Posted on 02/01/2009 3:12:01 AM PST by TigerLikesRooster
In Davos, protectionism is a dirty word
The beggar-thy-neighbour phase has begun in earnest. "Buy American" legislation has advanced from a barely credible threat to imminent reality on Capitol Hill in just weeks.
By Ambrose Evans-Pritchard Last Updated: 11:31PM GMT 31 Jan 2009
The House has voted for a bill that prohibits the use of foreign steel in most infrastructure projects funded by Barack Obama's $820bn (£563bn) rescue package. The Senate is drawing up plans to widen that to all manufactured goods.
This is what happens when a country loses half a million jobs a month, and when the state becomes spender-of-last-resort. Taxpayers are tribal. They do not want precious stimulus to feed the foreigner.
Even so, this Dutch auction has the disorderly feel of the Smoot-Hawley Tariff debacle in 1930, though this time the collapse of commerce if allowed to happen will have very different consequences for the global balance of power.
Mr Obama can veto the law, should he wish to pick a fight with Capitol Hill from day one. The world watches and waits in horror, especially in Davos.
"Everybody here is talking about protectionism. There's not a prime minister present not talking about protectionism," said Peter Sutherland, former (GATT) trade chief and now chair of BP.
Days earlier, US Treasury chief Tim Geithner called China a "currency manipulator" meaning that Beijing holds down the yuan to boost exports. The term is turbo-charged. It implies mandatory trade sanctions under US law.
(Excerpt) Read more at telegraph.co.uk ...
Buying only American steel for the “infrastructure” is a good thing, provided it does not cause steel prices to go up.
I live along the I94 corridor in Michigan. We used to be an industrial powerhouse. Here in Jackson alone we used to have Yard man, Goodyear, Die cast and Clark Equipment and a few other big players. For every one of those big players there were a half dozen smaller support shops. Back when NAFTA was passed our boss warned us that our small print shop wouldn’t be able to compete against mexico and within a year the doors were closed.
Today we have an empty run down industrial area with retail, resturants and welfare. Our unemploment rate topped 11% this week.
I’m sure some genius will be along soon to inform me that it’s all because of Jenny Granholm and unions. While not helpful they’re far from the only reason. The fact is that for every union job “conservatives” manage to eliminate, we lose a dozen or more non union jobs.
Someone needs to explain to me, why both union and non union jobs managed to thrive here in Michigan till the plummet following the passage of NAFTA.
Other countries are lending us the $$ for our excess. Do you think they will take kindly to being shut out? They want to hold our debt AND reap the profits when our consumers spend. It is a win-win situation for them that gives them an ever-bigger stranglehold over us.
Protectionism is a very bad move. It will not help the economy and will not affect the unemployment rate in the near future.
We have lost manufacturing jobs not to other nations, but to productivity/technology. Our manufacturing has remained steady as a % of GDP while jobs have consistently dropped over the last forty years.
All this move will do is raise the price of steel at the worst time and start trade wars that will cripple our exports.
The US is still the largest manufacturer and third largest exporter on earth....abandoning free trade hurts us far more than it helps. It limits consumer choice, raises prices, and lowers quality.
This is just another Pelosi sop to the unions.
Is he nuts! He can't do that as fast as O and his handy henchman in the democratic party can.
What AMERICAN steel companies re they going to find steel at?
I thought all the environazis had manages to close the USA steel mills.
If there are still some here, where is the ore coming from> They closed down the Mesabi iron ore mines in Minnesota.
With that state putting a Muslim and possible Franken into the Congress, I sure don’t see that ore mine opening up again....
With the “enviromental reviews” that are required to do anything today, how will they find new sources of ore?
Where willthey let new steel plants be built?
So what you’re saying is that we should simply give in to the enviroweenies?
Yes indeed! We are a super power when it come to importing. Just ask Toddster
Bingo, a Fact to consider, in 2006, US Mfg added the highest % to US GDP in history. We have lost manufacturing jobs not to other nations, but to productivity/technology. The US is still the largest manufacturer and third largest exporter on earth....abandoning free trade hurts us far more than it helps. It limits consumer choice, raises prices, and lowers quality.
Wake up Americans, the current Admin and the Left is not concerned with American prosperity or strength. They are 180 degrees from that!
You poor confused little girl.
Today we have an empty run down industrial area with retail, resturants and welfare. Our unemploment rate topped 11% this week.
Im sure some genius will be along soon to inform me that its all because of Jenny Granholm and unions. While not helpful theyre far from the only reason. The fact is that for every union job conservatives manage to eliminate, we lose a dozen or more non union jobs.
Someone needs to explain to me, why both union and non union jobs managed to thrive here in Michigan till the plummet following the passage of NAFTA.
The cold war forced us to be a serious country. It kept us honest. It kept us nationalistic
NAFTA could only be passed after the Soviet Union collapsed
Once we didn't have to devote so much resources to defense (the peace dividend) the powers that be found out that they could make more money investing in consumer companies like Wal Mart instead of producer companies like GM and Ford
So ship production down to Mexico and after that China ..... That's great for the wealthy investors or any investor who wants in on the racket such as pension funds and the Harvard endowment. Only problem is it is unsustainable and our current economic crash proves it. The much vaunted "consumer economy" was always a lie and this is its endgame
The United State's appetite for goods hasn't got anything to do with free trade.
I want the choice to buy whatever I please (legal goods of course)...I don't need the government telling me what can be sold and what can't.
We can do it. The only thing we really need from abroad are a few strategic metals
We could have pulled this off a lot easier 10-20 years ago because we had more industrial base intact
Think the "free traitors" for that.
But it could be done
We have vast coal deposits and natural gas to exploit
We could get rid of foreign oil if we did
I I I me me me mine mine mine....The pathetic war cry of the libertarian. Your absolute faith in free markets is as misguided as the communist devotion to the state. And amusingly enough both ideologies are atheist at heart. Lenin Marx and Ayn Rand were godless atheists
Obama and Pelosi are just paying off the unions at our expense...unfortunately, we are going to have to get used to it.
It wouldn’t be so bad if the economy wasn’t in the tank. I have begun to believe that Pelosi is purposefully destroying it.
What most people really object to when they object to a free market is that it is so hard for them to shape it to their own will. The market gives people what the people want instead of what other people think they ought to want. At the bottom of many criticisms of the market economy is really lack of belief in freedom itself. The essence of political freedom is the absence of coercion of one man by his fellow men. The fundamental danger to political freedom is the concentration of power. The existence of a large measure of power in the hands of a relatively few individuals enables them to use it to coerce their fellow men. Preservation of freedom requires either the elimination of power where that is possible, or its dispersal where it cannot be eliminated. It essentially requires a system of checks and balances, like that explicitly incorporated in our Constitution . . . .
—Milton Friedman
So what
We ran a 700 billion dollar trade deficit last year
I kinda think a trade war kinda works out better for us
Take that Smoot Hawley act .....we probably ran trade surpluses back then so it hurt us more than others
So you are saying you want the government to control what goods can and cannot be sold? Do you really want the government to protect your job at my expense?
Doesn’t seem very conservative to me.
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