Replies

Trade barriers reduce income in the home country and throughout the rest of the world. It is an Iron Law and unavoidable. As a result of the lowered income abroad less is exported from here. So we sell less and income is reduced again. This cycle continues until a new equilibrium with lowered supplies and demands is reached.

Just because my profits go up when my factory's product is protected does not mean the increase is not offset by losses to the rest of the country. Tariffs are an income redistribution scheme.

Reducing trade barriers on the other hand RAISES income inside and Outside the nation reducing them.

This is a no-brainer.

The free trade theories are correct in the LONG RUN, but your are ignoring the large short-term costs which make it quite probable that we will get it to the long run.

Global Free Trade theories ignore one very, very important aspect of human nature: individual and societies, for better or worse, change slowly. Conservatives have correctly criticized "liberal" policies over the years for just this reason, and we should not ignore this fundamental aspect of life just because we want cheap goods.

Let me give you a real life example of Globalization as it currently exists. A software programmer I know at Intel-Hillsboro, Oregon makes about $70k/year and is told that he will be laid off because much of the software development is being "outsourced" to Hyderbad, India. Not wanting to be total assholes, Intel does offer him a position in Hyderabad at a lower salary (in USD) which will allow him to live at a high standard of living in India. This scenario is not rare but will be unacceptable to the overwhelming majority of Americans.

Some people have supported free trade/globalization because they wanted to cripple the welfare/regulatory state. They might achieve this but will probably create conditions that will require a true global governing body. Check out the Hover Institute web site to find articles regarding this matter.

I'm not arguing for "protectionism" but for a more rational international trade policy that creates a measure of stability as well as wealth.