Posted on 03/10/2006 12:33:17 PM PST by groanup
REVIEW & OUTLOOK
The New Protectionists - How to create a real security crisis.
Friday, March 10, 2006 12:01 a.m. EST
Dubai Ports World finally threw in the kaffiyah on its American operations yesterday, agreeing to sell them "to a U.S. entity." We hope that entity turns out to be Halliburton, if only for the torment that would cause certain eminences on Capitol Hill.
Dubai Ports was susceptible to this political stampede because it was an Arab-owned company buying port operations, which Democrats have played up as uniquely vulnerable. But this is also the second such mugging of a foreign investor in recent months, following last year's demagoguery against a Chinese company's bid to buy Unocal, a middling American oil company. If Members of Congress want a real security crisis--a financial security crisis--they'll keep this up.
What's especially dangerous here is that we're seeing the re-emergence of the "national security" protectionists. They were last seen in the late 1980s, when Japan in particular was the target of a political foreign-investment panic. The Japanese were buying Pebble Beach and Rockefeller Center, and so America was soon going to be a colony of Tokyo. A Japanese bid for Fairchild Semiconductor of Silicon Valley was seen as a threat to American defense. Those fears seem laughable now. But here we go again, with new targets of anxiety.
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(Excerpt) Read more at opinionjournal.com ...
I agree. However, the more Free trade we engage in the less sovereignty we have because the more we become entangled in other countries economies and the power groups like the WTO, UN, etc gain power to settle dispute and the peoples voice (Congress) losses power to effect trade matters.
You're absolutely correct! I could be, but only if the explaining was done to someone who preferred conjecture to actual numbers from places like table B.100 in this report. Come on Paul, are you really that married to this goofy doom'n'gloom schtick?
No. I'm just being realistic. My own most recent house has tripled in value in 8 years. That's just nuts.
Washington On avoiding corruption of our own rulers by trade and alliances:
So likewise, a passionate attachment of one Nation for another produces a variety of evils. Sympathy for the favorite Nation, facilitating the illusion of an imaginary common interest, in cases where no real common interest exists, and infusing into one the enmities of the other, betrays the former into a participation in the quarrels and wars of the latter, without adequate inducement or justification. It leads also to concessions to the favorite Nation of privileges denied to others, which is apt doubly to injure the Nation making the concessions; by unnecessarily parting with what ought to have been retained; and by exciting jealousy, ill-will, and a disposition to retaliate, in the parties from whom equal privileges are withheld. And it gives to ambitious, corrupted, or deluded citizens, (who devote themselves to the favorite nation,) facility to betray or sacrifice the interests of their own country, without odium, sometimes even with popularity; gilding, with the appearances of a virtuous sense of obligation, a commendable deference for public opinion, or a laudable zeal for public good, the base or foolish compliances of ambition, corruption, or infatuation. 34 As avenues to foreign influence in innumerable ways, such attachments are particularly alarming to the truly enlightened and independent Patriot. How many opportunities do they afford to tamper with domestic factions, to practise the arts of seduction, to mislead public opinion, to influence or awe the Public Councils! Such an attachment of a small or weak, towards a great and powerful nation, dooms the former to be the satellite of the latter. 35 Against the insidious wiles of foreign influence (I conjure you to believe me, fellow-citizens,) the jealousy of a free people ought to be constantly awake; since history and experience prove, that foreign influence is one of the most baneful foes of Republican Government. But that jealousy, to be useful, must be impartial; else it becomes the instrument of the very influence to be avoided, instead of a defence against it. Excessive partiality for one foreign nation, and excessive dislike of another, cause those whom they actuate to see danger only on one side, and serve to veil and even second the arts of influence on the other. Real patriots, who may resist the intrigues of the favorite, are liable to become suspected and odious; while its tools and dupes usurp the applause and confidence of the people, to surrender their interests. 36 The great rule of conduct for us, in regard to foreign nations, is, in extending our commercial relations, to have with them as little political connexion as possible. So far as we have already formed engagements, let them be fulfilled with perfect good faith. Here let us stop.
All of the faux free trade agreements represent a "political connection". A bridge too far.
No it isn't That's a 15% rate of return.
Don't get me wrong, 15% is good, but even stodgy stocks (s&p, dow) have done that lots ('82-'90, '91-'99) and the Amex stocks have tripled in just the past three years. But before we get into arguments about your mortgage tax breaks and I compare stock commissions to real estate commissions, lets get back to this thread. You offered knowledge about some general widespread 'housing inflation', and now you're basing it on the increase in value of one house?
"that of the public-school teachers who insist that merely spending more money on teachers will lead to better public schools, and socialists who argue that despite dozens of failed historical examples, the One True Method of communism has not yet been applied. At some point, even the most lovely theory has to pass the more prosaic test of practice or else be relegated to the children's nursery of daydreams and wishful thinking."
There are things that are unseen in the dynamics of human commerce that hinder Free Trade. They operate like viruses below the surface which cause the best efforts to go wrong. Mr. Vox Day was not very specific as to what went wrong with NAFTA and the European Union concept. I am sure they would make an interesting study.
I am curious. Did you read Stephen Spruiell's article?
http://www.aworldconnected.org/article.php/489.html
For example, even after the tariffs were in place...it turns out that the U.S. steel market was still the cheapest, most competitive in the world! The jobs lost weren't from suddenly excessive steel prices, but turn out to in fact have been lost more to a recessionary contraction. The steel import lobby issued numbers which were biassed by counting in jobs lost from almost 6 months prior to the President announcement of the temporary tariffs, which were tailored only to the offender in reciprocal fashion.
The opponents claimed that the industries couldn't be saved. They were wrong. They were. And then, prior to the EU issuing sanctions pursuant the WTO declaring our soveriegn actions "illegal" (which completely ignored the endangered industry ruling of our ITC, and the reams of data supporting it...all valid pursuant to the WTO Charter)...the temporary tariffs were lifted.
And today our steel industry, having had a breather remains competitive. And U.S. steel market prices are still the cheapest on the planet. Not those 6 other countries which a Heritage scholar misleadingly ranked as "freer" than the U.S.
And the dependancy argument is real. It is a serious issue. It represents the core of national argument over this issue.
I did not realize the influence on other economists that Friedman has on the Globalist School of thinking. Is Friedman all that bad?
You have made some valid points. The effect on countries using dumping tactics to artificially drive down steel prices can catch our nation off guard with a policy that leaves us open to those who will exploit the situation. As I said in an earlier post, "Market forces will determine who is playing fair and punish those who fail to play fair." What I mean by that is those who have are known to not play fair will suffer from those who cease to trust them. I should have also added that government needs to come to the aid of those who are being cheated and punish the cheaters.
Finally, could you elaborate on the "dependency argument?"
Market forces will determine who is playing fair and punish those who fail to play fair
Here you are wrong. The market does not play fair. It plays unfair and goes to the lowest cost. Period. The market has no idea what a nation is, what an ideal is, what human rights are, or morals, or ethics. All of these things are imposed on the market to try to level the playing field by people. In a total "free" market non of these things exist. The only thing that matters to the "free" market is profit and loss. So the same with free trade.
If two or more components of GDP rise together but one rises with more magnitude than the others, you're going to have different rates of change...so why is this of any relevance? Never mind, do not answer.
Say, did you know that American capital that flows out of the United States and into other countries (purchasing things like production facilities and the subsequent outsourcing of some production that used to be done domestically) actually helps to balance our trade deficit? This must make you a closet supporter of outsourcing and of the principle that Americans should be buying up foreign assets a.k.a. Foreign Direct Investment.
I'm sure an outsourcer...and their import-lobby apologists... would glibly claim that.
Let's see your empirical data.
And then explain how we really don't have a trade deficit.
Net exports are equal to net capital outflows and, conversely, net imports are equal to net capital inflows. I have stated, many times to you, in fact, the last portion of that sentence. You have never disagreed with it before and now all of a sudden when I state the first portion of the sentence, you just now call B.S.?
Okay then, here, give yourself a proper education on the subject! This goes for you, too, unseen
Whew! Thank you, thank you, thank you. It is quite frustrating discussing something with someone who is uneducated on a topic just to have them turn right around and regurgitate information back to you - innacurately - while claiming that they're the ones who really know what in the heck they're talking about. It's enough to make me want to chew off your leg just to get away...I guess I'm just too undisciplined to ignore your stupidy-filled replies/posts.
Yes, I know it has been frustrating trying to educate you. But don't be so hard on yourself you can still stop mouthing the party line when ever you wish and start looking at the real data. I understand for some people it's hard to educate one's self but you should try. I know you could do it if you wanted too. I'm sure once your job is outsourced you will understand perfectly. Or maybe after your job is outsourced and the government (i.e taxpayers) must pay for your retraining/reeducation you will see the light. Just think that taxpayer funded retraining adds to the GDP. There's always hope.
There's a bit of unintended humor here. I did have the taxpayer pay for my higher education but not because my job was outsourced. I qualified under Chapter 30 of the Montgomery GI Bill and used all but one month of 36 months worth of benefits earning an Associates degree in Liberal Arts and then a Bachelor's of Science in Business Administration with a minor in Economics.
Now, properly understood, the government expense to educate me should have been a net wash on GDP as many others had their C (or maybe I) lowered by the same amount the G was increased. But the truth is is that the taxes put in place to raise G created a dead weight loss that lowered C (or maybe I) more than G was raised. However, if my lifetime production is increased more than it would have been if I had not pursued the degrees, then the investment in my human capital would have increased GDP through time and would have been with worth the investment. You can argue whether or not the GI Bill is a good program but it does not change the fact that it was a promised entitlement to me - as long as I chose to use it - for electing to serve this country and in an honorable fashion.
One could probably also say that we're lucky the protectionists have not figured out a way to re-institute the draft.
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