Posted on 09/29/2015 7:13:39 AM PDT by SeekAndFind
Free trade is supported by enlightened thinkers and academic economists. Those who are opposed to free trade are seen as special interests trying to shelter uneconomic industries that can’t stand up to foreign competition. It is a truism that no trade transactions would take place if they weren’t to the advantage of both parties. What could possibly be wrong with trade that is advantageous to both parties?
If free trade is so wonderful, one has to wonder why many of our trading partners are resistant to it. Perhaps these countries are just behind the times. They may not have caught up with the latest economic theories from the University of Chicago. For example, China has been the object of many trade complaints from the U.S. government. The Chinese subsidize exports. The Chinese engage in the wholesale theft of intellectual property – theft allegedly worth a hundred billion dollars per year. It is not plausible that the Chinese are behaving this way because they have failed to read the Economics 101 textbook at almost any college.
The theft of formal intellectual property – patents, copyrights, and trade secrets – is only one part of the transfer of intellectual property. A tremendous value of intellectual property takes the form of human capital – the accumulated knowledge of the workforce. If you have dealt with an airline reservation agent in India, you have an inkling as to the difference between American workers and those in more backward areas. If an American company opens a factory or a corporate research center in China, it is transferring human capital from the U.S. to China. Much learning takes place not in formal institutions of education, but in the workplace. This is especially true of the knowledge needed to make cutting-edge products.
(Excerpt) Read more at americanthinker.com ...
Might as well argue that free markets and capitalism are not sacred doctrines. A little socialism works wonders for business.
#1 reason: It’s an absolute sure-fire loser at the ballot box from here on out.
Free trade is good, but it can’t be unilateral. Our competitors don’t believe in free trade; instead the negotiate “free trade” agreements that are not equal, and then they willfully violate them at that.
Free trade is great.
Across State lines.
Regulated by the Representatives from those states. In Congress, by popular election.
There’s a place like that...let me see now...oh yeah.
The formerly United States...of America.
Free trade is a joke, The Founders were protectionists and protectionism ruled the US till the implementaion of the income tax in 1908. It fueled the Industrial Revolution, why wouldn’t you want to protect American industry and AMerican jobs over cheap foreign labor. What’s going on now is our industrial base has shifted to China and Indai. we manufature nothing, unemployment is over 50%. That’s your free trade. Our military buys its Ammo and US flags from CHina.
Yeah, but our founders were a bunch of Marxist populists that didn’t know anything about building a nation. Unfortunately, I probably should note that this is sarcasm.
I’m tired of “conservatives” who don’t think it matters if Boeing makes planes in America or China.
Free Traitors™ put the love of ever increasing profit ahead of country. The are like dogs salivating over mammon uber alles.
The investor can make the deal with the state regarding taxes, but there is a possibility the state could impose regulations, say a labor regulation, but it is really tax masquerading as a regulation. So the investors are given protection from this, and in NAFTA the investor protections are found in Chapter 11.
But when you give the investors protection, there is the risk that it is detrimental to labor, environment, etc.
When dispute arise, they are settled by the arbitration panel and each nations judiciary has to honor the arbitration panels decision. So, each and every time the arbitration panel resolves a dispute, the panel is, by precedent, establishing a law, which is called investor state law. Over time, and by settling numerous/many disputes the arbitration panel creates a body of investor state law.
With NAFTA, the dems and some GOPers knew there had to be investor protections but they thought the protections for labor, environment, etc were inadequate so they all agreed that the incoming prez, Bill Clinton, would negotiate a side or parallel NAFTA agreement that contained those protections and the following January Congress would ratify both NAFTA and Clinton's side agreement.
But Clinton's side agreement turned out to be toothless and the arbitration panel ignored it. This infuriated the unions and they thought Clinton was in cahoots with the GOP. Then later Clinton would negotiate welfare reform with the GOP and that turned out bad for the dems, which is why the leftwingers think Bill and Hillary are head of the Democratic wing of the GOP.
As for the tariffs, or removing tariffs, or harmonizing the tariffs, that revolves around benefits for the producers versus benefits for the consumers.
Under NAFTA, Mexico's tariffs on US corn would not fall until 2008. But immediately after NAFTA was signed, Mexico would allow some US corn in without tariffs. This was detrimental to corn producers in Mexico but it kept the price of tortillas down, benefitting consumers.
The trade may be in the interest of the two parties, but not in their nation's best interest.
Example 1: When the Rosembergs sold nuclear secrets to Russia, it was in both party's best interest, but not the U.S. best interest.
Example 2: When a company outsources to China during a time where we have high unemployment, it creates even more unemployment here. The government loses employment taxes which are not made up by current tariffs, we end up supporting unemployed Americans. And we also lose out on the income taxes and spending salaries into the American economy that would have occurred if those American employees had continued to work.
“The Chinese subsidize exports. The Chinese engage in the wholesale theft of intellectual property – theft allegedly worth a hundred billion dollars per year.”
Let’s unpack that, shall we?
“The Chinese subsidize exports.” - If the Chinese government wishes to impoverish its citizens with punitive tax rates and give away at less value the goods they produced to Americans who then get to pay less, I recommend even more of that. Impoverish the Chinese! Transfer wealth to America! Please, do more of this.
“The Chinese engage in the wholesale theft of intellectual property – theft allegedly worth a hundred billion dollars per year.” - There is no part of “theft” that is “fair trade”. I’m okay with bombing the factories that steal our intellectual property.
Were there any other arguments of note?
Free Trade is wonderful... in theory. Trouble arises when trading partners do not have similar labor rules or do not respect capitalism.
Free Trade with Canada and Great Britain works well. Those countries have similar labor laws and tax structures. (Note: similar, not identical). Based on labor laws and economic status, Free Trade with Japan should have worked— that it did not during the 1990s is a testament to Japan’s export/ import tax structure.
We don't pay less, that is an illusion. The difference in costs due to labor being dirt cheap is not passed on the the consumer. It goes to the bottom line and the stock holders.
Prove it.
There is only three ways for a nation to create wealth: Agriculture, mining and manufacturing.
Importing, transporting and retailing do not create any wealth. These are value added services, the wealth was created were the goods were manufactured. This is just wealth transfer from the USA to the country that made the product. This is a good recipe for the USA to become a third world nation.
You prove it. It is just common sense, why would Widget Company move an entire factory 5000 miles away just to pass on the reduced costs back to the consumer. It makes no sense. They ( and the stock holders) pocket that difference.
Free trade is always good is just too simple a doctrine to be true.
Free trade is, was and always will be a scam. Free trade can only exist between two nations that have comparable social structures and legal structures, giving a 3rd world hovel open access to your markets unfettered is not free trade, its the willful selling out of your nation.
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