Another free trade thread: Kregisen v. Anti Federalist

[Anti Federalist]

The following is a series of PMs that went back and forth between RPF member Kregisen and myself.

We both felt that the case should be made public.


10-24-2010, 12:08 PM
Kregisen

hey
Have you ever taken an economics course?


Anti Federalist

Hmm, I can see where this is going.

No, never, I'm just a dumbass HS dropout.


Kregisen

It's not going anywhere....it's just tiring to see you whine about free trade once every few threads. The arguments against protection policies are covered in intro econ courses....

Have you taken any?


Anti Federalist

Yah, and college economics courses also make Keynesianism and Marxism look good.

Don't like my whining? Put me on ignore.

Selling off the nation's industry and selling debt by the billions to a murderous communist regime is insane, period.


Kregisen

Intro classes don't go into keynesianism....and selling debt is not free trade. Those two have nothing to do with the other. We could be spending all of our money in the U.S. and still rack up the debt.

Have you taken any intro econ classes?


Anti Federalist

I already answered that, no, in my very first reply to you.

And of course selling debt is not "free trade", I understand they are two different things.

Both bad.

Let me ask you a question.

What do you do for a living?


Kregisen

I'm a student and working part time....I'm not gonna pretend I'm some successful man with a huge career going. But that's irrelevant when it comes to an economics issue....it's like asking a math question without taking math classes and thinking job is important.


Anti Federalist

No, it is very important.

Come and see me when you're pushing 50, have been supporting yourself since you were 16, supporting a family since 19, run multi million dollar enterprises and started three small business of your own and are now on the tip of the spear of the new world order of global free trade.

I see what's happening, I've seen the job losses, I've seen the people whose lives were destroyed, the critical manufacturing infrastructure gone, comforted the families of two people that I knew who committed suicide because of failed businesses whose failure can be directly attributed to "globalized free trade".

In 1986 I sat face to face with the director of a federal agency that was in charge of regulating the business I was in. He told me it was his goal to put at least 50 percent of my fellow workers in this industry out of business. When I asked where was he planning on getting the supply of product that would be taken off the market, he said, "no problem, we're lifting the tariffs on imports, we'll get all we need from foreign sources." And they went right ahead and did just that.

So, don't expect me to drink the "free trade" kool aid.

It's nothing but a corporatist/globalist/NWO sham.

I ain't buying it


Kregisen

But notice what you're doing....you're using emotion to win people over with that argument. It's like saying "it's for the children!!!"

Yes, when the government does not interfere with trade from private individuals, the most efficient means of trade will survive. That's free trade. Obviously if labor is so extremely cheap in third world countries because citizens are so poor they're willing to work so cheap, that brings cheaper prices, which enables workers in richer countries like the U.S. to move a different industry. Look up comparative advantage. Every country has a comparative advantage in something.

http://townhall.com/columnists/Walte...e_trade_at_all

Walter Williams is amazing.

"The Washington-based Institute for International Economics has assembled data that might help with the answer. Tariffs and quotas on imported sugar saved 2,261 jobs during the 1990s. As a result of those restrictions, the average household pays $21 more per year for sugar. The total cost, nationally, sums to $826,000 for each job saved. Trade restrictions on luggage saved 226 jobs and cost consumers $1.2 million in higher prices for each job saved. Restrictions on apparel and textiles saved 168,786 jobs at a cost of nearly $200,000 for each job saved."

How do you respond to facts like that? Do you think sugar jobs are worth $826,000?


Anti Federalist

It's interesting that you brought up Walter Williams, a man who I have great deal of respect for, but on this issue is just wrong.

Interesting, because I had a chance to "debate" him one day while he was filling in for Rush Limbaugh, back, oh jeez, must be 15 years ago or so now, on this very subject. He was making the exact same case, laying out the argument that, if an economist (WW's stock and trade) were to set up shop down the road from him, offering the same services as he does, but at a cheaper price because he figured out a comparative advantage then it would be incumbent upon him to find a similar advantage, compete with new services or die.

And I agree, but, and it was the first time I made this argument, that assumes that this economist is living down the street from you, paying the same taxes, suffering under the regulations, subjected to the same labor laws and so forth. That is not the case with global free trade with prison states like China or failed states like Mexico, or feudal caste system states like India (This was right around the time that trade with China and Mexico was just starting up, with NAFTA and so on)

I used the prison analogy, that I'm sure you seen me post before, in the argument, and he admitted that there was no comparative advantage that could be brought to bear against the power of the state to run a prison economy, which I maintain China is. His argument was that such an economy and system would be unsustainable, and perhaps that's true, but in the meantime I'm not willing to sell out a manufacturing infrastructure that was the envy of the world and go broke in the meantime.

As to the specific example of sugar quotas, yes, I think it's worth it. In a perfect world I'd rather pay $21 dollars more a year for domestic sugar and eliminate income taxation.

Now, don't get we wrong, of course I'm not in favor of North Korean or Cuba style trade restrictions. If there is a commodity or good that we cannot produce here, that the only source is trade with another nation, then by all means, let's trade to obtain what is needed.

But I submit that there are few items that fall into that category, that we, as free citizens, not "consumers", could produce just about everything that is needed right here. By doing so, we remain independent, free and unfettered by "entangling alliances".

You wrote:


Quote:
Obviously if labor is so extremely cheap in third world countries because citizens are so poor they're willing to work so cheap, that brings cheaper prices, which enables workers in richer countries like the U.S. to move a different industry

This notion has been debunked.


Quote:
[g]lobalism’s advocates have resurrected Dartmouth economist Matthew Slaughter’s discredited finding of several years ago that jobs offshoring by US corporations increases employment and wages in the US.

As I demonstrated in my syndicated column at the time and again in my book, How The Economy Was Lost (2010), Slaughter reached his erroneous conclusion by counting the growth in multinational jobs in the U.S. without adjusting the data to reflect the acquisition of existing firms by multinationals and for existing firms turning themselves into multinationals by establishing foreign operations for the first time. There was no new multinational employment in the U.S. Existing employment simply moved into the multinational category from a change in the status of firms to multinational.

If Slaughter (or Cohen) had consulted the Bureau of Labor Statistics nonfarm payroll jobs data, he would have been unable to locate the 5.5 million jobs that were allegedly created. In my columns I have reported for about a decade the details of new jobs creation in the U.S. as revealed by the BLS data, as has Washington economist Charles McMillion. Over the last decade, the net new jobs created in the U.S. have nothing to do with multinational corporations. The jobs consist of waitresses and bartenders, health care and social services (largely ambulatory health care), retail clerks, and while the bubble lasted, construction.

Paul Craig Roberts

American Job Loss Is Permanent

http://www.infowars.com/american-job-loss-is-permanent/

I'd like to post our exchange in the forums, if you're agreeable to it, let the people take a look at it and decide for themselves.


Kregisen

Quote:

His argument was that such an economy and system would be unsustainable, and perhaps that's true, but in the meantime I'm not willing to sell out a manufacturing infrastructure that was the envy of the world and go broke in the meantime.


Well, this is an argument between two economic amateurs, but how is a different country f***ing itself up by subsidizing and devaluing its currency hurting us? Yes, it takes jobs away….but like the facts state, the savings to consumers are more than 10 times the value of the actual job. If China wants to subsizide and devalue its currency, which makes our currency richer, meaning 1 hour of work in the U.S. will get you more wealth from China than if the currency wasn’t devalued, that’s HELPING us, not hurting us.

Worst case is, you could TAX 10% of the savings for consumers just to pay the employees who lost their jobs their full salary….and then you still have lower prices for consumers.


Quote:
And I agree, but, and it was the first time I made this argument, that assumes that this economist is living down the street from you, paying the same taxes, suffering under the regulations, subjected to the same labor laws and so forth.

We should abolish the income tax and take many regulations away….that’s a different issue than free trade though. The goal is to maximize free trade, which includes no income tax. We had a thread a while back about which is better to keep: income tax or tariffs, and I don’t know what the answer is, but I want both gone.


[quoteAs to the specific example of sugar quotas, yes, I think it's worth it. In a perfect world I'd rather pay $21 dollars more a year for domestic sugar and eliminate income taxation.

Ok, we both agree that a sugar job is worth $21 a year, but is it worth $826,000 a year? $21 is simply your share of the payment, not the total payment. We could have every American chip in 1 cent to pay for Ferrari…and yes the Ferrari is worth more than 1 cent, but is it worth $3 million? One person’s share of payment =/= total payment.


Quote:
Now, don't get we wrong, of course I'm not in favor of North Korean or Cuba style trade restrictions. If there is a commodity or good that we cannot produce here, that the only source is trade with another nation, then by all means, let's trade to obtain what is needed.


Is there such a thing that cannot be produced in the U.S.? I can’t think of anything that can’t be produced here. I think the article I gave you from Williams goes over that the U.S. could produce anything….even if it had to spend millions growing coffee beans in a humidity controlled indoor environment, which most people would say would be too costly for coffee beans, so instead, we trade with South American countries who have the perfect climate for it.



Quote:
“Obviously if labor is so extremely cheap in third world countries because citizens are so poor they're willing to work so cheap, that brings cheaper prices, which enables workers in richer countries like the U.S. to move a different industry”
This notion has been debunked.


Your debunking post had nothing to do with what I said. What I said is just common sense….if someone loses their job, they go get a new job, many times in a different industry. There’s no refuting a simple observation like that.

I'm perfectly ok with posting this in a thread....we've made so many threads over this already, but making another is fine. Did you wanna post it and continue this convo in there, or wait until it's done in here and then post the whole thing?

[college4life]

How do you decide which industries get protected?

These Americans that are losing their jobs to overseas competitors need to become more productive, not have the hand of the state intervene.

[Kregisen]

How do you decide which industries get protected?

That's easy. It's up to the politicians. They would never make corrupt decisions like creating tariffs in industries where families, friends, and bribers work, right? Right???

Big government only ruins everything it touches.

[low preference guy]

That's easy. It's up to the politicians. They would never make corrupt decisions like creating tariffs in industries where families, friends, and bribers work, right? Right???

Big government only ruins everything it touches.

of course. but that probably won't sway people like AF who expect politicians to be fair and solve their problems.

and you mentioned he probably didn't take economic classes, right? i bet he didn't read economics in one lesson either.

[silverhandorder]

I think Walter Block's lecture should have ended any debate had the anti free trade people actually listened to it.

By practicing protectionism places like China produce less on totality. As such we will be making a big mistake trying to mimic them. People who advocate protectionism do not understand what comparative advantage means.

[low preference guy]

I think Walter Block's lecture should have ended any debate had the anti free trade people actually listened to it.

By practicing protectionism places like China produce less on totality. As such we will be making a big mistake trying to mimic them. People who advocate protectionism do not understand what comparative advantage means.

exactly

[Brooklyn Red Leg]

Weird. Though its been nearly 20 years since I took my Intro to Macroeconomics class in college, I'm fairly certain that was where I first learned of Keynesian thought. Although I don't agree with AF on Free Trade, its certainly true my class seemed to paint Keynesianism as right and proper.

[Teaser Rate]

In my experience, I’d found that opponents of free-trade ultimately end up advocating the idea that producing more goods with less is a bad thing.

As if cheaper goods and a higher quality of life for everyone in society were not worth the price of abandoning the silly notion of sustainable nationalism; or as if having access to better, safer and cheaper goods was less important than making them.

[sratiug]

How do you decide which industries get protected?

These Americans that are losing their jobs to overseas competitors need to become more productive, not have the hand of the state intervene.

You make it flat for all countries and all products by constitutional amendment.

How about letting Americans experience free trade by abolishing the income tax and replacing it with a flat tariff. Let the foreigners become more productive instead of having the hand of the state give our free trade rights away to them for the benefit of multi-national corpoprations.

[LibertyEagle]

Weird. Though its been nearly 20 years since I took my Intro to Macroeconomics class in college, I'm fairly certain that was where I first learned of Keynesian thought. Although I don't agree with AF on Free Trade, its certainly true my class seemed to paint Keynesianism as right and proper.

Yup. Me too. The very first Macro class.

[specsaregood]

"Free trade" simply doesn't work when you have the world's global currency and the ability to print it at will. The inevitible result is a withering away until you are unable to fend for yourself an the other countries finally cut you off.

Neither of you is correct. As freetrade sucks our life away in our current system and protectionism won't fix it either.

[Mike4Freedom]

Tariffs are constitutional and the income tax is not. That is the bottom line. I want a goverment that follows the constitution.

If they decided to use tarriffs it would raise the price of goods being imported. At the same time they would need to get rid of the income tax( This is the consitutional solution to the problem)

So now we have freed up tax money because there is not income/corporate/or capital gains tax.

The price of imported goods will go up but the tax cuts will balance it. The goods we produce here would go up in price for a few years until we got all of our productive capacity back.

It could take a couple of years, maybe even 5 or 10. So the price of goods would be high and our standard of living will be lowering for a while but once we go through the hard peroid we will be producing more goods again and be better off for it.

This system we have now cannot be sustained. Eventually when our dollar collapses we will not be able to afford cheap chinese imports anymore and we will have even less productive capacity then we do today. We will really be f*cked.

This is a simple constitutional solution.

[forsmant]

Free trade is a way to bring about global governance as the rules would tend toward similarity to increase efficiency. Sometimes efficiency is not good.

[Kregisen]

Free trade is a way to bring about global governance as the rules would tend toward similarity to increase efficiency. Sometimes efficiency is not good.

Explain how that would lead to global governance.

John Lambert created the first gas powered car.....tons of other countries now produce gas powered cars. That's increasing efficiency, and has nothing to do with global governance. (we're still all separate countries)

[Kregisen]

The "free trade" we're all talking about is NOT our current system. Both tariffs AND the income tax would be eliminated.

[specsaregood]

The "free trade" we're all talking about is NOT our current system. Both tariffs AND the income tax would be eliminated.

I notice you didn't mention eliminating our current monetary system.

[Jordan]

The average tariff is something like 4%, the average income tax here is multiples of that. Income taxes between two citizens are essentially internal tariffs.

The question is, do you raise tariffs and lower taxes, making the two equal across the board? Is that a solution?

--
OT: The only thing "Keynesian" about your economics classes is the importance of the value of money, and the role of the government in recession. You people act like simple supply/demand curves are "Keynesian" and should thus be ignored. All schools of thought agree on like 99% of the entire study. Admittedly, it is that 1% that probably counts the most.

Keynesians: It's demand that matters!
Supply-siders: It's supply that matters!
Austrians: We're supply-siders but we care about currency!

[Kregisen]

I notice you didn't mention eliminating our current monetary system.

Still neutral on it. Before I do more research I'm not gonna reach a conclusion as to whether or not we should end the fed and go to a commodity-backed currency. There are problems with both...such as when fixing your currency to something like gold, you're fixing exchange rates to other countries who fix theirs to gold too. No solution is perfect.

[Kregisen]

AF, do you have an answer to this?


how is a different country f***ing itself up by subsidizing and devaluing its currency hurting us? Yes, it takes jobs away….but like the facts state, the savings to consumers are more than 10 times the value of the actual job. If China wants to subsizide and devalue its currency, which makes our currency richer, meaning 1 hour of work in the U.S. will get you more wealth from China than if the currency wasn’t devalued, that’s HELPING us, not hurting us.

Worst case is, you could TAX 10% of the savings for consumers just to pay the employees who lost their jobs their full salary….and then you still have lower prices for consumers.

[dannno]

I learned about comparative advantage in depth in an upper-division econ class.

I have a question, though. Comparative advantage seems to assume that trade amongst both entities can and will continue indefinitely. If you are importing required goods like food or energy, it seems like there should be a concern of the risk that trade may be cut off for one reason for another, perhaps voluntarily cut off by the other nation. This could be potentially devastating.

Could the concept of trade risk be worked into some sort of tariff structure? It seems like this would at least help the home country produce more to create a buffer of infrastructure in case the goods were no longer available. Or is there a free market solution :confused:

[dannno]

I mean, wouldn't it be great if we abolished the income tax, corporate/business taxes, capital gains taxes and property taxes, simply having a trade risk tariff that was the sole income for our government?

[Anti Federalist]

I learned about comparative advantage in depth in an upper-division econ class.

I have a question, though. Comparative advantage seems to assume that trade amongst both entities can and will continue indefinitely. If you are importing required goods like food or energy, it seems like there is should be a concern of the risk that trade may be cut off for one reason for another, perhaps voluntarily cut off by the other nation. This could be potentially devastating.

Could the concept of trade risk be worked into some sort of tariff structure? It seems like this would at least help the home country produce more to create a buffer of infrastructure in case the goods were no longer available. Or is there a free market solution :confused:

Nice point, and a concern I have as well, with increasing foriegn supplies of food and oil coming into play, just to name two vital commodities.

[Anti Federalist]

AF, do you have an answer to this?

Quick answer, governments playing fast and loose with currency valuations usually leads to disaster.

I notice you're cool on the idea of competing currencies.

I can understand that, a competing currency would destroy the ability for government to manipulate the currency to make a free trade agreement appear as a net positive.

[silverhandorder]

Well trade risks exists with everything. Should we demand self sufficiency from our country? That is stupid. If the trade is abruptly cut off we will have to deal with it then. Maybe some people will see this ahead of time and have infrastructure in place. Certainly you wouldn't put this type of responsibility into government?

Lastly the same concept has to work in individual level. As you can see we are not self sufficient for the fear of a grocery store closing down in our neighborhood.

[Brooklyn Red Leg]

I mean, wouldn't it be great if we abolished the income tax, corporate/business taxes, capital gains taxes and property taxes, simply having a trade risk tariff that was the sole income for our government?

I'll certainly take that over the anal violating we get now. Prices would plummet when the market reaches equilibrium. Now...if we could only get rid of the IP/Patent Laws....

[Anti Federalist]

Well trade risks exists with everything. Should we demand self sufficiency from our country? That is stupid. If the trade is abruptly cut off we will have to deal with it then. Maybe some people will see this ahead of time and have infrastructure in place. Certainly you wouldn't put this type of responsibility into government?

Lastly the same concept has to work in individual level. As you can see we are not self sufficient for the fear of a grocery store closing down in our neighborhood.

There's more than a few of us around here well prepared for just such and emergency.

Self sufficiency doesn't mean that the supermarket can't exist.

But if you think the supply chain is tenuous and energy intensive to get oranges from Florida or California, you should see how tenuous it is from say Indonesia.

I've read a number of reports that state, at best, there is only a 3-5 day supply of food in the "pipeline" at any given time.

It would be much easier to get that up and running again in the event of an interruption if you had to co-ordinate a couple hundred miles, instead of around the world.

One major naval engagement anywhere in the world, and the ships stop.

[Kregisen]

AF, do you have an answer to this?

how is a different country f***ing itself up by subsidizing and devaluing its currency hurting us? Yes, it takes jobs away….but like the facts state, the savings to consumers are more than 10 times the value of the actual job. If China wants to subsizide and devalue its currency, which makes our currency richer, meaning 1 hour of work in the U.S. will get you more wealth from China than if the currency wasn’t devalued, that’s HELPING us, not hurting us.

Worst case is, you could TAX 10% of the savings for consumers just to pay the employees who lost their jobs their full salary….and then you still have lower prices for consumers.


Quick answer, governments playing fast and loose with currency valuations usually leads to disaster.

I notice you're cool on the idea of competing currencies.

I can understand that, a competing currency would destroy the ability for government to manipulate the currency to make a free trade agreement appear as a net positive.

I'm not sure how that's answering my statements above.....if the facts state consumers end up paying close to 10 times the amount of the salaries of would-be lost jobs under protectionism, then why can't you just tax 10% of the savings of consumers and repay the full salaries, and then have everyone win?

[LibertyIn08]

As an aside, almost every introductory economics course will teach using the aggregate supply and aggregate demand models created by Keynes in his magnum opus.

[Bossobass]

Free trade is; level the playing field and may the best man win.

From the 1870s to the 1970s the US employed tariffs with reciprocity, no income tax, no federal debt and a gold standard to become the place you wanna be for a century.

Since 1971, Free Trade, guns and butter, ballooning gargantuan federal debt and the gold-decoupled Federal Reserve Note standard have changed that to the place you wanna flee.

Tariffs with reciprocity. If you have something I want and I have something you want, the tariffs disappear and we trade freely. Otherwise, it tariffs for you, fucko.

I design and build niche electronics. The finest in the world, by any standard. As a result, I get inquiries from all over the world. Recently, I received one from India. After a cursory check, I found that India imposes a 100% duty on any imports of the product I build.

OTOH, I can go to any number of global trade sites and punch in my product category and India, find one, inquire and have it at my doorstep in 4 days... no duty, no VAT, no import quotas, no tariff.

Don't even wanna start in about China.

Global trade has existed since before the pyramids were built. Free Trade is bullshit. It's like calling rape Free Sex Therapy.

AntiFed all day long. The rest of you "students", please learn to find Iraq on a map before you take over the global economics podium.


After more than three years of combat and nearly 2,400 U.S. military deaths in Iraq, nearly two-thirds of Americans aged 18 to 24 still cannot find Iraq on a map, a study released Tuesday showed.

The study found that less than six months after Hurricane Katrina devastated New Orleans and the Gulf Coast, 33 percent could not point out Louisiana on a U.S. map.

While Asian students are becoming scientists and engineers, American students are taking "Liberal Arts". The US is short 60,000 machinists, whose average age is now 55 years old. Most are retiring. To replace them, we need to be training 24 for every one of retirement age. We're training less than 2.

Since when did "protection" become a bad word? I'll protect my business with everything I have, including a shotgun, if necessary. The Free Trade Utopia BS story belongs in a philosophy or religion forum.

Bosso

[Pericles]

Since credentials seem to matter to some you, yes I've studied economics, primarily from this guy while serving as a visiting prof at Texas A&M:
http://waltoncollege.uark.edu/faculty/search.asp?type=profile&id=127716&letter=g

The arguments for free trade, just as with the arguments for anarchism as a governance model, are purely theoretical, as free trade exists nowhere in the world today.

Get back to Dr. Williams conversation with AF. While relying on "slave labor" is a long term disadvantage to countries that do so, in the short term, it gives them a production advantage over their competitors. Just as with any predatory pricing scheme, the goal is to eliminate competitors, in order to establish a monopoly position, in order to collect rents due to the lack of competition.

When an entity can influence governmental action in terms of tariffs, business regulation, or labor regulation - barriers to entry for competitors are raised within the legal jurisdiction applying such measures. Therefore in order to completely regulate matters of trade, organizations such as the WTO would have powers that infringe on the sovereignty of individual countries.

Which do you want - an international organization dictating trade conditions or individual countries determining which trade policies are in the best interest of their country. No other option exists in the real world.

[awake]

"free trade exists nowhere in the world today."

I take issue with that statement. It exists more or less in the U.S. between states minus various tax structures and law/ regulation. It exists with in territories of Canada intra-province, once again minus a variance in tax and law regulation. It exists inside monopoly territories through the world. It has been shown with out a doubt to work in these instances. The problem arises when one monopolist protection racket of one territory views another protectionist racket of another territory as foreign and alien thus to be feared and agressed upon. The us vs them mentality suddenly takes over.

Fear drives aggressive behavior and the following special controls on the foreign countries production. Tariffs are not defensive they are aggressive. And because the other guys do it is kindergarten approach to the issue.

Does New York imposing heavy tariffs on Pennsylvania help New York? It may in the short run, but in the long run it is simply self imposed restriction that harms the residents of both states to favor the corrupt few who actually receive the privileges and forced wealth transfers of the tariff program.

[Pericles]

"free trade exists nowhere in the world today."

I take issue with that statement. It exists more or less in the U.S. between states minus various tax structures and law/ regulation. It exists with in territories of Canada intra-province, once again minus a variance in tax and law regulation. It exists inside monopoly territories through the world. It has been shown with out a doubt to work in these instances. The problem arises when one monopolist protection racket of one territory views another protectionist racket of another territory as foreign and alien thus to be feared and agressed upon. The us vs them mentality suddenly takes over.

Fear drives aggressive behavior and the following special controls on the foreign countries production. Tariffs are not defensive they are aggressive. And because the other guys do it is kindergarten approach to the issue.

Does New York imposing heavy tariffs on Pennsylvania help New York? It may in the short run, but in the long run it is simply self imposed restriction that harms the residents of both states to favor the corrupt few who actually receive the privileges and forced wealth transfers of the tariff program.

I'll assume you do not practice a trade which requires a license from a state or province. You are probably not in the financial industry. I'll also assume you are not in pharma, and so on. The regulations in many of these industries may be the same nationwide, but there are also state regulations (primarily in trades and insurance) which are market distortions. I'm assuming that "free trade" can have two meanings (1) ability to sell or purchase goods and services in any location with the price being set without external governmental action (2) absence of legal restriction on a good or service being available to a market.

[forsmant]

The free trade you are talking about would have to involve a world where all the laws were similar or the same. Wouldn't that imply global governance? Free trade is bogus.

[awake]

I'll assume you do not practice a trade which requires a license from a state or province. You are probably not in the financial industry. I'll also assume you are not in pharma, and so on. The regulations in many of these industries may be the same nationwide, but there are also state regulations (primarily in trades and insurance) which are market distortions. I'm assuming that "free trade" can have two meanings (1) ability to sell or purchase goods and services in any location with the price being set without external governmental action (2) absence of legal restriction on a good or service being available to a market.

This is the more or less part of my statement; laws and regulations. Most of the regulations and laws you mention are a direct example of protectionist thinking in action. My point is that there are no open calls to keep out products from one state from entering another as in the U.S. China argument. It would be foolish to call for the same things wanted in the trade disputes with China and impose them intra state. It baffles me that people can not see this.

We do not embrace complete freedom to exchange because we fear it. Not that it doesn't work.

[Pericles]

We do not embrace complete freedom to exchange because we fear it. Not that it doesn't work.

It requires all parties to agree, and they don't agree because one or more sees an advantage in not agreeing.

[awake]

It requires all parties to agree, and they don't agree because one or more sees an advantage in not agreeing.

And they seek that advantage at the end of a gun. Some directly, others with a middle man.

[Sentient Void]

I'm a free trader. I want to maximize free trade. Taxes/ regulations are bad *period*, whether it's a domestic tax on production/consumption or a tariff on consumption and I think we all acknowledge this. Ultimately, both destroy wealth and are inherently immoral. Now, *If it came down to one or the other*, which is preferable? Even being a free trader myself, tariffs (although are still destructive to wealth and wealth creation) are preferable to domestic taxation on production (income tax) or consumption (sales tax), but should of course be minimized as much as possible, and non-targetted. *HOWEVER*, this is a *false choice*. We don't have the only choice between income taxation and tariffs. This is the reality of the situation.

The issue and disagreement here is not 'which is more preferable'. The issue, disagreement and debate here is: How do we respond to protectionist policies from other nations? Should we respond with protectionism, or do nothing and maintain and/or maximize free trade regardless of protectionist policies from other nations? This is at the heart of the disagreement between us.

If we decide to respond with protectionism - EVERYONE will be poorer, including ourselves, not to mention an increasing trade war will probable ensue, as well as the tendency that 'when goods don't cross borders, armies will'. Is it actually denied by the protectionists that responding to protectionism with protectionism will result in everyone, including ourselves being poorer and worse off? Do they really believe that responding with protectionism will increase our standard of living and make everyone wealthier? If we can all acknowledge this *fact* that everyone, including ourselves, *will* be poorer, even putting the moral argument of free trade aside, consequentially, everyone must favor maximizing free trade regardless of the situation.

Ultimately, what we should be doing is embracing freedom and liberty. The answer is *always* more freedom, less government. Maximize free trade with other nations, but work to minimize government coercion here at home (reduce income, sales, corporate taxes, and regulations). What you are asking for is trying to solve the problem of too much government taxation/regulation/coercion at home, with more government coercion at home. Sure, some will benefit (the newly protected industries), *but at the expense of everyone else*. This is socialism, through and through.

[Travlyr]

"free trade exists nowhere in the world today."

I take issue with this statement too. I'm a free trader.
The Internet is the free trade of ideas with few regulations and laws preventing anyone from exchanging ideas and information with anyone else around the world.
While economic trade is currently heavily regulated, achieving economic free trade on the level of informational free trade would be beneficial for all.

[Kregisen]

Which do you want - an international organization dictating trade conditions or individual countries determining which trade policies are in the best interest of their country. No other option exists in the real world.

The stats in Williams' article say that free trade policies are in the best interest of our country. Consumers save around 10 times the lost job's salary for the jobs he listed.

I understand that destroying all tariffs and quotas before getting rid of the income tax and most regulations isn't quite free trade either. The point is to lower them both, and if there are regulations on the U.S. that will never go away, maybe it is worth putting a small enough tariff equal to the U.S. regulation in place, to even out the equilibrium so the most efficient business can win.

But all the clueless americans out there who see protectionism as simply "saving american jobs" are simply dumbasses....they don't realize that the expense to consumers is so much greater than the savings to an ineffient business.

[Anti Federalist]

The stats in Williams' article say that free trade policies are in the best interest of our country. Consumers save around 10 times the lost job's salary for the jobs he listed.


So that means that a stable middle class lifestyle can be had for yearly salary that is ten times less than what it is now?

Correct me if I'm wrong but what you are saying is that the savings from cheap imports more than offsets the job loss or decrease in wages, by a factor of ten?

Given that that the average income for a family of four is, roughly, and off the top of head, $50,000, that means that yearly wages for that family could be $5,000 a year, with the $45,000 in lost income being made up in savings by buying cheap shit at Wal Marx?

[Sentient Void]

So that means that a stable middle class lifestyle can be had for yearly salary that is ten times less than what it is now?

Correct me if I'm wrong but what you are saying is that the savings from cheap imports more than offsets the job loss or decrease in wages, by a factor of ten?

Given that that the average income for a family of four is, roughly, and off the top of head, $50,000, that means that yearly wages for that family could be $5,000 a year, with the $45,000 in lost income being made up in savings by buying cheap shit at Wal Marx?

AF...

Money =/= Wealth. Zimbabweans are making thousands of times more nominal dollars than they were the year before, and the year before that. Would you say they are richer or poorer? Again, money =/= wealth.

Wealth comes from savings and production. Taxes and regulation, whether it's domestic or tariffs, *both* reduce both savings *and* productive capacity.

Free trade, in and of itself, increases both. This is a logical, economic *fact*.

If you want to increase economic prosperity, you must follow sound economics. Protectionism is always bad economics and always reduces economic prosperity, no matter what.

[Anti Federalist]

AF...

Money =/= Wealth. Zimbabweans are making thousands of times more nominal dollars than they were the year before, and the year before that. Would you say they are richer or poorer? Again, money =/= wealth.

Wealth comes from savings and production. Taxes and regulation, whether it's domestic or tariffs, *both* reduce both savings *and* productive capacity.

Free trade, in and of itself, increases both. This is a logical, economic *fact*.

If you want to increase economic prosperity, you must follow sound economics. Protectionism is always bad economics and always reduces economic prosperity, no matter what.

I agree SV, money does not equal wealth, and I've made the case many times in this thread and others that, given my druthers, I'd take less wealth and more freedom, if that's what the choice was.

Sound currency backed by real worth would solve a lot of that problem.

But I was addressing a specific point in Kregisen's post, that savings to purchasers (I hate the word "consumers" and won't use it) are equal to 10x the loss of income from one "average" job.

I was looking for more clarity on that specific point.

[Kregisen]

So that means that a stable middle class lifestyle can be had for yearly salary that is ten times less than what it is now?

Correct me if I'm wrong but what you are saying is that the savings from cheap imports more than offsets the job loss or decrease in wages, by a factor of ten?

Given that that the average income for a family of four is, roughly, and off the top of head, $50,000, that means that yearly wages for that family could be $5,000 a year, with the $45,000 in lost income being made up in savings by buying cheap shit at Wal Marx?

First off, several people ask you to go lookup comparative advantage every free trade thread, and you seem to never do it.

Second, you're reading my post completely wrong. Think about this for a second. Williams never said that prices for sugar went down 1000% (10 times). He said the difference in prices consumers are paying is 10 times the amount of the salaries for the jobs saved by the tariffs.

So using those facts, worst case we could say to tax 10% of the savings to consumers and pay the full salaries of the people who would be losing their job due to imports. The end result is then, those people have a full salary and their full time, and consumers have savings.

Tell me why this isn't a win-win.

[Pericles]

First off, several people ask you to go lookup comparative advantage every free trade thread, and you seem to never do it.

Second, you're reading my post completely wrong. Think about this for a second. Williams never said that prices for sugar went down 1000% (10 times). He said the difference in prices consumers are paying is 10 times the amount of the salaries for the jobs saved by the tariffs.

So using those facts, worst case we could say to tax 10% of the savings to consumers and pay the full salaries of the people who would be losing their job due to imports. The end result is then, those people have a full salary and their full time, and consumers have savings.

Tell me why this isn't a win-win.

So the real price of goods and services has been decreasing for the last 20+ years? And real wages have been increasing over the same time period?

[nobody's_hero]

So the real price of goods and services has been decreasing for the last 20+ years? And real wages have been increasing over the same time period?

This has all been a cleverly crafted illusion to create the appearance that the U.S. dollar still has a strong buying power. The only way to pull this off (so long as we have a fiat currency) is to ensure that there is a supply of cheap products coming in from overseas.

[Jace]

..

[Sentient Void]

Woodrow Wilson -- that quintessential progressive -- gave us the Federal Reserve, the income tax, crackdowns on the press, conscription, imprisonment of war dissenters, and 100,000+ Americans dead in a foreign war that saved the loan portfolios of JP Morgan, the Warburgs, Rothschilds, Schiffs and the Rockefellers. Wilson also eliminated tariffs and implemented a free trade policy. Eliminating tariffs and implementing a free trade policy was one piece in the puzzle of his progressive utopia.

Mr. Big Government himself, FDR, was also free trader. Today, the neocons worship at the free trade altar. Obama is a free trader, and at this moment he is in India selling out American workers and small business while chanting the mantra of free trade. The globalist bankers love free trade. All big government types love free trade. Why? Historically, it has been the most effective way of wiping out the middle class and making them dependent on big government. If you can't make a living, the government will provide for you, as long as you sell your soul to them.

/facepalm

EPIC logical fallacy FAIL, Jace.

Don't actually address the legitimate, moral, logical, and economic reasons behind free trade - simply 'guilt by association' it to death to attempt to marginalize it!

Hey, did you know that Hitler believed that 1+1=2? Therefore, you shouldn't believe it.

FAIL. FAIL. And more FAIL.

[Kregisen]

So the real price of goods and services has been decreasing for the last 20+ years? And real wages have been increasing over the same time period?

Where did you get that from in my post?? You have me bamboozled.


Everyone against free trade here has ignored the facts I've brought up every single time.

Can anyone answer?

If consumers are saving 10 times the amount of the salaries of lost American jobs, why can't we tax 10% of the savings to consumers and pay the full salaries of the people who would be losing their job due to imports?

The end result is then, those people have a full salary and their full time, and consumers have savings.

How is this not a win-win?

[Kregisen]

/facepalm

EPIC logical fallacy FAIL, Jace.

Don't actually address the legitimate, moral, logical, and economic reasons behind free trade - simply 'guilt by association' it to death to attempt to marginalize it!

Hey, did you know that Hitler believed that 1+1=2? Therefore, you shouldn't believe it.

FAIL. FAIL. And more FAIL.

Yup, ad hominem.

Jace, even the blind mouse can find the cheese occasionally.

Obama stood up for the rights of the muslims who wanted to build the mosque in NYC. Due to your logic, since Obama is wrong on most issues, he must be wrong on the mosque issue too.

[low preference guy]

/facepalm

EPIC logical fallacy FAIL, Jace.

Don't actually address the legitimate, moral, logical, and economic reasons behind free trade - simply 'guilt by association' it to death to attempt to marginalize it!



Yes, that's what he always does. If you have copious amounts of free time and go to some of my conversations with Jace, I called him out months ago for doing the exact same thing.

-rep to Jace

[Jace]

..

[nobody's_hero]

I think Jace was offering more of a history lesson that you won't find in a public-school textbook, rather than making a connection or accusation of association.

Either way,

It doesn't matter whether you are buying foreign goods because as a 'free-trader', you think you're getting a great deal. Kudos to you, if that's you.

It wouldn't matter if you were buying foreign goods just because you want to see the progressive agenda come to fruition. Kudos to you, if that's you (if not, don't worry about it).

The end result is the same. No association is even necessary. They've designed the system not to fail—at least, not until it has fulfilled its purpose. The tape will not self-destruct until the message has been played—after the middle class in America has seen their wealth shifted overseas and recirculated back to the dependents.

[Anti Federalist]

,

You say I made an ad hominem post and then give this "blind mouse" comment, but I made no ad hominem attack on anyone. I wrote a post that pointed out that free trade policy in America began with Woodrow Wilson and the progressive movement, and small government conservatives in America historically were for tariffs and against free trade -- at least what we call free trade today.

Woodrow Wilson gave us the Federal Reserve, the income tax, World War and free trade. Today, Obama, Bernanke and Geithner are free traders. They are associated with free trade because they are defenders of America's free trade policy of the last 65 years since the end of WWII. I disagree with them.



Agreed.

What ad hominem?

Jace "attacked" nobody.

The free trader side presents treatises and historical works to back up their argument, that's all this was, an accurate and true historical representation of who was in favor, politically, of "free trade".

[Kregisen]

AF, you've cleverly ignored my question for about a week now. Why are you refusing to answer?


Everyone against free trade here has ignored the facts I've brought up every single time.

Can anyone answer?

If consumers are saving 10 times the amount of the salaries of lost American jobs, why can't we tax 10% of the savings to consumers and pay the full salaries of the people who would be losing their job due to imports?

The end result is then, those people have a full salary and their full time, and consumers have savings.

How is this not a win-win?

[Anti Federalist]

AF, you've cleverly ignored my question for about a week now. Why are you refusing to answer?

*sigh*

I'm not ignoring your question...I'll admit, I'm frankly, stumped by your question.

Wouldn't a 10% tax on the savings of imported goods be a de facto tariff?

[Pericles]

AF, you've cleverly ignored my question for about a week now. Why are you refusing to answer?
Look at post 44 in this thread for your answer. If we were benefiting from "free trade", there should be evidence of decline in real prices because of decreased cost of production, or increase in real wages as labor is reallocated to more profitable activities. Prove that is actually happening, and you are in competition with real economists and your potential Nobel prize will be waiting.

[Anti Federalist]

Look at post 44 in this thread for your answer. If we were benefiting from "free trade", there should be evidence of decline in real prices because of decreased cost of production, or increase in real wages as labor is reallocated to more profitable activities. Prove that is actually happening, and you are in competition with real economists and your potential Nobel prize will be waiting.

Agreed.

[Kregisen]

Wouldn't a 10% tax on the savings of imported goods be a de facto tariff?

Right. The point is, this is showing you that the American consumers (all of us) are gaining FAR more than what the american workers in that specific industry are losing, and to prove that it leads to better outcomes than with big tariffs, is by adding a very small tax (like I stated in my example) to transfer some of that wealth from consumers to the American workers who lost their jobs, which then gives you the outcome of more money leftover for American consumers, and more money for American workers in that industry.



This is why free trade is good, and if we can get rid of the income tax and many regulations, we can afford to have little to no tariffs and become a wealthier nation. This is trade.

[Kregisen]

Look at post 44 in this thread for your answer. If we were benefiting from "free trade", there should be evidence of decline in real prices because of decreased cost of production, or increase in real wages as labor is reallocated to more profitable activities. Prove that is actually happening, and you are in competition with real economists and your potential Nobel prize will be waiting.

I just bought a car charger for my phone off ebay 2 weeks ago, from the U.S. Including shipping, the total price was $2.48. The seller obviously got a huge lot of them from china, and even then, probably didn't make an ounce of profit since it costed him about $1.50 to ship it to me.

Had we banned trade with china or had huge tariffs, the same thing probably would've costed me $10-15 from the U.S.

We get all kinds of things from China....the savings are in prices on all kinds of goods.



I don't see how U.S. wages would increase though. If China has a comparative advantage in an industry, and as a result the U.S. workers in that industry move to a new industry, that creates more competition to find a job, and at first I would guess wages would decrease......until the market corrects itself and new businesses start up in that industry and I would assume the wages would go back up to where they were in equilibrium.

How would wages go up further?

[Anti Federalist]

I don't see how U.S. wages would increase though. If China has a comparative advantage in an industry, and as a result the U.S. workers in that industry move to a new industry, that creates more competition to find a job, and at first I would guess wages would decrease......until the market corrects itself and new businesses start up in that industry and I would assume the wages would go back up to where they were in equilibrium.



I think the question myself and everybody else is asking, what new industry?

When all this started, we were told "Oh it's just those dirty blue collar jobs being shipped overseas, in the new economy everybody will be a white collar IT professional".

Then that work started getting sent overseas.

Tell me, you're a student, what do you plan on doing when you get out of school?

How much tuition debt will you have?

My point is that there is very little left, everybody keeps talking about these great
"new" jobs, but real wages are steadily falling and real unemployment is hovering around 20 percent and people with 4 year college degrees, in real majors, not "feminist studies" or "tribal basket weaving" are working as clerks at box stores and Wal Marx.

As I've said a million times before, as the economy collapses and the nation defaults, the only two jobs left will be a guard or convict.

[Anti Federalist]

How would wages go up further?

Oh, to answer that, wages are paid based on the value of labor being used.

To pull the raw material out of the ground and turn it into a car charger, or a car engine for that matter, requires skill and a pretty long learning curve.

The more that you know and understand the process and improve on it and make it more efficient or lower costs, the more valuable your time becomes.

That's why "value added" manufacturing or it's support is really the only source of good paying jobs.

Not much skill is required to be a greeter at Wal Marx or sweep out the shitters at Burger King.

[Anti Federalist]

FWIW:

Here are 18 Iconic Products That America Doesn't Make Anymore:

http://finance.yahoo.com/tech-ticker/19-iconic-products-that-america-doesn%27t-make-anymore-535569.html?tickers=f,ge,mat,DELL,MOT,aapl,bni

Rawlings baseballs

Last production date: 1969

Rawlings is the official supplier of baseballs to Major League Baseball. The St. Louis shop was founded in 1887 by George and Alfred Rawlings. In 1969 the brothers moved the baseball-manufacturing plant from Puerto Rico to Haiti and then later to Costa Rica.

Etch a Sketch

Last production date: 2000

Etch A Sketch, an iconic American toy since the 1960s, used to be produced in Bryan, Ohio, a small town of 8,000. Then in Dec. 2000, toymaker Ohio Art decided to move production to Shenzhen, China.

Converse shoes

Last production date: 2001

Marquis M. Converse opened Converse Rubber Show Company in Massachusetts in 1908. Chuck Taylors– named after All American high school basketball player Chuck Taylor– began selling in 1918 as the show eventually produced an industry record of over 550 million pairs by 1997. But in 2001 sales were on the decline and the U.S. factory closed. Now Chuck Taylors are made in Indonesia.

Stainless steel rebar

Last production date: circa 2001

Many forms of this basic steel product are not available domestically. Multiple waivers to the Buy America Act have allowed purchase of rebar internationally.

Note: The Buy America Act requires government mass transportation spending to use American products.

Dress shirts*

Last production date: Oct. 2002

The last major shirt factory in America closed in October 2002, according to NYT. C.F. Hathaway's Maine factory had been producing shirts since 1837.

*We know there are other shirt manufacturers in America. They do not produce in large quantities or supply major brands.

Mattel toys

Last production date: 2002

The largest toy company in the world closed their last American factory in 2002. Mattel, headquartered in California, produces 65 percent of their products in China as of August 2007.

Minivans

Last production date: circa 2003

A waiver to the Buy America Act permitted an American producer of wheel-chair accessible minivans to purchase Canadian chassis for use in government contracts, because no chassis were available from the United States. The waiver specified: "General Motors and Chrysler minivan chassis, including those used on the Chevrolet Uplander, Pontiac Montana, Buick Terraza, Saturn Relay, Chrysler Town & Country, and Dodge Grand Caravan, are no longer manufactured in the United States."


Vending machines

Last production date: circa 2003

Levi jeans

Last production date: Dec. 2003

Levi Strauss & Co. shut down all its American operations and outsourced production to Latin America and Asia in Dec. 2003. The company's denim products have been an iconic American product for 150 years.

Radio Flyer's Red Wagon

Last production date: March 2004

The little red wagon has been an iconic image of America for years. But once Radio Flyer decided its Chicago plant was too expensive, it began producing most products, including the red wagon, in China.

Televisions

Last production date: Oct. 2004

Five Rivers Electronic Innovations was the last American owned TV color maker in the US. The Tennessee company used LCoS (liquid crystal on silicon) technology to produce televisions for Philips Electronics. But after Philips decided to stop selling TVs with LCoS, Five Rivers eventually filed for Chapter 11 bankruptcy protection in Oct. 2004. As part of its reorganization plan, the company stopped manufacturing TVs.

Now there are ZERO televisions made in America, according to Business Week.

Cell phones

Last production date: circa 2007

Of the 1.2 billion cell phones sold worldwide in 2008, NOT ONE was made in America, according to Manufacturing & Technology publisher Richard McCormick.

After studying the websites of cell phone companies, we could not identify a single phone that was not manufactured primarily overseas.

Railroads (parts including manganese turnout castings, U69 guard bars, LV braces and weld kits)

Last production date: circa 2008

Manganese turnout castings are used to widen railroad tracks, and they were used to build our once-great railroad system. U69 guard bars, LV braces and Weld Kits, along with 22 mm Industrial steel chain are basic items that were certifiably not available in the US.

Dell computers

Last production date: Jan. 2010

In January 2010, Dell closed its North Carolina PC factory, its last large U.S. plant. Analysts said Dell would be outsourcing work to Asian manufacturers in an attempt to catch up with the rest of the industry, said analyst Ashok Kumar.

Canned sardines

Last production date: April 2010

Stinson Seafood plant, the last sardine cannery in Maine and the U.S., shut down in April. The first U.S. sardine cannery opened in Maine in 1875, but since the demand for the small, oily fish declined, more canneries closed shop.

Pontiac cars

Last production date: May 2010

The last Pontiac was produced last May. The brand was formally killed on Halloween, as GM contracts Pontiac dealerships expired.

The 84-year-old GM brand was famous for muscle cars.

Forks, spoons, and knives

Last production date: June 2010

The last flatware factory in the US closed last summer. Sherrill Manufacturing bought Oneida Ltd. in 2005, but shut down its fork & knife operations due to the tough economy. CEO Greg Owens says his company may resume production "when the general economic climate improves and as Sherrill Manufacturing is able to put itself back on its feet and recapitalize and regroup."

Incandescent light bulb

Last production date: Sept. 2010

The incandescent light bulb (invented by Thomas Edison) has been phased out.

Our last major factory that made incandescent light bulbs closed in September 2010. In 2007, Congress passed a measure that will ban incandescents by 2014, prompting GE to close its domestic factory.

[Kregisen]

I think the question myself and everybody else is asking, what new industry?

When all this started, we were told "Oh it's just those dirty blue collar jobs being shipped overseas, in the new economy everybody will be a white collar IT professional".

Comparative advantage. Comparative advantage. Comparative advantage.

Comparative advantage.






..................comparative advantage. Look it up!

[Bman]

The problem when arguing "Free Trade" is that there is nothing "Free Trade" about a one way street.

[Kregisen]

AF, you admitted my question stumped you. That's because there's no answer to it.

Every single industry this America is losing jobs on is because we can get the products EXTREMELY cheaper from other countries. It doesn't matter how many times you multiply it by, it helps us, it doesn't hurt us.

If we save 10 times the amount of salaries of sugar jobs in the U.S., and there are 40 other industry jobs like that lost in the U.S., 10 x 40 is 400, not -400. It's a positive number no matter how many times you multiply it by.

Due to comparative advantage there will always be many U.S. jobs by the way. Though, even if we lived in a world where there was no such thing as comparative advantage, if every manufacturing job in the U.S. was lost, goods would be so extremely cheap, you would only need a job working for a middle man (even wal-mart!) to afford everything we do now anyway. This Armageddon scare tactic that the MSM throws around holds no weight.

[Bman]

AF, you admitted my question stumped you. That's because there's no answer to it.

Every single industry this America is losing jobs on is because we can get the products EXTREMELY cheaper from other countries. It doesn't matter how many times you multiply it by, it helps us, it doesn't hurt us.

If we save 10 times the amount of salaries of sugar jobs in the U.S., and there are 40 other industry jobs like that lost in the U.S., 10 x 40 is 400, not -400. It's a positive number no matter how many times you multiply it by.

Due to comparative advantage there will always be many U.S. jobs by the way. Though, even if we lived in a world where there was no such thing as comparative advantage, if every manufacturing job in the U.S. was lost, goods would be so extremely cheap, you would only need a job working for a middle man (even wal-mart!) to afford everything we do now anyway. This Armageddon scare tactic that the MSM throws around holds no weight.

I understand where AF is coming from. It does hurt us, because the American worker cannot participate in a free market scenario, not at all, not for a second. If our government wants to hold us to certain standards and not where we get imports from we are f-ed.

[nandnor]

nvm

[LibertyEagle]

there is no trade deficit.
The official numbers dont include the dollars "imported" from the fed to the US economy. Hence total economy is balanced.

Are you talking about our debt?