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To: sixmil
More theory, eveyone gets the theory.

Not theory. It's a mathematical certainty. The only thing theoretical about it is a simplified approximation of the curve shapes and they all reflect the reality of it. The geometry of the curves as they actually exist AND as they are approximated in the given model makes it IMPOSSIBLE that you could achieve anything other than a net loss.

What we would like to see is empirical evidence of how it IS working instead of further analysis of the model.

That evidence is right in front of you. When protectionist tariffs are imposed the protected industry benefits but prices also go up (and trade often goes down). It happens every single time. The geometry of price curves makes it mathematically impossible for the benefits to that industry to outweigh the costs to society as a whole. In short, protectionism is nothing more than a welfare scheme that takes away an economic good from the country as a whole and redistributes it, though in inevitably lesser ammounts, to a recipient industry.

You always deal with the theory instead of real world evidence.

The real world evidence is there for anyone to see. Just look at the history of protectionism in this country. Take the Morrill tariff of 1861 for example. They imposed it as law, our entire trade halved virtually overnight, and domestic price levels went up. Look at the customs data from our ports of entry and the financial papers if you doubt me. You will find that it took almost a decade after that for trade to get back to 1860 levels. Take Smoot-Hawley during the depression as another example. Trade dropped off there even faster than it had in 1861, sparked retaliatory trade wars, and created the infamous month-to-month downward spiral that bottomed out at virtually nothing in 1932.

Your model means nothing if it is not observable in the real world.

My model is nothing more than a geometrical certainty within the price model. Prices are observed all over the real world and in fact observation of them is exactly where the price model comes from. Do you deny any of this?

Look at some of the schemes inacted by the World Bank.

The world bank is run by a bunch of utopian new world order thugs. They are not free traders in any common sense of the word, but rather are little more than rent seekers trying to get rich in their own way off government policy just like the protectionists.

These guys have the same economic theories you do

No they don't. They're in it for the money just like everybody else in that scheme of things. I'm a free trader in the classical and quasi-austrian sense, and by that I mean for government's involvement in the matter of trade itself to be minimal.

187 posted on 10/11/2003 4:46:01 PM PDT by GOPcapitalist
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To: GOPcapitalist
That evidence is right in front of you. When protectionist tariffs are imposed the protected industry benefits but prices also go up (and trade often goes down). It happens every single time. The geometry of price curves makes it mathematically impossible for the benefits to that industry to outweigh the costs to society as a whole. In short, protectionism is nothing more than a welfare scheme that takes away an economic good from the country as a whole and redistributes it, though in inevitably lesser ammounts, to a recipient industry.

Of course trade goes down, the country is supplying more of its own needs. Are you arguing trade for trade's sake?

The real world evidence is there for anyone to see. Just look at the history of protectionism in this country. Take the Morrill tariff of 1861 for example. They imposed it as law, our entire trade halved virtually overnight, and domestic price levels went up. Look at the customs data from our ports of entry and the financial papers if you doubt me. You will find that it took almost a decade after that for trade to get back to 1860 levels. Take Smoot-Hawley during the depression as another example. Trade dropped off there even faster than it had in 1861, sparked retaliatory trade wars, and created the infamous month-to-month downward spiral that bottomed out at virtually nothing in 1932.

For me, a trade surplus is evidence of protectionism. Likewise, a trade deficit is evidence of giveaway free-trade schemes that benefit corporate bottom lines and investors at a cost to everyoine else. Businesses and labor are competing interests, so it would be nice to strike some sort of balance between the two instead of your own brand of corporate darwinism.

My model is nothing more than a geometrical certainty within the price model. Prices are observed all over the real world and in fact observation of them is exactly where the price model comes from. Do you deny any of this?

What you have very effectively described is the distorting effect that all taxes have on the goods subjected to them. This distortion is the very reason why the founders talked about excise taxes and tariffs. The idea is that if we have to tax something, it should be as invisible to the population as possible, and placed on items that can be thought of as bad or unessential, such as tobacco, alcohol, luxuries, imports, gaming, etc. In essence, what you are arguing for is the complete elimination of taxes. How are you going to fund gov't or the military? Are you a closet libertarian?

188 posted on 10/12/2003 2:43:51 PM PDT by sixmil
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