you just argued that it essentially balances itself out in the jobs area.
Not really. In the statement you quoted I said some people get helped and some get hurt when you eliminate trade barriers. I didn't say the number of people in each group or the severity of the help or harm was equal. Later on in the post I specifically said they where not, that the total harm caused by the trade barrier was normally greater. I would add that this is true if you consider the world as a whole or just the US (or any other country with trade bariers that you want to talk about).
If you want to talk about less tangiable things I don't see free trade as being at all unpatriotic, I do however see trade barriers as something that reduces our freedom as well as our wealth.
the way to contain inflation is to run a sound currency by not printing too much money. protectionism is not inflationary.
Protectionism does not increase the money supply so it isn't inflationary in the classic economic sense, however it does decrease the amount of competition which can raise prices, and it results in less effcient use of resources which reduces total production. These factors decrease the supply of goods (and some services but its mainly goods that are traded) thus causeing higher prices if demand does not also go down.
in truth, america has prospered through much of our history whether we pursued
protectionism or free trade.
I can agree with that much. The fact that something is negative doesn't mean that nothing good can happen in its presence.
As for the claim that free trade benefits the big corporations over individuals that is not true. With restricted trade large corporations can rake in big bucks without having to face as much competition. With competition prices go down or quality goes up or both. The companies have to provide a reason for the consumer to buy their goods other then the consumer not having much choice.
Our wages here can be higher because our productivity is much higher. If trade barriers are lowered world wide then Americans in industries where we do not have a big productivity advantage may lose their jobs but new jobs will be created in areas where we have and advantage. Often with the economic growth that is caused by trade the number of employed people goes up all around not just in the low wage countries. The productivity of the employees also increases so more goods are produced. With less employment in some areas (where demand does not rise as much as productivity) more people can be employed produceing other things. In the past over half the population worked on farms, now less then 1% of the population does. Thats a huge "loss of jobs", but we are far better off for it.
real wages have plummeted
Nonsense. The total of wages and benefits has increased (not every year, year on year but during every 10 or 15 year period). People have bigger houses, fancier cars, a lot more electronics and computers. People have more now then they did 20 years ago or 30 or 40 or 50 years ago.
you can see how this might present a problem for average american blue collar workers? how can they compete with a mexican or an indonesian making 50 cents an hour or even 50 cents a day?
By being a lot more productive and by being closer to the market for their goods. We have a free trade treaty with Mexico. Some stuff that was produced in the US now is produced in Mexico, but some stuff that was made in Mexico even though it can be made better or cheaper here is now produced here because Mexico's trade barriers have come down. The typical worker making 50 cents a day might be an uneducated child or teenager in a third world country with no advanced production equipment. The free trade might cause the third world worker to lose their job instead because the better paid workers in industrialized countries are more productive. Of course eventually third world workers can also become more productive but as this happens total production and wealth goes up and they no longer work for 50 cents a day. They start having some money that they can use on imported goods.
I'm not just taking the total bottom line as some number for the whole country and saying it goes up. The majority of individuals benefit from the reduction of trade barriers. Its not a zero some game where something is produced either in country X or country Y and whoever produces it gets all the money. If the US is much less efficent and making a certain product then say Mexico and the production of that product is moved south, then (after some time for the transition) the resources that went to product this product will go to produce other products. The product produced in Mexico will probably be cheaper, and with the greater total production that arises from applying the factors of production more efficently overall wealth rises, and consumers can get buy more.
Yes some people are hurt becuase they do lose their job and they might not have the skills or temperment needed to get a different good job, but most people benefit.
Tim |
