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We Need Actual Free Trade, Not The TPP
Submitted by Ryan McMaken via The Mises Institute,
Brendan Nyhan at The New York Times seems to be under the impression that the Trans Pacific Partnership (TPP) has something to do with free trade. Nyhan writes that the TPP
is the latest step in a decades-long trend toward liberalizing trade — a somewhat mysterious development given that many Americans are skeptical of freer trade.
But Americans with higher incomes are not so skeptical. They — along with businesses and interest groups that tend to be affiliated with them — are much more likely to support trade liberalization.
Nyhan is probably correct that much of the population — especially the part that’s never studied economics — is against the lowering of trade barriers. After all, much of the population is wed to ancient ideas of mercantilism which views trade with foreign countries as a zero-sum game in which anything that benefits foreigners must be harmful to “us.” As Henry Hazlitt wrote with exasperation in Economics in One Lesson, “popular thought ... in everything connected to international relations, [has] not yet caught up with Adam Smith ...”
Nyhan is apparently deeply confused, however, since he equates the Trans Pacific Partnership with “trade liberalization.” In fact, the TPP is not about any type of liberalization, but is about centralizing political power. The TPP will further transfer the negotiation and implementation of trade policy into the hands of a small number of global regulators and bureaucrats, while further reducing the prerogatives of Congress and state legislators in the US. Indeed, citizens of all twelve member nations of the TPP will see trade policy become more remote and unknowable thanks to the TPP. And, since trade is but one small part of the agreement, we can expect a further shift toward opaque and authoritarian global decision making on everything from environmental policy to the internet to immigration.
There is no denying that the secret negotiations among unelected elites appointed by TPP members may result in the lowering of trade barriers for selected friends of the global regulators. This cronyist system of rewards and punishments for global favorites, however, should most certainly not be confused with free trade.
Real Free Trade is About Decentralization of Power
Full-blown free trade is about total decentralization in trade policy. In a country that enjoys free trade — that is, a country that has implemented unilateral free trade — it is fully up to the individual consumer and entrepreneur as to whether or not he wishes to do business with foreign suppliers. Under such a system, a baker who must buy delivery trucks and flour for his business can choose whether or not he will obtain his supplies from foreign or domestic suppliers. In most cases, he will choose the most economical option, and the marketplace will reflect this reality.
Trade agreements like the TPP and NAFTA, on the other hand, leave these decisions not up to individual citizens, but to government regulators and negotiators who make decisions in the interest of the state and its favored special interests.
Because of this, any agreement that threatened to implement true free trade would pose a significant threat to the status quo which greatly favors powerful special interests over the interests of small business owners and ordinary consumers. As Murray Rothbard pointed out:
If authentic free trade ever looms on the policy horizon, there’ll be one sure way to tell. The government/media/big-business complex will oppose it tooth and nail. We’ll see a string of op-eds “warning" about the imminent return of the nineteenth century. Media pundits and academics will raise all the old canards against the free market, that it’s exploitative and anarchic without government “coordination.” The establishment would react to instituting true free trade about as enthusiastically as it would to repealing the income tax.
In truth, the bipartisan establishment’s trumpeting of “free trade” since World War II fosters the opposite of genuine freedom of exchange. The establishment’s goals and tactics have been consistently those of free trade’s traditional enemy, “mercantilism” — the system imposed by the nation-states of sixteenth to eighteenth century Europe.
Capitalizing on Fear of Freedom in Trade
Unfortunately, it would likely be very easy for the media and business and political elites to turn the population against any move toward genuine free trade.
Concerned only with what they see in their own industries and not with the unseen benefits to others, special interest groups such as workers and owners in domestic industries will seek to use the coercive power of government to their own benefit.
By resorting to the violence of the state to control trade and crush the competition, what these groups are saying is people should not be able to freely choose what products and services they want. “We reserve the right to dictate to others what their choices should be,” is the position of the protectionist.
They are no different from taxi drivers who seek to crush Uber or native workers who seek to increase their own wages by legally sanctioning employers who hire immigrant labor.
For an illustration of the real effects of protectionist trade policy, we could look to the plight of any small business person who seeks to lesson his costs in the pursuit of making a living. Take an entrepreneur, for example, who finds there is a need in his city for more lawn and garden maintenance services. He or she then seeks to find the lowest-priced and most-reliable lawn mowing machines he can. He knows that the lower he can keep his costs, the lower his own prices will be. Or, if competition is light, he will be able to make more profit and hire more employees.
Ready to stand in the way of all of this are the workers at a domestic lawn mower factory who are quite happy producing lawn mowers that are both more expensive and less reliable than the mowers produced in a neighboring country.
The workers succeed in pressuring the government to slap a tariff on foreign lawn mowing machines which raises costs for the entrepreneur. The entrepreneur then sees his own profits drop which leads to layoffs and even to unemployment to the small business owner himself.
Protecting One Domestic Industry at the Expense of Another
Now, supporters of protectionism would no doubt come back with their own tale of woe about how, if the lawn business has been able to buy cheap mowers, the workers at the domestic lawn mowing factory would be laid off and destitute.
But, implied in the protectionist position is that it is good for the government to make a purely arbitrary decision to support one industry over another. For the protectionist, the freely-made decision of homeowners and gardeners is not to be tolerated and must be quashed by government. Moreover, to make sure that none of those sneaky gardeners gains access to any of these “cheap” foreign-made machines, a small army of customs workers must be hired to ensure compliance and that anyone who dares furnish any business owner with the “wrong” kind of machine will be punished, fined, and possibly imprisoned under federal law.
For the protectionist, this is all a perfectly good and legitimate function of government. The act of buying an economical machine becomes a crime, and the workers at the factory are able to go on producing their second-rate product.
Truly Free Markets Don’t Need a TPP
Obviously, to simply let Americans be free to buy what they want, we don’t need a NAFTA, or TPP, or global junkets of trade bureaucrats to decide what will or will not be allowed to cross over international borders. Certainly, the growth of the TPP moves member states further from the possibility of true free trade since trade policy will become increasingly enmeshed within a multilayered international bureaucracy that only inhibits a nation-state’s ability to unilaterally reduce trade barriers.
When not prevented by international treaties, however, all that need happen for freedom in trade to appear is for the government to refrain from punishing private citizens who seek to do business with foreign suppliers of desirable goods. That would be real “trade liberalization.”
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Now that is "change you can believe in" baby
Most transparent admin ever
Pass the bong, Reggie
Paul Craig Roberts has broken this whole subject of "free trade" down. Off-shoring is NOT free trade. Free trade is based on COMPARABLE advantages (I grow wheat and you'll grow sugar, due to climate, and we trade, etc.). Off-shoring seeks ABSOLUTE advantage by seeking the lowest, slave wage.
Exactly. trade is not free if it exacts economic costs. We need an absolute prohibition on bringing in goods at lower prices than they can be created in domestic terms. Thats really the only rule we need in addition to some safety requirements.
The banker class has purchased the conversation so they can frame it to their advantage and everyone elses detriment.
Like the RepubliCONS coining "PRO-LIFE" to replace "Right to choose"
Choosing death as an alternate convenience.
How will the "right to choose" be adjusted for our aging boomers. Are they really "productively alive? Lets face it. Many will become a burden, just like an unwanted child.
The right to choose a "late term' abortion.
Rights are to be determined by the "democratic" majority.
Ah, yes, more protectionism to support the inefficient at the expense of the productive.
Halting off-shoring of domestic manufacturing IS NOT "protectionism."
There are lots of reasons to not want the big feet of government tramping around arbitrarily deciding who gets protection and who doesn't, but that's what they have been doing, and usually for the their best donors.
The answer is voluntary protectionism by the American people. Yes, that right, WE actually acting in the interest of our country, realizing that it IS our country and as such, OUR homes, Our families and OUR JOBS. We have always had a choice, and we have always chosen poorly. We do it at the polls, we do it in the markets. We could have chosen to buy American goods and labor...for the good of our country....NOT the multinational companies and NOT the bought and paid for politicians.
We complain constantly how we are being fucked by corporations, by government, and by the banks, YET we do nothing in our own interest other than that which serves our most immediate needs as prompted by those who we all claim to detest.
We don't need no stinking revolution. We don't need no bankers hanging from lamp posts. All we need is for us to make the right choice, day in and day out. We know the evils of debt as have been written for thousands of years. WE know the evils of lying politicians as has been written for thousands of years as well.
What is it that we need to be able to stand up and just refuse to fuck ourselves for a few shiny baubles. Either we are sheep or we are men. That is our only real choice.
"This cronyist system of rewards and punishments for global favorites..."
This is all about the global monopolism which has been ongoing these past few decades. Ownership/control of so much is already in the hands of very few. The trend is clear.
This is the fight which will become clearer as time goes on.
The "fairness of off-shoring has also been skewed by playing shell games with shipping. Ships and railroads expences should be accounted for in the price of forign goods, limiting forign labor advantage. But today shipping cost often are not. As it stands today, globalism is a tool of monopolies, not free markets.
Offshoring is the legitimate choosing of free people (and companies) to allocate their own capital and resources in any way they see fit. Would YOU want governments insisting that you pay for amenities and services for other people at gunpoint? Because that's what "society" is these days...
"You just don't get it, do ya Scott?"
TPP just needs some "Frikken sharks with lazer beams on their heads!"
"Off-shoring seeks ABSOLUTE advantage by seeking the lowest, slave wage."
Not just the lowest wage, but lack of environmental controls and the depletion rate of natural resources also come into play.
The best example is China, where dumping of industrial waste with virtually no controls guarantees a lower cost base even without the advantage of lower wages. Unlike lower wages, however, the effects are cumulative in the form of poluted water, land and air, with an eventual negative impact on the low wage advantage. In effect, productivity is reduced commensurate with the reduction in quality of life. Liikewise, as productive land is consumed via population growth, reassignment to industrial purposes or simply industrial polution, the need for food imports grows, thus furher reducing the low wage advantage.
Unfortunately, comparative advantage suffers from its own set of problems.
Take Jamaica, whose primary export is bauxite, the ore from which aluminum is refined. Lacking the electric power needed to produce aluminum, Jamaica exports bauxite to nations which have that capacity. This is all well and good until the bauxite runs out, after which you're left with a labor pool with no other experience than mining, and no other profitable mineral to mine. The same problem exists with sugar, which has to compete with recently developed substitutes amidst a general decline in sugar consumption due to recently understood health effects. Jamaica then has to compete not only with the substitutes in a declining market, but with other sugar producing nations with similar lack of alternatives, thus reducing the comparative advantage of producing that single commodity.
Likewise, the USA until 1973 had a comparative advantage in oil production. Unlike Jamaica, the USA could offset that loss due to its diversified industrial base, and shift to comparative advantage in other areas, at least until those were overtaken by foreign competition such as Japanese electronics, steel and automobiles.
The main point is, none of the 19th century economists whose models we use took any of this into account. They based their theories on static relationships rather than an ever changing dynamic driven by changes in population, land use and most importantly, technology.
To summarize, the solution (if any is to be found) lies in understanding a complex dynamic system of interdependent variables. To put it another way, there are no easy solutions - not Hume, Ricardo, Smith or even Rothbard will get you out of this jam. New ideas are needed. Unfortunately, with all the vested interests, that's easier said than done.
Maybe we just need to cut the Federal Government loose and let it stand on it's own 2 feet without the rest of States. Bet you it collapses faster that the World Trade Center towers the second you remove all the tax mules from it's control.
You can have a United States without a Federal Government. It is called a Confederacy.
The false idea is the the United States is predicated on the Federal Government first then the states. Any form of unified government requires states first not the other way around.
A Confederacy is more along the lines of a voluntary governmental association of states (that also retain their sovereignty) than a Central Government based on the idea of Unions and Banks ever were.
At least in the United States, states like the New York are not as self deluded to think of themselves as countries unlike the EU which is the same fucking thing except a state like Greece or Germany likes to somehow think it is a sovereign country (they aren't).
The greatest weakness of humanity is it's infinite symbolic language generating abilities to come up with new words along with changing old ones to describe the same ideas over and over so it can keep lying to itself that something is other than what it is.
fter the Feds are gone, you haven't got any more REAL individual liberty.
You'll STILL be under the whip of STATE governments. And local governments. And taxation. And "representative democracy"...and nanny-statism...and...and...
That starts at the individual level.
Here we have a bill that is in complete secrecy and if anyone tells the public the specific details of this bill they go to jail. How the fuck is this supposed to be the most transparent admin in history? How the fuck is this constitutional? How the fuck are our representives not demanding the details be released to we the people as this will no doubt have an impact on our lives? our republic is 6 feet under.
Nancy Pelosi - "You have to vote for it to find out what's in it".
DavidC
The author here says only protectionist people that haven't "studied economics" don't like secret trade deals LOL.
Fuck off!
"How the f*ck are our representatives not demanding the details be released to we the people..."
Because they are no longer our representatives!
This could become a trend if they pull it off - in five years the details of ALL bills could be kept secret, if they believe they could get away with it.
We are at war so the priorities of war win. The gobalists control the military.
Well, they've done such wonderful work with "healthcare", shovel ready jobs, energy independence, Cash for Caulkers, appointing Ebola-Car-Stimulus Czars (lol), spying & groping grandma to keep her safe & secure, all while lowering the national debt so...
...what exactly is the problem with this? ;-)
I dispute the idea that what America needs is more "free trade" that is "really" free.
Adam Smith was right about the invisible hand, of course, but that affects price of goods AND price of labor.
Here it is as simple as I can put it - If you make Americans compete directly w/third world countries for labor, our labor price will fall and their labor price will rise.
Ergo, it would be foolish to agree to "free trade" with the economic cesspools of the world, because decreasing the wages in the U.S. in exchange for lower priced junk from abroad is . . . poor.
Humbly I suggest it will be only pleb workers that suffer the sting of a firm slap from the invisible hand. Labor price will fall here and it will not rise abroad.
You get (hopefully) what you pay for!
When I'm looking for one of these...,
This is not an acceptable substitute
Free trade is not possible without permissionless, decentralized currencies like bitcoin.
What's the Bitcoin priced in gold these days?
http://www.xe.com/currencyconverter/convert/?Amount=1&From=XAU&To=XBT
Very interesting interview on this subject.
https://www.corbettreport.com/interview-1046-patrick-wood-exposes-the-te...
What we need is FAIR trade, which is never going to happen. Big difference the Chinese government subsidizes every export to Walmart, and in return buys tbills... The cronizism cant and wont be destroyed.
What has to happen is tarrifs to level the playing field.
Or really level the field the old fashioned way like the way nature periodically takes care of overgrown land through brush fires for example.
Who decides what trade is considered "fair"?
The same government that fucks up everything it touches?
Bravo! Nice Work
"free trade" is nothing but a Bernayism...
"free trade" is an emotionally loaded propaganda statement to cause dissonance and create false associations of ideas.
Trade is a transaction. That is an association of a voluntary type between 2 parties. An exchange goods for goods, service for service, goods for service, even charity or a loan (interest free) is not free. Charity or a loan is an investment which changes the time frame of return from immediate to the future but it is never free. People are purposely dishonest in how they value the trade to lie themselves and others that it is somehow free.
There is no free EVER in any transaction or any market that is free.
To be free requires enough energy and/or resources to offset outside influences, so freedom is not free it is just a question of outside influence. So being free of outside influence is not free either. See the contradiction and double plus good speak in the language and meaning no matter the context.
Free always comes with a fee or terms and conditions. People never learn..........
People calling themselves 'libertarians' should know better and be more disciplined in how they use language.
I agree with you on many levels. Free trade if there ever was such a thing- no longer exists.
People misunderstand libertarians. We want minimum government- maximum freedom. That doesn't mean zero government nor do we believe free trade will ever exist in the sense that governments will always intervene- or corporate anywhere will always intervene.
Just get government the fuck out of my healthcare needs. Let me buy a Cuban cigar for 20 bucks. The fucking government acts like it is their money. That's when and where I start getting angry and my countrymen rather than get angry- submit to this sodomy.
Free trade .. so called .. has put US labor in competiton with slave labor .. China and Mexico . central America come to mind .. we do not compete against German or Swiss labor for instance but against a never ending supply of cheaper and cheaper labor from the third world.. and as it stands at the moment we have the trade profile of a third world nation .. trash being one of our biggest exports... not to mention US military and the dollar .. in any event .. only the UK and the USSA have decided to force their people to compete with slave labor . the Germans and others .. wisely . have maintained their high end manufacturing .. machine tooling etc .. we just willy nilly sent it to China . even the ONE bright spot we had .. aircraft manufacturing has been out sourced to so called 'trade partners ' including China . Brazil.. Japan etc.. China has used the technology edge that kind of trade gave them to advance their war machine .. and hegemony . but maybe the NWO has that factored in .. p;roblem solution resolution . create an enemy . then go fight it . if history is any guide that is how our plutocracy rolls.
Free Trade for a country that has exported its manufacturing jobs and runs massive multi-billion dollar trade deficits each month is not necessarily a good thing. Like Keynes economics, free trade is a leftover relic from a different age -- and age where countries invested in themselves, made things that their own inventors created, employed their own people to build things, etc. Any advocate of free trade today simply wants to import stuff made in factories around the world and then distribute and sell it in the US. So in ages long ago, when the US actually made things, free trade was a good thing as we tried to sell our products to other countries. Today, in a global economy where factories migrate to the cheapest labor pool, a high tax, high regulation, welfare state cannot compete.
What do we export today besides planes, weapons, and agricultural products?
Only in the New 'Land of the Free' is no one 'Free' to reveal what is in a 'Free Trade' deal!
When you talk about free trade, does that include the size of the population? The access to electricity? The access to clean drinking water? A healthy diet, safe working conditions? Equal pay?
I don't think so.
Just look at big corporations such as Nike. They pimp the world for the cheapest labor. Enough said.
Free trade would mean free movement of people and labor in addition to free movement of goods. Free movement of goods with captive labor is a form of slavery, where governments and corporations conspire to enslave people.
Another propaganda term 'free movement'. It costs me energy just to get out of bed every morning then even more to walk to the bathroom to use the toilet and that costs me energy to drop a deuce. Even that free fallin' deuce is using up gravitational energy. Something has to generate that energy plus that deuce required energy to be created in the first place. Inanimate objects goods or deuces don't move themselves without someone or something else energy being used.
Movement is not free. There is no free..... Just like there is no spoon.
Meh, Entropy is free (but its gonna cost ya!)
Agreed; Free trade should be accompanied by free movement of people.
We need unrestricted free trade as much as we need TPP or a nail in the head. This author's example of a lawn mowing service is weak. Then stating that American produced products are of lessor quality than one produced by a competitor, who quite possibly pays slave labor wages is even weaker. The goal of protection is not just to protect the wealthy businessman but, the myriad of employees within the industry and other industries supplying it. The question becomes would you rather support your own countrymen or those of another first. Any individual under a protective trade policy is free to buy the foreign product he just has to pay more for it. What the author is really saying is the people of our nation should support the multi-national corporation who have the ability to produce lawn mowers in Malaysia, and ship them into the U.S., duty free, so that Johnny can pay $100 less for his mower. Pretty soon those very same middle class home owners won't have middle class wages to even hire Johnny in the first place.
Do you actually think the lawnmower will cost $100 less?
Hasbro moved production of toys from China to Vietnam and started using regrind instead of virgin plastic. The production costs dropped dramatically but the retail prices increased 30%.
The trade deal is all about increasing EPS without real organic growth.
These are not true free trade deals. If things like CAFTA were real trade deals, you would be seeing bunch of cereal boxes made in Mexico. These are not free trade deals. These are managed trade deals. You don't see cheaper prices because foreign goods are kept out of the US market. Just because there is outsourcing doesn't mean prices will lower. Prices only lower with real competition and true free trade. Would manufacturers who moved from US to China lower prices simply because? Nope, that requires competition, US doesn't have enough foreign competition. US companies offshore their production, but without competition and little to no inflation, there is no incentive to lower prices. Despite all these so called free trade agreements, you actually don't see much foreign born and foreign made companies competing in the US market. Instead you simply seeing US companies offshoring production to other countries to export and sell in America.
The dollarization mechanism is not true free trade either. Americans consume, and everybody else feeds the American. Not true free trade at all.
And under TPP the lawn mower store owner had better not advertise those mowers as "American made" or the manufacturer in Malaysia will have grounds to sue his ass for restraint of trade and damages. THAT'S how fucked up the TPP is! After it passes, no more "buy American" or "buy American first".
OT
Secretariat Kerry has broken his leg in Swtizerland.
Breaking protocol , he was not put out of his misery by the roadside.
Luckily , no dogs will be poisoned as a result.
Switzerland is not France.
Maybe he gets good health coverage through Heinz
This is a free trade deal written by the Ferengi!
Democrats are pulling a page out of the RINO play book and are pretending to be an opposition party, but Reid and Pelosi will quitely allow enough rank and file to be bribed for their vote.
This is a free trade deal written by the Ferengi!
I think I agree with this, based on the title, but I can't really follow the argument of who he is accusing whom of betraying.
I remember twelve years ago when the state government said we had to deregulate the utility companies and open them to competition.
The people went along with it because the government said it would lower prices. People were taught competition is good and in a true free market it would drive down prices.
But instead of a free market we got hundreds of new corporations that existed as nothing more than PO boxes competing for commodity contracts and the right to sell you a paper deal. They would never actuality touch the physical commodity, generate it, or deliver it. What happened was the rates for electricity and gas gapped exponentially higher.
I paid $8.50 a month for cooking gas, with $5 being a base charge. After deregulation I paid $23 a month. The base charge increased from $5 to $20. The electric utility added a $.05 per kWh "transportation" fee because of the claim that the cost to transport electricity increased from all the new "utilities" that were created.
There was no new competition for actual generation or delivery. I would pay Synergy Energy for my power and gas, but not directly. I actually paid the same utility company I used to. They also continued to generate and deliver my power. So if my old utility still generated, serviced, and delivered my power, what the fuck did Synergy Energy actually do?
Even though natural gas dropped in price, I still paid more per MCF than I did before. That is because my gas company added a $2 per MCF delivery charge for the "transportation" of gas from Synergy. Wow a $2 charge for transporting a paper contract.
Instead of allowing a competing company to lay new pipelines or electric lines to enable real competition, we got Wall Street brand competition. Thieves competing over the right to generate profit for themselves without having to do any work for it. The consumer got hosed and there is nothing they can do about it.
The TPP is utility deregulation across the entire globe and every sector of the economy. Opening every aspect to the Wall Street thieves.
Well we can do something about it. We could storm the offices of Goldman Sachs and kill every single person inside. Then storm every office of the Federal Reserve. Those acts would do more to put the Earth on the right track than anything else done in the last 200 years. It needs to be done, but there isn't anybody willing to do it.
I share your frustration. Our legislators have eagerly allowed middlemen in every industry I can think of. The worst are in healthcare. Why do you need Kaiser, Humana, Health Net, Blue Cross etc. to access the healthcare system for a monthly fee while paying about the cost of the actual service in co-pays and deductables? Why is scorpion anti-venom that sells for $100 in Mexico, $30,000 in the U.S. Why do I have to pay a "Video access fee" every month on my Verizon bill? Isn't that part of their service, accessing video?
The TPP is about trumping our sovereign nation's laws by panels selected by big corporations. And it's also about protecting copyright and patents to the nth degree. Not to mention the nightmarish immigration provisions that will trump what little laws currently enforced in the U.S.
The goal is to homogenize society to a standard level of poverty ruled by corporations and big money. As in days of old, Royalty vs Serfs with no middle class.
Those who voted in favor of this should be hung for treason.
Corporations always seek monopoly powers, the crushing of competition, collusion to prevent competition, influence in government to favor them, control of regulations used to crush small operations, etc. etc. Anyone arguing that major corporations are the heart of free market capitalism is misguided at best. The government regulations that kill small business are almost always favored by large corporations who can easily meet or cheat the regulators, while small time people just get destroyed by governments, especially local governments. I have seen big developers actually take total control of City Councils and pass laws to favor one developer in particular, while sending building inspectors to shut down private builders or families just trying to upgrade their homes. This passes for a capitalist system, it is not. People need to wake the fuck up to that fact, instead of the lies media spread.
Always like your posts Jack. Always on point! Cheers!
Real free trade! Will never be allowed.
It's basically this: just like the "evil corporations" I too want ALL these pestering, thieving, manipulating, criminal governments to Fuck Off and leave me ALONE
Calling Bubba to the Board - bring rope, we have a lynching
Any Treaty or Law brought forth whose inner workings are kept secret to only a few do not merit the time of day much less the rants of those like the Mises Institute that feel the protections of mere commoners are a waste of time. This monstrosity will most likely pass ratification due to bribing of government officials wholly lacking any moral code of decency.
The common man will suffer from the feudalistic trash as he always has throughout history.
"If a foreign country can supply us with a commodity cheaper than we ourselves can make it," wrote Adam Smith in 1776, "better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage. The general industry of the country will not therefore be diminished... but only left to find out the way in which it can be employed to the greater advantage."
When the UK was the workshop of the world in the 1800s the US and Western Europe caught up by forgetting all about Adam Smith.
The UK was the home of the industrial revolution and therefore had all the technological advantages.
The US and Western Europe used tariffs on UK manufactured goods to catch up with its more advanced technology.
If Adam Smith's ideas had been popular 100 years ago the UK would still be the workshop of the world and the US would be a third world agricultural nation.
Japan did the same thing. Sure tariffs does isolate from forign competition, but nevertheless it can't be said that such policies are solely responsible for economic growth, but free trade benefits economies more globally. Look at the Japan during the early 1900's. FDR cut trade with Japan, the result was Japanese aggression due to imperialist ambititions in Asia. Economies have a need for basic commodities to transform them into goods that consumers needs, what the economy needs. Free trade benefits more than it harms and most economies do practice some form of free trade and see the benefits.
Fascist ideas about autarky and self sustenance are illussion, because resources are scarce and finite. Free trade is necessary for the human race. One tall order to claim that merchantilism created industry. The goal is not simpy to have the most industry, or who can beat who, the goal is moving complementary goods in exchange for other goods. One economy can cheaply deliver one complementary good (a raw material), the other transforms it, while another trades one complementary good for another complementary good. Milton Friedman already described it well when he discussed how a simple pencil is a product of many different economies spread across the globe. A simple pencil was a product of global trade bringing different materials, and forged from many different countries. Although I am no fan of Milton Friedman's monetary theories, he certainly got some things right.
What's better autarky, or free trade? Autarky is just more energy expended simply just prevent competition. No different than State Department having banned Americans from going to Cuba, or prevent free trade with Cuba. Autarky is rubbish.
South Korea subsidies it's industry <this is not free trade.
Currency manipulations < not condusive to free trade
Tariffs< no free trade
Banning of products < no free trade
China subsidizing industry, like solar panels << no free trade
So you are acting like free trade exists when there is so called treaties that are labeled free trade, doesn't make it free trade. Free trade only works if you have it. Claiming to have free trade and subsidizing industry directly is "do as I say, but not as I do," policy. So what are you advocating? Autarky, or trade wars with retaliatory tariffs and bans? HMM?? True free trade is much more pragmatic.
Communism works, you just doing it worng!
Socialism works, you just doing it wrong!
Free Trade Works, your just doing it wrong!
Blah blah blah blah etc etc etc etc