Today's Free Trade is not about the Free Market

JEFFHEAD.COM ^ | 08/01/2003 | Jeff Head

[Jeff Head]

TODAY'S FREE TRADE IS NOT ABOUT THE FREE MARKET

We are in a very real battle in this nation and it is a battle for our heart and soul. It is spread out on many, many fronts...education, foreign policy, work ethic (individually and societally), immigration, the economy, moral values...and the list goes on.

Let's focus on the economy and one significant part of it...a major, growing part of it. Free Trade and foreign outsourcing.

I was going to entitle this article..."I used to make something"...or..."We used to make something in this country". But, I thought better of it and realized that such a statment was really focusing on the tail end of the issue as opposed to the root.

So, instead, I am simply calling it, "Today's Free Trade is not about the Free Market."

And it is so, today's Free Trade is NOT about the free market. Instead, in a very similar manner to other key issues in this battle for the heart and soul of America, what is happening is that a very craftily wordsmithed message of "Free Trade" has been put forth that people have bought into, thinking "How could anyone be against free trade? Why, isn't that all-American?".

Like with abortion, "How could anyone be against a woman's right to choose? Isn't that all American?".

In both cases, the craftily worded title has nothing remotely to do with what is actually going on.

The free market is the system our founders based our commerce on, where the intrinsic, underlying moral values of the people involved in the free market governed the equitable, free exchange of goods and services for other goods and services or currency. Sort of like John Adams said regarding the Constitution...

"We have no government armed with power capable of contending with human passions unbridled by morality and religion. Avarice, ambition, revenge, or gallantry, would break the strongest cords of our Constitution as a whale goes through a net. Our Constitution was made only for a moral and religious people. It is wholly inadequate for the government of any other."- John Adams, Oct. 11, 1798

It is that underlying moral foundation coupled woth our liberty that made the Free Market in America the envy of the world, just like those same issues made our governmental form the envy of the world.

Well, as far as I am conerned, Adam's words could be tailored to this topic like so, ie... The Free Market was made only for a moral and religious people. It is wholly inadequate for the economy of any other.

This is a basic truth. Like our government, our free market was not supposed to be very regulated or burdened with miriad rules. The people and the companies were to use their own moral foundation to govern themselves. But, when the moral foundation is removed, you do not have what was intended for the Constitution, and you do not have a true free market.

When we use our foreign policy and economic policy to set up shop and trade with countries, societies, organizations or to implement policies that exploit their people's mercilessly, who keep them down without a hope for true liberty or freedom, who trample the moral values our own system was based upon...and when we do it knowingly, without compuction for those very underlying values, then we do not create a free market...no, that free trade has nothing whatsoever to do with, and is in no way similar to the FREE MARKET, rather, it serves to corrupt it.

Such notions, such actions are in fact wordsmithing for popularizing and putting forth a policy to drain the United States manufacturing, technological, agricultural, energy and other critical industries in order to weaken us...plain and simple...and it is working.

Based on my own travels on behalf of US firms and then later consulting for them...that is what is really happening here in my own opinion, and until we refocus as a people on that underlying moral foundation and the absolute need for it...we will continue to lose ground.

By the way, those same principles that are working at the societal level, have equal application at the personal level too...in fact, in the end it is the sum of their working at the personal level that creates the issue at the societal level.

Jeff Head
Engineering Consultant and,
Author of The Dragon's Fury Series
How current conditions could lead to World War

August 1, 2003
Emmett, Idaho

[Luis Gonzalez]

Good stuff Jeff.

I think trade with any nation that violates the human and civil rights of their citizens is a dark stain on America, there can be no "free trade" unless there is freedom, we should work tirelessly at ending the practice.

At the same time, I believe that we should lower all barriers with nations in our hemisphere, Las Americas, with Democratically elected governments. It's in the best interest of the US.

I know that I am going to take heat, but I think that it is in our best interest to help build up the economies of our neighbors, and not help create rich communists.

People are coming here looking for work by the millions, I'd rather send out ten million unskilled manufacturing jobs, than take in ten million illegals to do them here.

We need to build up our walls, and these walls are the nations in our hemisphere, and American jobs in Mexico, in Costa Rica, Guatemala, are not taking advantage of oppressed people, but rather they are helping elevate their level of living a bit. It's a lot more difficult to trap people with jobs and dreams into communism, than it is for those who have never seen anything but poverty in their future, and the future of their children.

"Good fences make for good neighbors" someone said to me once, I would like to see an American administration promoting freedom, Democracy, and free enterprise in our hemisphere as consistently and expansively as they do in others, so that with the help of our neighbors, we can push the fences protecting us from our enemies, to the combined coast line of The Americas.

[JNB]

Again, you do the name calling again. Again, what I and others is not state owned industry, not state ran planning, just want to make sdure the govrenmnet can do things like insure fair trade so the economy can do well in the long run, remeber that, planning for the long term, it is what US business did untill the 70s as well, plan for the long term rather than for next quarter.

As other have mentioned, there is no problem with trade when the plaing feild is level, trae between nations that have similar labor and enviromental laws, and of course do not have restriction on US goods coming in to their nation. That is not communism, it is being reasonable.

[Cacophonous]

...I believe that we should lower all barriers with nations in our hemisphere, Las Americas, with Democratically elected governments. It's in the best interest of the US...

I don't have a problem with this in principle, but would modify it lowering all tariffs with free market economies. While you can have democracies that do not have free markets, I can't think of a single truly free market that does not have a democracy.

[JNB]

I actually agree with much of what you say, but there should be a carrot and stick approach. If a country signs a free trade agreement with the US, again it should have provisons to have workers have the same labor protections US workers have, that will give that countrys workers the ability to imporve their standard of living, rather than be de-facto slaves, and also the countrys that sign free trade agreements need to enact similar enviromental standards. Chile actually is quite close in both of those areas.

[Poohbah]

remeber that, planning for the long term, it is what US business did untill the 70s as well, plan for the long term rather than for next quarter.

And then conditions started changing at a more rapid pace, shortening the planning horizon.

Anyone trying to plan beyond 5 years is, to put it mildly, a fool. And at the five-year mark, your "plan" shouldn't be more than a page long...double-spaced.

My experience is that it's when companies think they've found THE long-term plan and weld themselves to it that they've pretty much doomed themselves.

[Luis Gonzalez]

Absolutely.

[Luis Gonzalez]

"While you can have democracies that do not have free markets, I can't think of a single truly free market that does not have a democracy."

Bingo!

[JNB]

The situation that we are in right now, where the economic central planners(The FED) along with corporations, only thinking to the next quarter is producting even more long term problems. GM is a prime example, they are only thinkiong from quarter to quarter with their moronic 0% financing and ultra high rebates per car sold, things that will hurt GM in the longer run, while the FED and tresury were moronic for not planning ahead by not preventing bubbles in the stock market and now real estate.

In any event, the debate to put it mildy is academic. The economic situation the US has now will not exist long term, the voters in the US when they really start to exprience real economic fear when they no longer have the ability to re-fi their homes to maintain their spending will start to vote for politicians who will "protect" their economic status, and as I said in a earlier post, this will result in less economic and social freedoms and higher taxes than ever before. Again, and many do not like to hear this, a majority of Americans will not accept a reduction in their standard of living, somthing has to give.

[Jeff Head]

Thanks for that very reasoned and gracious reply Luis.

If a nation and its people are moving towards true liberty, where unalienable rights are recognized and protected, where people have the chance to raise themselves up in a true free market atmosphere and where all of that is undregirded by a clear commitment to fundamental moral principle, both by the government and the people in general (whose government represents them)...then by all means, we should open our markets and our arms to them and allow the free market, free enterprise and inginuity, work ethic and grit to carry the day.

Unfortunately, that is not what current free trade and most of the accompanying trade agreements, banking loans, etc are all about.

I will add, that our immigration policies need to be more oriented towards this same type of thing. Our nation should be open to anyone who wants to come here and adopt those principles just mentioned and become a true American...but at the same time, how much better to forment policies that will give them the support and incentive to turn their own nations into the same?

Anyhow, not an easliy addressed or resolved issue into today's environemnt.

[Poohbah]

GM is a prime example, they are only thinkiong from quarter to quarter with their moronic 0% financing and ultra high rebates per car sold, things that will hurt GM in the longer run,

The question is, which will hurt GM more? Keeping large amounts of unsold inventory into the 2004 model year at 100% loss, or getting it moved aside at a lesser loss?

[hedgetrimmer]

We pay them so little for their work that they can't possibly buy products that we make. We've decided that clean air and clean water is so important that we won't let industry build factories in this country, but we pay the Chinese and the Indians to poison their rivers and pollute their air so bad that occasionally a bit of their "brown cloud" blows over the Pacific ocean and across the entire north american continent and causes pollution alerts in Atlanta.

This strategy was decided for the world at the Earth Summit years ago. It was put into action by the UN and its treaties, the countless NGOs that take money from our government, the WTO and the INF. No American citizen voted to do this. All American citizens are the target of these destructive policies.

[sistergoldenhair]

Excellent discussion. Thanks for the ping.

[Luis Gonzalez]

Give them a job, and a chance at "better".

It's the only thing that most people wanted when they got to this vast, untamed hemisphere.

It should still work today.

[evilC]

>>>
... UNTRAMMELED
<<<

There is no other kind. If it is trammeled, then it is not free-market capitalism.

[JNB]

What hurts GM is the lack of profitability that the GM finance arm has brought in in the upcoming years, since GM like Ford and Chrysler have made more on the finance of cars and the actual car itself. Yes, short term it helps, but the fact that many of these cars will not produce profits for the duration of their loans is going to hurt GMs bottom line in the next few years, and also the 0% financeing, again while great in the short term to boost demand, has in effect, brought future demand forward.

So to restate the question, what is worse, taking a large loss in the near term so GM can be more solvent and profitable in the longer run, or trying to allways boost the next quarter, at the expense of future sales and profits?

The auto makers so far have done ok because home re-fis have enabled consumers to take out home equity loans to buy cars, but the end of the re-fi booms is going to iompact the auto makers in a very negative manner as well.

[snopercod]

Yes.

[snopercod]

"Trammeled" capitalism = fascism.

Read your history and philosophy, my friend.

[Fishrrman]

Elliott Gigantalope wrote:
Thank you for posting this. Well said. Why do so many supporters of free trade refuse to seriously consider the social and political consequences of their position? They base their arguments on theoretical concepts while ignoring the fact that their policy is not happening in a test tube, it is happening in the real world

When I found myself "turning conservative", one of the basic axioms I came to understand was that "freedom is not free". I accept this now as a matter of course, as I presume the overwhelming majority of readers of this posting do, as well.

Having said that, it's time to ask ourselves:
Is "free trade" really "free"?

What will the costs of "Free Trade" become for the America of our future?

As someone who is now conservative, reasoning and sensibility instruct me that precious few things in this life are indeed free; that nearly _everything_ "costs something".

Freedom is not free.

And "Free Trade" cannot be free, either.

The questions that remain, and must be answered, are:
1. What will Free Trade cost us ultimately? and...
2. Are we willing to _pay_ those costs?

Cheers!
- John

[TopDog2]

Sometimes I wonder if you actually have a degree from the "Close Cover Before Striking Institute of Home Study". You asked an idiotic question and I gave you a smart-a$$ answer. Surely you knew that, but continue to point to that post as some sort of "proof" of God knows what.

You post little more than one-line posts that either demand answers to your questions or are an insult, but can't seem to form a rational, reasoned argument for whatever misguided opinion you might have.

Do yourself a favor and don't waste your money on graduate school.