind of action.

I get the Nobel right?

[fooman]

The literate says that quotas are worse than tariffs. You end up with "key money" (similiar to what happens in rent control) to buy the quotas (read political corruption)

[adam_az]

"I invited a few of the free traitors to speak in front of a packed house of UAW workers; but, I think they took my warnings to heart as they boogied on out lol."

HAH I wouldn't even admit to being a Republican in a room of Union Thugs...

[MTOrlando]

At last, a solid conservative argument against offshore outsourcing! At least I won't feel like a such traitor when I fantasize about punching the "Pat Buchanon" chad this fall.