Posted on 10/25/2006 5:56:53 AM PDT by from occupied ga
There are only a handful of products that Americans import that cannot be produced at home and therefore create jobs for Americans. Let's look at a few of them.
We import cocoa from Ghana and coffee from African and Latin American countries. We import saffron from Spain and India and cinnamon from Sri Lanka. In fact, India produces 86 percent of the world tonnage of spices. There's absolutely no reason these products cannot be produced by Americans, and we could be cocoa, coffee and spices independent.
You say, "Williams, that's crazy! We don't have the climate and soil conditions to produce those products. Many spices, for example, require a moist tropical environment." No problem. We have the technology whereby we can simulate both the soil and weather conditions. We could build greenhouses in which to grow cinnamon trees and get our scientists to create the same soil conditions that exist in Sri Lanka. Greenhouses could also be built to simulate the climate conditions in Africa and Latin America to grow cocoa and coffee. In the case of cocoa, the greenhouses would have to be Superdome size to accommodate trees as high as 50 feet.
You say, "Williams, that's still crazy! Imagine the high costs and the higher product prices of your crazy scheme." I say, "Aha, you're getting the picture."
There are several nearly self-evident factors about our being cocoa, coffee and spices independent. Without a doubt, there would be job creation in our cocoa, coffee and spices industries, but consumers would pay a much higher price than they currently do. Therefore, nearly 300 million American consumers would be worse off, having to pay those higher prices or doing without, but those with the new jobs would be better off.
So let's be honest with ourselves. Why do we choose to import cocoa, coffee and spices rather than produce them ourselves? The answer is that it is cheaper to do so. That means we enjoy a higher standard of living than if we tried to produce them ourselves. If we can enjoy, say, coffee, at a cheaper price than producing it ourselves, we have more money left over to buy other goods. That principle not only applies to cocoa, coffee and spices. It's a general principle: If a good can be purchased more cheaply abroad, we enjoy a higher standard of living by trading than we would by producing it ourselves.
No one denies that international trade has unpleasant consequences for some workers. They have to find other jobs that might not pay as much, but should we protect those jobs through trade restrictions? The Washington-based Institute for International Economics has assembled data that might help with the answer. Tariffs and quotas on imported sugar saved 2,261 jobs during the 1990s. As a result of those restrictions, the average household pays $21 more per year for sugar. The total cost, nationally, sums to $826,000 for each job saved. Trade restrictions on luggage saved 226 jobs and cost consumers $1.2 million in higher prices for each job saved. Restrictions on apparel and textiles saved 168,786 jobs at a cost of nearly $200,000 for each job saved.
You might wonder how it is possible for, say, the sugar industry to rip off consumers. After all, consumers are far more numerous than sugar workers and sugar bosses. It's easy. A lot is at stake for those in the sugar industry, workers and bosses. They dedicate huge resources to pressure Congress into enacting trade restrictions. But how many of us consumers will devote the same resources to unseat a congressman who voted for sugar restrictions that forced us to pay $21 more for the sugar our family uses? It's the problem of visible beneficiaries of trade restrictions, sugar workers and bosses, gaining at the expense of invisible victims -- sugar consumers. We might think of it as congressional price-gouging.
Dr. Williams serves on the faculty of George Mason University as John M. Olin Distinguished Professor of Economics and is the author of More Liberty Means Less Government: Our Founders Knew This Well.
I have to oppose you on that.
We anti's would change all that.
Good luck with that. Ping me when your products are as cheap as the imported products. Thanks!
And the solution to these high priced goods is to make goods even more expensive? Great idea! LOL.
Nailed it in one sentence. Thank you.
Rude aren't you.
I'm really not interested in what you have to say on this matter, because you are clearly unwilling to consider anything beyond your own opinions ...
Yes you are obviously a paragon of openmindedness. I considered your opinions and after the 20 milliseconds it took me to determine that they were garbage I rejected them.
Okay, noob.
As a result of those restrictions, the average household pays $21 more per year for sugar. The total cost, nationally, sums to $826,000 for each job saved.
You think it's more expensive to pay $826,000 for a sugar job or just give the sugar worker a check for $26,000? And why the scare quotes around protectionism? Is it because you don't think it exists or because you don't understand what it means?
I'm against that too.
You stipulated that the raw materials were available.
Where do you get the knife to whittle a point on it?
Gee, you got me there. I assumed that technology widely available since paleolithic times was assumed to be available to my manufacturing. Gosh, I guess I'll have to smelt some ore, forge some billets and sharpen a resulting chunk of steel. The question was "how do you make a pencil from raw materials?", not "how do you make a pencil if dropped naked onto Mars?" May we also stipulate that the date of manufacture is today, and the location of same is any human occupied municipality in the U.S.?
Where do you get the clamp?
From a chunk of wood. Raw materials were stipulated, remember?
where do you get the metal? How do you form the band? To do all of these things you have to interact with someone else.
What's your point? That trade is necessary? That someone else does not need to be in Indonesia. Indonesian pencil, spice or tea production is cheap for one reason: transportation energy costs are fabulously cheap today. The physical production of goods is easy practically anywhere, given the raw materials and available labor. It's getting the raw materials to the labor and the finished product from where it's made to where it's wanted that is the key to trade.
If pencils could only be made in Indonesia, they would cost like rubies, but they aren't. They can be made anywhere on earth by any marginally sentient person with widely available materials. So, why not make your own? Because time is the one commodity that cannot be traded, and my own personal allotment of time is more profitably used in other ways. When the Indonesian pencil maker has more profitable ways of using his time, he won't make them either, and either pencils will cost more or be manufactured in Malawi instead.
But the whole discussion is a red herring. Pencils are not a vital commodity supplied from limited foreign sources along a supply line with multiple point-failure junctions. The safety and economy of the U.S. may not rely upon pencils, but it does rely upon steel and heavy industrial products, and abandoning the ability to produce these is as short sighted as selling your water rights in a drought prone area because of a few rainy seasons.
Well, I guess I'll chalk one up for me in the old "sent somebody home crying" log.
Will all $1 trillion of our exports this year be soybeans? LOL!
Why is it the same people who scream for the removal of tarriffs remain silent on the issue of uneconomic regulatory controls in the U.S?
I don't suppose you have any examples of these people?
You stipulated that the raw materials were available.
Graphite is not a raw material. It is a manufactured substance.
. Gosh, I guess I'll have to smelt some ore, forge some billets and sharpen a resulting chunk of steel. The question was "how do you make a pencil from raw materials
I was trying to elicit thought (obviously unsuccessfully in your case) about the complexities of manufacturing even a simple object like a pencil. The point was that even a pencil requires materials and machinery (the knife in your simplistic example) that are either beyond the means or beyone the skills of most individuals to manufacture. You need trading partners to get the materials and the machinery to manufacture even a lowly pencil. You can pay more or you can pay less, or you can waste your labor in trying to make on yourself, but unless you go for the cheapest alternative you are going to be missing out on capital or lifstyle.
. The safety and economy of the U.S. may not rely upon pencils, but it does rely upon steel and heavy industrial products, and abandoning the ability to produce these is as short sighted ...
Not true at all. If foreign producers can compete with domestic steel after you factor in the shipping costs, you have to ask yourself why can't us manufacturers beat the price? The answer is if they adopt the same methods dump the union featherbedding they can. So the answer is not to prop up an inefficient industry with taxes, but let it compete. Tariffs to protect inefficient and union ruined industries are like paying welfare queens to have more bastards. If you reward the stupid behavior, then you get more of it.
Why don't you make all your own steel, electronics, concrete, plastics, food etc.? It might be more expensive, but you'll be independent. Let me know if I took a liberty in expanding the argument.
My point was that, too often, there are only goods made in "other countries"; none to be found made in the USA.
So what? How does that put a gun to your head? Some things are of such poor quality that they aren't worth buying.
But I'll go you one better, name a product that you cannot buy that's made in the USA and I'll show you where or make it myself.
You see it's a matter of price you are talking about, not quality. And maybe you want to buy from a person who lives in a certain location, but again, it's about price, not quality.
For the right price, I will make you anything you want.
--Why don't you make all your own steel, electronics, concrete, plastics, food etc.? It might be more expensive, but you'll be independent. --
Thank you. That's the point I was trying to make. Glad we see eye to eye on this.
"For the right price, I will make you anything you want."
OK, build me a DVD player, using parts only made in the USA. I'm not holding my breath, believe me.
Actually, the converse tends to be true more often. When one suggests that many of these regulations increase the cost of the finished product beyond what is remotely reasonable (because one must spend man-hours documenting compliance in an adversarial environment), there are pro-tarriff FReepers who accuse us free-marketers of favoring environmental blight and opposing basic safety protection for employees.
No problem, I'll have it in 2 years and the price will be $10,000. Or I'll have it in 6 weeks and the price will be $1,000,000.
Hell, I'll deliver it for free.
So, you see my point don't you? It's about price.
There is no profit in making something out of parts made in only a certain place by certain people for a minuscule customer base.
Why would you want such an item?
No, I meant why don't you, not America, make all the steel etc you need.
Glad we see eye to eye on this.
Actually, we don't.
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