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To: Gerald R. Lampton who wrote (21682)	11/23/1998 1:21:00 PM
From: Daniel Schuh	Read Replies (1) \| Respond to of 24154

Gerald, this is getting a little political, which might force me to retire from the debate. I thought this was a safe haven after my sojourns of the last couple months. As far as Asia and free trade, I'd say they like to talk the talk, but won't walk the walk. I'm not totally up on the current situation, but it was always highly asymmetrical with Japan. My understanding is the situation with China is going in a similar direction. American businessmen see China, naively I'd say, as a big market where they'll have big opportunities. China sees America the same way, but much more realistically, according to trade figures. Maybe it doesn't matter. You can argue it's good for the markets, the dollars exported usually come back into the financial markets one way or another. All I'd counter is that the government maybe ought to articulate some coherent policy here, perhaps with reciprocity a condition for "free trade", rather than policy by highly paid lobbyists. Cheers, Dan.

To: Gerald R. Lampton who wrote (21682)	11/23/1998 3:42:00 PM
From: Charles Hughes	Respond to of 24154

>>> In Asia, they love this free trade nonsense. More proof of the decline of the West. And I suppose you love the protectionist nonsense of people like Pat Buchanan. <<< In all of Pat's demagogic rambling, the only note he sings that strikes a chord with the public is that of American jobs being sold out by our business men and government officials. This is also much of the appeal of Perot, of course. These messengers are a bit flawed of course. You don't need to have protectionism to stop all this. You only need to insist on one principle: For an average year, for a given country, exports must approximately equal imports. These countries could trade credits if necessary, and very poor countries could be given exceptions. But the idea that outgo must be less than or approximately equal to income is fundamental to every budget, whether you are talking about one family, a nation, or homeostasis. (Protectionism is alive and well, of course. It is practiced by Japan, to their benefit. Ditto for China. And in US-EC trade, both sides practice protectionism, which is the protection of individual vertical slices of the economy. What happened 70 years ago, of course, was more of a blanket rejection of trade, with disastrous results.) This balance of income with outgo is of course an obvious principle. Thus it has to be disguised or abused in many ways to allow what we actually do to occur. That includes promoting the careers of nattering academics who happen to be saying the right thing at the right time. We don't do equal trade with Japan or China because we think we can buy off another ascendant Asian colonial or military power with trade sacrifices. (That plus what influence american importers and retailers and a few other beneficiaries have in the political process.) This worked with Japan for a very long time, but it is now failing because China is now the important country there, and the other loci of trouble are places like North Korea. What we are doing now is weakening ourselves with this antique arrangement, so that conflict becomes ever more likely. And of course there is the usual corruption of our public officials of both parties by interests of other nations creating further imbalance. Take a look at how differently we negotiate with Europe. Our trade with Europe is damaging neither side significantly, yet we had a completely different trade negotiation process there on both sides. Not a perfect one. As I say, I would prefer a solution based on total financial flows rather than the protection of particular US industries, which is what we have now. Free trade with Asia has never had much to do with fair, free, sustainable trade relations. It has always been a subsidy intended to stave off another world war. One that is now clearly counterproductive. BTW, in Asia, they really do call us 'the Big Fish.' This refers to our trade policy, but American tourists are referenced this way too, as in 'Cutting the Big Fish', which means screwing shoppers and ticket buyers on prices, usually. (It helps to go there, and to speak a smidgin of Chinese, so that you can know what is going on around you.) Why does this matter? Well, the reason they won't follow us anymore, into democracy or anywhere else we might choose, is because they think we are stupid. They don't want to follow the stupid. And I don't blame them. Cheers, Chaz