# News & Current Events > Economy & Markets >  Do you support the removal of all trade barriers with other nations?

## Cutlerzzz

I'll keep this simple. Do you support having free trade with every nation on Earth?

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## LibertyEagle

As long as they remove theirs.

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## Cutlerzzz

> As long as they remove theirs.


So conditionally?

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## squarepusher

what about protectionism?  Even though we mainly invented computer technology, its been lost to Asia.

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## YumYum

I believe there should be tariffs or restrictions placed on imports from countries who are not playing fairly.

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## freshjiva

> As long as they remove theirs.


This condition is not needed. Free market forces will resolve unfair trade advantages other countries set up for themselves.

For example, if China keeps their currency weak relative to the dollar like they are, and impose large import tariffs on American goods, Americans can simply boycott all products made in China.

Also, keep in mind, artificial government-enforced policies of trade protectionism never come without unintended consequences. China right now is experiencing near hyperinflation thanks to their currency and trade manipulations. Eventually, the trade barriers will collapse under its own weight, just like thy did for us in the 30s with Smoot-Hawley.

In the longtrm, the free market always wins.

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## jdmyprez_deo_vindice

yes

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## Southron

So far I am the only no vote. I would keep some tariffs in place, even if other countries completely opened trade to us and didn't manipulate their currencies. 

Either you will fund our (future) limited government on the backs of our people or through tariffs.

Free trade abroad and taxation at home? No.

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## acptulsa

> For example, if China keeps their currency weak relative to the dollar like they are, and impose large import tariffs on American goods, Americans can simply boycott all products made in China.


We are?  When, exactly, will this begin?

Last I checked Wally World was importing everything but the Yellow River, and I still can't see their parking lot for the Japanese and South Korean cars...

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## cubical

Remove all barriers. If other countries want to weaken their currency or whatever, it will only increase our living standard.

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## LibertyEagle

> This condition is not needed. Free market forces will resolve unfair trade advantages other countries set up for themselves.
> 
> For example, if China keeps their currency weak relative to the dollar like they are, and impose large import tariffs on American goods, Americans can simply boycott all products made in China.
> 
> Also, keep in mind, artificial government-enforced policies of trade protectionism never come without unintended consequences. China right now is experiencing near hyperinflation thanks to their currency and trade manipulations. Eventually, the trade barriers will collapse under its own weight, just like thy did for us in the 30s with Smoot-Hawley.
> 
> In the longtrm, the free market always wins.


You realize that we don't have free trade now, right?  We have managed trade, with internationalist ruling bodies superceding our own government.

I would absolutely be against more so-called "free-trade" agreements in the vein of NAFTA and CAFTA.

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## headhawg7

> I believe there should be tariffs or restrictions placed on imports from countries who are not playing fairly.


This sounds reasonable to me. Who gets to make those decisions and decide who is and who is not playing fair?

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## VIDEODROME

I'm assuming this just means Tariffs so I'll say conditionally.

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## Seraphim

Thread winner.




> You realize that we don't have free trade now, right?  We have managed trade, with internationalist ruling bodies superceding our own government.
> 
> I would absolutely be against more so-called "free-trade" agreements in the vein of NAFTA and CAFTA.

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## freshjiva

> You realize that we don't have free trade now, right?  We have managed trade, with internationalist ruling bodies superceding our own government.
> 
> I would absolutely be against more so-called "free-trade" agreements in the vein of NAFTA and CAFTA.



Well, yes, I never said we have free trade now, that's why I advocated free trade in my post.

What I'm saying is that because market forces ultimately win out, no trade barriers have ever been implemented without unintended consequences. Economists and politicians commonly debate over why jobs are being shipped overseas. Here's a reason (out of many) you seldom hear of: NAFTA.

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## giskard

> As long as they remove theirs.


If we trade with say, China, we don't put a tariff on their imports but they put a tariff on our exports, they are simply taxing their populace when they want to buy our exports.  US consumers will benefit as they get to buy products from whomever makes said products most efficiently (lowest prices).  Chinese consumers wouldn't have that and they will then have a lower standard of living.  The argument "it will drive our exporters out of business", implicitly assumes that exporters should have preferential treatment over consumers, which is wrong.  If our exports start to wane, it will drive our currency lower vs. the Yuan and a new equilibrium will be found.

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## giskard

> what about protectionism?  Even though we mainly invented computer technology, its been lost to Asia.


What does that mean, "lost to China"?  If you mean assembly, so what?  Do you really want menial jobs stuffing printed circuit boards?  The USA still has the highest value added jobs and technology in the computer world - the development of operating systems, standards, and software.  Look at Apple, Android, Microsoft, and Cisco.

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## giskard

> I believe there should be tariffs or restrictions placed on imports from countries who are not playing fairly.


You will trust psychopathic, rent-seeking politicians and bureaucrats to decide what and who is "fair", as opposed to letting the free market run?
 Every decision politicians make is politically based.  The free market OTOH allows everyone to vote with their wallets.

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## Southron

How would you fund a limited government without tariffs?

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## amy31416

> How would you fund a limited government without tariffs?


Bake sales and car washes.

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## LibertyEagle

> What does that mean, "lost to China"?  If you mean assembly, so what?  Do you really want menial jobs stuffing printed circuit boards?  The USA still has the highest value added jobs and technology in the computer world - the development of operating systems, standards, and software.  Look at Apple, Android, Microsoft, and Cisco.


Actually, a high percentage of the once high-paying programming jobs have been moved overseas.

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## specsaregood

//

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## josh b

Tear them all down.  Having bureaucrats control international trade is a terrible idea.




> what about protectionism?


Protectionism doesn't work at all.  Haven't you read _Economics in One Lesson_ or the works of any major Austrian economist?  It may protect specific industries, but in the long run everyone but the protected industry gets screwed.  Much of shifts overseas is a result of anti-business practices by the government here at home.  You can't solve the problem of violent interference in the market with violent interference in the market.




> Even though we mainly invented computer technology, its been lost to Asia.


Maybe they are just better with computers? Their electronics industries are way better than ours.

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## enoch150

> So far I am the only no vote. I would keep some tariffs in place, even if other countries completely opened trade to us and didn't manipulate their currencies. 
> 
> Either you will fund our (future) limited government on the backs of our people or through tariffs.
> 
> Free trade abroad and taxation at home? No.


The tariff is paid by Americans who buy the foreign goods. All taxes collected by the government come on the backs of "our people".

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## Southron

> The tariff is paid by Americans who buy the foreign goods. All taxes collected by the government come on the backs of "our people".


So you prefer internal income taxes to fund the government?  Buying foreign goods with tariffs would be generally optional.

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## enoch150

> So you prefer internal income taxes to fund the government?  Buying foreign goods with tariffs would be generally optional.


Working is also optional...

No, I don't believe in income taxes any more than tariffs. If we must have a government (and I really don't know why anyone would want one), the best options to my mind involve pay for service. For example, road maintenance and construction would be paid for with tolls or a gas tax. Court fees imposed on those who use the court system would pay for court costs. Parents would pay for schools. User fees for library services. I don't believe in the need for a standing army, but at the national level there might be a head tax to pay for defense.

There is a stronger incentive to control taxes when the money is tied to a specific service rather than thrown into a general fund.

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## Southron

> Working is also optional...
> 
> No, I don't believe in income taxes any more than tariffs.


The reason I ask is because tariffs were original methods of funding our republic and worked well for many years.

But I figured you for an anarchist or some flavor of one.  I also assume 74% that answered this poll are also anarchists, which leads me to believe most here *do not* want a limited Constitutional government at all or at best want to deny any method of funding one.

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## Seraphim

Anarchism does not exist - it's a fallacious and empty adjective.

An (no), archism (structure).

There is NO SUCH THING as NO STRUCTURE.

Choosing National protectionist tarrifs over home grown taxation is not a better solution - in both cases the taxes and ill effects are felt by the people of the country.






> The reason I ask is because tariffs were original methods of funding our republic and worked well for many years.
> 
> But I figured you for an anarchist or some flavor of one.  I also assume 74% that answered this poll are also anarchists, which leads me to believe most here *do not* want a limited Constitutional government at all or at best want to deny any method of funding one.

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## enoch150

> The reason I ask is because tariffs were original methods of funding our republic and worked well for many years.
> 
> But I figured you for an anarchist or some flavor of one.  I also assume 74% that answered this poll are also anarchists, which leads me to believe most here *do not* want a limited Constitutional government at all or at best want to deny any method of funding one.


And your response to the service-tax suggestion rather than tariffs is ...?

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## Southron

> Anarchism does not exist - it's a fallacious and empty adjective.
> 
> An (no), archism (structure).
> 
> There is NO SUCH THING as NO STRUCTURE.
> 
> Choosing National protectionist tarrifs over home grown taxation is not a better solution - in both cases the taxes and ill effects are felt by the people of the country.


Would you like the U.S. to return to and maintain a limited Constitutional republic?

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## Southron

> And your response to the service-tax suggestion rather than tariffs is ...?


I agree that is an appropriate method of funding beyond what limited tariffs could provide.

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## ProIndividual

I voted yes, and this includes trading labor, which means immigration...unless you can magically remove the labor of the individual from the individual who does the labor.

Any restrictions on any trade is protectionism, and causes the American people to be poorer, by making their products more expensive. You will only protect and create monopolies...something all free market capitalists should be against.

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## enoch150

> I agree that is an appropriate method of funding beyond what limited tariffs could provide.


One of my major concerns is that some people are taxed for services they don't use, or are taxed disproportionately to their use. What services, in your opinion, ought tariffs fund?

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## Cutlerzzz

> So you prefer internal income taxes to fund the government?  Buying foreign goods with tariffs would be generally optional.


There is no such thing as external taxation.

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## Southron

> One of my major concerns is that some people are taxed for services they don't use, or are taxed disproportionately to their use. What services, in your opinion, ought tariffs fund?


Just the basic operating costs of a limited federal government.  Most of our government excesses are unconstitutional anyway.  Anything beyond the basics could be done at the state level.

I wouldn't mind funding federal courts with tariffs as long as the scope of their power is diminished.  Maintaining free trade among the states should be a main priority.

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## Southron

> There is no such thing as external taxation.


Are you on favor of a limited Constitutional republic?   And if so, how would you fund it?

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## ProIndividual

> Are you on favor of a limited Constitutional republic? And if so, how would you fund it?


I'll answer even though you didn't ask me.

No, I don't support minarchism, or any other monopoly (it's a monopoly on violence, gang turf aka land area, and the monopoly on the social contract). That being said, I'd much more prefer a Constitutional Republic to what we have now. We are, like it or not, allies. We are all on a train headed for the cliff of tyranny, and we all want to get the train to make a U-Turn. You want off the train at "minarchist station", I simply ask you not FORCE me off the train at your stop, and allow me to continue to "anarchist junction". You DO NOT have to stay on the train with me, you simply have to get off the train where you like, and STFU about how "anarchism doesn't make any sense, boohooo"...as if we never heard any of your concerns before, and haven't hundreds of times shown their logical flaws. 

Now that we all know that we are allies, in spite of your belittling nature toward us anarchists, we can address your question.

If you had a Constitutional Republic in this country, with a population soooooo much larger than the last time you had such a thing, the funding for such a republic should not require forced payments, like taxes or tariffs. 

300,000,000+ people...half of which are adults at least....this means you could fund government in at least three ways alone, or together.

First, user fees. And tariffs are NOT user fees. Ports shouldn't be government owned, and if not government owned, then the idea a tax on users of a port is a "user fee" is bunk. Besides, the consumer just pays for the tariff at the point of sale...so you tax those who NEVER used the port.

Secondly, donations. If your government is truely as small as the one we had in the Constitutional Republic era, then given the population change, but no additional welfare services to weight down the budget, there shouldn't be an issue funding this Republic with donations, as it does very little, meets only a few monthes a year, and doesn't spend money on very much. This easily pays for defense, courts, Congress, and the rest...but that would mean ACTUALLY going back to the very minarchist Constitutional Republic, not some bigger version which most advocates of "Constitutional Republics" want. (I won't even get into the slippery slope issue, I'm sure you've heard it and ignored it before.)

Thirdly, and lastly for now, is lottery. A national lottery, as all lotteries now, would be played often by many folks. As a matter of fact, the most rampant players are the poorest people...so it's acting as a regressive form of "tax"...except 100% voluntary, and with at least a CHANCE of getting something back in return (unlike now).

With these 3 methods used together, or just one by themself, we should have no problem funding the government in a Constitutional Republic...given you mean the one we used to have, simply adjusting the amount needed for the now humungous population in comparison to what they had back then. The "tax" burden on the individual, as it were, decreases as population grows...unless of course you grow government functions with population. The roads are growing slower than population, as are our borders (haven't changed for quite a while). So, there is no reason to increase the burden per "tax" payer, or citizen. The burden would be less than at the founding of the Constitution, not more, therefore making a NO TAX nation completely feasible. (Granted, this means giving people liberty to choose to pay or not...but that would just show how much "consent of the governed" you really do have to uphold the legitimacy of your government, since it obstensibly derives it powers from "the consent of the governed". )

Otherwise, I'm calling out "STATISM", and not Republicanism...it's pretty much that simple.

All in all, I hope you get your Constitutional Republic, because then I can get my anarchism easier...afterall, we simply take your minarchism to it's logical conclusion. You aid us, and we aid you, like it or not.

Signed,
Your Unwelcome Ally.

Ps. Statism is both of our enemy, meaning our enemy's enemy is our friend (even without liking each other's ideas at all).

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## Cutlerzzz

> Are you on favor of a limited Constitutional republic?   And if so, how would you fund it?


If a government is to exist, it has to be funded voluntarily.

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## Fox McCloud

Remove any all trade barriers, restrictions, etc.

Anything less is protectionism---even so called "reciprocal trade agreements"...and, as such will lower our standard of living.

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## romacox

I support free trade, but not what the government calls "Free Trade"...get government out of the way... True free trade does not have governments subsidizing or negotiating for a select few businesses that agree to their "global Governance" 

True free trade is decided by the natural working of the markets.

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## Austrian Econ Disciple

After reading Bastiat and Donald Boudreaux I don't know how anyone can be anti-Free Trade, unless they do so out of blind Nationalism as if GE or the Mom & Pop Store has more rights than individuals, or that producers are more important than consumers. The whole point of Capitalism is the benefit to consumers, not to producers. If you want to benefit producers in lieu of consumers then you should advocate Statism, Mercantilism, Cartelization, and the whole regime which follows. It's why Paleo-Cons are a walking contradiction -- professing economic literacy, but being economically illiterate. As for funding a Government....the least damaging is the most transparent, but make no bones all taxation is hideously damaging. I think the original tax appropriation envisioned was the best. The taxing authorities are only invested in the most local authorities, and taxation is appropriated per State on the basis of population. So, say the Federal Government spent 50 million. That would be apportioned among the States and then the local authorities (not the State or the Fed) would levy the tax to accrue the payment. Basically, the tax would last as long as it would take to fund the Government for a year. That's probably the best way to go about taxing, but it's not something that should be supported since taxation is the negation of individual liberty and self-ownership.

In other words -- the Federal Government and the State Government would not have any taxing authority and I would go as far as saying any legislator in either body advocating a tax should be given a trial and the justice upon conviction would be life imprisonment (or something along those lines). Perhaps even bring back the stockades

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## enoch150

> Just the basic operating costs of a limited federal government.  Most of our government excesses are unconstitutional anyway.  Anything beyond the basics could be done at the state level.
> 
> I wouldn't mind funding federal courts with tariffs as long as the scope of their power is diminished.  Maintaining free trade among the states should be a main priority.


Basics like national defense and federal courts. I'm not sure why someone who buys a toy made in China should be forced to subsidize the federal court system even if they never use the federal courts for their entire lives. But, I imagine, more importantly to you...

Aren't you at all concerned that foreigners have total control over the budgets for the federal courts and national defense? If they're willing to bite the bullet, any kind of significant boycott and the whole thing shuts down.

Or what if the "buy American" campaign catches on and federal revenue dries up. Would the government then need to promote a "buy imported" campaign?

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## Southron

> Or what if the "buy American" campaign catches on and federal revenue dries up. Would the government then need to promote a "buy imported" campaign?


I doubt Americans will embrace "buy American" but I already do.  We buy mostly foreign products and wonder where the jobs have gone.  Most have embraced your "free trade" as always good,  so you don't have anything to worry about. 

No one believes in tariffs anymore and we are headed for one-world government.

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## giskard

> Yes, you should look at how many H1-B visas those companies have lobbied for just to drive the wages down and get them their indentured servants.


The contracts between the H1B hires and the company are voluntary on both sides.  The new hires prefer to be working in the USA for x wages with a 2 year contract, than to stay in their home countries.  Why is that immoral?

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## giskard

> How would you fund a limited government without tariffs?


Personally I think a head tax is the most equitable tax, in addition to the pay-for-service fee mentioned earlier.

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## giskard

> Actually, a high percentage of the once high-paying programming jobs have been moved overseas.


And why is this a bad thing?  Foreign workers now compete with local ones.  Laws that disrupt this process are a net economic negative.  Such laws would favor the tiny % of programmers, to the detriment of the consumers.

I believe it was Bastiat that explained that favoring a small group of producers to the detriment of the consumers is folly.

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## krhedwards

Whoever voted conditionally or no needs to read more Ron Paul and Austrian Economics. Start with Economics in One Lesson by Henry Hazlitt.

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## mczerone

I oppose the continuation of govt-mandated trade restrictions, but I do think that voluntary boycotts should be allowed.

Trade barriers might be effective at influencing foreign govts to behave well, but why not let the individual consumer decide what restrictions he wants to follow?  Enforcing national trade barriers by a monopoly of force does not put the measures to the true test of the marketplace, and often do more harm than good, or do less good than another solution could have done.  Why do you want to tell me I can't trade with China, or must do so at a premium?  And why must this premium be paid to an irresponsible and unaccountable middle-man?

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## LibertyEagle

> And why is this a bad thing?  Foreign workers now compete with local ones.  Laws that disrupt this process are a net economic negative.  Such laws would favor the tiny % of programmers, to the detriment of the consumers.
> 
> I believe it was Bastiat that explained that favoring a small group of producers to the detriment of the consumers is folly.


Whole industries have been moved overseas.  A great deal of it due to governmental regulations and managed trade agreements.  If you think this isn't a big deal, then I highly recommend you have a conversation with some of the 15-20% of Americans who are now unemployed.

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## LibertyEagle

> After reading Bastiat and Donald Boudreaux I don't know how anyone can be anti-Free Trade, unless they do so out of blind Nationalism as if GE or the Mom & Pop Store has more rights than individuals, or that producers are more important than consumers. The whole point of Capitalism is the benefit to consumers, not to producers. If you want to benefit producers in lieu of consumers then you should advocate Statism, Mercantilism, Cartelization, and the whole regime which follows. *It's why Paleo-Cons are a walking contradiction -- professing economic literacy, but being economically illiterate.* As for funding a Government....the least damaging is the most transparent, but make no bones all taxation is hideously damaging. I think the original tax appropriation envisioned was the best. The taxing authorities are only invested in the most local authorities, and taxation is appropriated per State on the basis of population. So, say the Federal Government spent 50 million. That would be apportioned among the States and then the local authorities (not the State or the Fed) would levy the tax to accrue the payment. Basically, the tax would last as long as it would take to fund the Government for a year. That's probably the best way to go about taxing, but it's not something that should be supported since taxation is the negation of individual liberty and self-ownership.
> 
> In other words -- the Federal Government and the State Government would not have any taxing authority and I would go as far as saying any legislator in either body advocating a tax should be given a trial and the justice upon conviction would be life imprisonment (or something along those lines). Perhaps even bring back the stockades


That's the way to win over the traditional conservatives.  Insult the hell out of them.

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## Austrian Econ Disciple

> That's the way to win over the traditional conservatives.  Insult the hell out of them.


Well attempting to explain the irrationality of tariffs and trade restrictions hasn't worked, so I figured why bother. So now, I just state the plain facts. No Free-Trader defends NAFTA, CAFTA, etc. as they are basically enlargements of Nationalist protectionism. I'm still waiting on the Protectionists to come out in favor of tariffs among the States and other such trade restrictions to keep jobs from going from Michigan to Alabama, or Florida to New York, etc. I mean, employment opportunities arising out of the most conducive environment is bad -- we have to keep these unprofitable ventures in horrible business environment for the sake of...protectionism! That's the way. Protectionism destroys economic opportunities and growth. It's ironic that the Protectionists seem to be against the AMA, FDA, and the other protectionist rackets, while at the same time advocating an even more draconian protectionism upon the whole US! It's insane.

If I have to hear the non-sense about 'fair-trade' anymore, I shudder to think what I will do. Yeah, it's so bad to buy and trade goods and services cheaper than artificial high prices which are a product of protectionism. Let's stop trading with Vietnam and China and invade them instead. I don't know if you noticed or not, but when goods do not cross borders, soldiers do.

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## Sola_Fide

Milton Friedman refutes protectionism:

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## ProIndividual

This is an issue of nationalism, not economic benefits, for too many of these folks...no amount of logical and rational proof will convince them...it's about in-group/out-group mentality. Since it will never be resolved with them, I suggest we let them wallow in their nonsense flag waving BS. 

I love my country and my flag, but it represents the people, not the government...and what benefits the govrnment most is control of industry, i.e. protectionism. What benefits the people most is what maximizes their standard of living and overall "wealth". Although wealth is subjective, the decision to pursue protectionism for "wealth" building purposes is based in economic fallacy.

Sure...most people would vote for protectionism if given the choice...but they'd also fail an economics exam. This is the failure of democracy...the crowd means well, but is fickle and stupid.

The masses would have more subjective value in free trade if they had perfect information; Adam Smith knew without perfect information the free market would never exist, as the people will vote AGAINST their own economic self-interests, while thinking they are voting for their self-interests. Ignorance causes protectionism to be favored...nothing more.

And according to the poll results, libertarians are smarter than the average member of the mob...as the mob would usually majority vote for protectionism. I'm proud to be a libertarian, because we become libertarian through reading, not a lack thereof. Libertarianism largely denotes intelligence...and I've love to see a study on it to prove it.

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## Southron

> Sure...most people would vote for protectionism if given the choice...but they'd also fail an economics exam. This is the failure of democracy...the crowd means well, but is fickle and stupid.
> The masses would have more subjective value in free trade if they had perfect information; Adam Smith knew without perfect information the free market would never exist, as the people will vote AGAINST their own economic self-interests, while thinking they are voting for their self-interests. Ignorance causes protectionism to be favored...nothing more.


I'm pretty sure that people have swallowed your "free trade", hook, line, and sinker.  Democrats and Republicans alike champion it.  Meanwhile, our manufacturing base has been eroding.

You, Woodrow Wilson, Bill Clinton, and George Bush have won the debate.  I freely admit it.  Now we live with the consequences.

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## josh b

> After reading Bastiat and Donald Boudreaux I don't know how anyone can be anti-Free Trade, unless they do so out of blind Nationalism as if GE or the Mom & Pop Store has more rights than individuals, or that producers are more important than consumers. The whole point of Capitalism is the benefit to consumers, not to producers. If you want to benefit producers in lieu of consumers then you should advocate Statism, Mercantilism, Cartelization, and the whole regime which follows.


Yes, that is absolutely right.  We can't stress this enough.  Economic science has debunked protectionism as ultimately self defeating.




> I'm pretty sure that people have swallowed your "free trade", hook, line, and sinker.  Democrats and Republicans alike champion it.  Meanwhile, our manufacturing base has been eroding.
> 
> You, Woodrow Wilson, Bill Clinton, and George Bush have won the debate.  I freely admit it.  Now we live with the consequences.


What?  Nobody supports free trade anymore.  These so called 'consequences' are a product of interventionism.  You can't solve it with even more interventionism.  Protectionism _does not_ work.

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## johnrocks

yes

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## Southron

> What?  Nobody supports free trade anymore.  These so called 'consequences' are a product of interventionism.  You can't solve it with even more interventionism.  Protectionism _does not_ work.


Tariffs are at an all-time low with most countries.   Where is utopia?

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## ProIndividual

> You, Woodrow Wilson, Bill Clinton, and George Bush have won the debate. I freely admit it. Now we live with the consequences.


This is exactly what I'm talking about. 

First of all, none of the people you mentioned are free market capitalists, and do NOT support free trade. They support the words "free trade", as in "free trade" agreements...like NAFTA and CAFTA, for example. 

ANYONE WHO CALLS THEMSELVES A FREE MARKET CAPITALIST AND A FREE TRADER, ARE EXPLICATELY AGAINST ALL "FREE TRADE" AGREEMENTS.

So, stop making an argument that only makes sense to those who do not BOTHER to read about the subjects they discuss.

Murray Rothbard said it best when he said "you don't need a treaty for free trade." Any voluntary trade that the government doesn't control is a free trade...not a trade sanctioned by some treaty, obviously designed as a neo-mercantilistic control for industry and government to exploit for their mutual gain at the consumers' expense.

SECONDLY, you cannot show any data to support the nonsense that protectionism is GOOD for the economy longterm, in any way, in employment rates, growth, GDP, total average compensation for workers, Gini household income, productivity nationally, etc., etc.

So, this nonsense that we need to return to John Jay and Hamilton's BS economic style is based on ignorance of the facts. Hamilton thought the more we taxed people the better, as it would spur production...he was, in short, not very smart. He most likely didn't even read Adam Smith's Wealth of Nations (the most important economic treatise of the time). You're suggesting somehow protectionism benefits the economy...many Keynesians and leftists also make this claim (just google it), but can you prove it? I can show clear data that draw clear correlations to the contrary...as can any of us here on this side of the argument. I'd love to see you try, as it would guarantee you facing down the facts.

I will say it again...ignorance causes protectionism to be favored...nothing more.

And you do not have to like me, or my opinions, for me to be correct. I would gladly have you dislike me enough to look up the data, and come around to the reality of free market economics. When we suffer under economic fallacies our philosophical conclusions will be conjured in a void, with no basis in reality....and that IS utopian, while grounding philosophy in economic reality is NOT utopian.

You'll wise up, you're probably a very smart guy. Just take the time to explore our information, it will become abundantly clear...we are right.

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## josh b

> Tariffs are at an all-time low with most countries.   Where is utopia?


Who said anything about utopia?  We have provided abundant sources to explain why it doesn't work.  Could you please explain to us why violently interfering with the price system and the distribution of capital will bring us prosperity?  I would be very curious to here it.

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## Southron

> This is exactly what I'm talking about. 
> 
> First of all, none of the people you mentioned are free market capitalists, and do NOT support free trade. They support the words "free trade", as in "free trade" agreements...like NAFTA and CAFTA, for example.


Look, NAFTA lowered/ended most tariffs between the U.S., Canada(except dairy products ),and Mexico.

Do you prefer the U.S. completely opens our markets and allow our neighbors to maintain high tariffs on our goods? It seems to me that NAFTA accomplished what you desire in opening markets.

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## Southron

> Who said anything about utopia?  We have provided abundant sources to explain why it doesn't work.  Could you please explain to us why violently interfering with the price system and the distribution of capital will bring us prosperity?  I would be very curious to here it.


I just want to know why we haven't reaped noticeable benefits from all these lower tariffs? At best our manufacturing sector has been decimated and it appears to coincide with freeing up trade with Mexico and Asia.

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## LibertyEagle

> Well attempting to explain the irrationality of tariffs and trade restrictions hasn't worked, so I figured why bother. So now, I just state the plain facts. No Free-Trader defends NAFTA, CAFTA, etc. as they are basically enlargements of Nationalist protectionism. I'm still waiting on the Protectionists to come out in favor of tariffs among the States and other such trade restrictions to keep jobs from going from Michigan to Alabama, or Florida to New York, etc. I mean, employment opportunities arising out of the most conducive environment is bad -- we have to keep these unprofitable ventures in horrible business environment for the sake of...protectionism! That's the way. Protectionism destroys economic opportunities and growth. It's ironic that the Protectionists seem to be against the AMA, FDA, and the other protectionist rackets, while at the same time advocating an even more draconian protectionism upon the whole US! It's insane.
> 
> If I have to hear the non-sense about 'fair-trade' anymore, I shudder to think what I will do. Yeah, it's so bad to buy and trade goods and services cheaper than artificial high prices which are a product of protectionism. Let's stop trading with Vietnam and China and invade them instead. I don't know if you noticed or not, but when goods do not cross borders, soldiers do.


Thing is, you need to remember that those of us who post here, are just a fraction of who are actually reading what is written.  A large number of Americans do not realize that NAFTA, CAFTA, etc. are not real free trade.  So, when discussing this subject, it would help if you made that clear.  

Also, approaching the subject with some humility, rather than collectivistically denigrating an entire group of people, tends to entice more people to listen to what you have to say.  Especially since the "paleocons" are the Republicans whose votes we MUST get for Ron Paul to win the Republican nomination.  Ron Paul *is* their logical choice.  Surely, denigrating them is not the way to win them over.

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## ProIndividual

Rifleman, please read what I posted for you protectionist guys in another thread:

Part 1:

Statist Economic Fallacies: Breaking Through the Nonsense (so far a 3 part blog, 21 fallacies)

http://www.campaignforliberty.com/blog.php?view=41436



4. Tariffs that limit imports, and policies that encourage exports, are good ideas

 The fallacy that government is a better judge of the most profitable modes of directing labor and capital than individuals is well illustrated by exporting policies. In the twentieth century, the federal government has sought to promote exports in various ways. The first was by forcing open foreign markets through a combination of diplomatic and military pressure, all the while keeping our own markets wholly or partially closed. The famous "open door" policy, formulated by Secretary of State John Hay in 1899 was never meant to be reciprocal (after all, he served in the McKinley administration, the most archly protectionist in American history), and it often required a gun boat and a contingent of hard charging marines to kick open the door.

 A second method was export subsidies, which are still with us. The Export-Import Bank was established by Roosevelt in 1934 to provide cash grants, government-guaranteed loans, and cheap credit to exporters and their overseas customers. It remains today-untouched by "alleged" free market Republican administrations and congresses.


A third method was dollar devaluation, to cheapen the selling price of American goods abroad. In 1933, Roosevelt took the country off the gold standard and revalued it at $34.06, which represented a significant devaluation. The object was to allow for more domestic inflation and to boost exports, particularly agricultural ones, which failed; now Bush is trying it.

 I'd just like to point out, FDR's agriculture policies caused the "soup lines" or "bread lines" we always hear so much about. He had 10 million acres of crops destroyed and 6 million farm animals killed in order to boost domestic food prices for producers. This raised the price of food. His subsidies to export made exporting the food more profitable than selling it domestically. The combination of the two led to food shortages. So, next time some liberal claims that stimulus and bailouts prevented "soup and bread lines", remind them those were the fault of FDR and bad economics. It doesn't even matter that stimulus and bailouts don't work (or work well), it's enough the Obama administration isn't as dull on economics as their Roosevelt predecessors. We simply don't have these "soup and bread lines" because no one is repeating FDR's mistakes, which caused them to begin with.


A fourth method, tried by the Reagan administration, was driving down farm prices to boost exports, thereby shrinking the trade deficit. The plan was that America would undersell its competitors, capture markets, and rake in foreign exchange. (When others do this it is denounced as unfair, as predatory trade.) What happened? Well, it turned out that the agricultural export market was rather elastic. Countries like Brazil and Argentina, depending on farm exports as one of their few sources of foreign exchange, which they desperately needed to service their debt loads, simply cut their prices to match the Americans. Plan fails.


But it got worse: American farmers had to sell larger quantities (at the lower prices) just to break even. Nevertheless, although the total volume of American agricultural exports increased, their real value (in constant dollars) fell - more work, lower profits. Furthermore, farmers had to import more oil and other producer goods to expand their production, which worsened the trade deficit. Then, there were the unforeseen and deleterious side-effects. Expanded cultivation and livestock-raising stressed out and degraded the quality of the soils, polluted watersheds, and lowered the nutritional value of the expanded crop of vegetables, grains, and animal proteins.

 The author says "worsened" trade deficits, in italics, for a reason. Trade deficits are not negative, and the fact people think trade deficits are negative is itself a fallacy. We will cover this fallacy here, after we have finished with this part.


Finally, the policy of lower price/higher volume drove many small farmers, here and abroad, off the land, into the cities, and across the border, our border. Here is an economic policy that not only failed in its purpose but worsened the very problem it was intended to alleviate, and caused a nutritional, ecological, and demographic catastrophe.

 I wished the author would have also italicized "problem", as to further drive home the point that trade deficits are not negative. So, let's address this fallacy now.


•The instinctive reaction of politicians is that if one country places a tariff barrier on our exports, we should respond by doing the same. However economic theory suggests that placing a tariff barrier on imports leads to a loss of economic welfare. It is better to not retaliate.

 Time and time again, trade restrictions like tariffs have hurt our country's economy, not helped it.


The Embargo Act of 1807 and the subsequent Nonintercourse Acts were American laws restricting American ships from engaging in foreign trade between the years of 1807 and 1812. They led to the War of 1812 between the U.S. and Britain.

 Despite its unpopular nature, the Embargo Act did have some limited, unintended benefits, especially as entrepreneurs and workers responded by bringing in fresh capital and labor into New England textile and other manufacturing industries, lessening America's reliance on the British merchants.[8] (Since the damage that was caused was so widespread and severe, you can liken this to 'stepping over dollars, to pick up pennies')

 The Embargo was in fact hurting the United States as much as Britain or France. Britain, expected to suffer most from the American regulations, found consolation in the development of a South American market, and the British shipowners were pleased that American competition had been removed by the action of the U.S. government.

 The attempt of Jefferson and Madison to resist aggression by peaceful means gained a belated success in June 1812 when Britain finally promised to repeal her Orders in Council. The British concession was too late, for by the time the news reached America the United States had already declared the War of 1812 against Britain.

 The entire series of events was ridiculed in the press as Dambargo, Mob-Rage, Go-bar-'em or O-grab-me ('Embargo' spelled backward); there was a cartoon ridiculing the Act as a snapping turtle, named "O' grab me", grabbing at American shipping.



 Smoot-Hawley Tariff Act

 The Tariff Act of 1930, otherwise known as the Smoot-Hawley Tariff or Hawley-Smoot Tariff (P.L. 71-361)[1] was an act, sponsored by United States Senator Reed Smoot and Representative Willis C. Hawley, and signed into law on June 17, 1930, that raised U.S. tariffs on over 20,000 imported goods to record levels.[2]

 The overall level tariffs under the Tariff were the second-highest in US history, exceeded (by a small margin) only by the Tariff of 1828[3] and the ensuing retaliatory tariffs by U.S. trading partners reduced American exports and imports by more than half.

 Some economists have opined that the tariffs contributed to the severity of the Great Depression.[4][5][6]

 U.S. imports decreased 66% from US$4.4 billion (1929) to US$1.5 billion (1933), and exports decreased 61% from US$5.4 billion to US$2.1 billion, both decreases much more than the 50% decrease of the GDP. ( I want everyone to notice, we are in an era of a horrible economy with high unemployment and trade surpluses. In 1929, the trade surplus was $1 billion, this did not however translate to long term growth or more employment. In 1933, we ran a smaller trade surplus and had worsening effects, along with LESS TRADE OVERALL. Trade surpluses (foreign exchange deficits) are often regarded as good, but they have almost never translated into higher growth rates or low unemployment rates. The higher growth rates and lower unemployment rates are found in periods of high trade deficits (foreign exchange surpluses). The very way governments come up with trade numbers, and whether a nation has deficits or not, has been criticized as nearly erroneous, by free market economists from Frederic Bastiat to Don Boudreaux. Bastiat demonstrated that a government can record a deficit, even though a net profit was made by their citizen who was involved in the trade. This is counter intutitive, but deductively logical. The government numbers record the price at sale, not the resale value and profit made. When this profit is taken into account, then the only debt in the 'trade deficit' that is not covered by the foreign exchange surplus is government debt acrued by borrowing from foreigners. When people say "we need to do something about the trade deficit", I say "yes we do, we need to stop letting the government run in deficit and debt by borrowing money from foreigners". The common misconception is that unbalanced, or even unreciprocated, trade is bad for the economy. In fact, private sector trade is not debt, and is not bad for the economy at all. It's the debt the government runs up in the trade deficit that materializes as debt, and gives trade deficits a bad name. Private sector trade, good...Public Sector borrowing, bad. As you can see from the severely diminished trade numbers above, protectionism shrinks the economic pie, while free trade (or at least free-er trade) expands the total economic pie, benefiting everyone.)

 According to government statistics, U.S. imports from Europe decreased from a 1929 high of $1,334 million to just $390 million during 1932, while U.S. exports to Europe decreased from $2,341 million in 1929 to $784 million in 1932. Overall, world trade decreased by some 66% between 1929 and 1934.[15]

 Although the tariff act was passed after the stock-market crash of 1929, some economic historians consider the political discussion leading up to the passing of the act a factor in causing the crash, the recession that began in late 1929, or both, and its eventual passage a factor in deepening the Great Depression.[16] Unemployment was at 7.8% in 1930 when the Smoot-Hawley tariff was passed, but it jumped to 16.3% in 1931, 24.9% in 1932, and 25.1% in 1933.[17]

 Imports during 1929 were only 4.2% of the United States' GNP and exports were only 5.0%. Monetarists such as Milton Friedman who emphasize the central role of the money supply in causing the depression, downplay the Smoot-Hawley's effect on the entire U.S. economy.[18]

 I think it's fair to say the money supply was responsible for the deflation (too little money in circulation), and the tariffs were responsible for reduction in trade and GDP, overall.

 I think it's pretty clear, interfering in the economy to spur exports or reduce imports only hurt the economy. Which, by chance, brings us to our next fallacy...





5. The fallacy of trade deficits

 The 19th century economist and philosopher Frédéric Bastiat expressed the idea that trade deficits actually were a manifestation of profit, rather than a loss. He proposed as an example to suppose that he, a Frenchman, exported French wine and imported British coal, turning a profit. He supposed he was in France, and sent a cask of wine which was worth 50 francs to England. The customhouse would record an export of 50 francs. If, in England, the wine sold for 70 francs (or the pound equivalent), which he then used to buy coal, which he imported into France, and was found to be worth 90 francs in France, he would have made a profit of 40 francs. But the customhouse would say that the value of imports exceeded that of exports and was trade deficit against the ledger of France.[30]

 In the above example, there is a single trader who is traveling and trading across national borders. The Frenchman owns a cask of wine worth 50 francs, and travels with it to England. France records an export of 50 francs, England an import of 50 francs.. In England, he sells his wine for 70 francs (or the pound equivalent) and buys 70 francs worth of English coal. He then leaves England for France with the 70 francs of coal, so that Enland records this as an export and France as an import. So, England has exported 20 francs more than it has imported, for a trade surplus of 20 francs. Meanwhile France imported 20 francs more than it exported, for a trade deficit of 20 francs. This is the last time the trade is recorded by either government, the entire reason why trade numbers are irrelevant in most cases to trade effects. Therefore, it's important to notice that the nation with the trade surplus (England) actually "lost money" on the trades, while the nation with the trade deficit (France) actually made all the profits. But the trade did not conclude with the importation of 70 francs of English coal by the Frenchman...he then sells it in his native France for 90 francs, without any government recording it as an import/export. This means the trader profited 40 francs overall (he turned 50 francs of wine into 90 francs), and yet his government calls it a 20 franc loss. The idea he lost money for himself, or for his nations GDP, is erroneous.



The idea trade surplus or deficit is directly tied to whether the trade is "balanced" or not, is fallacious. The trade deficit is exactly balanced by the foreign exchange surplus in the private sector. The trade surplus is exactly balanced by the foreign exchange deficit. Every product traded for currency is an investment in currency. Every trade of currency for a commodity is an investment in that commodity. There basically is no such thing as "balanced trade", because every trade is balanced by virtue of the fact they are voluntary, and because of the inverse relationship of trade and foreign exchange. Trade and foreign exchange are negatively correlated.

 By reductio ad absurdum, Bastiat argued that the national trade deficit was an indicator of a successful economy, rather than a failing one. Bastiat predicted that a successful, growing economy would result in greater trade deficits, and an unsuccessful, shrinking economy would result in lower trade deficits. This was later, in the 20th century, affirmed by economist Milton Friedman.

 Contrary to popular misconception, trade deficits are correlated with higher growth rates, lower unemployment, and wealthier periods. The opposite is true for trade surpluses. We should embrace trade deficits, if in fact we put any creedance in them at all.



6. Immigration causes unemployment or lower wages for natives

 Immigrants increase the supply of labour but they also increase Aggregate Demand in the Economy. This means that they buy more goods and create additional demand in the economy. They provide labour supply and increase labour demand.

 If immigration caused unemployment why did America not have high unemployment during times of mass immigration? Because the immigrants created as many jobs as they took.

 Often immigrants take jobs that native workers just don't want to do. - You won't see big multinationals cueing up to stop immigration.

 Furthermore immigrants tend to be of working age. Therefore they tend to contribute more tax than receive in benefits. Without immigration US demographics would have a larger % of dependent old people.

 Fears that immigrants threaten American workers are mostly misplaced. Just as working women haven't deprived men of jobs, immigrants create jobs as well as filling them--both when they spend their wages and in complementary lines of work. Mexican construction workers, for instance, create jobs for Americans selling building materials, as well as spending their wages at Wal-Mart ( WMT - news - people ).

 Nor do immigrants depress wages, since they rarely compete directly with native-born Americans for jobs. On the contrary, their efforts often complement one another. A foreign nanny may enable an American doctor to return to work more quickly after childbirth, where hardworking foreign nurses and cleaners enhance her productivity. Research by Gianmarco Ottaviano of Bologna University and UC, Davis' Giovanni Peri found that the influx of foreign workers between 1990 and 2004 raised native-born Americans' wages by 2%. Only one in ten--high school dropouts--lost slightly, by 1%. All Americans benefited from higher capital returns, cheaper goods and services and faster productivity growth.

 Immigrant diversity and dynamism stimulates new ideas and businesses. Migrants are a self-selected minority who tend to be young, hardworking and enterprising. Like starting a new business, migrating is risky, and hard work is needed to make it pay off. Immigrants are 30% more likely than native-born Americans to start their own business.

 That number would surely be higher if we legitimized their status. People who lack formal property and business rights can't get a bank loan to start a business or ink legally enforceable contracts. Legalizing them would unleash their entrepreneurial energies and swell tax revenues.

 Exceptional individuals who generate brilliant new ideas are often migrants. Instead of following conventional wisdom, they tend to see things differently, and as outsiders they are more determined to succeed. Nearly a quarter of America's Nobel laureates were born abroad. Nearly half of Silicon Valley's venture capital-funded startups were cofounded by immigrants. No one could have guessed when he arrived at age 6 as a refugee from the Soviet Union that Sergey Brin would go on to cofound Google ( GOOG - news - people ). How many potential Brins does America turn away--and at what cost?

 Immigration limits not only make us less safe by encouraging people to not get background and medical checks, but are impossible to expect immigrants to follow:



As you can see, no 30 year old Mexican with a H.S. diploma, and a U.S. citizen sister already in the U.S. , is going to wait an estimated average wait time of 131 years. It's untrue to say "they need to just wait in line like everyone else", as most of these quotas and restrictions on immigration were not in effect when our ancestors came, and if they were, many would of came anyway (as in the people fleeing fascism or famine). We create criminals with the law, not the other way around. We are trying to fight free market forces in the exchange of labor and goods (the cardinal rule in free market economics), and expecting that it will remain enforcable. I won't even go into the ethical and moral implications. Natural law is a great argument here, but that's for another time.

 The fact is, there has never been a negative correlation between native poverty and unemployment rates and immigration levels. At times, there has been a positive correlation. This means immigrants can be a net benefit to a society, both in terms of employment levels and wage rates for natives, but they cannot be a drag on either. Like all other free exchange, this creates more activity in the economy, not less.



 7. You can't have open borders in a welfare state

 Many worry that if America opened its borders now, millions would come, the welfare burden would be unsustainable and society would collapse. Yet such fears are misplaced. Most people don't want to leave home at all, let alone forever. Since 2004 three rich European countries--Britain, Ireland, and Sweden--have allowed people in eight poor eastern European countries (notably Poland) to come work there freely. All 75 million of those eastern Europeans could have moved, yet only 1 million did--and half have already gone home.

The belief that free migration is incompatible with a welfare state--asserted by Milton Friedman and recently echoed by Paul Krugman--is also incorrect. When in 2004 Poles were given the option of moving to Sweden--which has the most generous welfare state on earth--or to Britain and Ireland, which denied Poles access to any benefits until they had worked for a year, less than 1% opted for Sweden. America, too, could deny immigrants access to welfare initially.

 Opening up to eastern Europeans gave Britain a big boost. Growth soared. Unemployment fell. Wages continued to rise. Newcomers paid much more in taxes than they took out in benefits and public services. After the global financial crisis plunged the economy into recession, many Poles went home rather than remain unemployed in Britain. Considering that Sweden is as rich as the U.S. and that Romania is poorer than Mexico, if open borders can work within the European Union, they can work in North America.

 Allowing people to move freely is not just a matter of economic self-interest. It is also a moral imperative: Freedom of movement is a basic human right that should not be denied to people less fortunate than ourselves.

 In February 2011, Reason Foundation senior policy analyst Shikha Dalmia spoke at the International Students For Liberty Conference about immigration.

 Calling for open borders, Dalmia argues that immigrants create more wealth than they consume and that an increasingly globalized economy inevitably means that people, like goods and services, will be crossing borders in growing numbers. While nativists and protectionists may view such developments with alarm, allowing people to move more freely is a great advance both for human rights and economic progress.

 In this video, she also addresses several mini-fallacies being spread by "libertarians" who call for closed borders (among other statist policies), like Hans Hermann Hoppe.

http://www.reason.tv/video/show/shik...ves-lecture-on


11. Hamilton was an economic genius and was just great

 Another myth is that the financial genius and economic statesmanship of Alexander Hamilton saved the credit of the infant United States and established the sound financial and economic foundation essential for future growth and prosperity. Ron Chernow's hagiographic biography of Hamilton is now moving up the best seller charts, cluttering the display tables of Borders and Barnes & Noble, and taking up time on C-Span's Booknotes; but its greatest contribution will be to perpetuate the Hamilton myth for another generation.


Sumner's concise and devastating biography of that vainglorious popinjay, written over a hundred years ago, remains the best. He closely studied Hamilton's letters and writings, including the big three - his Report on the Public Credit (1790), Report on a National Bank (1790), and Report on Manufactures (1791) - and came to three conclusions: first, the New Yorker had never read Smith's Wealth of Nations (1776), the most important economic treatise written in the Anglo-American world in that period; second, he was a mercantilist, who would have been quite at home serving in the ministry of Sir Robert Walpole or Lord North; and third, Hamilton believed many things that are not true - that federal bonds were a form of capital; that a national debt was a national blessing; that the existence of banks increased the capital of the country; that foreign trade drained a country of its wealth, unless it resulted in a trade surplus; and that higher taxes were a spur to industry and necessary because Americans were lazy and enjoyed too much leisure.


The idea here was that if you taxed Americans more, they would have to work harder to maintain their standard of living, thus increasing the gross product of the country and providing the government with more revenue to spend on grand projects and military adventures. Hamilton was once stoned by a crowd of angry New York mechanics. Is it any wonder why?

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## osan

> I'll keep this simple. Do you support having free trade with every nation on Earth?



Poorly structured query.

First, it would have been more precise to have asked:

"Do you support free market trade with every nation on earth?"

Even so stated, no.  The reason being that trading with slaver nations such as China leads to grotesque distortions of the market, thereby rendering it not free.

Free markets are inherently problematic because they fundamentally conflict with human nature.  I do not know whether there is any way around this problem.  That said, the freer the markets, the better the prosperity.

I support balanced trade with all nations, meaning that if China wants to trade with us while maintaining a slave labor market, perhaps they should be trading with someone other than the USA.  Halting trade is the only practical solution that I can see which protects our economy from the sorts of freedom-destroying distortions that trade with nations like China has brought to us.

If you sleep with dogs, do not be surprised at the fleas.

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## josh b

> I just want to know why we haven't reaped noticeable benefits from all these lower tariffs? At best our manufacturing sector has been decimated and it appears to coincide with freeing up trade with Mexico and Asia.


Your use of force is going to solve this problem...how exactly?

There are two major reasons why industries move overseas:

1. Government strangles business at home to the point where people rely on foreign production instead.

2. Foreign industries are simply superior and out-compete the ones at home.

Concerning the first point, protectionism as a solution in this instance does nothing but make people poorer, like we've pointed out a million times already.  The tariff is basically a tax on people, taking money from them that they could have spent elsewhere.  The only workable solution is to reduce regulation on business.  Do you see that?  _You need to cut off the interventionism at its source_, not add more of it.  

Concerning the second instance, what is the big deal?  The superior industry should be making more profit, that's the point of a capitalist system.  A tariff would have the same counterproductive results as in the first instance.  People have less money to spend and you have basically subsidized the inferior industry.  Everyone ends up poorer in the long run except the 'protected' industry.  This is corporate welfare plain and simple.

As to your example of lower tariffs correlating to a reliance on Asian and Mexico for manufacturing, _you are absolutely right_.  Our lowering of trade barriers has caused a migration of industries out of the US.  There are two potential reasons for this and I have already listed them.  Either unionism, minimum wage laws, various regulations and other anti business practices are causing a deficiency in our manufacturing capability or the Asian and Mexican industries are simply winning on the market.  

If the first seems to be the case we need to deregulate businesses.  If the second is true then _tough luck_.  Tariffs, which are just a clever form of subsidy paid for by the consumers, will not make anyone richer.  

Seriously this stuff goes all the way back to Adam Smith.  It should be common knowledge by now.  Economics does not look kindly on you my friend.  Now, no offense intended, but are you going to answer my question about why violent interventions in the market to subsidize American industries somehow produces prosperity?  I would like to see a good economic reason.

Edit: Woah, ProIndividual beat me to it big time.  His is a little more technical. I commend you sir.

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## ProIndividual

Part 2 :

15. The economic pie is finite, and when one person wins, another must necessarily lose

 This usually comes from folks who learn economics from the movie "Wall Street". 

The fact is, as I've demonstrated throughout this blog, wages grow due to: a) task maximization due to technological advances, competition with low paid labor, and competition in the global economy, b) which are caused by accumulations of capital in the hands of wealthy producers, c) that lead to said task maximizing strategies causing productivity to rise, and d) creating profits and causing them to rise, and therefore the amount of money that can be negotiated for wages. The fact is, the pie always continues to grow as long as we can task maximize. 

The most simple way to do this has been to grow the population. I mean which army can do more, the army of 3, or 3,000? Obviously building that base will go way faster with 3,000 soldiers, whether it's a base for 3 or the 3,000. After population, there is equality under the law. Notice how most third world countries don't let women work or own property of any real equity to males? When you keep half the population forcably unemployed you get half the possible economy for your population...which apparently means cave-living and a steady diet of bad food in insufficient quantities. And no education, I forgot that part. Because that's the next method of task maximization. If I teach you my job, I can do other stuff, and we can adapt more quickly to shocks like a wave of illness causing usual specialists to be absent, or retractions in the economy. 

So, without going on and on regarding all the different ways mankind task maximizes, let me just say, all of it is wholly dependent on wealth accumulation in a few hands. Who would pay the soldiers in my example? Some government, corporation, union, or church (or some other institution), take your pick. No matter what, in order to task maximize, wealth must accumulate in sufficient levels to allow longterm investment in things like technology, new labor sources (that can bear drawbacks and risks), and relocation to better fit into the specialization of Division of Labor. As the tasks maximize, the economy grows, and the pie expands. 

The predicatble path of this process should be the poor recieving a smaller and smaller fraction of the total pie in play at any given moment, but with overall real wages rising, therefore raising their standard of living far exceeding inflation. Since decimals are infinite (on a number line for the visual reader), then this process can continue infintely (which I do not necessarily believe would happen, especially in a truely free market where remaining mercantilist state supported coercions on power and capital erode and die). But even if this process continued infinitely, the poor would be better off generation to generation in all respects, even as the gap between rich and poor (poverty being something that would be largely a matter of perspective instead of need) continues to grow.





So the economic pie is certainly not finite.







I think between this and the last couple fallacies, you should see several very important facts: 

- You can receive a smaller and smaller piece (%) of the total pie, and at the same time recieve a larger and larger piece ($) each time, because the pie continuously grows, and is not finite.

 - Unions are not corollary or causal to wage rates, real wages, household income, total compensation, or national income share.

 - Productivity is corollary to wage rates, real wages, household income, total compensation, and national income share. Except for national income share, productivity is also causal to those things. In the case of national income share, it's causal (currently) to productivity.

 - Wage rates, real wages, household income,and total compensation are negatively correlated to national income share (when income share goes down, compensation rises), by way of productivity (productivity leads to higher wages, etc., but productivity is caused by wealth accumulation leading to technological advances, etc., which is corrolary to national share of income via the wealth gap increasing).

 - Unions do not improve the situation of the middle class in terms of any form of compensation listed, unless it is at the expense of some other middle class or lower class worker. This is evident from the graphs, that the top 1% continues to accumulate capital, and the middle class' and lower class' share continues to decline (it shows the bottom 80% on the one graph). So, if the income share continued to rise for the top 1% of earners with or without unions being a major aspect of the workforce (depending on the time frame), then obviously the income share the middle class is seeking to hold onto is rightfully the poor's. The lower class and middle class mostly share the same "slice of pie", as it were. The whole system depends on increasing standards of living, which depends on ever increasing productivity, which relies on ever increasing amounts of capital accumulation...so it's no suprise the rich aren't losing any momentum (and thank God, because if they did, the whole thing begins to erode). Since the top 1% NEED to continue increasing their share, that leaves the other two "classes" to fight over the constantly diminishing share (keeping in mind, their compensation and standard of living are continuously rising, and it's because of this widening wealth gap in the national income shares). So, unions can only raise wages artifically above the market value, causing more unemployment for equal or lesser wage workers, and therefore grabbing income share away from those same people. It's become my opinion, unions should never be allowed to collectively bargain on compensation...workers shouldn't all be paid the same wage either, some are more productive than others, and profit motive is enough to cause individual task maximization by workers on it's own, and eroding that inequity of pay but fairness of competition you end up rewarding the lazy to mediocre, and punishing the hard working. You do not have to be paid by wages, persay, however, you can be paid by any means, like percentage for example. The flexibility is important.



I'm not sure if unions have a causal relationship with safety...and after the research I've done on wages, I wouldn't be suprised either way. If they are not causal to safety in anyway, like standard of living, then I will have no reason to ever support any union again...which is mind blowing for me, as I have been a member of several unions. Admittedly, if I wouldn't have researched this stuff myself, I would never have believed it. That's how strong these economic fallacies are in regards to unions.



 16. There is a war on the middle class

 There is no war on the middle class. If I haven't given enough evidence of that thus far, then please watch this video:

 To hear the Lou Dobbses and Bill O'Reillys of the world--not to mention politicians ranging from Ron Paul to Hillary Clinton--the middle class of America (however you define that term) has never had it so tough. Between credit squeezes, out-of-control immigration, rising costs of education and health care and everything else, it's all darkness out there for those of us who are neither millionaires nor welfare cases, right?

 In "Living Large," Drew Carey and reason.tv examine the plight of the American middle class. What do they find? Click on the link below to find out.

http://www.reason.tv/video/show/living-large





 17. We need government to provide roads, police, and firemen...not to mention help the poor

 Privatization or public-private partnerships can more efficiently handle all four of these services. First, let's examine roads. 

When you buy a gallon of gas at the national average of $4 per gallon, $1 of that is tax (federal,state, and local combined). That $1 not only covers your local contractors profit, employees wages, and road maintenance/construction, but it also covers a bereaucrat's salary and benefits (including the coverage of his family). 

Now, imagine you pay no such tax. Imagine you also are sitting at a gas station. You get one gallon of gas for $3, and pull out onto a private road which requires tolls. At the toll booth, you pay 85 cents for your daily round trip usage, and keep the other 15 cents. The 15 cents savings was the bereaucrat's salary and benefits. 

Or you could imagine paying a monthly fee that amounts to 85 cents a gallon. Maybe being taxed (I'm hoping we can avoid this), and then using private-public partnerships to transition into a privatized system. Universal coverage can be achieved by basing amount due in payment for us, if any, on income ratings. Or you can just see the obvious...no one without the $4 drives now, so we aren't pricing anyone out of the driving market by cutting their total expense 15 cents.

 Police and fire are very similar. For most of our nation's history we didn't have centralized police. The idea we need to have a monopoly on policing is absurd. Private security should be able to compete with current government police services for public-private contracts, at the very least. If not that, then fully privatize it to allow bad and violent police forces to be hired and fired by their communities. We all know police are NOT receptive to criticism or complaints. They have a horrible record of "customer relations". Although they have gotten better in the age of cameras, they still kill people every other day and never face any real standard of the law that can be called equal, by any stretch of the imagination. The ability to just compete for tax dollars, or private dollars, would not mean the poor would recieve no police service. Again, universal coverage is possible in a free market model. Even if you don't do it as I explained, there are several other ways. One is allowing insurance companies to hire and fire police as a side effect of trying to keep insurance payouts for crime victimization low, another is to include the costs of all dealings in the justice system into the penalties assesed to the violators, and unpaid penalties acrue on the costs of subsequent criminals, making it increasingly unprofitable to be a career criminal. 

Either way, police and fire require no monopoly on force to exist, and they do not need to be necessarily run or funded by the government.

 As for the poor...

 ...in the greatest influxes of immigration to this country we saw the largest poverty problems. Yet, no mass starvation or homelessness (overall). True, there were horror stories, but wages continued to rise, and standards of living continued to drive down poverty despite the issues. Why did those poverty stricken immigrants make such a "good go of it"? Was it welfare? Entitlements? 

No. Those who fled Italy pre and post fascism, and the Irish immigration fleeing the Great Potato Famine, did not have a welfare or entitlement system to depend on. So how did they make it? 

Mutual aid societies. 

Unfortunately private welfare is now illegal for the most part. It was deemed racist, and in many cases I agree. However, a monopoly on welfare is not necessary in order to stop racist business practices. You could base the membership of a mutual aid society on geographics, or anything besides race, and it would largely be as beneficial. Not only would charity driven or profit driven welfare be more efficient, it would be less likely to okay welfare for those abusing the system. The beauty of decentralized welfare was the ability to sniff out and police fraud more effectively. It's much easier to sucker a nation of millions for welfare than a group of a dozen.

 There's also an issue with taxation. Taxing the poor and lower middle class (those right above the poverty line) CREATES or EXACERBATES poverty. They wouldn't be in poverty at all, or for as long, or as far, if you didn't tax them at all. You might think this a great argument for a progressive tax rate, but in actuality it's an argument for not taxing people into poverty, and then claiming to solve poverty with their money. Stop taxing anyone lower middle class or worse off, and you will essentially lessen the poverty problem.

 With the combination of not taxing the poor and allowing mutual aid societies (not race based) one can eliminate the "need" for government welfare.

 I hope you can see, police, firemen, roads, and welfare can be better supplied by the private market, existing without a monopoly.

19. You must give to charity, or pay taxes, or you are not a benefit to society

 Creating jobs for others is a huge benefit. In fact, charity is less efficient than profit driven pursuits, and government is less effecient than charity. This means profit seeking leads to the employment of others, and in doing so you spend capital more efficiently than if you just gave it away to a charity. 

The best way to help the poor is to save the money you were going to give them, and instead employ them.

 "If you give a man a fish, you feed him for a day. If you teach him to fish, you feed him for a lifetime."--- old proverb

 Now, I'm not against charity, and I do think it's necessary, as some problems (like rare diseases) have little market value in solving, and require immediate capital to help. Also, emergencies are more likely to require charity than long standing issues. 

But all in all, you do not have to pay taxes or give to charity to benefit society. Society is lucky to have whatever you are willing to contribute of your own free will and spirit.



 20. The rich get richer, and the poor get poorer

 As I've demonstrated, we all get richer. The fact the ratio of richness isn't egalitarian isn't evidence of failure, it's an observation of a mechanism. In order for us all to get collectively wealthier, the top percentage of us needs to accumulate large amount of capital. So, as I showed previously in this blog, we all get richer even as the gap between rich and poor grows, and this is completely sustainable. 

(And lastly, but please, before you give any cooky hypothetical situation whre "this doesn't work", read about externalities, and make sure what you are describing is not an externslity!)

21. Externalities force our hand in interfering in the markets to achieve efficiency

 This one fallacy took me a whole separate, two-part, blog to cover. Read that debunk here:

 The Externality Fallacy: The Failure of the Statist Economic Case (Part I)

http://www.campaignforliberty.com/blog.php?view=41342

 The Externality Fallacy: The Failure of the Statist Economic Case (Part II)

http://www.campaignforliberty.com/blog.php?view=41344






Sources: me, bing (search engine), http://econ.economicshelp.org/2007/0...fallacies.html

http://100777.com/node/906

 The above link was originally posted at Mises.org, but I had issues viewing that copy so linked the alternative.

 Also sourced, various Wikipedia articles. Almost anything not in bold print is copied and pasted. (in the original copy, go to the links to see what I wrote, what others wrote)

http://www.forbes.com/forbes/2010/06...them-in_2.html

http://econ.economicshelp.org/2007/0...fallacies.html

http://www.reason.tv/

 originally posted at Mises.org:

http://100777.com/node/906

----------


## ProIndividual

And one more for Rifleman and protectionist folks:

Notice how productivity (not to be confused with a necessarily production-based industrial base) and compensation always continued to rise to beat inflation through the periods you and liberal economists SWEAR our standard of living was declining. Also, notice household income continued to rise (I know, the graphs do not match the years eactly, but you can do the rest on your own, use google image search.) And notice that unemployment rates are NOT at all related to immigration rates as well (look up immigration to verify, it's easily done; trust me).







And for the heck of it, notice unions have no relation to any of this:






The fact is, your real wages may have declined or stayed stagnant, but your medical costs are apart of your total compensation too. So, wages plus benefits is your total compensation, and until at least 2008, your standard of living continuously rose over the very period you said protectionism would have been better. 

Now I showed you mine, show me yours...where has free trade caused wars like Smoot-Hawley caused WW2, and the Embargo Act of 1807 caused the War of 1812? Where has protectionism outperformed free trade? I WISH you'd compare period to period and see, the leaps and bounds are becuase of the decreasing of protectionism, not the increasing of it.

You are the isolationists the media should be concerned with, not us non-interventionist free traders.

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## ProIndividual

> slaver nations such as China


common liberal arguemnt...how are people starving in agrarian settings with mass child labor somehow "slaving" to WILLINGLY improve their lives by making more money in a budding adolescent economy where industrialization is taking place?

Every nation goes through a transition like this...every nation who was agrarian had child labor as a default, every nation has low wages until capital accumulation by the ruchest few leads to investments in longterm things like technology, which cause productivity per man hour to rise, and therefore real wages to beat inflation. Standards of living rise as total compensation rises, whether that's raises in real wages or just benefits, or both.

Slaver nations...lol. You mean young capitalist economies that are in the process of getting rid of rampant child labor (like us), rampant unsafe work conditions (like us), and low wages (like us). None of this is slavery, and when polled, these workers LOVE their conditions in comparison with the starvation and rampant death in the agrarian fields. True, they want better conditions in the factories, as we did, and more pay, as we did....but they would NEVER quit and go back to LOWER standards of living.

They are "slaves" only when you're a spoiled American.

----------


## Teaser Rate

In an ideal world, I don't believe there should be any tariffs. However, in the real world,  imposing a tariff on certain goods can improve your country's economy in certain situations.

----------


## osan

> common liberal arguemnt...how are people starving in agrarian settings with mass child labor somehow "slaving" to WILLINGLY improve their lives by making more money in a budding adolescent economy where industrialization is taking place?


You started off with some good stuff and have devolved into this?  Jesus...

OK, China is a slaver nation - the largest in history to date - because they ARTIFICIALLY depress labor rates.  There is no free labor market in China.  There isn't one here, either, but there are two differences: first, we are not nearly as bad as China is, particularly where the individual is concerned, and second: the USA interferes with wages in the opposite direction, keeping them artificially high.  Neither is good, but it can be argued that our way is  better than China's.

In China, those with the temerity to ask for higher wages are treated to their famously humane "justice" system.  If they are lucky, they get one to the brain stem and their miseries are put to an end.  The less fortunate get to be "reeducated".  Whoopdy doo.

Effectively, there is no meaningful opportunity to significantly improve one's lot beyond that which their rotten government deems reasonable.  Where's the freedom there?

Try forming a union and see what happens to you.  I am no fan of unions.  In fact, I despise them, but in a free market unions should be available to those wishing to have them and  who are able to swing them in private agreements with employers.  They should not be banned, but they should likewise not be protected with governmental force, either.




> every nation has low wages until capital accumulation by the ruchest few leads to investments in longterm things like technology


This is a hopelessly naive assertion.  Those with the money strive to keep wages as low as possible.  That is one reason for the rise of unions in the USA.    HUman nature being what it is, once established, the unions became just like the "evil" capitalist shareholders, trying to squeeze them for every penny they could because those whose smart, diligent, and often gutsy endeavors that brought wealth to the world somehow owed it to their workers to give them their "fair share", a complete load of crap.  In so many ways people are their own worst enemies.

The bottom line is that people often do not deal squarely - freely - in economic affairs.  They think they can "fix" human nature, or they are just hopelessly corrupt.  The Chinese government maintains a blatant slave labor marker.  There is no way around this truth.  Yes, many Chinese went from abject slavery and perhaps even poverty to a less ugly form.  So what?  Where is the freedom?  I see it nowhere because the avenues of personal choice for most Chinese are hopelessly narrow when compared with far freer nations.  So to say that this blatant condition of economic slavery is somehow indicative of an organic move toward greater freedom is ridiculous on its face.  Do you think that the Chinese government, once China's economy has eclipsed that of, say, the USA will somehow miraculously remove all wage restrictions, instituting a truly free market system?  I'd bet money I don't have that that will not be forthcoming any time prior to hell's freezing solid to the core.  Those at the top have a good thing going.  They control everything - what motivation is there to change - to relinquish control?  There is none and without such motivation, they will continue to hold their citizens as economic slaves.  Of that I am comfortably certain.  People are people and in all recorded history they have not changed a lick.  Until someone holds their feet to the fire, I predict the Chinese "government" will keep chugging along just as they have been.  In economic terms, I do not see this as a good thing for much of the rest of the world.




> Slaver nations...lol. You mean young capitalist economies that are in the process of getting rid of rampant child labor (like us), rampant unsafe work conditions (like us), and low wages (like us).


Have you been paying attention?  They are doing everything they can to suppress the natural rise in wages that would occur, were their labor market not rigged by government force.




> None of this is slavery, and when polled, these workers LOVE their conditions in comparison with the starvation and rampant death in the agrarian fields.


Well DUH...  that does not mean their conditions rate with those of a free market economy.




> True, they want better conditions in the factories, as we did, and more pay, as we did....but they would NEVER quit and go back to LOWER standards of living.


Nor will they ask for better conditions, as those requests are met with grave violations of their human rights.




> They are "slaves" only when you're a spoiled American.


Spoiled American?  Are you kidding?  What are you, Canadian or something?

----------


## ProIndividual

> You started off with some good stuff and have devolved into this? Jesus...


First of all, I'm completely accurate in the statement. They willingly work in these factories for the most part (slavery exists today, but is declining, as it has been since the dawn of market economics). Also, you seem to not realize slavery is MORE expensive than paid labor. Look at charts concerning slave states and resale value of slaves. Slavery dies economically on it's own. If you want a model of "cheap" statist forced labor, look at prisons....it isn't cheap at all. The cost of maintaining slaves, even when treated lower than normal animals, is too expensive to maintain. In Sicily (my people), slaves weren't even fed, they worked until they starved to death. Great rollers were set up to crush sugarcane, and if someone's arm got caught in the grinder, they had a fire and sword always lit to remove the crushed limb and simultaneously couterize it. They found it cheaper to stop importing slaves, and then they found it cheaper to end it altogether. 

Slavery is economically ineffective...and for you to make the assumption it works as a system, is to assume falsely. Therefore, let our competitors use slave labor (economically, of course I'm against human rights violations), it would only give us greater advantage. 

Now, as far as depressing wages...so what? We get cheaper products....that's not good? I mean, do you think market level wages that are not coerced down, but still are lower than American wages, are bad for the economy? If so, this is why you think this depressed wages thing is an issue at all. If you don't think normally cheaper labor in other countries which have less productivity per worker, and therefore lower standards of living, in their budding economies...then why would you think wages that are even CHEAPER are bad for us as Americans, since we consume those goods?

You can 50 liberals in 5 seconds on the net making your argument about "slave labor" overseas...it's a "fair trade" argument. You will not find any of them making the argument I just made...so why was it out of line to call that a liberal argument?

And what you call a naive assertion, is the basis of what all reputable economists say causes rises in the standards of living. Read Mises...hell, any of the free market capitalists...even Adam Smith talked about this.

Capital is accumulated (by the efficient private individuals, or by the inefficient State, depending on whether it's capitalism or socialism), then technology and other longterm investments are invested in, these lead directly to more productivity per worker and per man hour, and this leads to greater profits, which leads directly to the share the workers negotiate for increasing, allowing for wages rising to beat inflation and raises to standards of living. This isn't controversial. Please read what I post...the link to the Statist Economic Fallacies article addresses your fallacious believe that wages are held up by some other means. Wages can only bottom as far as your subjective value on time and money allow it; in short wages can not be driven down effectively past market levels without force of arms...people won't work for less than they need, and the labor market is competitive even when flooded. 

For instance, if you read what I posted on immigration fallacies, you'd see they cause more jobs than they take, through consumption.

So, I'm still okay, your a little off.


Ps. We manipulate our money far more than the Chinese...say we depress wages also...real wages have been stagnant or falling largely for 30 years (although total compensation and standard of living kept rising...see the charts above). The reason it keeps wages lower is cost-push can't keep up with the rate of inflation when high constantly.

----------


## Cutlerzzz

> Free markets are inherently problematic because they fundamentally conflict with human nature.  I do not know whether there is any way around this problem.


On Ron Paul forums?




> I support balanced trade with all nations, meaning that if China wants to trade with us while maintaining a slave labor market, perhaps they should be trading with someone other than the USA.  Halting trade is the only practical solution that I can see which protects our economy from the sorts of freedom-destroying distortions that trade with nations like China has brought to us.


The US benefits from trading with China. American and Chinese compensation has increased over the last few decades, and the division of labor is one of the main reasons why. 

So it sounds like you don't believe in comparitive advantage or the division of labor? Or am I misinterpreting you?

----------


## osan

> First of all, I'm completely accurate in the statement.


Accurate, but deceptive.  What you describe is analogous to offering a prisoner the choice to be in solitary confinement in a maximum security prison or house arrest.  Either way he is still a prisoner.




> They willingly work in these factories for the most part


And their opportunities for furtherance are almost utterly stifled.




> Also, you seem to not realize slavery is MORE expensive than paid labor.


There is an operational difference between abject, chattel slavery and wage slavery.  The former is very costly whereas the latter is relatively low cost.  One reaps virtually all the benefits with almost none of the costs.  The slave is in better stead, but is still a slave.  Broader avenues of choice do not necessarily mean one is free.  There are degrees of slavery, whereas there are no degrees of freedom.  If you offer a slave a better grade of slavery, prettier flavors, he is likely to take it especially if he is unaware of his slave status.  He simply feels that fortune has smiled upon him when no such thing has happened to him.  All that has come upon him is the deign and din't of his master's wishes.  Big deal.  Great in the slave's narrowly channeled mind.  Not always so good from the standpoint of one whose awareness is broader.





> Look at charts concerning slave states and resale value of slaves. Slavery dies economically on it's own.


You apparently hold a very distorted and one-dimensional view of slavery.  The most effective slavery is the brand where the slave is unaware of his condition.  Were he to become aware of it, he might rebel.  Kept blissfully ignorant, what crumbs are thrown him he is likely to take with gratitude for his good fortune.




> If you want a model of "cheap" statist forced labor, look at prisons....it isn't cheap at all.


Not if you only consider the US model.  Put eyes on that of China and a very different picture emerges.  Night and day.




> The cost of maintaining slaves, even when treated lower than normal animals, is too expensive to maintain.


Yet China uses an ever increasing prison labor force.  Are they so stupid that they cannot add two and two?





> Slavery is economically ineffective...


Then why is economic slavery the standard model, no end in sight?  Business and political power are the supreme pragmatic arts.  Anything that does not meet the intended goals is rapidly retired from service.  Economic slavery is alive, well, and growing, suggesting that it is in fact very economically, as well as politically, viable.

T


> herefore, let our competitors use slave labor (economically, of course I'm against human rights violations), it would only give us greater advantage.


A nice sounding fairy tale with no basis in reality.




> Now, as far as depressing wages...so what? We get cheaper products....that's not good?


Not when it is done in this manner.  Do you understand the fundamentals of macroeconomics?  It appears that you are unfamiliar with the fundamentals because nothing you have written in this branch of the discourse indicates otherwise.  On the one hand you go on, quite correctly, about the virtues of free markets.  Then you falsely ID China as a (freely) capitalist economy, which it is not.  There is nothing free about their economy, which is centrally planned - albeit more wisely than was that of the Soviets - but centrally in any event.  If you cannot or will not see the deleterious effects of an artificial, state-enforced labor arbitrage market, then I don't know what else to say.




> I mean, do you think market level wages that are not coerced down, but still are lower than American wages, are bad for the economy?


If they are "naturally" lower, then no.  When they are so severely, not to mention artificially, depressed as we find in China - depressed with violence - nothing good stands to come of it in the long term.  If all you can focus on is the lower cost of goods we enjoy today, then your gaze is very short.  There are many dimensions to these affairs, some of which we don't hold sufficient truth on and the truth of which could reap widely varying results from another truth.

----------


## osan

> On Ron Paul forums?
> 
> 
> The US benefits from trading with China. American and Chinese compensation has increased over the last few decades, and the division of labor is one of the main reasons why. 
> 
> So it sounds like you don't believe in comparitive advantage or the division of labor? Or am I misinterpreting you?


Greatly misinterpreting.

I did not even raise the issue of division of labor.  It is an effective means of attaining greater efficiencies.

China's forced wage slavery is not a legitimate form of comparative advantage, IMO.  It is not an element of free market capitalism.  It is part of a rigged market system.

In macroeconomics classes comparative advantage is either explicitly or implicitly characterized as a "naturally" occurring phenomenon.  That aside, government interference in such economic affairs are universally decried as drags on an economy - which is demonstrably correct.  Therefore, interference in the wage markets would qualify as a deleterious, parasitic element.

----------


## Cutlerzzz

> Greatly misinterpreting.
> 
> I did not even raise the issue of division of labor.  It is an effective means of attaining greater efficiencies.
> 
> China's forced wage slavery is not a legitimate form of comparative advantage, IMO.  It is not an element of free market capitalism.  It is part of a rigged market system.
> 
> In macroeconomics classes comparative advantage is either explicitly or implicitly characterized as a "naturally" occurring phenomenon.  That aside, government interference in such economic affairs are universally decried as drags on an economy - which is demonstrably correct.  Therefore, interference in the wage markets would qualify as a deleterious, parasitic element.


What is this wage slavery? I hope that you're not refering to the Marxist term, and claiming that industrializing is somehow slavery.

----------


## osan

> What is this wage slavery? I hope that you're not refering to the Marxist term, and claiming that industrializing is somehow slavery.


If you are not free to seek improved opportunities and conditions without fear of violent government reprisal, you are a wage slave. This is particularly so when that government controls wage rates, directly or otherwise.

Is this not clear?

----------


## josh b

None of this really matters.  Trade barriers with China are still counterproductive.  If you want to boycott Chinese production then go ahead and voluntarily boycott them.  Don't mess with the market even more.  People need to make the choice themselves. 

Where is Rifleman?  I'm still waiting on him to read my and ProIndividual's posts.  I want an economic justification for protectionism.

----------


## ProIndividual

Like I said, osan, you're making liberal arguments. Only from a spoiled American perspective could you derive such a point of view. The reality for us during the industrial revolution was very similar to the reality in China now...it's not slavery.

And we've never had less slavery in the world than since the dawn of wage labor. Capitalism kills child labor, high worker fatalities, and slavery...it doesn't produce it.

Chinese prisoners cost more than free Chinese citizens, it;s economically impossible for the State to guard you 24-7 and not spend $#@!loads of money....think it through.

If China is so imprisoned, then why do we have waaaaaay less population and waaaaaay more prisoners, both in TOTAL and PER CAPITA. Umm, we are the most incarcerated nation in history and currently. Stop it.

I don't know what branch of Keynesian macroeconomics you studied, but I suggest you ask for a refund.

Finally, since you admit "naturally" lower wages at market level are good for us and our economy, because we are made wealthier by buying cheaper cost products, then how can it be that even cheaper wages are somehow detrimental to the American consumer and relative wealth? Higher wages in process of production would depress standards of living here, not increase it. You THINK what you're advocating is helpful...but protectionism is economic suicide. I've provided enough evidence to that fact, now show me some or concede the point.

----------


## Dr.3D

With the EPA and OSHA and the like, manufacturing in the United States can not compete with countries that don't follow the same rules.  If somehow the EPA and OSHA were either removed from the Unites States or implemented in the other countries, there can not be a level playing field and jobs will move to where there is less regulation.

Government regulation on U.S. industry is the major culprit when it comes to the loss of industry in the United States.

----------


## The Grinning Maniac

So then in order to get our industry back we should get rid of all rules concerning labor standards, wages and pollution. Lower taxes completely on large industries. Bust all the unions. Shame on workers for wanting more money.

...How exactly does that help anyone apart from the few people who own large factories? You guys keep dancing around the notion that you want our individual economic realities to be on par with the Chinese.



> "Foreign industries are simply superior and out-compete the ones at home."


Cheapness = Superiority. All other factors...irrelevant. How else do you read this? This is why libertarians are not taken seriously. Their blind loyalty to certain economic viewpoints eclipses reality and facts on the ground. I'm sorry...were factory owners destitute and sobbing at night when they had their factories here and paid Americans decent wages? I'm willing to bet they were still...oh what's the word...filthy rich. 

So how does this change benefit you? Tons of people are out of work and when you go to the store, the product (MAYBE) becomes .50 cheaper, you see .25 of the savings for one product. The owner keeps .25 for a million transactions. Whose living standards have improved more? I'm pulling numbers out of thin air, but you can see my point, yes?

Also, when China and India become first world nations with great living standards....what makes you think they'll let you come over to work? They have more than enough people. Why would they not simply allow America to fall into abject poverty and laugh at the irony? Explain.

----------


## ProIndividual

Amen 3d!

Here is a video of Stefan Molyneaux describing how many Trillions of dollars we lose a year to regulations (it isn't just that companies leave, it's that we make them wholly inefficient as well through pre-emptive, as opposed to post-action, regulation). Also, a graph seen on "Stossel" that shows the irrelevance of OSHA in reality...not the liberal union statist myths we hear about the glory and goodness of OSHA. And a chart to show unions are also irrelevant.





Technological advance is corollary to advances in safety...the less men do, the less we can be hurt by doing it. Unions are obviously not at all causal or corollary to woker fatality decreases.




Regulation may be the easiest and best option, with spending cuts coming in a close second. But raising taxes is NOT an option. Last time I checked, if I spend too much the solution is NEVER to demand more money from my boss, but to cut my spending habits. Raising taxes is essentially demanding more money from the boss...it's economic nonsense unless you're a tyrant.

----------


## ProIndividual

Unless the capitalist protectionists come back, it looks like we're left debating with liberals...lol.

One of which is a troll, most obviously.




> This is why libertarians are not taken seriously.


No, what you wrote, after all the info and graphs I posted on this thread, is why libertarians don't take YOU, or your arguments, seriously.

Please read my posts, and the articles I linked too on Statist Economic Fallacies and Externality Fallacy....they address, answer, and generally destroy your apprehensions. Although, you do need to take the time to READ them before you can try and attack them...

...sometimes I think I'd be better off arguing with a wall.

----------


## Dr.3D

> Cheapness = Superiority. All other factors...irrelevant.


Well, let's see.....

Factory #1 is in the United States, it makes parts that are painted with solvent based paint and has to spend millions of dollars for equipment to clean the solvent out of the exhaust air before it released back into the environment.

Factory #2 is in China, it makes the same parts as factory #1 but doesn't have to spend the millions of dollars to clean the exhaust air.

Which one can make the product cheaper?

Of course the company owning factory #1 can't compete with it's Chinese counter part and thus decides to move it's manufacturing to China.

Free trade sure does work fine for the people in the country where the same part can be made cheaper because of less government regulations.

----------


## romacox

These large global businesses exist only because of government subsidies (a creation by the very government that seeks to regulate them).

----------


## josh b

> Shame on workers for wanting more money.





> Cheapness = Superiority.


I take it that you missed the marginalist revolution, and all of economic theory that followed it.  Prices, profits, and wages are not arbitrary numbers that evil capitalists create from thin air.  The structure of production is not mystical and otherworldly.




> So how does this change benefit you? Tons of people are out of work and when you go to the store, the product (MAYBE) becomes .50 cheaper, you see .25 of the savings for one product. The owner keeps .25 for a million transactions. Whose living standards have improved more? I'm pulling numbers out of thin air, but you can see my point, yes?


“The whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” 
~Henry Hazlitt

Have you been paying the slightest attention to what we have said so far?  You are ignoring the secondary consequences of the tariff.  Where is all the money not spent on that particular product going to go?   Are the consumers going to use it as toilet paper?  You are the one ignoring 'reality and facts'.  While that poor unfortunate industry is not being propped up by the tariff other industries will expand as a result of people having more money to spend.  Tariffs do not create employment they simply rearrange it.  It redistributes capital in a less efficient way than the distribution under free trade.  





> Also, when China and India become first world nations with great living standards....what makes you think they'll let you come over to work? They have more than enough people. Why would they not simply allow America to fall into abject poverty and laugh at the irony? Explain.


I take it you did not read ProIndividual's link.  Immigration restriction is technically another form of protectionism, which we oppose.  Also, what does 'more than enough people' mean, exactly?  I was unaware that there was a limited amount of work to be done in the world.  I did not know that scarcity could be completely done away with.  

Wait, why am I responding to trolls?  Go read some books on the topic.

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## ProIndividual

joshb...this is why protectionism was loved by mercantilist society and the State and monopolists that benefited from it...

...protectionism redirects capital at the expense of the consumers to the oligarchy, plain and simple.

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## josh b

> joshb...this is why protectionism was loved by mercantilist society and the State and monopolists that benefited from it...
> 
> ...protectionism redirects capital at the expense of the consumers to the oligarchy, plain and simple.


Yep.  Many Republicans today are mercantilists posing as free marketers. I always called them that because it sounds better than 'corporatist'. I can't stand to listen to some of them attack leftist ideas about interventionism and then turn around and make such a blatant fallacy.  Oh well, Ron Paul supporters are usually better than the average Sean Hannity or Bill Oreilly style Republican.  Most of them know better than this I hope.

----------


## Southron

> Seriously this stuff goes all the way back to Adam Smith.  It should be common knowledge by now.  Economics does not look kindly on you my friend.  Now, no offense intended, but are you going to answer my question about why violent interventions in the market to subsidize American industries somehow produces prosperity?  I would like to see a good economic reason.


My economic reasons are based on what I have witnessed in the area of NC that I live.  Manufacturing has disappeared and has been replaced by service (fast food) jobs or nothing at all.

I think you all put entirely too much faith in the market.  Ending regulations would certainly help some but if we can't bring manufacturing back, then we are never going to have a true economic recovery.

----------


## mtj458

For all the talk of there being no jobs left, can anyone give me any evidence that OUTSIDE of a recession, our job numbers are any worse than they have been historically? Unless you are naive enough to blame the recession on free trade, I just don't understand the argument.  I mean, I want my children performing manual labor in a textile factor rather than having a lousy service job in technology or medicine just as much as the next guy, but give me a break.

----------


## Dr.3D

> For all the talk of there being no jobs left, can anyone give me any evidence that OUTSIDE of a recession, our job numbers are any worse than they have been historically? Unless you are naive enough to blame the recession on free trade, I just don't understand the argument.  I mean, I want my children performing manual labor in a textile factor rather than having a lousy service job in technology or medicine just as much as the next guy, but give me a break.


Well, we have been losing industry for at least the past 30 years.  I doubt the loss of those jobs has had much to do with the current recession.   As government regulations picked up, the loss of jobs accelerated.

----------


## mtj458

> Well, we have been losing industry for at least the past 30 years.  I doubt the loss of those jobs has had much to do with the current recession.   As government regulations picked up, the loss of jobs accelerated.


Government regulations are not the same as trade restrictions.  But regardless, look at the unemployment rate over the last 15 years- obviously our society can support a stable amount of jobs.

Seems like a lot of people here have a weird obsession with manufacturing jobs over service jobs and it doesn't make sense.  Comparative advantage says poor countries should be doing the manufacturing.  If we have economic growth for 500 years, it's hard to imagine there being any service jobs left.

----------


## tpreitzel

Absolutely not. In fact, the US needs to form a veritable trade barrier around the union of states. Multi-national corporations need to become multi-state corporations or leave the union.

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## Fox McCloud

> Absolutely not. In fact, the US needs to form a veritable trade barrier around the union of states. Multi-national corporations need to become multi-state corporations or leave the union.


You do realize this will only crush our current standard of living even more, right?

----------


## Dr.3D

> Government regulations are not the same as trade restrictions.  But regardless, look at the unemployment rate over the last 15 years- obviously our society can support a stable amount of jobs.
> 
> *Seems like a lot of people here have a weird obsession with manufacturing jobs over service jobs and it doesn't make sense.*  Comparative advantage says poor countries should be doing the manufacturing.  If we have economic growth for 500 years, it's hard to imagine there being any service jobs left.


 Mark my words, the country with the most heavy industry is going to come out way ahead in the end.  Yeah, those service jobs will be taking care of those who work in heavy industry.   

Hey mister, do you want fries with your shake?

----------


## josh b

> My economic reasons are based on what I have witnessed in the area of NC that I live.  Manufacturing has disappeared and has been replaced by service (fast food) jobs or nothing at all.
> 
> I think you all put entirely too much faith in the market.  Ending regulations would certainly help some but if we can't bring manufacturing back, then we are never going to have a true economic recovery.


This debate appears to be winding down now.

I also believe that your use of the political means as a way to bring manufacturing back is based on false pretenses.  Propping up businesses is not an effective means to speed up economic recovery, it just sweeps underlying problems under the rug.  It's similar to how the stimulus bills and quantitative easing as solutions actually make the problem worse.  I'll leave it at that.  

I hope I wasn't too harsh in this thread.  At least people should leave with an awareness of the secondary consequences of economic policies.

----------


## tpreitzel

> You do realize this will only crush our current standard of living even more, right?


You do realize that "our current standard of living" is based on a mirage, i.e. debt, so your question is meaningless. Furthermore, since the better paying jobs have been purposely exported overseas, I can't pay my portion of accumulated debt. While still possible, maybe, I could apply for a loan and start another local McDonalds' franchise. Thanks to "free trade", please welcome the US as one of the newer members of the third world.

----------


## Dr.3D

> While still possible, maybe, I could apply for a loan and start another local McDonalds' franchise. Thanks to "free trade", please welcome the US as one of the newer members of the third world.


Welcome to the reverse of the Industrial Revolution.   Seems TPTB believe it is now time for China to have theirs.

----------


## Fox McCloud

> You do realize that "our current standard of living" is based on a mirage, i.e. debt, so your question is meaningless. Furthermore, since the better paying jobs have been purposely exported overseas, I can't pay my portion of accumulated debt. While still possible, maybe, I could apply for a loan and start another local McDonalds' franchise. Thanks to "free trade", please welcome the US as one of the newer members of the third world.


What? This doesn't even make any sense. The average family does have a mortgage and some credit card debt, but that's hardly what the economy is built on---the massive debt the US has it accumulated by the Federal government, not individual citizens---it has little to do with standard of living or anything----the case could be much better made that the debt has reduced or is holding down our current standard of living, not sustaining it. 

You also engage in a complete strawman, equating service with purely McDonalds (or other low paying service sectors)---and that industrialization/manufacturing doesn't exist at all....I'll leave it to my fellow free trade brethren, but there's a chart around here somewhere that shows that manufacturing has actually gone up, over the years--it's just far more efficient now and we require far less workers to do the same job it took 2-3 men to do 30 years ago.

Your argument is a moot point, even if our economy was almost totally service---take a look at Hong Kong; they have ultra minimal government almost TOTAL free trade with practically no restrictions, and they thrive---they're very wealthy...and guess what? They don't have gobs of manufacturing, either--IIRC, they're something like 90% of their GDP coming purely from "service".

----------


## tpreitzel

> What? This doesn't even make any sense. The  average family does have a mortgage and some credit card debt, but  that's hardly what the economy is built on---the massive debt the US has  it accumulated by the Federal government, not individual citizens---it  has little to do with standard of living or anything----the case could  be much better made that the debt has reduced or is holding down our  current standard of living, not sustaining it.


LoL ... yeah right ... Let's return to a strictly constitutional  currency based on gold and silver coinage if debt has "little to do  with standard of living or anything" ... 




> You also engage in a complete strawman, equating service  with purely McDonalds (or other low paying service sectors)---and that  industrialization/manufacturing doesn't exist at all....I'll leave it to  my fellow free trade brethren, but there's a chart around here  somewhere that shows that manufacturing has actually gone up, over the  years--it's just far more efficient now and we require far less workers  to do the same job it took 2-3 men to do 30 years ago.


LoL again ... "Over the years", shouldn't one expect manufacturing to  increase, at least a tad?  Talk about "a complete strawman" .... What  does "gone up" over the years mean in comparison with likely manufacturing levels if such jobs weren't exported overseas? Answer: zilch. Lastly, in a healthy economy, increased efficiencies should simply mean the reallocation of resources to other industries *within* the US. 





> Your argument is a moot point, even if our economy was almost  totally service---take a look at Hong Kong; they have ultra minimal  government almost TOTAL free trade with practically no restrictions, and  they thrive---they're very wealthy...and guess what? They don't have  gobs of manufacturing, either--IIRC, they're something like 90% of their  GDP coming purely from "service".


Guess what? Hong Kong is a recipient of business transferred from other  nations under the guise of "free trade".  In other words, if other  nations still retained their manufacturing capability, Hong Kong might  not be so wealthy, eh?

----------


## Cutlerzzz

> What? This doesn't even make any sense. The average family does have a mortgage and some credit card debt, but that's hardly what the economy is built on---the massive debt the US has it accumulated by the Federal government, not individual citizens---it has little to do with standard of living or anything----the case could be much better made that the debt has reduced or is holding down our current standard of living, not sustaining it. 
> 
> You also engage in a complete strawman, equating service with purely McDonalds (or other low paying service sectors)---and that industrialization/manufacturing doesn't exist at all....I'll leave it to my fellow free trade brethren, but there's a chart around here somewhere that shows that manufacturing has actually gone up, over the years--it's just far more efficient now and we require far less workers to do the same job it took 2-3 men to do 30 years ago.
> 
> Your argument is a moot point, even if our economy was almost totally service---take a look at Hong Kong; they have ultra minimal government almost TOTAL free trade with practically no restrictions, and they thrive---they're very wealthy...and guess what? They don't have gobs of manufacturing, either--IIRC, they're something like 90% of their GDP coming purely from "service".

----------


## tpreitzel

> 


Yep, welcome to the greased skids of fiat money and "free trade"... an illusion of wealth waiting to implode.  This country better hope that exported industries return BEFORE attempting a reduction in the supply of fiat money, though.

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## nobody's_hero

I voted 'conditionally.'

It does not matter, though. Tariffs will not be raised to amount to much in my lifetime, because doing so doesn't not jive with the plans of the establishment to wreck our economy and throw us into a state of complete dependency.

EDIT: So, it does not matter what we want, the Fed has the system set up just the way it wants it. Keep the Americans distracted with cheap foreign goods, make them think that foreign manufacturers are simply more competitive and we've been beaten fair-n-square, and that we can go on consuming, consuming, and consuming our way to prosperity.

----------


## osan

> What? This doesn't even make any sense. The average family does have a mortgage and some credit card debt, but that's hardly what the economy is built on---the massive debt the US has it accumulated by the Federal government, not individual citizens---it has little to do with standard of living or anything----the case could be much better made that the debt has reduced or is holding down our current standard of living, not sustaining it.


The federal government takes on its debt in the name of the citizens of the USA.  It is able to do this because we allow them to.  That is implicit consent, more or less.  It can certainly be argued to be that in any event.  Therefore, we consent to take on that debt personally, each of us - so from a way of looking at things we indeed are very much part of the problem.

That said, it can also be argued that the system is set up in such a way as to disallow individuals from "opting out", and by virtue of the implication of force and violence, is wholly immoral - a position I would accept as valid.

----------


## Paul Or Nothing II

> Guess what? Hong Kong is a recipient of business transferred from other  nations under the guise of "free trade".  In other words, if other  nations still retained their manufacturing capability, Hong Kong might  not be so wealthy, eh?


It's really funny that you're blaming free market even though you recognize that free market is what turned HongKong from a third-world $hithole into a prosperous nation.  Quite ironic. 




> Yep, welcome to the greased skids of fiat money and "free trade"... an illusion of wealth waiting to implode.  This country better hope that exported industries return BEFORE attempting a reduction in the supply of fiat money, though.


What that graph shows is that America's manufacturing has been increasing & over the years America has produced more with less & less workers which means our productivity has gone up which has allowed people to move into service industry which has caused the standard of living to go up.

The industries have left because of high corporate taxes, high regulation, union-lobbying, minimum-wage laws, etc etc if those are are gotten rid of then a lot of those industries will be back. Hell, as Ron has mentioned in his recent debates, trillions of American corporations' money is saved overseas because of high taxes, if taxes are considerably lowered then that money will be back & it'll craete jobs & REAL WEALTH (ie goods/services) in America.




> I voted 'conditionally.'
> 
> It does not matter, though. Tariffs will not be raised to amount to much in my lifetime, because doing so doesn't not jive with the plans of the establishment to wreck our economy and throw us into a state of complete dependency.
> 
> EDIT: So, it does not matter what we want, the Fed has the system set up just the way it wants it. Keep the Americans distracted with cheap foreign goods, make them think that foreign manufacturers are simply more competitive and we've been beaten fair-n-square, and that we can go on consuming, consuming, and consuming our way to prosperity.


Seriously, why is it that so many baby-boomers are sold on "manufacturing creates prosperity" myth? Manufacturing are largely low-paid, low-skilled jobs & if you guys like them so much then just wait a little till depression sets in & Americans' living standards go down then all your favorite manufacturing low-paid jobs will be back.

----------


## Paul Or Nothing II

I've voted Yes because trade barriers never help.

Some have talked about tariffs & retaliatory tariff-policy being good, etc but I've a few contentions.

Import tariffs just increase the cost of goods within the country as it adds to the price of goods & thereby all Americans are forced to buy costlier goods & services, & remember, living standards are dictated by goods & services which is the "real wealth" so the less Americans are able to enjoy them, lower their living standards.

On the other hand, export tariffs ( & even minimum-wage, regulations, high taxes, etc) cause the price of exported goods to go up which means fewer people want to buy them so fewer businesses are interested in producing them within America which means fewer jobs are created within America.

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## josh b

> I've voted Yes because trade barriers never help.
> 
> Some have talked about tariffs & retaliatory tariff-policy being good, etc but I've a few contentions.
> 
> Import tariffs just increase the cost of goods within the country as it adds to the price of goods & thereby all Americans are forced to buy costlier goods & services, & remember, living standards are dictated by goods & services which is the "real wealth" so the less Americans are able to enjoy them, lower their living standards.
> 
> On the other hand, export tariffs ( & even minimum-wage, regulations, high taxes, etc) cause the price of exported goods to go up which means fewer people want to buy them so fewer businesses are interested in producing them within America which means fewer jobs are created within America.


Absolutely right.  However we've already had a lengthy discussion on this to no avail, so it may fall on deaf ears.  Have you read the rest of the thread?

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## Fox McCloud

> LoL ... yeah right ... Let's return to a strictly constitutional  currency based on gold and silver coinage if debt has "little to do  with standard of living or anything" ...


Thanks for completely twisting my words around. First of all, you equate debt with purely a fiat standard. While it could be argued debt is far more tenable, for a country, that's on a fiat standard, having a gold standard won't instantly fix our debt related problems---if anything, the government will run to debt even more if we have a gold standard since they cannot rely on quantitative easing to fix their budget issues. And again, you conflate personal debt with public/governmental debt---my point still stands.

[quoe]LoL again ... "Over the years", shouldn't one expect manufacturing to  increase, at least a tad?  Talk about "a complete strawman" .... What  does "gone up" over the years mean in comparison with likely manufacturing levels if such jobs weren't exported overseas? Answer: zilch. Lastly, in a healthy economy, increased efficiencies should simply mean the reallocation of resources to other industries *within* the US.[/quote]

As the graph posted above aptly demonstrates, manufacturing as, in fact gone up _significantly_---the amount of manufacturing jobs has dropped for two reasons (1)Cheaper labor overseas (2)Less workers required to do the same amount of work. Yes, there has been regulations that have pushed it overseas....I'm in full favor of rolling back of a lot of regulations---that said, this still won't cause manufacturing to suddenly come flooding back in---our labor is better economically employed elsewhere...it's just thew ay the division of labor works--it's better for consumers and society when people/nations/etc specialize in producing one thing over trying to produce everything.





> Guess what? Hong Kong is a recipient of business transferred from other  nations under the guise of "free trade".  In other words, if other  nations still retained their manufacturing capability, Hong Kong might  not be so wealthy, eh?


*facepaws* Do you even know what you're talking about? Of course Hong Kong buys and sells products from other countries...that's free trade, as well---they also offer services to their own people's and other nations, abroad. To conflate that as anything other than free trade is ludicrous, at best, and grasping for straws, at worst.

No one here is saying that manufacturing should be abolished and done away with EVERYWHERE in the world---there's always a place for it, somewhere---we're just advocating letting the market pick who is the best manufacturer of said product as opposed the government erecting trade barriers that will ultimately lower our standard of living.

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## The Grinning Maniac

Speaking in generalities, manufacturing is pretty much done by China and Hong Kong, etc. High tech jobs and design jobs that can be uprooted are in India. Office work and customer support jobs are also moving to India. Then there are the jobs filled now by HB-1s and finally increasing mechanization/automation (which, granted, has always happened)... In a broad sense, I'm wondering what we're supposed to do long term. 

Yes, yes, I know...the free market will take care of everything, but I'm wondering...in what way? How do you know the "new configuration" of the world will be good for us? What replaces all that's been lost? Some here criticize the blue collar work, saying we don't need it anyway...but what about those people who aren't fit for college? I even had this question back when we were still in the "high tech jobs will fix everything" phase. You know, before they were shipped out too. Not everyone's into that sort of thing. Steelworkers probably won't become genetic engineers. Should they kill themselves now?

This seems like a game of musical chairs, doesn't it? I swear I'm not being a troll. It's just a question that looms in the back of my mind. An economy that has all sorts of jobs, for all skill levels and interests makes sense. It seems balanced. An economy where you have to be a doctor, lawyer, or scientist....or wither away at Wal-Mart or the DMV (exaggerating)...seems unbalanced.

Thoughts?

------------------------------

Also, I'm in the midst of reading the info Individual cited. A little busy to respond point for point, ATM. Although a lot of what was said tends to gloss over points I made or questions I raised, some of it has been very interesting and challenged my preconceptions. Also, don't call me a liberal. That's just really annoying and petty. My political views don't fit any one mold. There are a lot of things I fall into the libertarian camp on. This is just an area where we differ. I don't automatically believe that what's good for corporate America is good for me. I believe all things work in moderation, and maybe this free trade (for others) is something we've pigged out on to our detriment.

----------


## nobody's_hero

> Seriously, why is it that so many baby-boomers are sold on "manufacturing creates prosperity" myth? Manufacturing are largely low-paid, low-skilled jobs & if you guys like them so much then just wait a little till depression sets in & Americans' living standards go down then all your favorite manufacturing low-paid jobs will be back.


First. I'm not a baby boomer, I'm early gen Y. 

Second, I simply appreciate the vulnerability of not being able to produce for oneself. I understand that under normal circumstances, division of labor is the most effective means of economic growth. We are not under 'normal' circumstances. We have a heavily managed economy and the establishment has been grooming the sheeple for a lifestyle of dependency. Dependency on others, but even more so, dependence on the state. It isn't a dependence formed by some 'free market' or 'mutual benefit', it is forged by policy, and therefore is *FAKE*. 

We lost manufacturing because of government policies, not because of some natural 'free market shift'. We think we can get economic recovery from consumption, and it's because our entire currency is based on debt and empty promises. Thus far, there has been no penalty for unpaid debts. When the $#@! hits the fan, we will have to produce for ourselves.

It will be at that point, that we will ask,"Where have the manufacturers gone?"

----------


## osan

> Speaking in generalities, manufacturing is pretty much done by China and Hong Kong, etc. High tech jobs and design jobs that can be uprooted are in India. Office work and customer support jobs are also moving to India. Then there are the jobs filled now by HB-1s and finally increasing mechanization/automation (which, granted, has always happened)... In a broad sense, I'm wondering what we're supposed to do long term.


Sweat?




> Yes, yes, I know...the free market will take care of everything, but I'm wondering...in what way? How do you know the "new configuration" of the world will be good for us?


One doesn't.  The answer depends on what is really happening in the world, and that is something of which we cannot be entirely certain at the root levels.  Is the market "organic" in its function, or are there "artificial" manipulations at work pushing the market in a given direction?  If the latter, what is the source, what are the goals, who will be affected, and how?  

We are talking of a very large and complex entity, the market.  There are so many variables that it comes into question whether reliable prediction can be accomplished, especially when there are so many unknowns at play.




> What replaces all that's been lost? Some here criticize the blue collar work, saying we don't need it anyway...but what about those people who aren't fit for college? I even had this question back when we were still in the "high tech jobs will fix everything" phase. You know, before they were shipped out too. Not everyone's into that sort of thing. Steelworkers probably won't become genetic engineers. Should they kill themselves now?


Valid questions, none of which have the globalists answered satisfactorily.




> This seems like a game of musical chairs, doesn't it?


In many ways, yes.  But the truth predicates on knowing enough about what is really going on.  If the market is indeed "organic", the answers will be very different from those if it is being manipulated.  If it is being manipulated, wide vistas of manifold possibilities open up to us, but most likely there is a strong element of power consolidation at play at the very least.




> I swear I'm not being a troll. It's just a question that looms in the back of my mind. An economy that has all sorts of jobs, for all skill levels and interests makes sense. It seems balanced. An economy where you have to be a doctor, lawyer, or scientist....or wither away at Wal-Mart or the DMV (exaggerating)...seems unbalanced.
> 
> Thoughts?


If we assume that the market is being manipulated, that it is being done competently, and that the intentions behind it are purely innocent and good (a big mouthful, admittedly) and is aimed at raising the material wealth of all people in the world, there are a few consequences that I see.

First, for a long time there has been a profound imbalance in the distribution of wealth across the globe, most of it concentrated in the "west", the reasons for which are many.  For instance, the focus on individualism in places such as the USA has provided the environment of opportunity by which people have been able to pursue their own best interests.  A general consequence of this has been the wealth "draft" that has carried along huge numbers of others, e.g. through the creation of jobs, as well as products and services for which people are not only willing to pay, but whose lives are presumably improved significantly by them.  This is called "win win".  Once this situation bootstrapped itself beyond a point, it became very nearly self-sustaining and wild growth became possible.

Contrast that with other places such as China, Soviet Union, many European nations, and the myriad petty and bald-faced tyrannies of Africa and South America where peoples' freedoms and prerogatives were tightly reined.  In such places stagnation was the result, at best.  More often, the societies suffered greatly not only in terms of lagging far behind in the development of material wealth, but also in terms of political turmoil.  "The states" in question expended unimaginable energies in corralling "the people", very often at the end of a gun, employing torture and murder  and generally wreaking untold havoc, death, and misery on vast numbers of people.

If we look at the state of the world, ca. 1989, this grossly and mainly artificially induced state of imbalance in the wealth of nations was, more or less, at its apex (not really in some ways, but there is no point in discussing these arcane points here).  Fast forward to, say, 2000, and what do we see?  The collapsed Soviet Union replaced with numerous smaller and relatively free nations, all of which are now eagerly playing catch up with the west.  Add to that the case of China, who had been on that path since the mid-70s, and by 2000 was enjoying the benefits of "free trade" with the rest of the world, especially the USA.

Manufacturing fled US and other shores because of the advantages provided by a government-rigged labor market.  As manufacturing and other jobs flew the coop for Chinese and Indian shores, the products and services now being provided by the Chinese were to be sold to whom?  The west, of course.  Who else could afford them?  Not even the Chinese can readily afford many of the things that we in the west take for granted.  This imbalance is the remnant of the previous condition wherein freedom was denied to so many.  While the west became prosperous, the rest languished in relative material poverty.  

Now that some large proportion of the rest of the world is getting into the game on the supply-side, they can sell only in those markets that can afford to buy what they offer.  Again, the west.  Until the average prosperity in the rest of the world rises beyond some threshold, we are going to have an imbalance between supply and demand.  Manufacturing for the current market is currently covered in the main by China.  Until the demand side of the market increases to the point where the slack in Chinese and other off-shore manufacturing is taken up, other more costly labor markets are going to "suffer".  The longer China maintains a rigged labor market, the longer the rest of the world will have to struggle with establishing, keeping, and growing domestic manufacturing jobs.

The western "free world" pined for the end of the Soviet Union and "democracy" and "freedom" for nations like China.  Well, they got what they wanted and a consequence of opening up those once closed markets, was the loss some of our own markets on the supply side.  Those other nations are full of smart and motivated people who are champing at the bit to get a taste of "freedom" and improved wealth.  They are willing to it for less - they are ABLE to do it for less because their costs of living are far lower than ours.

Opening trade willy nilly to comparatively impoverished nations who cannot offer balanced trade conditions is a dangerous game that stands to put one's own economy into some trouble.  US-China trade relations were opened in just that manner and we are suffering the consequences.  

I cannot call it right or wrong, but the results have been unpleasant.  It seems to me that a more measured approach to "free trade" would have been wiser.

----------


## josh b

> Speaking in generalities, manufacturing is pretty much done by China and Hong Kong, etc. High tech jobs and design jobs that can be uprooted are in India. Office work and customer support jobs are also moving to India. Then there are the jobs filled now by HB-1s and finally increasing mechanization/automation (which, granted, has always happened)... In a broad sense, I'm wondering what we're supposed to do long term. 
> 
> Yes, yes, I know...the free market will take care of everything, but I'm wondering...in what way? How do you know the "new configuration" of the world will be good for us? What replaces all that's been lost? Some here criticize the blue collar work, saying we don't need it anyway...but what about those people who aren't fit for college? I even had this question back when we were still in the "high tech jobs will fix everything" phase. You know, before they were shipped out too. Not everyone's into that sort of thing. Steelworkers probably won't become genetic engineers. Should they kill themselves now?
> 
> This seems like a game of musical chairs, doesn't it? I swear I'm not being a troll. It's just a question that looms in the back of my mind. An economy that has all sorts of jobs, for all skill levels and interests makes sense. It seems balanced. An economy where you have to be a doctor, lawyer, or scientist....or wither away at Wal-Mart or the DMV (exaggerating)...seems unbalanced.
> 
> Thoughts?
> 
> ------------------------------
> ...


I know, I was irritated and ProIndividual seems to have been on the verge of exploding.  If you really aren't a troll then you have my apologies.  

Yes, the free market is not perfect.  We never said it was.  Out of all options it is simply the best.  However, I take exception to people assuming that we can just centrally plan our way out of any problem.  I also get annoyed with the people who get so wrapped up in their NWO conspiracies and chest thumping nationalism that they propose this stuff.

You are correct that the 'new configuration' might not work out for everyone.  It's a problem of skill specialization.  However, you can't fix it by passing legislation.  Ignoring government granted monopoly privileges, businesses are produced and expanded by consumer demand.  The new configuration will automatically be better for the _majority_ of people.  I dare you to find a way to fix this specialization problem without making everything worse.  Ultimately I would rather deal with some people out of the job than go down the dangerous road of granting special privileges to business.  What is good for the corporations is not always good for the people.  See what I did there?

Picking winners and losers arbitrarily like this _will_ ensure that everyone loses.

Now to comment on something you posted earlier about regulations.  Have you considered that their might be a difference between regulations that protect individuals and their property from harm and regulations that dictate how businesses do their job or shield them from competition?  Usually when free marketeers speak of regulations they are not referring to the former.  All the word 'regulate' means is to set standards.  This is just a semantics game.  Most regulations, so called, are used to shield politically connected businesses from competition.  It's not hard to say 'harm someone and you go to jail', so why all the hullabaloo about it?  Why do we have like _78000_ pages of regulations?  It's a political con game and nothing more.

----------


## Paul Or Nothing II

> In a broad sense, I'm wondering what we're supposed to do long term.


We should do what we CAN do, jobs will always be available in the free market as the capital is directed to the most productive areas to maximize jobs as well as the "real wealth" (ie goods/services)




> Yes, yes, I know...the free market will take care of everything, but I'm wondering...in what way? How do you know the "new configuration" of the world will be good for us?


Nobody knows the "new configuration" but if you allow freedom to rule then those who are willing to work will find ways to provide themselves a decent life as per their skill.

"Markets" are like a natural phenomena like Earth rotating the Sun, gravity, etc; you can't expect humans to "run" the markets "properly" because no  human has all the information needed to run them "correctly"; it's an 'order out of chaos' phenomenon where infinite factors are at work which can't even be comprehended or quantified by humans & by interfering in the markets, we only end up hurting ourselves as a whole & some people unfairly benefit while other unfairly suffer.




> Steelworkers probably won't become genetic engineers. Should they kill themselves now?


Why are American steelworkers ENTITLED to anything more than what other steelworkers are getting? They're not. If they're willing to work hard then they'll find something else to do.

On the other hand, if you put tarrifs & taxes on foreign steel just to "help" American steelworkers then that means the prices of steel within America go up & that means EVERYONE in America must pay higher prices for goods & services which are directly or indirectly affected by steel prices which means Americans as a whole have a lower standard of living than they otherwise would've had. Why make everyone pay for a few people? And it doesn't just stop at steel, then other workers might ask for protection from imports & so on & this whole process leads to lobbying & corporatism as unions & big corporations get involved & then over a period, it just becomes a mess.

So the rules of the free market are simple, NO ONE should get any favors from the government because when one person or group get them then it's just a slippery slope & the whole system becomes where everyone is trying to benefit at the cost of someone else & then whoever can offer enough bribes to the politicians & bureaucrats, be it in the form of votes or money or whatever, ends up benefitting at the cost of honest hardworking people.




> It's just a question that looms in the back of my mind. An economy that has all sorts of jobs, for all skill levels and interests makes sense. It seems balanced. An economy where you have to be a doctor, lawyer, or scientist....or wither away at Wal-Mart or the DMV (exaggerating)...seems unbalanced.
> 
> Thoughts?


Where's the economy where everyone has to be a doctor, lawyer, scientist? There's no such thing, other jobs are always there, of course, you may not want to do them or mayn't like the pay but the market is free of an favoritism, everyone earns according to one's skill & how valuable that skill is.




> My political views don't fit any one mold. There are a lot of things I fall into the libertarian camp on. This is just an area where we differ. I don't automatically believe that what's good for corporate America is good for me. I believe all things work in moderation, and maybe this free trade (for others) is something we've pigged out on to our detriment.


You can't "fall into libertarian camp" unless you believe in free markets; of course, there are minor differences between anarchists & minarchists but free markets always come first.

And don't believe the media rhetoric that "free market capitalism is all about corporate America", free markets are FOR THE PEOPLE, it's about people being able to determine their economic paths based on their skill & hardwork, so free marketers ONLY respect HONEST businesses that make money out of providing goods & services to the people, corporatism is NOT tolerated by free marketers & the funny thing is that the kind of protectionist policies that you're advocating for actually lead to corporatism as I've already explained.




> Second, I simply appreciate the vulnerability of not being able to produce for oneself.


As has been said, just because a country isn't manufacturing-intensive does NOT mean it's worse off, there's nothing "vulnerable" about it. It just means that others are producing it a lot more efficiently, be it due to destructive policies of our government.

We DON'T "have to" manufacture everything we need, if we can just buy it cheaper from others then why adopt protectionism & force lower living standards on all Americans? Please read my reply to "The Grinning Maniac"

We lost manufacturing because of government policies, not because of some natural 'free market shift'.......When the $#@! hits the fan, we will have to produce for ourselves[/QUOTE]

If you recognize that government policies have caused the problems then why do think government can fix it by thwarting the free market by adopting protectionist policies. When SHTF all the cuddly manufacturing jobs will be back automatically anyway if we keep the markets free because our living standards as a country will've gone down but there's no need to adopt protectionism.




> It seems to me that a more measured approach to "free trade" would have been wiser.


I liked your exposition of the whole situation upto a point but I was disappointed to see that you're also proposing managed trade as the answer when it's clearly not.

What do you mean by "measured approach"? You mean we should put tariffs on cheaper foreign imports? But as I've already explained, that only leads to rise in prices of goods & services within America & Americans as a whole enjoy lower living standards because of it. Why force some people to pay higher costs & suffer lower living standards, just so that some other could benefit? As I've said, this is what leads to corporatism. Once you allow politicians & bureaucrats to interfere with the market then that leads us to a very slippery slope.

----------


## osan

> I liked your exposition of the whole situation upto a point but I was disappointed to see that you're also proposing managed trade as the answer when it's clearly not.


Not everything is clear.  The economic imbalances arose as the results of the political imbalances.  A small proportion of the global population enjoyed an environment of nearly limitless opportunity while the rest languished in comparatively severe tyranny.  Wealth was built in our camp while it sublimated into the ether in the others.  All of a sudden the flood gates were opened wide and the willing, capable, and far less costly labor of those relatively impoverished markets became available to the west, which naturally bolted for those shores.

As I wrote, the situation was and remains far more complicated than this.  Another exacerbating circumstance has been the gross over-application of "regulation", not to mention the governmental institutionalization of unions.  All of this greatly aided in the currently high labor rates with which we are saddled.  I am not against all corporate regulation because history has shown that many cannot be trusted to the door.  Corporate rights are not human rights and that must be kept in the forefront of our thoughts at all times when considering these sorts of questions.




> What do you mean by "measured approach"?


I mean not opening up markets such that the vacuum effect I have documented completely wrecks the stronger economy.  By "stronger" I mean materially larger.  The comparative labor advantage that a nation such as China enjoys is artificially contrived - the result of the past 65 years of communist oppression, at the very least.  Letting those people loose all at once has proven troublesome to the US economy.  Our economy should have been freer than it was.  So should those of all of the rest of the world.  Had this been the case, the imbalances we see today would likely not exist.  The global economy would arguably far and away stronger and more "naturally" equitable than it is.

The real point here is that it took a lot of time and a great convolution of conditions - a gordian knot of governmental interference - to cause these massive imbalances to have evolved over however many decades.  Opening the floodgates of free trade is going to necessarily result in some violence.  The situation is deplorable, but it is what it is and sudden changes are not the right solutions.  A gradual ramp up of trade is probably the saner path to take.  Ideals are great things to work toward, but when one's forebears paint the world into corners such as we find over many decades and more, gradual movements in the right direction are probably the right-minded actions, all else equal.  But if we have at the top of the decision making totem people who are either inept or malicious in their choices, then no solution is likely to benefit the world at large.




> You mean we should put tariffs on cheaper foreign imports?


I made no such statement, nor did anything I write imply this.  I put no definition to "more measured".  I was writing only in the broadest conceptual terms.




> But as I've already explained, that only leads to rise in prices of goods & services within America & Americans as a whole enjoy lower living standards because of it.


This is a peanuts-league effect when compared to the effects that government over-regulation and sanction of unions have had.




> Why force some people to pay higher costs & suffer lower living standards, just so that some other could benefit?


Why, indeed.  Once again, because of the circumstances that past generations have forced upon us, extrication is most likely not a mere matter of opening all the spigots full-bore.  That is effectively what we have done, and with at least one majorly rigged labor market.  Any fundamentally sound economic analysis is going to point to trouble.  Free market trade is absolutely dependent on the presence of free markets, no exceptions... especially when one of the players is as large as China.  It is not just the rigged nature of China's labor market that threatens us - here size matters.   A lot.  Were we talking about Cuba, chances are we would not be suffering the problems we now face.

The solution is very difficult and perhaps even less-than-intuitive in some cases.  All markets on the planet need correction.  They are all manipulated - interfered with by their respective governments.  The USA is no exception.  Had the world not gone off the rails, what with all the authoritarian bull$#@! that has dominated human politics since our earliest written history, such corrections might never have been necessary.  The fact is, the world economy is intimately and inextricably tied to its politics.  Both are almost hopelessly corrupted and convoluted.  Simple, easy, and fast solutions are almost certainly not even a remote possibility.

----------


## showpan

200 years of history prove that tariffs are needed to protect a nations businesses from being unfairly reduced by foreign competition. NAFTA has only proven that open borders export jobs. Our founding fathers knew this and although some of them did not like the idea of higher taxes, they deemed it necessary in order to keep this country from being dependent on others. Some of the most productive and prosperous periods of this country were when tariffs were highest. Unfortunately, tariffs have also been manipulated favoring one industry over another. Prior to the civil war, higher tariffs were enacted to protect northern factories. However it adversely effected southern wool and cotton growers who mainly exported to Europe at the time. They should have used a sliding scale respective to each industry but the northern politicians deemed it necessary to raise the cost of southern exports so that their prices would fall and they could increase their own profits. It worked and this is one of the main reasons for succession that led to the civil war.

----------


## showpan

> Why are American steelworkers ENTITLED to anything more than what other steelworkers are getting? They're not. If they're willing to work hard then they'll find something else to do.
> 
> On the other hand, if you put tarrifs & taxes on foreign steel just to "help" American steelworkers then that means the prices of steel within America go up & that means EVERYONE in America must pay higher prices for goods & services which are directly or indirectly affected by steel prices which means Americans as a whole have a lower standard of living than they otherwise would've had. Why make everyone pay for a few people? And it doesn't just stop at steel, then other workers might ask for protection from imports & so on & this whole process leads to lobbying & corporatism as unions & big corporations get involved & then over a period, it just becomes a mess.
> .


You couldn't be any further from the truth. I have been working with steel for over 30 years and the price of steel has skyrocketed since we "rewarded" those companies for leaving. You are correct in that higher prices has adversely effected everything but you are wrong in your assumption of who is to blame. Protectionist measures have worked in Brazil who climbed from almost last on the economic scale to #5 in just 10 years. Our present economy would be much worse if they didn't use fuzzy math to prop up their figures. Our policies have ruined this country and 1/4 of it's workforce is unemployed. 

So, explain to me again how your model has worked so well?
After 30 years...you would like me to find another trade simply because you place a higher value on share prices than you do on my career and my family.
Thank god this country wasn't founded upon your principles, someday soon, Americans will have had enough of this none sense.

----------


## showpan



----------


## The Grinning Maniac

I really wish people had listened to Ross Perot. He knew what he was talking about. But noooo...he has funny ears and a reedy voice. He can't be a serious candidate. Ugh America.

----------


## showpan

> I really wish people had listened to Ross Perot. He knew what he was talking about. But noooo...he has funny ears and a reedy voice. He can't be a serious candidate. Ugh America.


It's a shame he wasn't taken seriously. I was building Trident subs at General Dynamics when Ct was the only state that voted for him. The steel was from Pa, the nuts and bolts were made right there in Ct. Almost every part of those Subs were built using American materials and labor. When the defense money stopped, Ct lost 10,000 jobs per month for 2 years straight. 100's of banks failed and 100's of companies closed. Pratt and Whitney, Sikorski, American Standard, all of the major companies all layed off it's entire workforce. Tens of thousands of people lost their homes. It was just as bad as it is now except this time the whole country is in this mess. This funny little businessman and his charts layed it all out and told this country what was wrong and what would happen. He had a plan to fix it too but nobody believed him. Turns out he was right and look at us now.

----------


## nobody's_hero

> If you recognize that government policies have caused the problems then why do think government can fix it by thwarting the free market by adopting protectionist policies. When SHTF all the cuddly manufacturing jobs will be back automatically anyway if we keep the markets free because our living standards as a country will've gone down but there's no need to adopt protectionism.


Tariffs, at this point, would not be protectionist. They couldn't even qualify for protectionism _because there's hardly anything left to protect_.

Why is that? 

Well, because what we have today is the _EXACT OPPOSITE_ of Smoot-Hawley. We went from one extreme to another. The government stopped 'protecting' manufacturing industries and went to discouraging, or more accurately _punishing_, companies that try to produce in the U.S.

Increasing tariffs would not 'thwart the free market' anymore than taxing you and your neighbor's business at the same 10% rate. 

Currently, if you're a producer, we're taxing your neighbor at 3% and taxing you 30%. The government is already picking winners and losers. 

It would be nice to have a balance; bring tariffs up and domestic taxes down until they meet in the middle. This will not hurt the "free market". Everyone plays by the same rules. 

But, then again, as I said, the tariffs will not be raised. Doing so would quickly bring to light how devastating the Fed has been to our dollar. So, we have the never ending rat race to find cheap stuff and encourage the importation of it into the U.S. with B.S. trade agreements, all to maintain the illusion that you can actually get a lot of stuff for that FRN in your pocket. If you don't want to change that, fine. But at least understand what's going on here.

----------


## Paul Or Nothing II

> I made no such statement, nor did anything I write imply this.  I put no definition to "more measured".  I was writing only in the broadest conceptual terms.


Look, either you can say what the "measured approach" should be or you're just playing on words.

"Measured approach" automatically leads to tariffs and/or other imposition in terms of costs which make cheaper foreign goods costlier & thereby lower living standards for Americans. And if you think politicians & bureaucrats should decide what it should be then you need to look into the corporatism that it leads to.




> The solution is very difficult and perhaps even less-than-intuitive in some cases.  All markets on the planet need correction.  They are all manipulated - interfered with by their respective governments.


Again, if you think your "solution" is going to come from politicians & bureaucrats then we've no hope of getting anywhere.




> You couldn't be any further from the truth. I have been working with steel for over 30 years and the price of steel has skyrocketed.
> 
> So, explain to me again how your model has worked so well?


America is NOT a free market, NAFTA, CAFTA & all so called "free trade agreements" are NOT free trade as such & all the free-marketers HATE them. What they are is "managed trade", as Ron has said, we don't need thousands pages of documentation to have free trade with other countries, these agreements are forms of "regulated trade" that are designed to benefit big corporations; this is what happens when you let politicians & bureaucrats run the markets, the big guys buy out the politicians & bureaucrats & benefit at the cost of the people; this is corporatism at its worst & when you support politicians & bureaucrats "regulating" the markets, you unknowingly support exactly this kind of corporatism.




> Increasing tariffs would not 'thwart the free market'


Free markets & tariffs are incompatible.




> It would be nice to have a balance; bring tariffs up and domestic taxes down until they meet in the middle.


And where would we find such angels who'd re-arrange the markets exactly how they "should be" & do so without it leading to corporatism like it always does?

Only if all the corporate taxes, tariffs & regulations & so called "free trade agreements" are gotten rid of then that in itself will encourage so many businesses into America that there'd be no shortage of jobs so there's absolutely no "need" to resort to tariffs or any other anti-free-market practices.

----------


## LibertyEagle

> Free markets & tariffs are incompatible.


Hasn't Dr. Paul mentioned that one way we could pay for a constitutional government if the IRS was dissolved, is through small tariffs?  Yes, yes, I believe he did.

----------


## Paul Or Nothing II

> Hasn't Dr. Paul mentioned that one way we could pay for a constitutional government if the IRS was dissolved, is through small tariffs?  Yes, yes, I believe he did.


Yes, he did but that doesn't mean it's compatible with free markets. I like Ron a lot but it's not a personality cult for me to agree with everything he says.

----------


## nobody's_hero

> Free markets & tariffs are incompatible.


Close, no cigar. Free markets and _biased tax codes_ are incompatible. There is a difference.

Even if the tax rate were 99.9%, _but applied equally to everyone in the world_, you could _still_ have a competitive economy. Of course, no one would call that an ideal situation, because 99.9% of everyone's resources were being siphoned off to the government, *but*, applied equally, no one could call it _unfair_. It's proportional. However, if your tax rate is 99.9% and your neighbor's is 0.0099%, we've just created a massive handicap. I guess some people don't see a problem with that, probably too busy chanting "viva la Free market". 

As long as we get cheap stuff from _somebody_, everyone else can just go pound sand, right?




> Only if all the corporate taxes, tariffs & regulations & so called "free trade agreements" are gotten rid of then that in itself will encourage so many businesses into America that there'd be no shortage of jobs so there's absolutely no "need" to resort to tariffs or any other anti-free-market practices.


Agreed, mostly. (I don't think it's the "only" way, but I like the idea of an end result that involves no taxes, regulations, tariffs, or FTAs)

You realize, though, that we'd basically have to abolish every government in the world for that to work. If America decides there will be no more taxes, tariffs, regulations, FTAs, but say, for example, China decides to keep only its tariffs, then companies will still flock to China in order to avoid fees associated with importation of goods into that country (huge market in China, so believe me, they won't pass it up).

[abolition of every government] looks even less likely than a serious increase in tariffs.

----------


## sailingaway

I think tariffs are better than income tax, but the government should be small enough they don't have to be problematic.  I also think we have to take into account things like China's playing with their money value when we consider that.  So I'm open to it philosophically, but I think we have a lot of wrinkles to iron out.

----------


## LibertyEagle

> Yes, he did but that doesn't mean it's compatible with free markets. *I like Ron a lot but it's not a personality cult for me to agree with everything he says.*


Fair enough.  I'm just pointing out that Ron Paul does not agree with you, for the lurkers.

----------


## osan

> Look, either you can say what the "measured approach" should be or you're just playing on words.
> 
> "Measured approach" automatically leads to tariffs and/or other imposition in terms of costs which make cheaper foreign goods costlier & thereby lower living standards for Americans. And if you think politicians & bureaucrats should decide what it should be then you need to look into the corporatism that it leads to.
> 
> 
> 
> Again, if you think your "solution" is going to come from politicians & bureaucrats then we've no hope of getting anywhere.


This is largely unresponsive.  Who is "we" and where are looking to go?

I clearly stated that I was not in possession of the particulars of the best path moving forward.  What I have identified are the principles at work and the results; nothing more.






> America is NOT a free market


You think?




> Free markets & tariffs are incompatible.


True, but since there are no free markets to be found on the planet, the current reality requires such external controls in order to maintain balances that would otherwise be dangerously upset when one trading partner decided to stop playing nicely.  China is a good example, with its rigged labor market.  

Going from universally rigged or otherwise interfered-with markets to free markets does not happen just by one nation opening the floodgates. It took millennia to get this screwed up.  It will take a long time to correct, even under the best circumstances of good will and competency.  Reduce either of these factors and the time to realization elongates.




> And where would we find such angels who'd re-arrange the markets exactly how they "should be" & do so without it leading to corporatism like it always does?


A $64 question, to be sure.  People are what they are and even under the best conditions, things can be difficult and one will rarely be able to satisfy everyone.

IMO the solution must come from the bottom up - local economies willing to do what is needed for secure long term prosperity.  A tall  order in an age where get-rich-quick has become the universal attractor and the sacred promise.

O

----------


## showpan

> It took millennia to get this screwed up.


Nope, it too only 10 years, the same amount of time it took Brazil to go from almost last to almost 1st. Without protectionist measures, ending the wars, regulating the FED and capping immigration.....this country will only get worse. Numbers have been fudged to protect the interests. If people saw the real numbers, this country would collapse from shock alone.

----------


## osan

> Nope, it too only 10 years, the same amount of time it took Brazil to go from almost last to almost 1st.


An impossibly narrow view.  Authoritarianism has reigned supreme for thousands of years, as has the mindset that accepts it.  This very mindset has been used by those in power to manage affairs to their own liking, the rest be damned.  Dispensing with the acceptance of this way of thinking is no mean task.  Barring some true physical cataclysm, it may even be impossible to realize.




> Numbers have been fudged to protect the interests. If people saw the real numbers, this country would collapse from shock alone.


We agree on this.

----------


## Cutlerzzz

I'm pleased with the results of the poll. 74% of Ron Paul supporters support free trade, and another 14% are open to it. I thought that it was more like 50/50.

----------


## showpan

> An impossibly narrow view.


You're opinion has been received, unfortunately this is truth based upon facts.

While I have been researching around all of this, I found this, from the  UNITED STATES BUSINESS AND INDUSTRY COUNCIL


EMERGENCY MEASURES 
1.   The President must declare that the United States faces a manufacturing, R&D, and outsourcing emergency 
no less threatening to Americas long-term future than even the Great Depression. He must also make clear that
the crisis stems mainly from the manipulation of world trading system by mercantilist countries and to the 
encouragement of offshoring by U.S. trade policy.
2.   The President should create an Apollo Program-type task force in the federal government to oversee 
Washingtons response to the manufacturing crisis. Its mission should be to restore domestic U.S. 
manufacturing to global preeminence and to boost domestic manufacturing employment and wages.  The 
program should involve all agencies of U.S. government. 
3.   Federal R&D spending should be tripled and Washington should offer matching grants to industry.  Special 
emphasis should be placed on tasking the national labs with helping to develop commercially viable, high-tech 
products to be manufactured in the United States. 
4.   The U.S. trade deficit should be quickly and dramatically reduced by imposing a variable trade equalization tariff on imports from countries running a trade surplus ten percent or greater of total bilateral trade.  
These tariffs should be increased each year until bilateral surpluses fall below the threshold level, at which time
they would be removed. Tariffs should be imposed on U.S. trading partners as soon as surpluses reach the 10 
percent threshold. 
The United States should offer a partial exemption for the worlds poorest countries, but only if concrete, 
measurable trade breaks from the other Organization for Economic Co-Operation and Development (OECD) 
countries follow suit and only if the developing country seeking the exemption demonstrates a commitment to 
democracy and to the economic advancement of all of its people.  Exemptions are not intended to enrich
corrupt, dictatorial elites. 
In addition, exceptions would be made for energy imports and other commodities that are not found in the 
United States and for which no acceptable substitutes exist
TO SAVE AMERICAN MANUFACTURING: USBICS PLAN FOR AMERICAN INDUSTRIAL RENEWAL         PAGE 4 
5.   Companies manufacturing or assembling in the United States should be barred from treating service work 
performed overseas as a deductible business expense.  Private companies that outsource overseas the processing 
of sensitive records, such as medical and financial records, must ensure that their subcontractors meet U.S. 
privacy standards or face stiff fines. 
6. Washington should declare a moratorium on all current and future free trade talks pending development of 
new national trade strategy. The United States government clearly has lost the ability to negotiate trade 
agreements that enrich the great majority of Americans and strengthen the domestic manufacturing base on net. 
U.S. leaders should not engage in trade negotiations until this ability is regained. 
To develop a fundamentally new national trade strategy, the President and Congress should appoint a National 
Trade Strategy Commission that includes representatives of business, plus civil society groups, such as labor 
unions and environmental groups. The business representatives on the Commission should be dominated by 
companies and industries that produce the great majority of their product and value in the United States. The 
Commission should also include representatives of the nations science and technology and national security 
communities.
7. Washington should declare a moratorium on compliance with WTO panel decisions pending dramatic 
reform of the organization to reflect Americas position in world economy. The United Nations Security 
Council veto and the International Monetary Fund/World Bank weighted voting systems are possible models of 
international organization structures appropriate to Americas geopolitical and economic superpower status.     
If appropriate reform is not completed by the end of 2005, the United States should declare its intention to 
withdraw from the organization as soon as legally permissible.
8. Washington should declare a moratorium on compliance with North American Free Trade Agreement 
(NAFTA) panel decisions pending reform of NAFTAs dispute-resolution process to reflect U.S. predominance 
in the North American economy. In addition, NAFTAs rules of origin and external tariffs should be revised to 
offer meaningful trade preferences to goods with much higher levels of North American content. 
9. The U.S. government should resolve the Foreign Sales Corporation (FSC) tax dispute with the European 
Union and the WTO by replacing the current FSC tax incentive with a major tax break for any company, either 
American or foreign-owned, that performs genuine manufacturing activity in the United States.  Qualification
for the tax break would require detailed certification that true manufacturing is occurring in the United States. 
10. The United States should expedite procedures for anti-dumping and countervailing duty suits. The 
thresholds for standing, actionability, and remedies should all be eased. In addition, remedies should be 
extended to companies upstream and downstream from immediately affected industries, to ensure protection for 
suppliers and consumers, and to prevent foreign economic interests from using divide and conquer tactics 
against domestic industries. 
11. The recent steel tariffs should be restored and expanded to cover industries using significant quantities of 
U.S.-made steel.  Further, the option of extending the tariffs beyond the original three-year deadline should be 
left open in order to determine conclusively that foreign steel subsidization and dumping have ceased. 
12. A stiff tariff should be imposed on countries determined by the U.S. government to be manipulating their 
currencies for trade advantage. In light of the Treasury Departments equivocation on the currency policies of 
Asian mercantilist nations, the definition of currency manipulation that now exists must be broadened.  A 
strong dollar remains in the long-term interests of the U.S. economy, but foreign governments must not be able 
to distort trade flows to the advantage of their companies by giving them artificial cost advantages.
TO SAVE AMERICAN MANUFACTURING: USBICS PLAN FOR AMERICAN INDUSTRIAL RENEWAL         PAGE 5 
UNITED STATES BUSINESS AND INDUSTRY COUNCIL  910 16
TH
ST. NW, SUITE 300 WASHINGTON, DC 20006 
13. The defense industry must be treated by the federal government in a fundamentally different way from the 
commercial sector.  It exists solely to serve the national interest and national security, and must be structured 
and managed accordingly.  Therefore, a 65 percent U.S. content requirement should be imposed on all military 
procurement, rising to 80 percent in five years and 95 percent in ten years.  This requirement should 
immediately cover the procurement of all goods and services for domestic military facilities and operations, and 
to the fullest extent possible cover foreign bases as well.  Presidential waiver authority should be sharply 
limited, especially for countries that have records as problem traders or that demand offsets for purchases of 
American weapons systems. 
14. Public money taken from the domestic economy by taxes or borrowing should be returned to the domestic 
economic economy by the procurement of American-produced goods and services.  Procuring government 
services domestically is also necessary to ensure the continued privacy and security of the financial and health 
records of all Americans.  Thus a 50 percent U.S.-content requirement should be imposed on all non-military 
federal procurement, rising to 80 percent in five years and 95 percent in ten years. Presidential waiver authority 
should be sharply limited. This requirement should immediately cover the procurement of all services for 
domestic facilities and programs. 
15. The scheduled abolition of the Multi-Fiber Arrangement governing world trade in textile and apparel should 
be suspended indefinitely, pending a study of the effects of the MFA's abolition on domestic and third-world 
producers in these industries. 
16. Stiff tariffs should be levied on countries that impose offset requirements on U.S. defense manufacturers. 
17. The President should declare a moratorium on foreign acquisitions of U.S. defense-related companies 
pending completion of comprehensive study of the status of the roughly 1,500 such companies acquired since 
1988 under the current policy framework and government screening system. 
18. Strict, detailed country-of-origin labeling should be required on all food and agricultural imports. 
19. Legal immigration into the United States should be limited to 500,000 annually. Enforcement measures to 
halt illegal immigration should be dramatically increased, including significant and sustained increases in the 
budgets of those federal agencies responsible for enforcing immigration laws. 
Immigration at todays levels  both legal and illegal  can only serve to depress wages for American workers 
by artificially inflating the supply of labor. Moreover, the most likely victims of such massive immigration 
flows are the recent arrivals themselves, who are forced to compete directly for jobs with the unending flow of 
newcomers arriving right after them. 
The H-1B visa program for technology workers should be abolished.  A new federal commission comprised 
both of U.S. technology worker interests and tech industry interests should conduct a study to determine labor 
needs in technology industries and how they should be met. 

LONGER-TERM MEASURES 
1.   Washington must insist that any future trade agreements be strictly reciprocal and strongly enforceable by 
the U.S. government, unilaterally if necessary. 
2. Any future U.S. trade agreements must include provisions penalizing signatories for currency manipulation, 
which, in fact, can be used to defeat or offset the effects of reducing or eliminating trade barriers. 
(202) 728-1980  (202) 728-1981 FAX  COUNCIL@USBUSINESS.ORG  WWW.USBUSINESS.ORGTO SAVE AMERICAN MANUFACTURING: USBICS PLAN FOR AMERICAN INDUSTRIAL RENEWAL         PAGE 6 
3.   The President should launch a major diplomatic campaign to press other OECD countries to increase third 
world imports, enforceable unilaterally by tariffs on the products of any non-cooperating OECD countries. 
Under-importing of third-world products by the European Union and Japan in particular has greatly increased 
the pressure on the U.S. market to absorb third-world production. Greater burden sharing in this vital sphere is 
urgently needed. 
Because the overriding interest of U.S. trade policy is to advance the economic interests of the great majority on
the American people and the long-term security and prosperity of the United States, Americans should feel no
special obligation to import goods or services from third-world, or indeed any other, countries.  Such imports 
are especially unacceptable if they sacrifice the interests of American workers and domestic companies.  But a 
campaign to get Europe and Japan to do more is needed: (a) to counter perceptions that U.S. protectionism is 
the greatest current barrier to third world economic development; (b) to highlight Americas record in promoting this development; and (c) to call attention to the poor import records of the other main OECD countries. 
4. The United States should focus any new trade agreements on high-income countries capable of serving as 
final consumers of U.S. exports. Washingtons recent focus on third world countries capable of serving only as 
re-export platforms has been a substantial contributor to todays current trade deficits.  In particular, the United 
States should seek a free trade agreement with Europe that excludes agriculture.  Washington should also take 
stronger measures to open Japanese and Korean markets, including unilateral tariffs if necessary. 
5. The President should remove responsibility for monitoring and enforcing trade agreements from the office 
of the United States Trade Representative (USTR) and place it in the Department of Commerce. As the lead 
agency for negotiating new trade agreements, the USTR has every incentive to soft-pedal the deficiencies in 
both the structure and functioning of these agreements. Dividing these responsibilities would eliminate a major 
policy-making conflict of interest. 
6. Congress should enact strict foreign lobbying reform covering all federal officials, including lifetime bans 
on working for foreign interests for former senior Executive and Legislative branch officials. 
7. The Commerce and Defense Departments should be designated as co-chairs of the inter-agency Committee 
on Foreign Investment in the United States (CFIUS), which reviews all proposed foreign acquisitions of U.S. 
defense-related companies. Exon-Florio filings must be made mandatory, and the threshold for investigation 
lowered.  With the Treasury Department chairing this panel for its decade-and-a-half of existence, national 
security concerns have not been adequately addressed in the decisions of CFIUS, which generally reflect only 
Treasurys desire to see surplus dollars in foreign hands repatriated effortlessly. 
8. The President should commission immediate reports  written by special Commercial Action Teams 
composed mainly of industry representatives and some government officials  on foreign subsidies existing 
outside the steel industry and implement tariffs to offset them. Washington should first offer to negotiate the 
abolition of such subsidies, but it must insist on results that are achieved quickly, as well as completely 
verifiable and enforceable by the U.S. government. 
9. The federal government must publish more complete and timely foreign trade and investment data. This 
data should include detailed information on the importing, sourcing, and employment trends of all multinational 
companies and in fact all companies that do business in the United States.  The provision of the data to the 
appropriate government agencies must be made mandatory. 
10. The President should launch a comprehensive review of all U.S. defense alliances to determine which 
remain relevant to 21st century U.S. interests.  The President should explicitly state that foreign policy and 
defense considerations will no longer automatically trump the economic interests of the United States and the 
American people

----------


## osan

> You're opinion has been received, unfortunately this is truth based upon facts.


I am afraid I cannot quite parse this response with certainty.  What is your precise meaning?






> While I have been researching around all of this, I found this, from the  UNITED STATES BUSINESS AND INDUSTRY COUNCIL


Not all bad, though mostly statist crap.  Again, not sure of your point.

----------


## showpan

> I am afraid I cannot quite parse this response with certainty.  What is your precise meaning?


You'll have to go back a page to read my response to your post.






> Not all bad, though mostly statist crap.  Again, not sure of your point.


The point is that there are many businesses who have suffered due to trade agreements an 8yr old could have made better. Only large multinational corporations who contribute large amounts of campaign funds have benefited. This country continues to ignore those who have suffered the most and the ideas that they have presented fall on deaf ears. 

When before this country was founded, our cheap resources were being shipped to England and in return, we were forced to buy their more expensive goods. The founders of this country imposed tariffs in order to pay for the war and protect our businesses. They believed that tariffs were a necessary evil so that this country would not be dependent on others. Our country had grown so much, that other countries relied on our goods. They were imposed at an average rate of 29% until 1913 when tariffs were reduced to 9%, a federal income tax was enacted and the FED took over. Prior to the FED, none of our economic problems were ever due to tariffs except for the policies that started the civil war where some politicians favored one industry over another. Today, the lack of tariffs has caused most of our manufacturing capabilities to decline to the point we can no longer even protect this nation should it come under attack. Unemployment has eroded to such an extent that more than 1/4 of this country is now without jobs. Taxes have grown and can no longer support the policies of a corrupt government. Our economy is about to collapse and this is exactly what our founders believed would happen and why they imposed tariffs in the first place rather than tax the people and their businesses.

An open border policy will never raise the standard of living in other countries to such an extent that they will be able to buy the goods they now make. Most of this countries economic problems since 1913 can be traced back to the FED, unfair trade agreements, a meddlesome government and war.

----------


## osan

> The point is that there are many businesses who have suffered due to trade agreements an 8yr old could have made better. Only large multinational corporations who contribute large amounts of campaign funds have benefited. This country continues to ignore those who have suffered the most and the ideas that they have presented fall on deaf ears. 
> 
> When before this country was founded, our cheap resources were being shipped to England and in return, we were forced to buy their more expensive goods. The founders of this country imposed tariffs in order to pay for the war and protect our businesses. They believed that tariffs were a necessary evil so that this country would not be dependent on others. Our country had grown so much, that other countries relied on our goods. They were imposed at an average rate of 29% until 1913 when tariffs were reduced to 9%, a federal income tax was enacted and the FED took over. Prior to the FED, none of our economic problems were ever due to tariffs except for the policies that started the civil war where some politicians favored one industry over another. Today, the lack of tariffs has caused most of our manufacturing capabilities to decline to the point we can no longer even protect this nation should it come under attack. Unemployment has eroded to such an extent that more than 1/4 of this country is now without jobs. Taxes have grown and can no longer support the policies of a corrupt government. Our economy is about to collapse and this is exactly what our founders believed would happen and why they imposed tariffs in the first place rather than tax the people and their businesses.
> 
> An open border policy will never raise the standard of living in other countries to such an extent that they will be able to buy the goods they now make. Most of this countries economic problems since 1913 can be traced back to the FED, unfair trade agreements, a meddlesome government and war.


So we agree that government meddling has, on the whole, been more troublesome than anything else - largely due to corrupt actors operating pursuant to agenda items that do not serve anything we might call a neutral and fair market environment.

Many here say that so-called "government" is incapable of doing anything right.  I would say that this belief is not quite correct.  In my opinion, "government" is perfectly capable of governing very much perfectly.  What fails is human choice.  People choose to make inept or dishonest choices and people are "government".  The whole notion of government per se is absurd.

----------


## Paul Or Nothing II

> Close, no cigar. Free markets and _biased tax codes_ are incompatible. There is a difference.
> 
> Even if the tax rate were 99.9%, _but applied equally to everyone in the world_, you could _still_ have a competitive economy. Of course, no one would call that an ideal situation, because 99.9% of everyone's resources were being siphoned off to the government, *but*, applied equally, no one could call it _unfair_. It's proportional. However, if your tax rate is 99.9% and your neighbor's is 0.0099%, we've just created a massive handicap. I guess some people don't see a problem with that, probably too busy chanting "viva la Free market". 
> 
> As long as we get cheap stuff from _somebody_, everyone else can just go pound sand, right?


The fundamentally wrong assumption you make is that "world" pays for the tariffs. NOT TRUE, the AMERICAN PEOPLE pay for the costs of tariffs because importers that  import into America pass on tariff-costs on to those Americans that buy the imports. And because we don't import everything equally, we import some & others we produce for ourselves, which means that only SOME Americans are being forced to pay into the government which violates the principle that government should treat every American EQUALLY.

Because government is liable to protect everyone EQUALLY, the system of taxation should be equal or at least equitable so in that sense, a single consumption tax on everything WITHOUT any kind of concessions, rebates & loopholes would mean that if you buy $ X worth of goods/services & I buy goods/services of equal worth then we're paying the same amount of tax. And if you don't even want a consumption tax then as has been suggested already by others, government funding should depend totally on charitable citizens contributing VOLUNTARILY to bear the expenses of the government.





> You realize, though, that we'd basically have to abolish every government in the world for that to work. If America decides there will be no more taxes, tariffs, regulations, FTAs, but say, for example, China decides to keep only its tariffs, then companies will still flock to China in order to avoid fees associated with importation of goods into that country (huge market in China, so believe me, they won't pass it up).
> 
> [abolition of every government] looks even less likely than a serious increase in tariffs.


It's a really fallacious argument that we can't have free market because other countries won't have it. If china is lowering its currency & putting tariffs, & thereby keeping their people's living standards low should NOT mean that America also force its citizens to have low living standards, it doesn't make ANY sense. In a free market where enterpreneurship is allowed to prosper without massive taxes & regulations then enterpreneurs in our country will always find ways of doing something productive & thereby creating jobs for the people here

And the idea that tariffs makes companies "flock" to a country is laughable. Tariffs raise costs & make the companies' goods LESS competitive & LESS profitable because fewer people would buy the costlier goods, the only reason they've flocking there for a while because the people's living standards & wage demands were lower but that's changing pretty fast & wage-gap between China/India/Brazil/etc & the West is closing rapidly as their middle-classes become grows & expands

And lets say a country kept its currency low & wages low forever, it doesn't affect us, it just means that we're getting cheaper goods from them which wouldn't be as cheap if we make them which is good, so our people will be engaged in other productive activities, this is what leads to division of labor & specialization among countries which benefits everyone. And the only reason this hasn't been happening in America because enterpreneurship has been suffocated & businesses driven out by taxes & regulations so if that's taken care of then as I've said, enterpreneurs here would definitely be engaged in productive activities & find ways utlizing the spare labor here.




> I think tariffs are better than income tax, but the government should be small enough they don't have to be problematic.  I also think we have to take into account things like China's playing with their money value when we consider that.  So I'm open to it philosophically, but I think we have a lot of wrinkles to iron out.


I don't support income-tax but as I've explained, tariffs are an inequitable form of taxation & not in line with the principle that government that govenrment should treat everyone equally, & there are better ways of funding the government than that.




> This is largely unresponsive.  Who is "we" and where are looking to go?
> 
> I clearly stated that I was not in possession of the particulars of the best path moving forward.  What I have identified are the principles at work and the results; nothing more.


Oh, for FSM's sake, quit hiding behind words & just be honest that you've no "solutions" & that "measured approach" is just a pointless term that you've no clue about 




> You think?


*Oh, you think America is a free market? Oh well, don't let anyone here know that or you'll be the joke of the town here.*




> True, but since there are no free markets to be found on the planet, the current reality requires such external controls in order to maintain balances that would otherwise be dangerously upset when one trading partner decided to stop playing nicely.  China is a good example, with its rigged labor market.  
> 
> Going from universally rigged or otherwise interfered-with markets to free markets does not happen just by one nation opening the floodgates. It took millennia to get this screwed up.  It will take a long time to correct, even under the best circumstances of good will and competency.  Reduce either of these factors and the time to realization elongates.


You know it's really sounds great when you talk about someone "correcting the markets" & "correcting the world", etc etc that's what communists/socialists long for so much but the whole idea collapses when one is asked "Who'll do the correcting?", "Where do we find angels who will correct everything & run the system without perversing it?"

And as I've already explained above, the idea that the whole world needs to agree on free markets is fallacious, our government shouldn't impose tariffs-costs & lower living standards on our people just because other countries are imposing them on their people, it's a ridiculous premise. We should do what we can & as Ron says "lead by example".




> A $64 question, to be sure.  People are what they are and even under the best conditions, things can be difficult and one will rarely be able to satisfy everyone.
> 
> IMO the solution must come from the bottom up - local economies willing to do what is needed for secure long term prosperity.  A tall  order in an age where get-rich-quick has become the universal attractor and the sacred promise.
> 
> O


And yet you don't realize that the free markets is what will do it, people making choices for themselves rather than governments imposing tariffs & regulations & deciding on what the "measured approach" should be because that'll keep leading us to corporatism & that's why we should let freedom reign & have free markets instead of government imposing costs on one person to benefit the other.

----------


## nobody's_hero

> And the idea that tariffs makes companies "flock" to a country is laughable. Tariffs raise costs & make the companies' goods LESS competitive & LESS profitable because fewer people would buy the costlier goods, the only reason they've flocking there for a while because the people's living standards & wage demands were lower but that's changing pretty fast & wage-gap between China/India/Brazil/etc & the West is closing rapidly as their middle-classes become grows & expands.


Don't laugh too hard; you stopped halfway with your analysis of how tariffs cause companies to relocate:

Say, for example, the U.S. had a tariff of 200%, as an extreme example. Other countries around the world had marginal or non-existant tariffs. What do you suppose businesses around the world would do? They'll flock to America.

_Why?_ 

America is a big market, and the industries have no desire to pay 200% to import goods into our country. They'll try to pass the costs on to the consumer, sure (all tax on industry/business does this, you are correct on that). But some people just won't buy their goods after mark-up, and the companies will not pass our market up. Too juicy. What will they do?

They'll move here, _because_ if they move here, then they don't have to pay that rediculous 200% importation fee. They can manufacture goods here in the U.S., tap the market, and export the surplus to the rest of the world (It's more efficient because no other country has nearly as high a tariff, maybe they signed a "Free Trade" Agreement). It will become cheaper to manufacture goods here in the U.S. as opposed to manufacturing them elsewhere and trying to send them here, and other companies will catch on, and move here to access the market. Manufacturing increases supply, supply surpasses demand, prices fall. 

Now replace America in my example with China, and it is no longer a hypothetical situation. 

If China's people are suppressed by currency manipulation, it will not last long. They are on track to become the most industrialized nation in the world, if they aren't already, thanks in part to tariff imbalances between nations. Let's look at supply and demand:

Tons of industries in China = a s***load of goods in their country. Supply in China goes up, prices fall. Standard of living rises. Mass production always leads to cheaper goods, in any case.

Tariffs do *NOT* decrease standard of living because they tend to lead to mass production _within_ a nation. China is experiencing this. The constant assumption among 'free traders' is that China is hurting themselves with high tariffs because they can't import goods from other countries.

The truth is that China doesn't really need to import stuff, because they make stuff themselves, just like we once did.

EDIT:




> It's a really fallacious argument that we can't have free market because other countries won't have it.


Not at all. You can't have free markets without fair markets. 

If you disbelieve me on that, I'll tell ya what:

You pay 30% in taxes while I pay 3% in taxes, and I'll sit here like a good an-cap praising myself for my "free market" genius and being the better competitor, and you can just go pound sand when your company collapses.

----------


## Paul Or Nothing II

> Don't laugh too hard; you stopped halfway with your analysis of how tariffs cause companies to relocate:
> 
> Say, for example, the U.S. had a tariff of 200%, as an extreme example. Other countries around the world had marginal or non-existant tariffs. What do you suppose businesses around the world would do? They'll flock to America.
> 
> _Why?_ 
> 
> America is a big market, and the industries have no desire to pay 200% to import goods into our country. They'll try to pass the costs on to the consumer, sure (all tax on industry/business does this, you are correct on that). But some people just won't buy their goods after mark-up, and the companies will not pass our market up. Too juicy. What will they do?
> 
> They'll move here, _because_ if they move here, then they don't have to pay that rediculous 200% importation fee. They can manufacture goods here in the U.S., tap the market, and export the surplus to the rest of the world (It's more efficient because no other country has nearly as high a tariff, maybe they signed a "Free Trade" Agreement). It will become cheaper to manufacture goods here in the U.S. as opposed to manufacturing them elsewhere and trying to send them here, and other companies will catch on, and move here to access the market. Manufacturing increases supply, supply surpasses demand, prices fall.


The problem with hypothetical examples like these is.......well, they're hypothetical & therefore sometimes the author can lose track of reality.

If we look at your example carefully, your hypothetical country is too perfect in that it produces everything all its citizens want all the time at the least in amounts required by its citizens which means either there are omniscient angels centrally planning & running the whole thing OR may be it's just not realistic.

Reality tells us that countries usually have natural resources, environments, social behaviors, social structures etc etc which are endemic to them & one or more of these factors dictate what any particular country produces & it is extremely unrealistic to assume that a country will produce everything its citizens need, & that they'll produce goods of the best quality.

Further, in real life, there are existential limits like as I've said, natural resources or number of workers available in a country, etc which means no matter how many countries want to set up shop in a country, there will always be limits to how many can come & of what kind which limits the amount & variety of goods that will be produced, & again they won't all necessarily be of the best quality.

And there'll always be producer goods which'll have to be imported because some other country, at least momentarily, has discovered a better way facilitating them or because the natural resources required for their production don't exist in the hypothetical country which again leads to violating the equality principle (which you've side-stepped quite conveniently ) as government is forcing some to pay for others due to tariff-costs imposed on them inequitably.

Now, lets look at the other side of your story, all the other countries being relatively free, they still have their natural resources, they still have their people/workers so they'll exploit them & due to freer & costless exchange of goods, even though they can't export much to the hypothetical country, they'll still import/export amongst themselves without additional costs AND enjoy all the cheap imports from the hypothetical country as well  but the hypothetical country's people must pay excessively high costs if they want to enjoy goods from other countries which means they're subjugated to a lower living standard than they OTHERWISE would've had.

Since this is a hypothetical & an unlikely scenario results could be much worse than we can possibly project due to factors which we can't account for right now & because we can't ascertain all the variables that may be involved if such a hypothetical situation were to become real so utopic societies always seem plausible in hypothetical scenarios.




> Now replace America in my example with China, and it is no longer a hypothetical situation.


NOPE, China is NOT the everythingland that your hypothetical country is supposed to be & again, import-tariffs are NOT the reason for companies flocking to China but it's because of their lower acceptable incomes due to people's generally lower living standards & currency devaluation, & partially, due to high taxation & regulation in some of the other countries.




> If China's people are suppressed by currency manipulation, it will not last long. They are on track to become the most industrialized nation in the world, if they aren't already, thanks in part to tariff imbalances between nations. Let's look at supply and demand:


Do you think Chinese are diluting their currency & thereby reducing their people's purchasing-power just for fun or because they don't've anything else to do??? The moment they stop doing it, it'll cause their wages to go up & the prices of their exports will go up & that'll cause their overall exports to go down & they'll become less competitive & less profitable for companies to produce within China which'll cause companies to cut back on production & cut back on employees that would cause, at least temporary, loss in export-related jobs & their leaders fear that even such temporary setback could further strengthen their democratic movement due to the anguish that it may lead to amongst the people.




> Tons of industries in China = a s***load of goods in their country. Supply in China goes up, prices fall. Standard of living rises. Mass production always leads to cheaper goods, in any case.
> 
> Tariffs do *NOT* decrease standard of living because they tend to lead to mass production _within_ a nation. China is experiencing this. The constant assumption among 'free traders' is that China is hurting themselves with high tariffs because they can't import goods from other countries.
> 
> The truth is that China doesn't really need to import stuff, because they make stuff themselves, just like we once did.


Really fallacious reasoning. Do you think Chinese produce everything their people'd like to enjoy AND of the highest quality? Seriously?

Because the Chinese government is incessantly diluting its currency & its people's purchasing-power is stolen, they can't afford to buy BETTER foreign products, either they've to get by on local cheap low-quality products or they must pay extremely high prices for the foreign ones, & import-tariffs make things worse by adding additional costs. And therefore their people can't enjoy all the wonderful goods produced in other countries which they OTHERWISE could've if their currency & purchasing-power weren't being diluted or they must be willing to expend higher portion of their earnings on foreign imports by paying much higher prices than they OTHERWISE would've which means that their living standards are constantly being diluted.

There's no way of saying that this isn't happening in China, hell, as I've said before, just wait until the American economy collapses & dollars aren't as much anymore & then all your favorite low-paid manufacturing jobs might be back because the general living standards & income expectations of Americans will've dropped significantly




> EDIT:
> 
> Not at all. You can't have free markets without fair markets.


Nope, free market means market that is free of any form of government intervention so there are no ways about that & since tariffs clearly are a form of government intervention, tariffs DEFINITELY are incompatible with free markets




> If you disbelieve me on that, I'll tell ya what:
> 
> You pay 30% in taxes while I pay 3% in taxes, and I'll sit here like a good an-cap praising myself for my "free market" genius and being the better competitor, and you can just go pound sand when your company collapses.


I'm not really sure what you're referring to, could you clarify? I don't recall ever supporting variable taxation so I don't know what you're trying to say with 3% & 30%, as I've said, government should treat everyone equally & that means no inequitable forms of taxation.

*And again, I see you're trying to avoid it  but as I've said before, tariffs violate the equality principle that government should not force some citizens to pay for others in an inequitable manner.*

----------


## nobody's_hero

> *And again, I see you're trying to avoid it  but as I've said before, tariffs violate the equality principle that government should not force some citizens to pay for others in an inequitable manner.*


I haven't avoided it. In fact, the equality principle is the EXACT topic I'm trying to address by matching tariffs to meet domestic taxation. 

When I brought up 30% and 3%, I was referring to domestic corporate taxation (30%, give or take) versus tariffs (3%, give or take). Free market? Hardly. A blind fool can see who wins this one. 

There are essentially a few ways to address the issue:

Lower domestic taxation to 3% and level the playing field. (or do away with taxes/tariffs for everyone, my favorite, but most unlikely, goal).

Raise tariffs to 30% and level the playing field. (not desirable, but still proportionate, holding true to the equality principle, albeit tyrannic)

Lower domestic taxation and raise tariffs until they meet in the middle.

Now, as previously stated a few pages back: you don't have to agree with the idea to raise tariffs, but at least _understand_ the situation enough not to freak out whenever someone says that a balanced playing field is going to upset a 'free market' that doesn't exist.




> Nope, free market means market that is free of any form of government intervention so there are no ways about that & since tariffs clearly are a form of government intervention, tariffs DEFINITELY are incompatible with free markets


Exactly. And China's government's tariff rate is still government intervention, isn't it? No free trade exists currently, and if we completely did away with all tariffs while China kept theirs, it still would not exist. We cannot control China's tariffs, but we can match them with ours. (We won't, and I've already explained why, because it would bring to light how much our currency has been devalued).

EDIT: Which is why I voted "conditionally": 

We remove trade barriers (do we even have any tariffs to amount to anything?) if another country removes theirs.

----------


## Cutlerzzz

> Lower domestic taxation and raise tariffs until they meet in the middle.


I'm confused? Which do you want? Higher taxes or lower taxes? Last I checked there is no such thing as a foreign tax. You're telling me that if I don't pay a kings ransom to uncle sam(AKA, special interest groups) in order to subsidize some lazy union employee, that I'm going to prison.

----------


## Cutlerzzz

> Don't laugh too hard; you stopped halfway with your analysis of how tariffs cause companies to relocate:
> 
> Say, for example, the U.S. had a tariff of 200%, as an extreme example. Other countries around the world had marginal or non-existant tariffs. What do you suppose businesses around the world would do? They'll flock to America.
> 
> _Why?_ 
> 
> America is a big market, and the industries have no desire to pay 200% to import goods into our country. They'll try to pass the costs on to the consumer, sure (all tax on industry/business does this, you are correct on that). But some people just won't buy their goods after mark-up, and the companies will not pass our market up. Too juicy. What will they do?


Nobody has to sell anything to America. What you're proposing makes it *more* difficult to start a business in America, because it will raise prices. 




> They'll move here, _because_ if they move here, then they don't have to pay that rediculous 200% importation fee. They can manufacture goods here in the U.S., tap the market, and export the surplus to the rest of the world (It's more efficient because no other country has nearly as high a tariff, maybe they signed a "Free Trade" Agreement). It will become cheaper to manufacture goods here in the U.S. as opposed to manufacturing them elsewhere and trying to send them here, and other companies will catch on, and move here to access the market. Manufacturing increases supply, supply surpasses demand, prices fall. 
> 
> Now replace America in my example with China, and it is no longer a hypothetical situation. 
> 
> If China's people are suppressed by currency manipulation, it will not last long. They are on track to become the most industrialized nation in the world, if they aren't already, thanks in part to tariff imbalances between nations. Let's look at supply and demand:
> 
> Tons of industries in China = a s***load of goods in their country. Supply in China goes up, prices fall. Standard of living rises. Mass production always leads to cheaper goods, in any case.
> 
> Tariffs do *NOT* decrease standard of living because they tend to lead to mass production _within_ a nation. China is experiencing this. The constant assumption among 'free traders' is that China is hurting themselves with high tariffs because they can't import goods from other countries.
> ...


Tariffs *do* decrease the standard of living, because they *lower* the amount of production by forcing nations to create everything themselves. By using the division of labor and comparative advantage, there is a greater amount of goods produced based on specialization. 

http://wiki.mises.org/wiki/Comparative_advantage

http://en.wikipedia.org/wiki/Compara...tage#Example_2

People will go to jobs that they specialize in, and thus produce more. Prices will fall in both countries as total production is increased.

There is no long term change in unemployment from free trade or protectionism. Demand is unlimited, so there will always be employment opportunities somewhere.

There are also things that cannot be produced here in large enough quantities(oil) and need to be imported. There are also certain things(let's say certain fruits or vegetables that cannot be created in the United State's climate) that are nearly impossible to create.




> You pay 30% in taxes while I pay 3% in taxes, and I'll sit here like a good an-cap praising myself for my "free market" genius and being the better competitor, and you can just go pound sand when your company collapses.


An Ancap would not advocate any taxation.

----------


## nobody's_hero

I give up. The "free traders" are getting exactly what they want, anyway, so there's really no point in arguing. Time will decide whose theory held true in practice, and whose theory was . . . just a theory. 

God help us.

----------


## Cutlerzzz

> I give up. The "free traders" are getting exactly what they want, anyway, so there's really no point in arguing. Time will decide whose theory held true in practice, and whose theory was . . . just a theory. 
> 
> God help us.


What are us Free Traders getting?

----------


## showpan

It doesn't matter what mises.org globalists "think" because history proves them wrong, just as it proves most of the posts and pollsters here wrong. Doesn't anyone actually do any research anymore using real data and historical facts? Wiki can be edited by anyone...just look at how many times Paul Revere's ride was edited in just 2 days...lmao
What are the "free traders" getting....depression era unemployment, mass suffering, the ability to make nothing, record breaking profits for large international corporations, record breaking CEO pay, record breaking business closures, a bankrupt nation and a Chinese superpower that will make us look silly.

----------


## Cutlerzzz

Mises.org and the Austrian School are the bad guys now?

----------


## osan

> Oh, for FSM's sake, quit hiding behind words & just be honest that you've no "solutions" & that "measured approach" is just a pointless term that you've no clue about


Hiding behind words?  I don't know if that is a joke or whether your reading comprehension is somehow in trouble.  I clearly stated that I did not have the particulars.  How is that "hiding"?






> *Oh, you think America is a free market? Oh well, don't let anyone here know that or you'll be the joke of the town here.*


Perhaps you missed the sarcastic tone?  Get a grip.




> You know it's really sounds great when you talk about someone "correcting the markets" & "correcting the world", etc etc that's what communists/socialists long for so much but the whole idea collapses when one is asked "Who'll do the correcting?", "Where do we find angels who will correct everything & run the system without perversing it?"


Well, it seems to me your view is rather narrow.  We are not speaking of what is good v. what is bad.  The case here is one of lesser evils chosen on a path toward eventual correction such that we would have markets that were actually free.  As for human integrity, that is the greatest problem of them all.  Honest and clued in people will see when something is not working and will try something different.  We have witnessed the same things being done over and over since at least 1913, giving the same rotten results.  The only changes of which I am aware have consistently produced results worse than what had been before.  This has happened so many times over so many decades, I feel safe in asserting that the outcomes are well beyond statistical chance.  There is a malicious or hopelessly psychotic agenda afoot.




> And as I've already explained above, the idea that the whole world needs to agree on free markets is fallacious, our government shouldn't impose tariffs-costs & lower living standards on our people just because other countries are imposing them on their people, it's a ridiculous premise. We should do what we can & as Ron says "lead by example".


Nonsense. A player as large as China doesn't give a $#@! about our example.  Your assertion assumes that others will see how we are, get all welled up in the eyes and begin their own march in the same direction.  This is naive at best.




> And yet you don't realize that the free markets is what will do it, people making choices for themselves rather than governments imposing tariffs & regulations & deciding on what the "measured approach" should be because that'll keep leading us to corporatism & that's why we should let freedom reign & have free markets instead of government imposing costs on one person to benefit the other.


Uh huh.  As I said, naive.  USA goes all perfectly free.  China doesn't.  What is going to happen?  Distorted markets CONTAMINATE less- or non-distorted ones.  This is economics 101.  Take a class, or if you already have, take another one and this time pay attention.  Jesus.

----------


## osan

> What are the "free traders" getting....


It would appear you have failed to grasp the difference between  free trade and Free Trade(tm).  

The two are not even remotely the same.

----------


## osan

> By using the division of labor and comparative advantage, there is a greater amount of goods produced based on specialization.


This is correct, but only to a point.  I would also dispute the lines of division of specialization at the national level.  Between companies within markets, sure.

Over-specialization is a real hazard for a nation.  If, for example, the markets for which their specialty does service collapse, that nation is going to be in some deep $#@!.  If the collapse if sudden and catastrophic, many would likely die.  Not saying this is likely - just illustrating the principle.  Imagine a nation that produces nowhere near enough food for all its people and its economy went bye-bye because of the precipitous rise of a disruptive technology that rendered their entire industrial basis obsolete in, say, 1 year.  That nation would be so very deep in the kimchee that it would hurt just thinking about it.  Entire economies are not likely to be able to respond in so short a time frame.  Given this, the nation in question would be at the mercy of its neighbors.  People and their politics being what they tend to be, what are the odds that such a nation would receive help without some major strings attached?  Nobody in their right mind would want to expose themselves to such a risk, however slim it might be.  We get on commercial aircraft, banking on the low likelihood that they will fall from the sky.  Planes still fall.

----------


## ProIndividual

Nobody addressed any of the links or facts I left...lol. You "fair trade", protectionist, "reciprocal trade", "balanced trade" cromagnons are really NOT even trying to face any facts you don't like, facts that don't support your Hamiltonian case, or data that PROVES those facts. Ask yourselves..."why am I so afraid of the truth?"

And I have a final argument to make, on top of the one those of us favoring free trade have already won (whether your delusions allow you to see that, or not):

When hunter gathers decided to change their economy to an agrarian sedimentary (non-nomadic) economy, they increased productive output per person. This allowed less starvation, and therefore population grew faster (people won't breed into starvation, instinctually, like most animals...unless their religion convinces them to do such suicidal, infantcidal things). This happened gradually, and some cried "but the hunter/gatherer jobs are all disappearing!"...but that was good, a natural aspect of economic progress.

When the agrarian society gradually ended, it was industrial economics that replaced it. And they cried "but all the farming work is disappearing!"...but that was good, a natural aspect of economic progress, allowing population to grow (not vice versa), allowing hunger to further decrease as a pervasive problem in society, and individual wealth to grow. In fact, this transition raised productivity exponentially (some 60 times per man hour I've read in some sources). Again, this was good, but the laid-off farmers and sharecroppers predictably complained and tried to lobby for protectionism.

Now, industrial society is dying. What is happening is the technological revolution. Sure, some will cry "but all out industrial jobs are disapearing!"...but service jobs, on average, pay MORE. This isn't debatable. Show me a study that says otherwise, please. I dare you! Like I dared you to read every other FACT I posted. Why do people want their kids to be doctors and lawyers? Because they pay a lot, and are SERVICE jobs. One day, all manufacture will be automated, and we will be free to pursue other things. Sure, we all can't be doctors and lawyers, but that isn't the case now either...some people will always make crap money...and some won't. This downturn has caused issues with new jobs, many coming from crappy service sector jobs...but throughout periods of DECREASED protectionist tariffs, we have seen the most GROWTH in employment and pay in the sectors of utilities (like garbage men, sewer technicians, electric lineman, plumbers, etc.), medicine, law, and other SERVICE sector jobs.

Manufacturing, like agrarian and hunter/gatherer economies, had to die eventually. And yes, these transitions are often coupled with short periods (relatively) of a flat economy. But during the industrial revolution this was about a 20-25 year span...in the agrarian revolution, this lasted nearly a century...and today, as the Austrians stress, the economy would only need about 2 years to recover. Not just from recession, but also from the change-over to a technologically driven economy!

The idea we should be Luddites about this, and cry and smash the machines that are taking our jobs, is nonsense that has been proven stupid for hundreds of years now.

Free trade is the only way to be a free market capitalist...no free trade, no free market capitalism. So, are you guys the only other two kinds of capitalists, which amount to the same thing; Keynesians or mercantilists? I mean you basically get three choices of type of capitalist, free market, Keynesian (or some offshoot/variation), or mercantilist. I didn't make the rules or definitions, don't hate the player, hate the game.

So, which are you? Which of the other two possibilities do you claim? Which State dependent form of exploitative capitalism do you support to prop up oligarchies of your choice?

Free markets are not dependent on the State, and therefore are not open to the exploitation the government creates by writing regulation and using it's guns and laws to limit the free actions of consumers with their own property. Why do you reject this? By what moral theory (of any consistancy anyway)?

Look, you are crying about dinosaurs creeping into the La Brea tar...even though that means humans will run the Earth consequentally. Are you a dinosaur? If not, why cheerlead against the advancement of our species to top of the food chain? We may never evolved at all if the dinosaurs still ruled the Earth.

And this is what you do in economics, metaphorically. You are crying about the end of the manufacturing age, and the dawn of the less labor intensive, more productive, safer, service sector technological economy...even though it has done nothing except benefit us all. Sure, buggy whip makers went out of business when the stagecoach, buggy, and horse were replaced by the automobile...but who wants to "save" buggy whip makers' jobs and NOT have cars? Progress in an economy comes with growing pains, like lay-offs of less productive means of production and re-allocation of that labor. Overall, this benefits us all, including those longterm workers who evetually find higher paid jobs (evidenced by longterm studies on labor being re-allocated, and datas on labor and compensation during the industrial revolution).

One day, people will look back and laugh that people wanted to preserve manufacturing based economies instead of allowing the change to technological economies...just like we laugh that people fought the change from the agrarian dominated society to the industrial dominated society.

I know you guys will reply with still further nonsense...but that's it, I'm done. I have recieved ZERO retorts to my info, and ZERO links to anything that might dispute it. Good luck living in a fantasy land where facts that don't agree with you don't matter.

----------


## Cutlerzzz

> This is correct, but only to a point.  I would also dispute the lines of division of specialization at the national level.  Between companies within markets, sure.
> 
> Over-specialization is a real hazard for a nation.  If, for example, the markets for which their specialty does service collapse, that nation is going to be in some deep $#@!.  If the collapse if sudden and catastrophic, many would likely die.  Not saying this is likely - just illustrating the principle.  Imagine a nation that produces nowhere near enough food for all its people and its economy went bye-bye because of the precipitous rise of a disruptive technology that rendered their entire industrial basis obsolete in, say, 1 year.  That nation would be so very deep in the kimchee that it would hurt just thinking about it.  Entire economies are not likely to be able to respond in so short a time frame.  Given this, the nation in question would be at the mercy of its neighbors.  People and their politics being what they tend to be, what are the odds that such a nation would receive help without some major strings attached?  Nobody in their right mind would want to expose themselves to such a risk, however slim it might be.  We get on commercial aircraft, banking on the low likelihood that they will fall from the sky.  Planes still fall.


Well, as you said, that is highly unlikely. Specializing does not mean that everyone works in one industry. 

I also don't see how you're point about a new technology rendering everything obsolete makes sense. I don't see how a new form of technology making everything "obsolete" in just one year is a bad thing. That would just make everything that gets upgraded more efficient, creating more wealth. And just because it makes everything older obsolete does not mean that all production done by the old method stops. There is an increase in wealth in this scenario by my estimate.

----------


## The Grinning Maniac

Individual, you make a good point about the eventual end of the industrial age. It's inevitable. I worry about the end game and what we'll all be doing when everything is automated. But that's not the issue right now. The issue is companies choosing to move jobs (including high tech jobs) out of America because of labor and overhead cost differentials. The desire to raise stock prices. Not obsolence.

We're not complaining about machines being invented to take over certain work. We're complaining because existing manufacturing and service jobs are being shifted elsewhere...to other humans who won't get all uppity and ask for things like overtime pay or sick days. That is a problem for us.

But good rant, seriously. Thought provoking. 

PS: What are your thoughts on The Singularity? Feel free to PM me.

----------


## ProIndividual

Grimm, I'm Pming you 

Also, I believe my earlier posts on statist economic fallacies covered what you just brought up...they are super long posts, copied from blogs I wrote long ago...also I linked material. I know that isn't the main point of the problem, I addressed those issues earlier...I just wanted to add in something I didn't cover. That being, we do NOT need to preserve a industrial economy and fight the transition to a technologically dominated society. I know there are growing pains, but growth is assured, provided we stop fighting the markets as they try to clear themselves.

----------


## osan

> Well, as you said, that is highly unlikely. Specializing does not mean that everyone works in one industry.


I did not mean to imply that it does. 




> I also don't see how you're point about a new technology rendering everything obsolete makes sense. I don't see how a new form of technology making everything "obsolete" in just one year is a bad thing. That would just make everything that gets upgraded more efficient, creating more wealth. And just because it makes everything older obsolete does not mean that all production done by the old method stops. There is an increase in wealth in this scenario by my estimate.


It may indeed make _more_ wealth but is that wealth _better_?  Does more necessarily make life better, especially when the more remains concentrated in the hands of the few due to the particulars of a given rigged market?  People seem so stuck on the notion of quantity only.  It is great to strike it rich.  It is less so when you are one of the people on the short end who never had any real opportunity to rise above a certain level and character of "wealth".  Economics does not have to be a zero-sum, yet it is often played that way.  Economics has long been politicized - used as a means to groom the political landscape.  It has been used very effectively to establish and maintain a state of de facto tyranny and perhaps in some cases, even slavery.

One of the root problems is the admixture of mutually antagonistic elements in the overall political pot.  So-called "free markets" cannot readily coexist alongside the modern "nation state".  A truly free market is, for lack of a better word, "natural", whereas the nation-state is a purely artificial construct wherein large power is invariably concentrated into the hands of a few and access to the shirt tails of such men tends to be limited to those of a like feather.  This pretty well invariably results in a lot of inbreeding as the political power is further concentrated and broadened (e.g. "globalism").  Because of the inherent conflicts present in such circumstances, wherein the political and economic interests (as if the two were really separate in such cases) of those holding power are not well aligned with those of the rest, an organically free market is functionally impossible to realize.  How could it be otherwise?  And as it is between people, so we find it to be between nations because the functions and relationships are sufficiently close analogs.  Corporations and nations, when examined with even casual care, behave very much like statistically "average" individuals of the populations they represent.  This fact has a fractal-like quality to it.

The US courts have made a very big deal of the notion of separation of church and state.  This has, at best, proven to be a grand waste of time and effort, the results having been arguably a disaster for this nation in many ways.  All this churning over such a non-issue, yet the same courts have virtually ignored the centrally important question of the separation of economics and politics, perhaps through an erroneous or otherwise misguided interpretation of the welfare clause.  At some functional level political issues and those of economics must either be completely separated or completely integrated, or so it seems to me.  I don't see how the latter leads to anything but fascism, and I see no way to separate them sufficiently.  So what does that leave - a choice between descending into rank totalitarianism or freedom sapping feudalism?

It could be concluded that the very nature of humans is self-defeating.  I do not know this to be fact, but sometimes the appearances are very compelling.

----------


## osan

> Now, industrial society is dying. What is happening is the technological revolution. Sure, some will cry "but all out industrial jobs are disapearing!"...but service jobs, on average, pay MORE. This isn't debatable. Show me a study that says otherwise, please. I dare you! Like I dared you to read every other FACT I posted. Why do people want their kids to be doctors and lawyers? Because they pay a lot, and are SERVICE jobs. One day, all manufacture will be automated, and we will be free to pursue other things. Sure, we all can't be doctors and lawyers, but that isn't the case now either...some people will always make crap money...and some won't. This downturn has caused issues with new jobs, many coming from crappy service sector jobs...but throughout periods of DECREASED protectionist tariffs, we have seen the most GROWTH in employment and pay in the sectors of utilities (like garbage men, sewer technicians, electric lineman, plumbers, etc.), medicine, law, and other SERVICE sector jobs.


You fail to define "industrial society".  Without a definition of terms, your statement cannot readily be addressed.

----------


## eworthington

> So far I am the only no vote. I would keep some tariffs in place, even if other countries completely opened trade to us and didn't manipulate their currencies. 
> 
> Either you will fund our (future) limited government on the backs of our people or through tariffs.
> 
> Free trade abroad and taxation at home? No.


Tariffs are taxes on citizens; they are a punitive tax for buying a foreign product.

I'm not sure how that prevents citizens from being taxed to support a limited government.

----------


## eworthington

> The reason I ask is because tariffs were original methods of funding our republic and worked well for many years.
> 
> But I figured you for an anarchist or some flavor of one.  I also assume 74% that answered this poll are also anarchists, which leads me to believe most here *do not* want a limited Constitutional government at all or at best want to deny any method of funding one.


Lotteries, user fees, royalties from public lands, or levies on states (that they can fund however they wish), are all ways of financing a limited government without tariffs.

Tariffs were chosen at the start of the republic partly because many of them believed in mercantilism -- something that we should not seek to emulate.

----------


## showpan

> ..but service jobs, on average, pay MORE. This isn't debatable. Show me a study that says otherwise, please. I dare you!


Challenge accepted....this was too easy, since you must not have done too much research and I found tons of info that refutes your claim. 
Doctors and Lawyers are professional jobs, not service jobs....lol...I just killed that one!
60 million people46 percent of the American workforcein 2009 worked in the service sector as cashiers, office clerks, cooks, retail salespeople, or customer-service representatives. It's much higher now. 
According to data from the Bureau of Labor Statistics
These jobs pay half of what a manufacturing job pays and a third of what a professional job pays.

*Jul 23, 2010  U.S. Manufacturing Key Facts. Manufacturing Wage Rates. In June 2010, average hourly earnings in manufacturing were $18.54*
The International Trade Administration, U.S. Department of Commerce

*Dec 17, 2009  Median hourly wages of cashiers, except gaming in May 2008 were $8.49. The middle 50 percent earned between $7.50 and $9.72 an hour.*
Health and personal care stores	$8.71
Other general merchandise stores	8.60
Grocery stores	8.59
Department stores	8.38
Gasoline stations	8.16
www.bls.gov/oco/ocos335.htm


Manufacturing leads all sector employment in sales and ranks 4th in employment behind government, HC and retail.
So lets  put a little data behind this. The following table lists the 2010 national  sales and employment numbers for 2-digit NAICS industry sectors, ranked in  terms of total sales.

Industry Name Sales (Millions) Jobs  Employment Rank 
31-33 Manufacturing $4,444,349 12,116,153 4 
90 Government $3,055,594 23,931,184 1 
52 Finance and Insurance $2,335,933 9,276,170 8 
62 Health Care and Social Assistance $1,671,158 18,983,244 2 
54 Professional, Scientific, and Technical Services $1,482,841 11,711,344 6 
53 Real Estate and Rental and Leasing $1,391,188 7,374,135 11 
44-45 Retail Trade $1,194,951 17,369,914 3 
51 Information $1,135,475 3,252,198 18 
23 Construction $1,123,601 8,886,854 9 
42 Wholesale Trade $993,673 6,071,136 13 
48-49 Transportation and Warehousing $770,350 6,084,630 12 
72 Accommodation and Food Services $691,475 11,872,079 5 
56 Administrative and Support and Waste Management and Remediation Services $601,900 10,138,827 7 
81 Other Services (except Public Administration) $502,463 8,872,041 10 
22 Utilities $377,695 595,031 21 
55 Management of Companies and Enterprises $376,055 1,935,179 19 
11 Agriculture, Forestry, Fishing and Hunting $360,521 3,456,096 17 
21 Mining, Quarrying, and Oil and Gas Extraction $355,246 1,410,588 20 
61 Educational Services $260,555 4,080,407 14 
71 Arts, Entertainment, and Recreation $208,984 3,780,900 16 
 Total $23,334,007 171,198,110  
Source: EMSI Complete Employment, 4th Quarter 2010 

Industry Sector	                                                             Sales Per Worker
Utilities	                                                                           630K
Manufacturing	                                                                   370K
Information	                                                                           350K
Finance and Insurance	                                                           250K
Mining, Quarrying, and Oil and Gas Extraction	                           250K
Real Estate and Rental and Leasing	                                           190K
Management of Companies and Enterprises	                           190K
Wholesale Trade	                                                                   160K
Government	                                                                           130K 
Professional, Scientific, and Technical Services	                           130K
Construction	                                                                   130K
Transportation and Warehousing	                                           130K
Agriculture, Forestry, Fishing and Hunting	                                   100K
Health Care and Social Assistance                                               90K
Retail Trade	                                                                            70K
Accommodation and Food Services	                                            60K
Admin and Support and Waste Mngmnt and Rem Services	            60K
Other Services (except Public Administration)	                            60K
Educational Services	                                                            60K
Arts, Entertainment, and Recreation	                                            60K
Source: EMSI Complete Employment, 4th Quarter 2010
unfortunately, vBulliten does not support <> tags and I couldn't get the table to show in it's correct form so it would be easier to read.

*When it Comes to Income Manufacturing is Still King*

At $4.4 trillion in total sales, manufacturing is by far the biggest income generator in our nation, despite a fairly rapid decline in employment (manufacturing has slipped to fourth in overall employment). Despite these trends, manufacturing still manages to far outperform all other industries in terms of pure income creation. Each individual that works in manufacturing generates roughly $370,000 per year. This is a very important fact to consider in a day and age when many folks advocate for improving the service sectors. 
Again, heres the thing to note: sectors like manufacturing that generate more income per worker have much bigger ripple effects, creating much more impact in a region while helping to raise wages in lower-productivity service sectors. 

*Retail Trade vs. Information*

The retail trade and information industry sectors have similar income generation ($1.19 trillion and $1.13 trillion, respectively), however, retail trade is five times the size of information in terms of employment. This is why every economic developer is looking for the next Facebook and not the next Napa Auto Parts. Retail trade only generates $70K per worker while information generates $350K per worker.

*So whats wrong with a service-based economy? It shrinks manufacturing employment as well as the manufacturing sectors ability to prop up wages. A labor market that loses wage pressures of high-productivity manufacturing industries will settle at wage rates lower than markets where this wage-boosting effect is present. Economic development policy makers should be careful about shunning manufacturing or other production sectors in favor of service sectors.*

This was Interesting:
*IHS Global Insight Study Finds India's Manufacturing Labour Costs Top China in 2010*
Auto sector in particular feels the pinch of rising labour costs
For multinational companies, understanding the labour costs associated with manufacturing facilities around the globe is a key issue when making investment decisions. India and China have long attracted foreign investment given relatively low risk profiles and their high levels of surplus labour.
Total labour costs in India's formal manufacturing sector are expected to average US $2.68 per hour in 2010 compared to China's US $2.51. Basic wages have risen fast in India over the last year, but still lag China -- India averages US $1.71 per hour, to China's US $1.82.
Benefits are key difference
The difference in overall costs between both countries is in benefits. India's benefit structure includes contributions to the Provident fund (social security), survivor insurance, pension contributions, state-mandated 13th month pay, and double pay for overtime.
As basic wages rise, then benefits increase accordingly which can add considerably to companies costs, especially in India, Lewis said.
http://press.ihs.com/press-release/c...acturing-labou

In 2009, 43.6 million people lived in poverty, up from 39.8 million in 2008, The poverty threshold for a family of four is an annual household income of $21,954. 
Government safety net programs prevented more people from falling into poverty. Social Security kept 14 million people afloat, and unemployment insurance did the same for more than two million people, according to the report.
http://www.census.gov/hhes/www/pover...009/index.html

Here are some charts that show us what has happened since the loss of manufacturing.

U.S. Unemployment (unemploymant numbers are rigged to not include anyone who's benefits have run out, anyone who is enrolled in a class and a nuber of other factors to make things look better than they are.


Length of Unemployment


Manufacturing loss


Income distribution is relevant because this tells us where the money has gone 


foreign employment vs U.S. employment
http://mgx.com/blogs/wp-content/uplo...3.44.38-PM.png

----------


## ProIndividual

> You fail to define "industrial society". Without a definition of terms, your statement cannot readily be addressed


The economy defined by industrial production, as opposed to automated technological production.

No one should have any problem with what I'm describing given the explanation about hunter/gatherer vs agrarian society, or agrarian vs industrial...I mean, it's self evident. 

Did you have a confusion regarding the definitions of "hunter/gatherer" or "agrarian" or "industrial"? No. So what you are attacking is semantical. It's clear I'm describing an economic revolution we are undergoing now, where automation in production replaces human labor, and our labor is allocated elsewhere, like to the service sector, and intellectual pursuits. I fully expect that one day the service sector will be automated as well...and again this will be GOOD overall for the economy (preceded by some growing pains in employment and earnings). This what David Ricardo called "labor set free" when discussing the industrial revolution's effects on agrarian based employment and earnings for agrarian workers. It's also the same process that happened when we left hunter/gatherer society behind, in favor of the more productive and efficient agrarian society.

I hope that clears it up...but I can't imagine anyone else had any issue understanding what I meant. If anyone did, please say so.

----------


## Cutlerzzz

I should let Pro Individual handle this, but as he's probably not here right now and this won't be difficult.




> Challenge accepted....this was too easy, since you must not have done too much research and I found tons of info that refutes your claim.


Most of your claims are either factually incorrect, prove his point, or taken out of context.





> Doctors and Lawyers are professional jobs, not service jobs....lol...I just killed that one!


Read this.

http://en.wikipedia.org/wiki/Tertiar...of_the_economy

Those are a form of service sector jobs.





> U.S. Unemployment (unemploymant numbers are rigged to not include anyone who's benefits have run out, anyone who is enrolled in a class and a nuber of other factors to make things look better than they are.


That statistic shows that there was a nasty recession. It shows nothing about the general trends of unemployment. Actual historical unemployment rates look like this.



As you can see, before 2008 unemployment had been at normal levels since the depression.





> Length of Unemployment


That line is nearly flat before 2008. It actually hurts your argument.





> Manufacturing loss


That shows manufacturing job loss, not manufacturing loss. As we have already noted, there has not been a general trend of job loss, just manufacturing job loss. However, manufacturing is at by far the highest levels in history.



As you can see, manufacturing is at all time highs in the United States. 





> Income distribution is relevant because this tells us where the money has gone


Your link only shows income, not total compensation. 

Wages are up when you include total compensation.



http://mises.org/Community/forums/t/15824.aspx

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## showpan

Here is the bottom line folks....free trade and open borders will never exist unless the entire world becomes one. A one world government, one world currency, a United Earth....While it sounds cool, a utopia where all people were free to come and go and do what they want without gooberment interference.....this is a pipedream and the closest thing you are going to get is the New World Order.....a world run by corporations who do not believe in competition, free markets, freedom or liberty. At the current rate of mergers and acquisitions....soon there won't be much choice at all and only a handful of corporations will own everything.

This forum:
*Mission Statement*: Inspired by US Rep. Ron Paul of Texas, this site is dedicated to facilitating grassroots initiatives that aim to restore a sovereign limited constitutional Republic based on the rule of law, states' rights and individual rights. We seek to enshrine the original intent of our Founders to foster respect for private property, seek justice, provide opportunity, and to secure individual liberty for ourselves and our posterity.

*Our founding fathers believed in tariffs and built this nation with them, not on our taxes. Where is all the prosperity now?*

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## showpan

Wow, someone needs to make a graph for denial here, it would be off the charts....lol
How can anyone reject actual figures and stats from the very globalists they support?
I'm going to edit that wiki page right now...lol...it will soon look like Paul Revere's page!!!

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## Cutlerzzz

> Wow, someone needs to make a graph for denial here, it would be off the charts....lol
> How can anyone reject actual figures and stats from the very globalists they support?
> I'm going to edit that wiki page right now...lol...it will soon look like Paul Revere's page!!!


If you stopped posting figures you didn't understand this wouldn't have to happen.

----------


## ProIndividual

Showpan...

Here come a ton of criticisms about your data...

I want to attack your use of these arbitrary statistics before I show how truely arbitrary (and erroneous) they are.




> Doctors and Lawyers are professional jobs, not service jobs....lol...I just killed that one!


Wrong...they do not produce a physical product in an industrial production process...all "professional" jobs are service jobs. They only provide a service, there is no physical product.




> There were 2.3 million people employed in BC in 2008. Of these, 1.8 million worked in the service sector, while 502,000 were employed in goods-producing industries.
> 
> The stereotype of a service-sector worker (someone with little training and limited skills who works part-time for minimum wages) is not accurate.
> 
> Although there are many entry-level positions and minimum-wage jobs in the service sector, service-sector jobs exist at all levels of training and at all points along the pay scale. Many people who work in service industries—airline pilots, engineers, computer scientists, doctors, lawyers, university professors, to name just a few—are both highly trained and well paid, as are longshore workers, ferry and railway workers, and numerous others who work in this sector.


So, fallacy one is debunked. Here is the link to the article:

http://www.guidetobceconomy.org/bcs_...employment.htm

Now, you assert that industrial jobs make more money...but the wage gap has been steadily declining, and with comparable experience and specialization across sectors (years of experience, etc.), service sector jobs make more money. True, the industrial base makes more per hour, slightly, and I'll quote that too...but this gap is about to flip the other way, unless trends suddenly change (which they aren't). Also, service jobs work LESS hours, meaning they get more for their time. It's also not labor intensive, meaning your working life is longer (as is life expectancy). So, even if you just say per hour industrial jobs "make more", it only applies at the entry level, and when experience is compared, the service sector gets more and quicker advancement. In other words, your industrial wet dream is based on a unionized level pay scale, hence why the MEDIAN wage is higher...not average wage, MEDIAN (where 50% of the population fall above or below). Service sector jobs are FAR LESS unionized, and therefore have a top heavy pay scale...like it SHOULD in a free market. So, sure, the MEDIAN level is less, but the room for advancement in terms of compensation is VASTLY better.




> Until recently, the wage gap between workers in the goods and service sectors had been declining. In 1997, the wage difference was $2.04; it had shrunk to just over a dollar by 2005...


Any decline in this progress of service jobs overtaking industrial jobs in terms of compensation is directly tied to the economic downturn...not the process of technological and service based economic revolution we are undergoing since the 1980s.




> Eight out of 10 workers in the province are employed full time. Part-time employment is quite common in the service sector, where nearly a quarter of the workers spend less than 30 hours a week on the job. In the goods industries, relatively few (one in 12) workers are employed part time. 
> 
> In the service sector, where part-time employment is more common, workers spend an average of 35 hours a week on the job. The average work week in the goods sector is longer (40 hours per week). For all industries, the average work week is 36 hours long.
> 
> 
> Employment in the goods sector is quite seasonal: the number of jobs tends to peak in the summer and is lowest at the beginning of the year. In the service sector, employment is more stable, but also shows some seasonal variability. The number of people working in service industries is usually lowest in January.
> 
> Unemployment rates vary significantly among industries. Seasonal variations in the need for workers play a big role in the likelihood of unemployment in some industries. For example, people with jobs in industries such as agriculture, fishing, and construction may only be able to work at certain times of the year.
> 
> ...


As you can see, you'd much rather be in a service sector job during an economic downturn, than an industrial job. Not only are you more likely in normal times to be layed-off, but in a downturn it worsens exponentially. The stability and growth is continuously in service sectors, not industrial.

This may of escaped you since you fallaciously took all the high paying "professional" service sector jobs out of your equations and numbers.

The other issue you face is...your higher wages, if you consider that to be the case, is only at the expense of higher unemployment rates. Those wages are higher WHY?

Because they are union. The union creates higher unemployment rates as it selfishly gets wages above market value...so when you take MARKET VALUE, not your union utopia you seem to favor, wages in the service sector are HIGHER, and unemployment is LOWER, not to mention shorter in duration. So, sure, union jobs pay more....and poor people stay laid off longer, and some NEVER find jobs due to the unemployment union premium wages cause. No unions, no advantage for industrial wages (hence my point, in a free market SERVICE JOBS PAY MORE).

I suppose you want to perpetuate higher unemployment for the poor in order to "fudge" your wage statistics? Is that how you win a debate? Do you fix the problem by continuing to promote an anti-free market? Or do you solve it by moving toward a free market? Hmmmmmm.




> Unemployment rates are higher, and more volatile, in the goods sector








As you can see, my assertions are correct...there is NO advantage for industrial workers in this area. There is one for service workers. 

And yes, I'm using Candian stats for now, although I'll go back to USA stats, only because we have very similar stats, and these were easily on hand, whereas I figure you can spend the time to look at the mirror-image American stats in these areas.

http://www.ehow.com/about_5419144_se...-industry.html

Between the two links I gave so far, you'll find all my quotes and charts to this point.



Now, as I said, the fact you use median numbers benefits the union jobs in this analysis. What you should use is average or mean...but even if both are still higher in industrial jobs, this is a slight difference (even by your stats), and that difference is EASILY attached to unionization...not any free market reason. Unless you are about to start railing for unions, just stop it now...lol.

But if you do rail for unions, I have plenty of charts stats on hand to show you they DO NOT help an economy AT ALL. They hurt it in fact. You are stepping over dollars to pick up pennies.

Now, you go on to list a bunch of industry specific stats and totals...but if you add all those sectors together that make up the service sector in total, it tops the chart. Go ahead, I'll wait (lol), add up all the service jobs on that list...it takes over the top spot from manufacturing...wow! See how defining service sector jobs correctly helps the stats pan out in my favor? You're welcome.

The same applies to the "per worker" list.



Your unemployment chart is way to short term to conclude anything at all...so it's useless. I'll provide a better one near the end of the blog.

Actually all of your charts except maybe 2 are too short term to draw any conclusions. 

This process began in the 1980s...so any chart not covering this time span is just not helpful (in this debate anyway).


Again, I'll link the same blogs I always link, and again I'm sure you won't read them:

Statist Economic Fallacies: Breaking Through the Nonsense (Part I)

http://www.campaignforliberty.com/blog.php?view=41436

The other 2 parts of this blog are found at a link at the top of the linked page. I'm just going to copy and paste what I think MAY be relevant.





4. Tariffs that limit imports, and policies that encourage exports, are good ideas

The fallacy that government is a better judge of the most profitable modes of directing labor and capital than individuals is well illustrated by exporting policies. In the twentieth century, the federal government has sought to promote exports in various ways. The first was by forcing open foreign markets through a combination of diplomatic and military pressure, all the while keeping our own markets wholly or partially closed. The famous "open door" policy, formulated by Secretary of State John Hay in 1899 was never meant to be reciprocal (after all, he served in the McKinley administration, the most archly protectionist in American history), and it often required a gun boat and a contingent of hard charging marines to kick open the door.

A second method was export subsidies, which are still with us. The Export-Import Bank was established by Roosevelt in 1934 to provide cash grants, government-guaranteed loans, and cheap credit to exporters and their overseas customers. It remains today-untouched by "alleged" free market Republican administrations and congresses.


A third method was dollar devaluation, to cheapen the selling price of American goods abroad. In 1933, Roosevelt took the country off the gold standard and revalued it at $34.06, which represented a significant devaluation. The object was to allow for more domestic inflation and to boost exports, particularly agricultural ones, which failed; now Bush is trying it.

I'd just like to point out, FDR's agriculture policies caused the "soup lines" or "bread lines" we always hear so much about. He had 10 million acres of crops destroyed and 6 million farm animals killed in order to boost domestic food prices for producers. This raised the price of food. His subsidies to export made exporting the food more profitable than selling it domestically. The combination of the two led to food shortages. So, next time some liberal claims that stimulus and bailouts prevented "soup and bread lines", remind them those were the fault of FDR and bad economics. It doesn't even matter that stimulus and bailouts don't work (or work well), it's enough the Obama administration isn't as dull on economics as their Roosevelt predecessors. We simply don't have these "soup and bread lines" because no one is repeating FDR's mistakes, which caused them to begin with.


A fourth method, tried by the Reagan administration, was driving down farm prices to boost exports, thereby shrinking the trade deficit. The plan was that America would undersell its competitors, capture markets, and rake in foreign exchange. (When others do this it is denounced as unfair, as predatory trade.) What happened? Well, it turned out that the agricultural export market was rather elastic. Countries like Brazil and Argentina, depending on farm exports as one of their few sources of foreign exchange, which they desperately needed to service their debt loads, simply cut their prices to match the Americans. Plan fails.


But it got worse: American farmers had to sell larger quantities (at the lower prices) just to break even. Nevertheless, although the total volume of American agricultural exports increased, their real value (in constant dollars) fell - more work, lower profits. Furthermore, farmers had to import more oil and other producer goods to expand their production, which worsened the trade deficit. Then, there were the unforeseen and deleterious side-effects. Expanded cultivation and livestock-raising stressed out and degraded the quality of the soils, polluted watersheds, and lowered the nutritional value of the expanded crop of vegetables, grains, and animal proteins.

The author says "worsened" trade deficits, in italics, for a reason. Trade deficits are not negative, and the fact people think trade deficits are negative is itself a fallacy. We will cover this fallacy here, after we have finished with this part.


Finally, the policy of lower price/higher volume drove many small farmers, here and abroad, off the land, into the cities, and across the border, our border. Here is an economic policy that not only failed in its purpose but worsened the very problem it was intended to alleviate, and caused a nutritional, ecological, and demographic catastrophe.

I wished the author would have also italicized "problem", as to further drive home the point that trade deficits are not negative. So, let's address this fallacy now.


•The instinctive reaction of politicians is that if one country places a tariff barrier on our exports, we should respond by doing the same. However economic theory suggests that placing a tariff barrier on imports leads to a loss of economic welfare. It is better to not retaliate.

Time and time again, trade restrictions like tariffs have hurt our country's economy, not helped it.


The Embargo Act of 1807 and the subsequent Nonintercourse Acts were American laws restricting American ships from engaging in foreign trade between the years of 1807 and 1812. They led to the War of 1812 between the U.S. and Britain.

Despite its unpopular nature, the Embargo Act did have some limited, unintended benefits, especially as entrepreneurs and workers responded by bringing in fresh capital and labor into New England textile and other manufacturing industries, lessening America's reliance on the British merchants.[8] (Since the damage that was caused was so widespread and severe, you can liken this to 'stepping over dollars, to pick up pennies')

The Embargo was in fact hurting the United States as much as Britain or France. Britain, expected to suffer most from the American regulations, found consolation in the development of a South American market, and the British shipowners were pleased that American competition had been removed by the action of the U.S. government.

The attempt of Jefferson and Madison to resist aggression by peaceful means gained a belated success in June 1812 when Britain finally promised to repeal her Orders in Council. The British concession was too late, for by the time the news reached America the United States had already declared the War of 1812 against Britain.

The entire series of events was ridiculed in the press as Dambargo, Mob-Rage, Go-bar-'em or O-grab-me ('Embargo' spelled backward); there was a cartoon ridiculing the Act as a snapping turtle, named "O' grab me", grabbing at American shipping.



 Smoot-Hawley Tariff Act

The Tariff Act of 1930, otherwise known as the Smoot-Hawley Tariff or Hawley-Smoot Tariff (P.L. 71-361)[1] was an act, sponsored by United States Senator Reed Smoot and Representative Willis C. Hawley, and signed into law on June 17, 1930, that raised U.S. tariffs on over 20,000 imported goods to record levels.[2]

The overall level tariffs under the Tariff were the second-highest in US history, exceeded (by a small margin) only by the Tariff of 1828[3] and the ensuing retaliatory tariffs by U.S. trading partners reduced American exports and imports by more than half.

Some economists have opined that the tariffs contributed to the severity of the Great Depression.[4][5][6]

U.S. imports decreased 66% from US$4.4 billion (1929) to US$1.5 billion (1933), and exports decreased 61% from US$5.4 billion to US$2.1 billion, both decreases much more than the 50% decrease of the GDP. ( I want everyone to notice, we are in an era of a horrible economy with high unemployment and trade surpluses. In 1929, the trade surplus was $1 billion, this did not however translate to long term growth or more employment. In 1933, we ran a smaller trade surplus and had worsening effects, along with LESS TRADE OVERALL. Trade surpluses (foreign exchange deficits) are often regarded as good, but they have almost never translated into higher growth rates or low unemployment rates. The higher growth rates and lower unemployment rates are found in periods of high trade deficits (foreign exchange surpluses). The very way governments come up with trade numbers, and whether a nation has deficits or not, has been criticized as nearly erroneous, by free market economists from Frederic Bastiat to Don Boudreaux. Bastiat demonstrated that a government can record a deficit, even though a net profit was made by their citizen who was involved in the trade. This is counter intutitive, but deductively logical. The government numbers record the price at sale, not the resale value and profit made. When this profit is taken into account, then the only debt in the 'trade deficit' that is not covered by the foreign exchange surplus is government debt acrued by borrowing from foreigners. When people say "we need to do something about the trade deficit", I say "yes we do, we need to stop letting the government run in deficit and debt by borrowing money from foreigners". The common misconception is that unbalanced, or even unreciprocated, trade is bad for the economy. In fact, private sector trade is not debt, and is not bad for the economy at all. It's the debt the government runs up in the trade deficit that materializes as debt, and gives trade deficits a bad name. Private sector trade, good...Public Sector borrowing, bad. As you can see from the severely diminished trade numbers above, protectionism shrinks the economic pie, while free trade (or at least free-er trade) expands the total economic pie, benefiting everyone.)

According to government statistics, U.S. imports from Europe decreased from a 1929 high of $1,334 million to just $390 million during 1932, while U.S. exports to Europe decreased from $2,341 million in 1929 to $784 million in 1932. Overall, world trade decreased by some 66% between 1929 and 1934.[15]

Although the tariff act was passed after the stock-market crash of 1929, some economic historians consider the political discussion leading up to the passing of the act a factor in causing the crash, the recession that began in late 1929, or both, and its eventual passage a factor in deepening the Great Depression.[16] Unemployment was at 7.8% in 1930 when the Smoot-Hawley tariff was passed, but it jumped to 16.3% in 1931, 24.9% in 1932, and 25.1% in 1933.[17]

Imports during 1929 were only 4.2% of the United States' GNP and exports were only 5.0%. Monetarists such as Milton Friedman who emphasize the central role of the money supply in causing the depression, downplay the Smoot-Hawley's effect on the entire U.S. economy.[18]

I think it's fair to say the money supply was responsible for the deflation (too little money in circulation), and the tariffs were responsible for reduction in trade and GDP, overall.

I think it's pretty clear, interfering in the economy to spur exports or reduce imports only hurt the economy. Which, by chance, brings us to our next fallacy...





5. The fallacy of trade deficits

The 19th century economist and philosopher Frédéric Bastiat expressed the idea that trade deficits actually were a manifestation of profit, rather than a loss. He proposed as an example to suppose that he, a Frenchman, exported French wine and imported British coal, turning a profit. He supposed he was in France, and sent a cask of wine which was worth 50 francs to England. The customhouse would record an export of 50 francs. If, in England, the wine sold for 70 francs (or the pound equivalent), which he then used to buy coal, which he imported into France, and was found to be worth 90 francs in France, he would have made a profit of 40 francs. But the customhouse would say that the value of imports exceeded that of exports and was trade deficit against the ledger of France.[30]

In the above example, there is a single trader who is traveling and trading across national borders. The Frenchman owns a cask of wine worth 50 francs, and travels with it to England. France records an export of 50 francs, England an import of 50 francs.. In England, he sells his wine for 70 francs (or the pound equivalent) and buys 70 francs worth of English coal. He then leaves England for France with the 70 francs of coal, so that Enland records this as an export and France as an import. So, England has exported 20 francs more than it has imported, for a trade surplus of 20 francs. Meanwhile France imported 20 francs more than it exported, for a trade deficit of 20 francs. This is the last time the trade is recorded by either government, the entire reason why trade numbers are irrelevant in most cases to trade effects. Therefore, it's important to notice that the nation with the trade surplus (England) actually "lost money" on the trades, while the nation with the trade deficit (France) actually made all the profits. But the trade did not conclude with the importation of 70 francs of English coal by the Frenchman...he then sells it in his native France for 90 francs, without any government recording it as an import/export. This means the trader profited 40 francs overall (he turned 50 francs of wine into 90 francs), and yet his government calls it a 20 franc loss. The idea he lost money for himself, or for his nations GDP, is erroneous.



The idea trade surplus or deficit is directly tied to whether the trade is "balanced" or not, is fallacious. The trade deficit is exactly balanced by the foreign exchange surplus in the private sector. The trade surplus is exactly balanced by the foreign exchange deficit. Every product traded for currency is an investment in currency. Every trade of currency for a commodity is an investment in that commodity. There basically is no such thing as "balanced trade", because every trade is balanced by virtue of the fact they are voluntary, and because of the inverse relationship of trade and foreign exchange. Trade and foreign exchange are negatively correlated.

By reductio ad absurdum, Bastiat argued that the national trade deficit was an indicator of a successful economy, rather than a failing one. Bastiat predicted that a successful, growing economy would result in greater trade deficits, and an unsuccessful, shrinking economy would result in lower trade deficits. This was later, in the 20th century, affirmed by economist Milton Friedman.

Contrary to popular misconception, trade deficits are correlated with higher growth rates, lower unemployment, and wealthier periods. The opposite is true for trade surpluses. We should embrace trade deficits, if in fact we put any creedance in them at all.


Part 2 is next, that's only a piece of the info.

----------


## showpan

> If you stopped posting figures you didn't understand this wouldn't have to happen.


Hehe...typical neocon globalist response, why not rewrite our whole history....lol

----------


## ProIndividual

Part 2:

6. Immigration causes unemployment or lower wages for natives

Immigrants increase the supply of labour but they also increase Aggregate Demand in the Economy. This means that they buy more goods and create additional demand in the economy. They provide labour supply and increase labour demand.

If immigration caused unemployment why did America not have high unemployment during times of mass immigration? Because the immigrants created as many jobs as they took.

Often immigrants take jobs that native workers just don't want to do. - You won't see big multinationals cueing up to stop immigration.

Furthermore immigrants tend to be of working age. Therefore they tend to contribute more tax than receive in benefits. Without immigration US demographics would have a larger % of dependent old people.

Fears that immigrants threaten American workers are mostly misplaced. Just as working women haven't deprived men of jobs, immigrants create jobs as well as filling them--both when they spend their wages and in complementary lines of work. Mexican construction workers, for instance, create jobs for Americans selling building materials, as well as spending their wages at Wal-Mart ( WMT - news - people ).

Nor do immigrants depress wages, since they rarely compete directly with native-born Americans for jobs. On the contrary, their efforts often complement one another. A foreign nanny may enable an American doctor to return to work more quickly after childbirth, where hardworking foreign nurses and cleaners enhance her productivity. Research by Gianmarco Ottaviano of Bologna University and UC, Davis' Giovanni Peri found that the influx of foreign workers between 1990 and 2004 raised native-born Americans' wages by 2%. Only one in ten--high school dropouts--lost slightly, by 1%. All Americans benefited from higher capital returns, cheaper goods and services and faster productivity growth.

Immigrant diversity and dynamism stimulates new ideas and businesses. Migrants are a self-selected minority who tend to be young, hardworking and enterprising. Like starting a new business, migrating is risky, and hard work is needed to make it pay off. Immigrants are 30% more likely than native-born Americans to start their own business.

That number would surely be higher if we legitimized their status. People who lack formal property and business rights can't get a bank loan to start a business or ink legally enforceable contracts. Legalizing them would unleash their entrepreneurial energies and swell tax revenues.

Exceptional individuals who generate brilliant new ideas are often migrants. Instead of following conventional wisdom, they tend to see things differently, and as outsiders they are more determined to succeed. Nearly a quarter of America's Nobel laureates were born abroad. Nearly half of Silicon Valley's venture capital-funded startups were cofounded by immigrants. No one could have guessed when he arrived at age 6 as a refugee from the Soviet Union that Sergey Brin would go on to cofound Google ( GOOG - news - people ). How many potential Brins does America turn away--and at what cost?

Immigration limits not only make us less safe by encouraging people to not get background and medical checks, but are impossible to expect immigrants to follow:




As you can see, no 30 year old Mexican with a H.S. diploma, and a U.S. citizen sister already in the U.S. , is going to wait an estimated average wait time of 131 years. It's untrue to say "they need to just wait in line like everyone else", as most of these quotas and restrictions on immigration were not in effect when our ancestors came, and if they were, many would of came anyway (as in the people fleeing fascism or famine). We create criminals with the law, not the other way around. We are trying to fight free market forces in the exchange of labor and goods (the cardinal rule in free market economics), and expecting that it will remain enforcable. I won't even go into the ethical and moral implications. Natural law is a great argument here, but that's for another time.

The fact is, there has never been a negative correlation between native poverty and unemployment rates and immigration levels. At times, there has been a positive correlation. This means immigrants can be a net benefit to a society, both in terms of employment levels and wage rates for natives, but they cannot be a drag on either. Like all other free exchange, this creates more activity in the economy, not less.



7. You can't have open borders in a welfare state

Many worry that if America opened its borders now, millions would come, the welfare burden would be unsustainable and society would collapse. Yet such fears are misplaced. Most people don't want to leave home at all, let alone forever. Since 2004 three rich European countries--Britain, Ireland, and Sweden--have allowed people in eight poor eastern European countries (notably Poland) to come work there freely. All 75 million of those eastern Europeans could have moved, yet only 1 million did--and half have already gone home.

The belief that free migration is incompatible with a welfare state--asserted by Milton Friedman and recently echoed by Paul Krugman--is also incorrect. When in 2004 Poles were given the option of moving to Sweden--which has the most generous welfare state on earth--or to Britain and Ireland, which denied Poles access to any benefits until they had worked for a year, less than 1% opted for Sweden. America, too, could deny immigrants access to welfare initially.

Opening up to eastern Europeans gave Britain a big boost. Growth soared. Unemployment fell. Wages continued to rise. Newcomers paid much more in taxes than they took out in benefits and public services. After the global financial crisis plunged the economy into recession, many Poles went home rather than remain unemployed in Britain. Considering that Sweden is as rich as the U.S. and that Romania is poorer than Mexico, if open borders can work within the European Union, they can work in North America.

Allowing people to move freely is not just a matter of economic self-interest. It is also a moral imperative: Freedom of movement is a basic human right that should not be denied to people less fortunate than ourselves.

In February 2011, Reason Foundation senior policy analyst Shikha Dalmia spoke at the International Students For Liberty Conference about immigration.

Calling for open borders, Dalmia argues that immigrants create more wealth than they consume and that an increasingly globalized economy inevitably means that people, like goods and services, will be crossing borders in growing numbers. While nativists and protectionists may view such developments with alarm, allowing people to move more freely is a great advance both for human rights and economic progress.

In this video, she also addresses several mini-fallacies being spread by "libertarians" who call for closed borders (among other statist policies), like Hans Hermann Hoppe.

http://www.reason.tv/video/show/shik...ves-lecture-on


11. Hamilton was an economic genius and was just great

Another myth is that the financial genius and economic statesmanship of Alexander Hamilton saved the credit of the infant United States and established the sound financial and economic foundation essential for future growth and prosperity. Ron Chernow's hagiographic biography of Hamilton is now moving up the best seller charts, cluttering the display tables of Borders and Barnes & Noble, and taking up time on C-Span's Booknotes; but its greatest contribution will be to perpetuate the Hamilton myth for another generation.


Sumner's concise and devastating biography of that vainglorious popinjay, written over a hundred years ago, remains the best. He closely studied Hamilton's letters and writings, including the big three - his Report on the Public Credit (1790), Report on a National Bank (1790), and Report on Manufactures (1791) - and came to three conclusions: first, the New Yorker had never read Smith's Wealth of Nations (1776), the most important economic treatise written in the Anglo-American world in that period; second, he was a mercantilist, who would have been quite at home serving in the ministry of Sir Robert Walpole or Lord North; and third, Hamilton believed many things that are not true - that federal bonds were a form of capital; that a national debt was a national blessing; that the existence of banks increased the capital of the country; that foreign trade drained a country of its wealth, unless it resulted in a trade surplus; and that higher taxes were a spur to industry and necessary because Americans were lazy and enjoyed too much leisure.


The idea here was that if you taxed Americans more, they would have to work harder to maintain their standard of living, thus increasing the gross product of the country and providing the government with more revenue to spend on grand projects and military adventures. Hamilton was once stoned by a crowd of angry New York mechanics. Is it any wonder why?

13. Minimum wage laws and unions increase standards of living

Why do wages rise?

Ludwig von Mises largely explains this, but some is left to mystery, as it always has been. No one has ever truelly answered this question, although I will do my best to do so, after ripping off the ideas of others as all good scholars do. Mises said "[o]ur economic system - the market economy or capitalism - is a system of consumers' supremacy. The customer is sovereign; he is, says a popular slogan, 'always right.' Businessmen are under the necessity of turning out what the consumers ask for and they must sell their wares at prices which the consumers can afford and are prepared to pay. A business operation is a manifest failure if the proceeds from the sales do not reimburse the businessman for all he has expended in producing the article. Thus the consumers in buying at a definite price determine also the height of the wages that are paid to all those engaged in the industries."

So the first thing to understand is, wages are ultimately determined by many factors, chiefly of which is what consumers are willing to pay for a product the laborers are producing. So wages, like taxes, are paid by consumers not producers. This can lead you to the fallacy that labor costs are the most influential aspect of pricing in the market, which it is not. But in markets with low profit margains, like farming and construction, labor can act in such a way, as to seemingly prove the larger economic fallacy (see the labor theory of value versus the subjective theory of value). Without getting stuck in this fallacy, we can still see how effects of consumer tastes and utility (see utility theory) effect wages, albeit in industry specific ways.

Again, I defer to Mises for further factors:

"The buyers do not pay for the toil and trouble the worker took nor for the length of time he spent in working. They pay for the products. The better the tools are which the worker uses in his job, the more he can perform in an hour, the higher is, consequently, his remuneration. What makes wages rise and renders the material conditions of the wage earners more satisfactory is improvement in the technological equipment. American wages are higher than wages in other countries because the capital invested per head of the worker is greater and the plants are thereby in the position to use the most efficient tools and machines. What is called the American way of life is the result of the fact that the United States has put fewer obstacles in the way of saving and capital accumulation than other nations. The economic backwardness of such countries as India consists precisely in the fact that their policies hinder both the accumulation of domestic capital and the investment of foreign capital. As the capital required is lacking, the Indian enterprises are prevented from employing sufficient quantities of modern equipment, are therefore producing much less per man-hour and can only afford to pay wage rates which, compared with American wage rates, appear as shockingly low.

There is only one way that leads to an improvement of the standard of living for the wage-earning masses, viz., the increase in the amount of capital invested. All other methods, however popular they may be, are not only futile, but are actually detrimental to the well-being of those they allegedly want to benefit."

So, another major factor in wage levels are the technologies used in production. Indeed, David Ricardo's "comparative advantage" and "labor set free" come into play here, showing how short term lay-offs in the pursuit of cheaper production actually leads to higher wages, more consumer spending, and therefore higher employment rates. This also applies to the dreaded (sarcasm) outsourcing and low paid immigrant labor (legal or "illegal") in most cases, the exceptions being when these things are subsidized or given tax breaks (or other monopolist regulation) in order to promote them above market levels (which is occuring, btw).

This leads me to the epiphany that wealth is created by increasing not the capital involved, or decreasing the cost of labor, but by maximizing the number of tasks that can be taken on. That is to say, what makes America wealthier than other nations, even those with larger populations, is that America out-tasks those countries. Americans in general out-task all other peoples. We invented "multi-tasking". I believe that multi-taking, short attention spans, and acceptance of the chaotic nature of reality (especially economics) will lead directly to the extinction of poverty as we know it, and the upward trajectory of the wages of the masses. The future, if I'm right, will be determined by only your skills, the ability to find people to pay for those skills, and the amount of tasks you can handle in the pursuit of fulfilling the demand for your specialized skills with your finite labor.

The key to wealth is multiplicative task growth.

Again, this is not to buy into the labor theory of value. I am affirming that labor is not the key to prices, and therefore wages. I'm also affirming that prices are based on subjective value and utility of the consumer. What I'm suggesting is that the utility and value that is placed subjectively on a product is related to the wage the consumer himself makes, in most cases. This means the wage-to-price and price-to-wage relationships are cyclical, not causal. In other words, wages do not determine prices (subjective value and utility do), and prices do not determine wages (task maximizations do). This forms a triangle of wage, price, and task. The number of tasks handled by each person, or per person, in production will determine the price of a product, in conjunction with the utility and subjective value the consumer places on that product. Once this price is agreed to by producer and consumer, profit margain is determinable. As the tasks increase, this margian can be maintained or even increased, which has the overall long term effect of rising wages. These rising wages give an elevated standard of living to potential consumers (as all producers are also consumers), and therefore reduce the required utility needed to purchase products, and cause the subjective value to be subjectively lower on money itself, spurring consumption. Rinse, wash, repeat.

Also, let me point out, the rising wages do not necessarily cause inflation, but if they do, it will not keep up with the rising standard of living (the reduced cost of living). This is my hypothesis anyway.

Now, how does the data back up this assertion?

I'll begin by quoting Mises again:

"There is a lot of nonsense said about these things. Some people assert that wage raises are 'inflationary.' But they are not in themselves inflationary. Nothing is inflationary except inflation, i.e., an increase in the quantity of money in circulation and credit subject to check (checkbook money). And under present conditions nobody but the government can bring an inflation into being. What the unions can generate by forcing the employers to accept wage rates higher than the potential market rates is not inflation and not higher commodity prices, but unemployment of a part of the people anxious to get a job. Inflation is a policy to which the government resorts in order to prevent the large-scale unemployment the unions' wage raising would otherwise bring about."

So, if it does not increase the amount of money in circulation, it is not a cause of inflation. Pretty simple. I'll even go a step further and say that if it does not add to the amount of money in circulation, and/or does not cause price increases through interference in the market (like taxes, regulations, etc.), then it does not cause the currency to lose value (inflation). Obviously higher taxes and excessive (which can mean ANY in many regards) regulations can cause increased prices, and therefore a loss in the purchasing power of the money. The rising prices, however they happen, will have the same effect as money that just loses value due to increased quantity of money in circulation. The consumer utility and subjective value will be effected, causing less spending. That causes less production, as demand has tailed off. Less production means less profit, and less jobs, with less pay. This causes more complications in the utility and subjective value of products to the consumers. Rinse, Wash, Repeat.

As the overall number of tasks decrease in the economy, so to will the wealth of the people, and the GDP of the nation.

Mises, yet again:

"The dilemma that this country - and no less many other countries - has to face is very serious. The extremely popular method of raising wage rates above the height the unhampered labor market would have established would produce catastrophic mass unemployment if inflationary credit expansion were not to rescue it. But inflation has not only very pernicious social effects. It cannot go on endlessly without resulting in the complete breakdown of the whole monetary system."

That pretty much speaks to the labor aspect of the economic triangle I presented earlier.

Now I'll quote Dr. F. A. Harper:

"The belief that unions cause wages to rise seems to be borne out by simple observation: In repeated instances it is observed that a labor union demands a rise in wages for its members. An argument ensues between the union and management; there may even be a strike. Sooner or later a wage rise is granted-if not for the full amount requested, at least for a major part of it. Other firms then have to meet this new rate or lose workers. So it appears, ipso facto, that wages in general are raised by union activity.

Such a close-up observation, however, may lead one to see things that are not so, as the proverbial fly on the chariot wheel believed that it propelled the vehicle. One must stand off a bit from the publicized union activities if he is to gain a true perspective on whether they cause average wage rates to rise. One needs, for this purpose, a telescopic view by which to compare the long-time trends of wage rates with changes in union membership.

On the accompanying chart, hourly wage rates in the United States are shown by the upper line. Wages will now buy nearly five times what they would a hundred years ago. The chart is constructed so that a constant rate of change in real wages would appear as a sloping straight line. Progress in an advancing economy seems to work that way, so that wages tend to rise in the manner of compound interest.

Wage trends in the United States over the past century have fallen into three distinct periods: a yearly increase of 1.27 per cent for the period 1855-1895, a yearly increase of 0.55 per cent for 1896-1916, and a yearly increase of 2.47 per cent for 1917-1955. The reason for these changes in trend is a large question, which will be considered here only as it relates to union membership.

The lower line on the chart shows union membership in per cent of all "gainful workers" in the United States. Here too are three distinct levels: A negligible union membership prior to 1900, then a rise at the turn of the century to a level of about 6 to 9 per cent which prevailed from 1903 to 1936, and then a sharp rise to a little over one-fourth of all workers as members of unions for the past ten years.

So the trend in wage rates and in the proportion of workers who are union members have each had three distinctive periods during the past century. But if we compare the two lines carefully, no noticeable relationship between the two is to be found. Neither wage rates nor union membership could be predicted from the other, with any accuracy whatsoever. Try it. After covering the lower line, try to draw one to represent union membership based only on this evidence about wage trends, and vice versa. By comparing your estimate with the facts, I'm sure you will agree that changes in wage rates are quite unrelated to changes in union membership.

1. Assumption: If unions were presumed to be the cause of rising wages, one would expect wages to have been at their lowest point-and to have remained at about the same low point-from 1855 to about 1900, when union membership was negligible.

Fact: Wages rose appreciably over the period. They doubled within a man's working lifetime.

2. Assumption: Whatever the cause of the rising wage rates in the earlier period when union membership was negligible, one would expect it to have continued. But he would, in addition, expect the rise to be accelerated with the rise in union membership about the turn of the century.

Fact: The rate of rise in wage rates from 1896 to 1916 was less than half that of the previous fifty years.

3. Assumption: One would expect the sharpest rise in wage rates to come when union membership was having its most rapid in-crease-from 1936 to 1945-and then to have leveled off when union membership stopped rising.

Fact: The rate of increase in wage rates which began at the close of World War I continued with amazing consistency for the entire period from 1917 to 1955.

From this evidence one must conclude, I believe, that wage rates show no clear response whatever to changes in union membership.

If one says that the two lines are related but there is a lag in time of some 15 to 20 years, the evidence would be that rising wage rates cause union membership to rise, not vice versa. In any event it is the opposite of the theory that unions cause wage rates to rise. Consequences do not happen before their causes.

And so this popular illusion that rising wages are due to the growth of labor unions must be discarded if there is to be any room for attention to other possible causes.

As a preview to the answer as to what makes wages rise, I will merely say here that wages can be paid only out of what is produced.

Something other than your joining a union is what increases your hourly economic output-now five times that of your great-grandfather's a century ago."

Indeed, Dr. Harper, something else does cause the increase in your hourly economic output to five times that of our great-grandfather's output just a short time ago; increased tasks per worker/producer via technological advances in production, cheap immigrant labor, and outsourcing (in that order). The task maximization has been the chief catalyst in this process, this triangle of economic fire. (The fire triangle is oxygen, ignition source, and burnable substance.)

As you can see, my hypothesis was correct as well. Rising wages were not corollary to inflation, and as I thought, the standard of living would increase far faster than the rate of inflation. People often say "our wages have been stagnant for years", but this is fundamentally untrue. Wages on your check have been stagnant or falling, while the overall pay package (what we are referring to in this article as "wages") have always been rising. If you take into account your benefits, your wages have beeen growing all along, as evidenced by the rising standard of living. Where the standard has decreased has been a function of extra-market inflation (printing money and excessive regulations and taxes), not by rising or falling wages persay. Wages, in the terms we mean in this article, have not been stagnant. The cost of medicine has been so increased over these years that almost all of your wage increases have been dedicated to it. Blame medicine and government inflation/taxes/regulation, not the red herring of stagnant or falling wages and gaps between rich and poor (capital accumulation, ie one of the major causes of upward economic growth). To sum up, the hypothesis was correct, increased wages do not cause inflation such that it eclipses the lowered cost of living (raised standard of living).

I'd like to quote Mises one last time:

"There are no ivory towers to house economists. Whether he likes it or not, the economist is always dragged into the turmoil of the arena in which nations, parties and pressure groups are battling. Nothing absorbs the minds of our contemporaries more intensely than the pros and cons of economic doctrines. Economic issues engross the attention of modern writers and artists more than any other problem. Philosophers and theologians deal today more often with economic themes than with those topics which were once con*sidered as the proper field of philo*sophical and theological studies. What divides mankind into two hos*tile camps, whose violent clash may destroy civilization,- is antagonistic ideas with regard to the economic interpretation of human life and action."

Dr. Harper goes on to say:

"Politicians proclaim their utter contempt for what they label as 'mere theory.' They pretend that their own approach to economic problems is purely practical and free from any dogmatic prepossessions. They fail to realize that their policies are determined by definite assumptions about causal relations, i.e., that they are based on definite theories. Acting man, in choosing certain means for the attainment of ends aimed at, is necessarily al*ways guided by "mere theory"; there is no practice without an un*derlying doctrine. In denying this truth, the politician tries in vain to withdraw from the criticism of the economists the faulty, self-contra*dictory and a hundred times refuted misapprehensions directing his con*duct of affairs.

The social function of economic science consists precisely in develop*ing sound economic theories and in exploding the fallacies of vicious reasoning. In the pursuit of this task the economist incurs the deadly enmity of all mountebanks and charlatans whose shortcuts to an earthly paradise he debunks. The less these quacks are able to ad*vance plausible objections to an economist's argument, the more fu*riously do they insult him."

So, to conclude, unions and minimum wage laws are not corollary or causal to wage levels. Unions are corollary and causal to unemployment rates, which are not "seen" effects, but instead are "unseen" effects, of pushing wages above market value. Doing this costs other's jobs, but does not increase standard of living overall.

Minimum wage, although I do not give data, works on the same principle as 0% and 100% taxes. If minimum wage laws raise the standard of living, why not just legislate $100 per hour wages? How about $1,000 per hour? Obviously this would tank the economy quickly. So, one can easily and logically see that raising the minimum wage doesn't raise the societies standard of living, it only adds to unemployment. Many economic fallacies are debunked in such a fashion.





Here are a few relevant graphs, not directly related to the sources above, but that show the same correlations, or lack thereof.











I will do a Part 3 next...

----------


## showpan

> Showpan...
> Here come a ton of criticisms about your data...
> I want to attack your use of these arbitrary statistics before I show how truely arbitrary (and erroneous) they are.
> Wrong...they do not produce a physical product in an industrial production process...all "professional" jobs are service jobs. They only provide a service, there is no physical product.
> So, fallacy one is debunked. Here is the link to the article:


You have merely redefined those jobs just as manufacturing jobs have been redefined in order to embellish the lie that traditional service sector jobs pay well....lol
Service sector employees work less hours because they are only part time in order for employers to circumvent paying benefits.
You have no clue what unions are and why they were formed...do you?
I wonder, how many millions of unemployed people will now be attending a University when tuition is up by 40% this year and most of the professors who teach (especially economics) aren't even tenured, they are also part time and seasonal and will pass anyone coming through so they can maybe get another years contract...what a friggin joke.

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## ProIndividual

Part 3:

Notice several things:

1. Unemployment is in no way corollary or caused by the beginning of the technological revolution (beginning in the 1980s), UNLESS you want to admit it is forcing DOWN unemployment overall. I wouldn't say they are at all related, to concede the point (as long as you also concede it). In fact, I'll concede (if you do) that none of these charts draw any clear correlation or causality with unemployment. I'd argue that unemployment is caused by a variety factors, and even unions are of minimal impact overall (but unions do cause unemployment for workers at, or below, their premium wage level).

2. Over the priod of time you claim the technological revolution we are still undergoing somehow caused a problem for wages (I mean, you assert that service sector jobs pay less, and since they now dominate, and didn't before, our economy, then wages should have on average decreased, logically), you will notice that real total compensation rose. Wages are irrelevant, your wages aren't your total hourly compensation. Wages may have stayed flat or fell, but total compensation continued to rise. As a matter of fact, in the 1980s the trend began where compensation more closely mirrored gains in productivity directly...because machines aren't in unions, causing distortions in the process of wages rising and falling based on productivity.

3. Household income mirrored compensation, not wages...so household income started to more sharply RISE during this period, not fall or stay flat as wages did. And again, your total compensation is NOT just wages, so decrying it like liberals do is fallacious. Your standard of living is based on household income and total individual compensation, not wages. The standard of living ROSE all throughout this cycle. Only the government caused collapse in 2008 has changed these trajectories, not the "failure" of the service sector versus industrial sectors.




14. If not for unions, wage rates would be driven down

As I showed in Part II of this blog, unions are not corllary or causal to wage rates. So, what then sets the minimum wage for workers? Since only about 12% of our economy is unionized, what keeps wages rising, decade after decade, irregardless of union memberships?

What sets the minimum wage is the cost of living to the individual laborer, their subjective value on money and labor, and the utility of their time, labor, and money to them individually. Sounds complicated, but it really itsn't.  In effect, the minimum wage for you is set by the minimum wage you are willing to work for. You will not work for less than enough to meet your needs, given alternatives. Seeing as how 12% of the economy is unionized, and it used to be much closer to 50%, one would assume that wages would be nearing 1 penny an hour by now...but quite the opposite, real wages and income have risen accounting for inflation. But why? 

Because unions do not control wage rates, and various things they support constrict wage growth, like anti-technology approaches to "job security". This leads to the gap between real wages in unionized sectors, given their collective bargaining above the market value and simultaneous attack on task maximization, and non-unionized sectors to be smaller. With the gap between compensation packages getting smaller and smaller, so to are the membership rolls of unions. Largely, union breaking is not causing the demise of unions, their inefficiency is.

I'd also like to point out wages generally rise in recessions, or stay flat, they do not drop. This is why unemployment rises so sharply, as opposed to gradually, in a recession. This is for a variety of reasons, and maybe I'll cover it later. But what's important is that unions use downturns (and the atmosphere of fear and apprehension surrounding them) as a recruitment frenzy, when in fact, it's the time in which workers are least vulnerable to wage decreases, and more susceptable to higher rates of unemployment I believe unions create with their artifically high wages.

At any rate, with or without unions, wages only drop so far, and they always rise over the longterm. Wages are a function of task maximization, and therefore productivity, not unions. If we ban all new technology in the process of production that might cause short term unemployment, and unionized the entire country (by force or in some voluntary socialist wet dream), we would still have falling wages in the longterm. Standard of living and wages are that unrelated to unions.

PLEASE REFER TO CHARTS ALREADY SUBMITTED TO SEE THE DATA.

Notice...unions have NO relation to longterm gains in compensation, therefore their impact on manufacturing wages over service jobs (the ever-so slight advantage they STEAL from others) should be discounted easily. If we only look at median incomes, without union premiums above market value, the evidence is clear...THE SERVICE SECTOR GETS MORE COMPENSATION per man hour, per year, overall, and in pay raises. And since unions, and the industrial jobs they occupy, can only hinder this process, it must be logically said that the sooner these sectors die (at market value and speed, not above or below), the better.

Now, referring to the charts I provided again...

Now, let's look at a chart that was featured on the Ed Show, with host Ed Schultz, a MSNBC show that is economically cromagnon:



Notice how share of income is fallaciously tied to union membership, which I've already shown is erroneous, but it's passing off "share of national income" off as "middle class income" shrinking. The reality is, I fully expect the share of national income to continue to fall in a healthy economy where employment rates, real wages, and standard of living continue rise. Total compensation will rise even at times when income share drops and real wages drop. That's because real wages do not reflect benefit compensation, and if benefits rise in cost faster than other facets of the economy (like healthcare costs as opposed to food), then wages will stay stagnant or decrease even as total compensation is rising. Really total compensation is the only relevant number, as what the compensation pays for is irrelevant to the laborer. They try to assert with the above graph that people are getting poorer as the rich get richer...but all it really does is fallaciously associate union membership decline with income share decline. The membership decline is due to competitive wages and compensation in non-union alternatives, while the decline in income share is an expected event that's totally irrelevant to wages and compensation, as the previous graphs show.

 The point is, compensation rises while union membership falls...a correlation they do not wish you to see. 

And income share is not corollary at all with union memberships, so the Ed Show graph is a totally misleading graph, intended to confuse the liberal statist viewer, to draw conclusions that are completely false. I do believe this Ed Schultz guy and Lawrence O'Donnell from the Last Word are both crazy socialist propagandists, with no regard for intellectual honesty, and no remorse of being sophistic.

In the next fallacy, I'll show why falling income share is expected, even while simultaneously increasing standard of living and compensation.


15. The economic pie is finite, and when one person wins, another must necessarily lose

This usually comes from folks who learn economics from the movie "Wall Street". 

The fact is, as I've demonstrated throughout this blog, wages grow due to: a) task maximization due to technological advances, competition with low paid labor, and competition in the global economy, b) which are caused by accumulations of capital in the hands of wealthy producers, c) that lead to said task maximizing strategies causing productivity to rise, and d) creating profits and causing them to rise, and therefore the amount of money that can be negotiated for wages. The fact is, the pie always continues to grow as long as we can task maximize. 

The most simple way to do this has been to grow the population. I mean which army can do more, the army of 3, or 3,000? Obviously building that base will go way faster with 3,000 soldiers, whether it's a base for 3 or the 3,000. After population, there is equality under the law. Notice how most third world countries don't let women work or own property of any real equity to males? When you keep half the population forcably unemployed you get half the possible economy for your population...which apparently means cave-living and a steady diet of bad food in insufficient quantities. And no education, I forgot that part. Because that's the next method of task maximization. If I teach you my job, I can do other stuff, and we can adapt more quickly to shocks like a wave of illness causing usual specialists to be absent, or retractions in the economy. 

So, without going on and on regarding all the different ways mankind task maximizes, let me just say, all of it is wholly dependent on wealth accumulation in a few hands. Who would pay the soldiers in my example? Some government, corporation,  union, or church (or some other institution), take your pick. No matter what, in order to task maximize, wealth must accumulate in sufficient levels to allow longterm investment in things like technology, new labor sources (that can bear drawbacks and risks), and relocation to better fit into the specialization of Division of Labor. As the tasks maximize, the economy grows, and the pie expands. 

The predicatble path of this process should be the poor recieving a smaller and smaller fraction of the total pie in play at any given moment, but with overall real wages rising, therefore raising their standard of living far exceeding inflation. Since decimals are infinite (on a number line for the visual reader), then this process can continue infintely (which I do not necessarily believe would happen, especially in a truely free market where remaining mercantilist state supported coercions on power and capital erode and die). But even if this process continued infinitely, the poor would be better off generation to generation in all respects, even as the gap between rich and poor (poverty being something that would be largely a matter of perspective instead of need) continues to grow.







And again, please look at compensation and productivity in the charts I provided earlier, and at household income.

So the economic pie is certainly not finite.



I think between this and the last couple fallacies, you should see several very important facts: 

- You can receive a smaller and smaller piece (%) of the total pie, and at the same time recieve a larger and larger piece ($) each time, because the pie continuously grows, and is not finite.

- Unions are not corollary or causal to wage rates, real wages, household income, total compensation, or national income share.

- Productivity is corollary to wage rates, real wages, household income, total compensation, and national income share. Except for national income share, productivity is also causal to those things. In the case of national income share, it's causal (currently) to productivity.

- Wage rates, real wages, household income,and total compensation are negatively correlated to national income share (when income share goes down, compensation rises), by way of productivity (productivity leads to higher wages, etc., but productivity is caused by wealth accumulation leading to technological advances, etc., which is corrolary to national share of income via the wealth gap increasing).

- Unions do not improve the situation of the middle class in terms of any form of compensation listed, unless it is at the expense of some other middle class or lower class worker. This is evident from the graphs, that the top 1% continues to accumulate capital, and the middle class'  and lower class'  share continues to decline (it shows the bottom 80% on the one graph). So, if the income share continued to rise for the top 1% of earners with or without unions being a major aspect of the workforce (depending on the time frame), then obviously the income share the middle class is seeking to hold onto is rightfully the poor's. The lower class and middle class mostly share the same "slice of pie", as it were. The whole system depends on increasing standards of living, which depends on ever increasing productivity, which relies on ever increasing amounts of capital accumulation...so it's no suprise the rich aren't losing any momentum (and thank God, because if they did, the whole thing begins to erode). Since the top 1% NEED to continue increasing their share, that leaves the other two "classes" to fight over the constantly diminishing share (keeping in mind, their compensation and standard of living are continuously rising, and it's because of this widening wealth gap in the national income shares). So, unions can only raise wages artifically above the market value, causing more unemployment for equal or lesser wage workers, and therefore grabbing income share away from those same people. It's become my opinion, unions should never be allowed to collectively bargain on compensation...workers shouldn't all be paid the same wage either, some are more productive than others, and profit motive is enough to cause individual task maximization by workers on it's own, and eroding that inequity of pay but fairness of competition you end up rewarding the lazy to mediocre, and punishing the hard working. You do not have to be paid by wages, persay, however, you can be paid by any means, like percentage for example. The flexibility is important.



I'm not sure if unions have a causal relationship with safety...and after the research I've done on wages, I wouldn't be suprised either way. If they are not causal to safety in anyway, like standard of living, then I will have no reason to ever support any union again...which is mind blowing for me, as I have been a member of several unions. Admittedly, if I wouldn't have researched this stuff myself, I would never have believed it. That's how strong these economic fallacies are in regards to unions.

16. There is a war on the middle class

There is no war on the middle class. If I haven't given enough evidence of that thus far, then please watch this video:

To hear the Lou Dobbses and Bill O'Reillys of the world--not to mention politicians ranging from Ron Paul to Hillary Clinton--the middle class of America (however you define that term) has never had it so tough. Between credit squeezes, out-of-control immigration, rising costs of education and health care and everything else, it's all darkness out there for those of us who are neither millionaires nor welfare cases, right?

In "Living Large," Drew Carey and reason.tv examine the plight of the American middle class. What do they find? Click on the link below to find out.

http://www.reason.tv/video/show/living-large


20. The rich get richer, and the poor get poorer

As I've demonstrated, we all get richer. The fact the ratio of richness isn't egalitarian isn't evidence of failure, it's an observation of a mechanism. In order for us all to get collectively wealthier, the top percentage of us needs to accumulate large amount of capital. So, as I showed previously in this blog, we all get richer even as the gap between rich and poor grows, and this is completely sustainable. 



Now I did these blogs a while ago....but I admit, they do not cover the collapse and up to today. However, NO ONE should be arguing a 30 year positive trend is the problem, while the collapse is obviously the cause of the dip in all those numbers. The collapse isn't caused by the benefit of service sector expansion, the technological revolution automating industrial production and manufacture...it's caused by the government keeping interest rates too low, and causing unsustainable malinvestment, which then caused the housing boom and subsequent bust, and then took the rest of the economy with it.

You want to assasinate the good part of the economy, and move backwards 30 years, instead of killing the FED, who caused the issue to begin with. Don't step over dollars to pick up pennies, it's not good.



In conclusion:

It's obvious the emerging service sector is good, and has been since the trend started in the 1980s. Whether or not you attribute higher wages to service sector jobs versus industrial manufacturing sector jobs, depends on whether or not you think unions benefit the wages in question, whether or not you think they benefit the economy, and whether or not you think wages are synonymous with total real compensation (which they aren't). It also may depend on other fallacies, that I don't list, like manufacturing somehow just inherently magically props up wages (which I addressed), and other similar manufacturing fetishes. All of these are debunked with just the charts I provide and deductive logic.

I'd also like to point out:



Unions never made anyone safer...neither did laws. Industrialization meant widespread technology in production, aiding the human productivity. This created safer conditions. Notice as technology of an automated nature (not human aided) became pervasive in the 1990s, a new decline erupts, and makes us safer yet. It's hard to die behind a desk.



Notice the switch in unions...they are now mostly government, not even fighting "corporate evil" (not that corporate evil doesn't exist, but not as they present it).




And while I'm debunking myths:



Gloabl warming is BS.




No matter how much better life is getting, humans tend toward complaint and relativism.

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## ProIndividual

One last thing:



You then say "manufacturing is at an all-time high", or something. 

Right. Because we have never had more automation than this, more technology in the process of production. We also never has less people in manufacturing...so the process is working...we are getting richer, more output, and with less effort or hours invested. See how that works? See how it's good, and just shows this process is more efficient and beneficial?





EDIT: I was flipping up and down the page...lol..thought that this was apart of showpan's post...oops...so I was retorting someone who was agreeing with me, and mistook a response to showpan for a post by showpan....my bad cutlerzzz.....but my point is the same as yours, and we are both right!...lol.

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## axiomata

> One last thing:
> 
> 
> 
> You then say "manufacturing is at an all-time high", or something. 
> 
> Right. Because we have never had more automation than this, more technology in the process of production. We also never has less people in manufacturing...so the process is working...we are getting richer, more output, and with less effort or hours invested. See how that works? See how it's good, and just shows this process is more efficient and beneficial?


But but Obama told me dat Automatic Teller Machine terk mah jerb!

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## Cutlerzzz

Well done.




> You must spread some Reputation around before giving it to ProIndividual again.


Well, I'll rep you later.

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## ProIndividual

> You have merely redefined those jobs just as manufacturing jobs have been redefined in order to embellish the lie that traditional service sector jobs pay well....lol


Wrong. You are redefining things to fit your argument. Show me where a product, a physical good, is produced by those "professional" jobs.

There are two sectors in this argument, not 50...the goods sector and the service sector.

Please tell me you have something better than this...or at least aren't another dogmatist just spewing nonsense and ignoring anything that proves them wrong...

...we have enough of those as it is.





> Our founding fathers believed in tariffs and built this nation ...


What you should say is inhibited the growth of our nation because Hamilton was an economic cromagnon who never read Adam Smith EVER.

And BTW, this is called "an appeal to antiquity"...it's an informal logical fallacy. BUSTED!

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## ProIndividual

> But but Obama told me dat Automatic Teller Machine terk mah jerb!


I literally laughed out loud...

TERK MAH JERB!

lmfao!

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## showpan

And here it is...history has been rewritten for neocon globalists.

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## Dr.3D

> And here it is...history has been rewritten for neocon globalists.


Wow, looks just like the place where I used to work..... at least till they tore it down... now there is nothing there but grass growing.

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## Cutlerzzz

> And here it is...history has been rewritten for neocon globalists.


lol

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## ProIndividual

Cutlerzzz...i like your chart (unemployment), stealing it now...lol.

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## Cutlerzzz

Glad to help. Keep promoting freedom.

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## ProIndividual

> And here it is...history has been rewritten for neocon globalists.



Another bad bit of logic...lol. Nice anecdote when the data no longer fits your argument...ugh.

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## ProIndividual

I'm also glad to have your help Cutlerzzz, and everyone else who happens in and helps, like 3d, and the hillarious axiomata...

...I'm still laughing at the South Park reference.

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## showpan

*19 Facts About The Deindustrialization Of America That Will Blow Your Mind*

The United States is rapidly becoming the very first "post-industrial" nation on the globe.  All great economic empires eventually become fat and lazy and squander the great wealth that their forefathers have left them, but the pace at which America is accomplishing this is absolutely amazing.  It was America that was at the forefront of the industrial revolution.  It was America that showed the world how to mass produce everything from automobiles to televisions to airplanes.  It was the great American manufacturing base that crushed Germany and Japan in World War II.  But now we are witnessing the deindustrialization of America.  Tens of thousands of factories have left the United States in the past decade alone.  Millions upon millions of manufacturing jobs have been lost in the same time period.  The United States has become a nation that consumes everything in sight and yet produces increasingly little.  Do you know what our biggest export is today?  Waste paper.  Yes, trash is the number one thing that we ship out to the rest of the world as we voraciously blow our money on whatever the rest of the world wants to sell to us.  The United States has become bloated and spoiled and our economy is now  just a shadow of what it once was.  Once upon a time America could literally outproduce the rest of the world combined.  Today that is no longer true, but Americans sure do consume more than anyone else in the world.  If the deindustrialization of America continues at this current pace, what possible kind of a future are we going to be leaving to our children?

Any great nation throughout history has been great at making things.  So if the United States continues to allow its manufacturing base to erode at a staggering pace how in the world can the U.S. continue to consider itself to be a great nation?  We have created the biggest debt bubble in the history of the world in an effort to maintain a very high standard of living, but the current state of affairs is not anywhere close to sustainable.  Every single month America does into more debt and every single month America gets poorer.

So what happens when the debt bubble pops?

The deindustrialization of the United States should be a top concern for every man, woman and child in the country.  But sadly, most Americans do not have any idea what is going on around them.

For people like that, take this article and print it out and hand it to them.  Perhaps what they will read below will shock them badly enough to awaken them from their slumber.    

The following are 19 facts about the deindustrialization of America that will blow your mind....

#1 The United States has lost approximately 42,400 factories since 2001. 

#2 Dell Inc., one of Americas largest manufacturers of computers, has announced plans to dramatically expand its operations in China with an investment of over $100 billion over the next decade.

#3 Dell has announced that it will be closing its last large U.S. manufacturing facility in Winston-Salem, North Carolina in November.  Approximately 900 jobs will be lost.

#4 In 2008, 1.2 billion cellphones were sold worldwide.  So how many of them were manufactured inside the United States?  Zero.

#5 According to a new study conducted by the Economic Policy Institute, if the U.S. trade deficit with China continues to increase at its current rate, the U.S. economy will lose over half a million jobs this year alone.

#6 As of the end of July, the U.S. trade deficit with China had risen 18 percent compared to the same time period a year ago.

#7 The United States has lost a total of about 5.5 million manufacturing jobs since October 2000.

#8 According to Tax Notes, between 1999 and 2008 employment at the foreign affiliates of U.S. parent companies increased an astounding 30 percent to 10.1 million. During that exact same time period, U.S. employment at American multinational corporations declined 8 percent to 21.1 million.

#9 In 1959, manufacturing represented 28 percent of U.S. economic output.  In 2008, it represented 11.5 percent.

#10 Ford Motor Company recently announced the closure of a factory that produces the Ford Ranger in St. Paul, Minnesota. Approximately 750 good paying middle class jobs are going to be lost because making Ford Rangers in Minnesota does not fit in with Ford's new "global" manufacturing strategy.

#11 As of the end of 2009, less than 12 million Americans worked in manufacturing.  The last time less than 12 million Americans were employed in manufacturing was in 1941.

#12 In the United States today, consumption accounts for 70 percent of GDP. Of this 70 percent, over half is spent on services.

#13 The United States has lost a whopping 32 percent of its manufacturing jobs since the year 2000.

#14 In 2001, the United States ranked fourth in the world in per capita broadband Internet use.  Today it ranks 15th.

#15 Manufacturing employment in the U.S. computer industry is actually lower in 2010 than it was in 1975.

#16 Printed circuit boards are used in tens of thousands of different products.  Asia now produces 84 percent of them worldwide.

#17 The United States spends approximately $3.90 on Chinese goods for every $1 that the Chinese spend on goods from the United States.

#18 One prominent economist is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040.

#19 The U.S. Census Bureau says that 43.6 million Americans are now living in poverty and according to them that is the highest number of poor Americans in the 51 years that records have been kept.

So how many tens of thousands more factories do we need to lose before we do something about it?

How many millions more Americans are going to become unemployed before we all admit that we have a very, very serious problem on our hands?

How many more trillions of dollars are going to leave the country before we realize that we are losing wealth at a pace that is killing our economy?

How many once great manufacturing cities are going to become rotting war zones like Detroit before we understand that we are committing national economic suicide?

The deindustrialization of America is a national crisis.  It needs to be treated like one.

sept 2010

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## showpan

*The Plight of American Manufacturing
Since 2001, the U.S. has lost 42,400 factories and its technical edge.*

Something has gone radically wrong with the American economy. A once-robust system of traditional engineeringthe invention, design, and manufacture of productshas been replaced by financial engineering. Without a vibrant manufacturing sector, Wall Street created money it did not have and Americans spent money they did not have.

 Americans stopped making the products they continued to buy: clothing, computers, consumer electronics, flat-screen TVs, household items, and millions of automobiles.

Americas economic elite has long argued that the country does not need an industrial base. The economies in states such as California and Michigan that have lost their industrial base, however, belie that claim. Without an industrial base, an increase in consumer spending, which pulled the country out of past recessions, will not put Americans back to work. Without an industrial base, the nations trade deficit will continue to grow. Without an industrial base, there will be no economic ladder for a generation of immigrants, stranded in low-paying service-sector jobs. Without an industrial base, the United States will be increasingly dependent on foreign manufacturers even for its key military technology.

For American manufacturers, the bad years didnt begin with the banking crisis of 2008. Indeed, the U.S. manufacturing sector never emerged from the 2001 recession, which coincided with Chinas entry into the World Trade Organization. Since 2001, the country has lost 42,400 factories, including 36 percent of factories that employ more than 1,000 workers (which declined from 1,479 to 947), and 38 percent of factories that employ between 500 and 999 employees (from 3,198 to 1,972). An additional 90,000 manufacturing companies are now at risk of going out of business.

Long before the banking collapse of 2008, such important U.S. industries as machine tools, consumer electronics, auto parts, appliances, furniture, telecommunications equipment, and many others that had once dominated the global marketplace suffered their own economic collapse. Manufacturing employment dropped to 11.7 million in October 2009, a loss of 5.5 million or 32 percent of all manufacturing jobs since October 2000. The last time fewer than 12 million people worked in the manufacturing sector was in 1941. In October 2009, more people were officially unemployed (15.7 million) than were working in manufacturing.

When a factory closes, it creates a vortex that has far-reaching consequences. The Milken Institute estimates that every computer-manufacturing job in California creates 15 jobs outside the factory. Close a manufacturing plant, and a supply chain of producers disappears with it. Dozens of companies get hurt: those supplying computer-aided design and business software; automation and robotics equipment, packaging, office equipment and supplies; telecommunications services; energy and water utilities; research and development, marketing and sales support; and building and equipment maintenance and janitorial services. The burden spreads to local restaurants, cultural establishments, shopping outlets, and then to the tax base that supports police, firemen, schoolteachers, and libraries.

Has U.S. manufacturing declined because its companies are not competitive? Hardly. American companies are among the most efficient in the world. The nations steel industry, for instance, produces 1 ton of steel using two man-hours. A comparable ton of steel in China is produced with 12 man-hours, and Chinese companies produce three times the amount of carbon emissions per ton of steel. The same kinds of comparisons are true for other industries.

But American companies have difficulty competing against foreign countries that undervalue their currencies, pay health care for their workers; provide subsidies for energy, land, buildings, and equipment; grant tax holidays and rebates and provide zero-interest financing; pay their workers poverty wages that would be illegal in the United States, and dont enforce safety or environmental regulations.

Proponents of free trade and outsourcing argue that the United States remains the largest manufacturing economy in the world. Yet, total manufacturing gross domestic product in 2008 (at $1.64 trillion) represented 11.5 percent of U.S. economic output, down from 17 percent in 1999, and 28 percent in 1959. As for our balance of trade, U.S. imports of goods totaled $2.52 trillion in 2008, while exports came to $1.29 trillioncreating a goods deficit of $821 billion. Those imported goods represented 17.6 percent of U.S. GDP. The U.S. trade deficit in goods and services in 2008 stood at $700 billionor more than $2,000 for every American.

Our trade deficit will not diminish absent a significant increase in domestic manufacturing. Those unconcerned about the decline of American manufacturing might want to read Winwood Reades 1872 volume The Martyrdom of Man, in which he chronicled the economy of ancient Rome: By day the Ostia road was crowded with carts and muleteers, carrying to the great city the silks and spices of the East, the marble of Asia Minor, the timber of the Atlas, the grain of Africa and Egypt; and the carts brought nothing out but loads of dung. That was their return cargo.

Today, Americas biggest export via ocean container is waste paperour version of dung. The largest U.S. exporter via ocean container in 2007 was not even an American company, but Chinese: American Chung Nam, which exported 211,300 containers of waste paper to its Chinese sister company, Nine Dragons Paper. By comparison, Wal-Mart imported 720,000 containers of sophisticated manufactured products from overseas factories into the United States, followed by Target (435,000 containers), Home Depot (365,300 containers), and Sears, which owns K-Mart (248,600 containers). Our own Ostia Road.

The United States is not losing old, inefficient industries that produce buggy whip products for which there is no more demand. There is ample demand for televisions, sporting goods, bicycles, blenders, hearing aides, golf clubs, laptops, and desktops. The industries that have left the United States are still producing products that are in demand.

Indeed, the U.S. is losing the industries of the future. In 2004, it lost world dominance in high-tech exports, when China exported $180 billion worth of information- and communications--technology products and the U.S. exported just $149 billion.

Without a printed circuit board (PCB) industry, for instance, a country cannot expect to have an industrial foundation for high-tech innovation. But the domestic PCB industry shrunk from $11 billion in 2000 to $4 billion in 2008, a period during which the industry was growing globally. U.S. PCB manufacturers accounted for only 8 percent of global production in 2008, down from 26 percent in 2000. Chinas share of the global PCB market in 2008 was 31.4 percent or $16 billion, four times larger than the U.S. industry. Asia now controls 84 percent of the global production of printed circuit boards, which are used in tens of thousands of different products.

Today, the U.S. PCB industry is in free fall. For the first nine months of the year, U.S. shipments were down by 25.5 percent over the same period in 2008. The industry has been crippled beyond repair, says Doug Bartlett, chairman of Bartlett Manufacturing, the oldest PCB company in the United States until it went out of business in June 2009.

What about the promise of the solar industry? There was only one American company (First Solar) among the top 10 worldwide in photovoltaic-cell production in 2008. But the European Commission does not even classify First Solar as being an American company, instead labeling it international because it does most of its production in Asia. The U.S. federal government has invested hundreds of millions of dollars in photovoltaics research and development, yet the United States accounted for only 5.6 percent of global production of photovoltaics in 2008, down from 30 percent in 1999. Chinese production, by contrast, represented only 1 percent of global output of photovoltaics in 1999. By 2008, its output had risen to 32 percent of global production.

The wind-energy industry? Only one U.S. company (General Electric) ranked among the 10 largest in the world. GEs worldwide market share in 2008 was 18.6 percent.

In 2008, 1.2 billion cell phones were sold throughout the world, none of which were manufactured in the United States. Motorola held 8.4 percent of the global market in 2008, but that figure sunk to only 4.5 percent in the first quarter of 2009 (a 46 percent decline from the same quarter in 2008). Apple held 1.1 percent of the global market for cell phones in 2008.

In 2007, only 8 percent of all new semiconductor fabrication plants (fabs) under construction in the world were located in the United States. Twelve percent of new fabs were being built in China, 40 percent in Taiwan, and 6 percent in South Korea, according to Semiconductor Equipment Materials International. In 2007, the United States produced 17 percent of the world output of semiconductors, a number that has been declining since 1995, when the U.S. accounted for 23 percent of global output.

The decline of Americas longtime leaders in manufacturing is better known. In 2008, 12 percent (8.7 million) of all the cars produced in the world were made in America. China has now surpassed the United States in motor-vehicle production (9.3 million in 2008), as has Japan (11.56 million). The U.S. steel industry produced 91.5 million tons of steel in 2008, down from the 97.4 million tons in 1999. By comparison, Chinas steel industry produced 500 million tons in 2008, more than five times the amount of U.S. producers and up from the 124 million tons it produced in 1999, despite the far greater efficiency of U.S. steel production.

The U.S. machine-tool industrythe industry thats the backbone of an industrial economy and the means by which all products are manufacturedproduced $4.2 billion in equipment in 2008, a paltry 5.1 percent of global output. American machine-tool consumption has collapsed in tandem with American manufacturing. Since 1998, U.S. machine-tool consumption has fallen by 23 percent. Chinese consumption has increased by 714 percent, from $2.7 billion in 1998 to $19.3 billion in 2008. U.S. consumption stood at $6.7 billion in 2008. For the eight months ending in August 2009, U.S. machine-tool consumption declined to only $1.04 billion. The evaporation of orders, says Mike Austin, vice president of Atlas Technologies in Fenton, Michigan, is the last straw for many people in this industry.

Machine tools have long been considered essential to maintaining the countrys national security. In 1948, Congress passed the National Industrial Reserve Act based on the idea that the defense of the U.S. requires a national reserve of machine tools for the production of critical items of defense material. In 1986, President Ronald Reagan, a staunch free-trade advocate, supported a five-year Voluntary Restraint Agreement with Japan and Taiwan on imports of machine tools based on national-security grounds. In making his determination, Reagan said the industry was a vital component of the U.S. defense base.

Dozens of other industries are nearly gone from U.S. shores. U.S. producers of luggage account for 1 percent of the American market, but virtually every American owns luggage. U.S.?based production of high-performance outerwear used by skiers, hikers, mountain climbers, bikers, police officers, and military personnel accounts for less than 1.7 percent of all of the outerwear sold to Americans.

Do you need ceramic tile for a new kitchen floor? One major American manufacturer remains: Summitville Tiles of Summitville, Ohio. The companys president and CEO, David Johnson, says the industry has been virtually wiped out by international competitors and adds, The industry is just about finished.

The furniture industry lost at least 60 percent of its production capacity in the United States from 2000 to 2008 with the closure of 270 major factories during that period. Imports of wood furniture accounted for 68 percent of the U.S. market in 2008, up from 38 percent in 2000.

The rapid relocation of the worlds manufacturing belt from the U.S. to China has also meant a shift in these nations technological capacities. As foreign manufacturers flock to China to take advantage of its cheap labor, devalued currency, and manufacturing subsidies, they have also shifted their research and development endeavors to China. Georgia Techs biennial High-Tech Indicators study found that China improved its technological standing by 9 points (on a scale of 100) between 2005 and 2007, moving that nation ahead of the United States in technological capability for the first time since Georgia Tech started keeping score two decades ago.

Americas technological standing peaked at 95.4 in 1999; by 2007, it had declined to 76.1. Chinas standing rose from 22.5 in 1996 to 82.8 in 2007. In that year, the U.S. had also fallen behind the European Union. South Korea, Singapore, Taiwan, Brazil, India, and China are all increasing their technological capacities, while the U.S. position degrades.

That American technological supremacy has declined alongside its manufacturing supremacy should come as no surprise. The proximity of research, development, and manufacturing is very important to leading-edge manufacturers, a report from President George W. Bushs Council of Advisers on Science and Technology warned in 2004. The continuing shift of manufacturing to lower-cost regions and especially to China is beginning to pull high-end design and R&D capabilities out of the United States. (Not surprisingly, the Bush White House did not publicize this report.) The report recommended that the U.S. make its research and development tax credit permanent. It has not. Once the worlds most generous, the U.S. research and development tax credit is now lower than those of 17 other nations.

Decoupled from domestic manufacturing, the tax credit no longer pays for itself as it once did. If our innovation system discourages an invention from being manufactured in the U.S., says Susan Butts, senior director of external science and technology programs at Dow Chemical, then American industry will not generate the taxes that fund the federal investment in research.

Executives of U.S. manufacturing companies understand that they are up against not just foreign companies but mercantilist nations. As Wayne Johnson, director of worldwide strategic university customer relations at Hewlett-Packard told a 2008 conference sponsored by Bushs Office of Science and Technology Policy, We in the U.S. find ourselves in competition not only with individuals, companies, and private institutions, but also with governments and mixed government-private collaborations.

What domestic manufacturers want is for the United States government to shift its economic policies away from consumption to incentives that favor investment in new factories, equipment, and jobs in the United States. They want the United States to abandon policies that favor geopolitical global interests that have no regard for the economic health of the United States and its millions of taxpayers and retirees.

To the disappointment of the domestic manufacturing community, the Obama administration has yet to devise a strategy aimed at creating the industrial jobs needed in America to generate trillions of dollars of tax revenue. Without a surge in U.S. production and exports, how will the United States pay off its mounting debts and cover the retirement and medical costs of the largest generation of Americans in history? Creating more jobs for dental hygienists, health-care workers, retail clerks, and bartenders will not do it.

There are nascent signs that the administration is awaking to the need for new economic policies aimed at private-sector industrial investment and the creation of good jobs. President Barack Obama has appointed Ron Bloom, a financial whiz, to be his senior counselor for manufacturing policy. Bloom, a graduate of Harvard Business School, worked for years in the investment-banking industry before taking a job with the United Steelworkers, using his experience to help restructure companies to assure their survival and their ability to employ American workers. He also worked on the Obama administrations Task Force on the Automotive Industry, which (at least for now) saved General Motors and Chrysler from extinction. Bloom is piecing together a strategy that will build upon investments being made in the $787 billion economic stimulus package aimed at helping the U.S. clean-energy sector.

There is little time to waste. We need a modern-day Paul Revere, says Brian OShaughnessy, chair of Revere Copper Products, the oldest industrial company in the United States. We all need to wake up and understand the forces of foreign economic mercantilism that are waging an economic war against us.

Richard McCormack is editor of Manufacturing & Technology News. He was founding editor of High Performance Computing and Communications Week in 1991 and New Technology Week in 1987.

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## Cutlerzzz

The article's premise is false. US industrial production is at all time highs. That completely invalidates it.

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## showpan

> The article's premise is false. US industrial production is at all time highs. That completely invalidates it.


You invalidate nothing...still. Production numbers have been fudged to protect the guilty. Making mass amounts of Big Macs do not count. It's jobs that count....and if you eliminate the fuzzy math, there is actually more jobs lost than actually reported. Your misunderstanding of how to read statistics and apply them to (face) reality is one of the problems this country faces and why neocons are still in power.

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## Cutlerzzz

> You invalidate nothing...still. Production numbers have been fudged to protect the guilty. Making mass amounts of Big Macs do not count. It's jobs that count....and if you eliminate the fuzzy math, there is actually more jobs lost than actually reported. Your misunderstanding of how to read statistics and apply them to (face) reality is one of the problems this country faces and why neocons are still in power.


If your only defenses are calling people neocons for advocating freedom, posting irrelavent numbers you don't even understand, and claiming all relevant numbers are made up, I think this is over.

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## ProIndividual

> Concession accepted.








But seriously...

Something occurred to me...is this in the Constitution other than interstate commerce (commerce between the states)? If this isn't in the Constitution...which I do not believe it is...then this is a state's issue, not federal. Therefore, you can be as protectionist as you want as long as you don't live in Ohio (and you can't do it against other states, per the interstate commerce clause). I'll watch your state flounder, while mine succeeds. 50 laboratories of experimentation, I say.

So this is a non-issue, other than just arguing the point of who is right, one side or the other...essentially we'll see when the Constitution is restored.

I got every red cent I have to my name on free trade, for the record. (Full disclosure, I'm a professional gambler.)

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## osan

> But but Obama told me dat Automatic Teller Machine terk mah jerb!


You mean "audamaddic telluh m'sheen".  

Learn to spell Amerkin', dammit.

Oh wait... I meant Indonesian.

Oh wait... I really meant Kenyan.

Oh wait...  DOH...

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## osan

> Something occurred to me...is this in the Constitution other than interstate commerce (commerce between the states)? If this isn't in the Constitution...which I do not believe it is...then this is a state's issue, not federal. Therefore, you can be as protectionist as you want as long as you don't live in Ohio (and you can't do it against other states, per the interstate commerce clause). I'll watch your state flounder, while mine succeeds. 50 laboratories of experimentation, I say.


The outcome is already demonstrated.  Some few years ago, the douches in NYC (yes, redundant I know) tried to do the tax NAZI shuffle on their own one Christmas season by setting up roadblocks at the Hudson River crossings and actually ransacking cars in search of merchandise purchased in NJ where there was a 3% sales tax.  Those caught with NJ-bought goods were forced to pay the 8.25% NYC sales tax on top of that!  What nerve.  This went on for some weeks and the results were so poor, which is to say it cost the city millions to recover maybe a few tens of thousands, that the stupid bastards gave up.

Another aspect of this deal that was particularly disgusting was the fact that virtually every single one of the ***-sheep meekly obeyed the orders to allow their vehicles to be searched.  I do not recall so much as a single case reported where a driver demanded a warrant.  Revolting compliance.

People will generally follow he path of the greatest perceived economic advantage.  What is greatest for Tom may not be the case for Dick and Harry.




> essentially we'll see when the Constitution is restored.


When?  You mean "if".  It is far from a foregone conclusion.

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## showpan

> If your only defenses are calling people neocons for advocating freedom, posting irrelavent numbers you don't even understand, and claiming all relevant numbers are made up, I think this is over.


And in typical neocon fashion, you offer no real facts, you misinterpret data, you offer insults instead of debate and you have simply exposed yourself in order to embellish the great lie. WTG.

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## ProIndividual

> When? You mean "if". It is far from a foregone conclusion.


I agree...and since we only should debate this, really, on the state level, is we are really Constitutionalists, we cannot advocate for the feds to govern the economy AT ALL.




> And in typical neocon fashion, you offer no real facts, you misinterpret data,


Except we did show real facts, that you never disputed in any manner worth mentioning. Also, we didn't misintepret anything...as a matter of fact, we showed CLEARLY how you misinterpretted information YOU provided.

It's sad when these dogmatists implode before their egos do. It's okay buddy, you can be wrong and not die. Trust me!

And Showpan...quit calling free market capitalists "neocons". We aren't, at all. I'm waaaaaay farther to the libertarian side than you are, I'm positive of it. Libertarians aren't pro-war, neo-Trotskyist leftists, who think deficits "don't matter", that the welfare state is great (just not when they speak in public), and government is to be used to legislate morality.

Just because neocons are RIGHT on ONE issue, it doesn't mean you can damn everyone who agrees with that one point.

Hitler took baths...you Nazi bath taker!

See how stupid that is?

It's called "guilt by association"...it's a Marxist propaganda model. Read Marx, or just wikipedia "propaganda", and you'll see I'm right. Stop using informal logical fallacies, like "appeal to antiquity or tradition", or anecdotes in place of evidence (like your pics of buildings), and Marxist propaganda models like "guilt by association" to make your points. They fail every logical test in an intelligent conversation. They only make sense if you haven't taken high school debate (class).

Thank you very much.

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## showpan

Look, you haven't actually shown any "facts" to support your theory because there is none. That's all "free trade" is..._a theory._.. because you would have to go back in time when data was not even recorded. All you have done is embellish neocon lies to support your theory. I am not going to hop on board with you because the neocons have destroyed this country and if they are for a particular policy, then I will guarantee that it is only to screw us, they are not for "free markets"....please stop kidding yourself and neocon NAFTA payed companies to move. We have been neoconned....snookered.

You keep using the argument about Doctors and Lawyers but they are not service jobs...they are professions that require a degree. You cannot compare a traditional service employee with that of a professional...lol...the only reason they have tried to rewrite history is to make it look like wages are higher. This was all written down in the federalist papers and the anti federalist papers over 200 years ago for people who do not get it.

*Fact.*..the constitution provides for Tariffs on imports to fund the government. The founding fathers also viewed them as necessary to protect our business from unfair foreign competition. Unfair would be countries that manipulate what their currency is worth and those who pay their workers in rice. They worked because this country had tremendous growth right up until 1913 when the FED took over, tariffs were reduced and personal taxes were seized. The FED caused the depression...not tariffs. We have also been in a state of perpetual war since that time which only keeps Keynesian theorists afloat.

When reading charts, you must first look at who made them and where was the data obtained such as that one that keeps getting posted about production vs jobs. That chart is very deceptive because it does not say production of what....does it include farming, durable goods, non durable goods, what is it actually measuring? We don't know and frankly I don't care because the person who made it is a FED and we all know what the FED does...they lie and they steal!!! There isn't any government data that shows what he drew in there except for job losses which have been fudged to make it look as if there aren't as many. Go to any government site and look up  production, it is broken down into categories by industry. If you are going to prove a point without using the only (I would say reliable but this is the government we are talking about) resource that actually measures data...the government, then how can you claim to refute anything? Here is one you posted about unemployment which is close but only shows the U-3 which does not reflect true unemployment. Again U-3 is used because it is very deceptive and has been manipulated to make it look better than it is. When you compare charts to one another, you can get a pretty good picture of what has happened like that idiot tried to do in your production chart.



Ok, See that spike in 1980-1985, when that happened Reagan increased defense spending in order to lower the unemployment that was getting our of control. I know this happened, I was there. Now look at this chart:



See, the spike in spending coincides with the decrease of unemployment. It wasn't "deregulation" because deregulation was a myth...he merely changed the rules which effectively shifted money from one sector to another. The FED also effects unemployment along with a host of other things. Unemployment was only able to level off after all their meddling because we had industries that were still standing....well guess what, if this country were to cut all defense spending right now, we are done....because we do not have industry to save us any longer.
Industrial jobs not only drove this countries growth, it also funded our government. They are now laying off and cutting everything. While I agree, less government is good, more unemployment and cutting everything to fund their wars is treasonous. This country needs to return to it's roots and stop bickering about untested theories.
The money trickles up...not down....this has been proven now for 30 years.

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## Carson

I've passed over the headline many times and all I can think is do you mean all barriers like cash and everyone just give anyone anything they want anywhere. 

That would lead to a lot of waste.


Then again I think of the old saying is the drug trade is the last bastion of free enterprise. 


Sometime I do favor the idea of protecting our industries by different means. Then other times I think if someone is dumping on the market it is time to fold up and stock up on the stuff being dumped. 

It can be very dangerous though as I'm sure many of you have noticed. If we get in trouble, sticks and stones better be enough because it is all we will have for a while.

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## Fox McCloud

> You invalidate nothing...still. Production numbers have been fudged to protect the guilty. Making mass amounts of Big Macs do not count. It's jobs that count....and if you eliminate the fuzzy math, there is actually more jobs lost than actually reported. Your misunderstanding of how to read statistics and apply them to (face) reality is one of the problems this country faces and why neocons are still in power.




You've pretty much outlined why I haven't contributed a lot to this topic---others have done just as  good of a job or better than I could and yet you just chuck things like this out here as if it completely invalidates all the figures, arguments, and logic. Obviously, this goes against your worldview, so your first reaction is to deny it/suggest its tarnished---then you paradoxically go on to suggest that we're looking at the figures incorrectly. Which is it? Are the figures wrong or are we---or are you just throwing random things out there (including the first things you can google+find that go against free trade) and hope something sticks?

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## ProIndividual

Showpan...lol. I will just say this:

You have been utterly destroyed on this thread...just stop.




> Fact...the constitution provides for Tariffs


As it provided for slavery as well. Neither is moral or economically intelligent (or beneficial). Why do you hate property rights so much?




> Ok, See that spike in 1980-1985,


I see a trend ending there, that started as an uptrend in about 1971 (when we came off the gold standard, what a coincidence!). Notice the period you claim is so bad, the trend ends, and starts downward...lol. You are too easy dude. It again spikes in 2008, due to the Fed Reserves bubble popping. This works totally against the fake argument you're making. Thanks for the help though.

And military spending needs cut like everything else...how does that reflect on free trade badly? It reflects on your system of protectionism badly, as Hamilton and John Hay wanted to use military FORCE to pry open foreign markets, but not to reciprocate. It caused more than one war, btw. Again, dropping your delusions, anmd reading what we wrote and linked that disproves your BS isn't fatal. Just come one over to the side with all the facts on figures on their side; our side; free trade. We welcome you with open arms. All you have to do is stop being a dogmatist who is obviously beaten, and wrong.

Also, military jobs don't create wealth...so how is this any different than any other govt job? It consumes wealth, and drags the economy, not vice versa. All FDR did was kill the otherwise unemployed by employing them in the military. Any capital syphoned off to govt jobs that produce NO wealth cannot be good for the economy.  If we cut defense spending now, and the taxes that fund it, it would less than 2 years before we had sufficient employmwent numbers for our vets in the private sector. You are suffering from a fallacy I alredy linked you to: the Broken Window Fallacy. You are looking at the "seen" in Bastiat's parable, not the "unseen". The "seen" is the unemployment caused by letting troops out of the military...the "unseen" is the jobs that same capital creates when used MORE efficiently by the private market when not syphoned off through theft (cough, cough, I mean tax).

Try reading all our posts and links man...you'd save yourself embarrassment.

And again, money doesn't "trickle up" or "down"...we all got wealthier until the collapse...as we said b4, your stagnant or falling wages are erroneous...total real (accounted for inflation) compensation is what measures this...and you got more more more until 2008, all classes, period. Stop lisatening to libtards, they don't know what they're talking about. They just cherry pick stats like you're doing now.


And again, this is state's issue, as economics isn't in the Constitution...tariffs may be, but so was slavery...so that needs to end. Allow states to deal with economics on their own. Then you can kill your states economy all you like with protectionism, I won't care. And once for all, we'll see who's right. Only state i care about is Ohio, my state. You can destroy your state as long as it is any of the other 49. If this isn't a good compromise for you, then oh well, because you're just flatly WRONG anyway.

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## Fox McCloud

> Only state i care about is Ohio, my state. You can destroy your state as long as it is any of the other 49. If this isn't a good compromise for you, then oh well, because you're just flatly WRONG anyway.


As a fellow Ohioan, I feel I can comment on this....sadly, it seems Ohio is pretty good at destroying itself....as far as economic freedom goes, anyway =T

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## Paul Or Nothing II

> You keep using the argument about Doctors and Lawyers but they are not service jobs...they are professions that require a degree.


Look, it's pretty simple. They provide a SERVICE to other people that's why they're SERVICE JOBS & aside from that, how does it support "tariffs are good" argument? It does NOT.




> *Fact.*..the constitution provides for Tariffs on imports to fund the government. The founding fathers also viewed them as necessary to protect our business from unfair foreign competition.


This is the problem with the "tariffers" here (so VERY FEW that are here, I'm glad most here already understand how they're unfair). They think that just because Founders were right about a lot of things, means that they were right about everything, this is just pure dogmatic behavior.

They look at the Constitution & see "tariffs" & they go "oh yeah, that's what's wrong with America today, we don't've enough tariffs" & think that that's the solution to making America better but don't ponder over the fact that things like high regulations & high taxation, minimum-wage laws are what's hurting America & getting rid of these things in itself will make America strong again, even without the tariffs but then dogmatists aren't in the habit of using reason & logic anyway.

The belief that tariffs are a mode of "external taxation" is even more foolish. 




> Unfair would be countries that manipulate what their currency is worth and those who pay their workers in rice.


It's a really weak position when one says that just because other countries are diluting their currencies & STEALING purchasing-power from their people that America should also mistreat its own people.

As I've explained elsewhere, the price of tariffs gets added to the eventual price that Americans will've to pay for the imported goods & since not everyone necessarily uses imported goods nor does everyone uses the same amount of imported goods, means that tariffs cause the government to tax all its citizens differently, it allows the government to NOT treat all its citizens EQUALLY & violates the principle that every citizen has an EQUAL right to their life, liberty & property.

Further, tariffs lead to corporatism as politicians & bureaucrats start using tariffs to benefit those businesses that are willing to bribe them which hurts the small businesses the most & unfairly hurts the market & the consumers/people. The fact that Civil war was caused by tariff-wars & turned United STATES of America into United EMPIRE of America should in itself be enough for any rational person to realize how destructive tariffs can be.

The "tariffers" are no different than socialists in that they support the belief that it's ok for the government to NOT treat all its citizens equally because as I've said, not all Americans pay the "tariff-tax" equally.

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## ProIndividual

> As a fellow Ohioan, I feel I can comment on this....sadly, it seems Ohio is pretty good at destroying itself....as far as economic freedom goes, anyway =T


Arggggh, true.

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## Southron

I have a question for the globalists: what happens in a future war with China where they manufacture most of our defense-critical parts?  Surrender?

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## ProIndividual

> I have a question for the globalists: what happens in a future war with China where they manufacture most of our defense-critical parts? Surrender?


First of all, globalist means free market capitalist, not one world government conspiracy theory...okay? So quit using it as pejorartive, we don't call ourselves that. You keep doing it, and I'm gonna refer to you as "xenophobe mercantilist scumbag property rights hater"...k?

Sencond...China doesn't make our defense stuff...we do.

Third...why would any nation allow a competing power to see their tech? This doesn't even pass the common sense smell test.

Fourth...they have a puny economy compared to ours still...they can't catch up for decades, maybe a century, depending on estimates and growth. It would take like 80 years if we had neagtive growth for that 80 years and they had current growth rates. So stop worrying about China, they are making us rich, the government is making us poor by borrowing from them. Trade good, borrowing bad.

How may dumb questions are you going to ask? Why not google some these dumb questions? Why ask them in a manner that is obviously insulting?

You may not understand economics, but that's no reason to call free market capitalists "globalists", like it's some kind of backward ideology that means to achieve one world government or something. The "surrender?" at the end of the question clearly shows you think you know everything anyway, and this isn't an honest question to begin with.

Can we try covering up our dogmatism a little better next time?

If you want to ask rhetorical questions just for the sake of insulting people whose positions you do not understand, or refuse to educate yourself about, then go stand in front of the mirror and ask yourself questions.

Maybe then you'll actually listen to the answers and check some the gosh darn links provided.

(drop the mic) And I'm out!

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## VBRonPaulFan

hahaha +rep when i can

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## ProIndividual

http://www.ronpaulforums.com/showthr...53#post3387353

Zombie: "Hey, free trade doesn't work, and you're a globalist naive silly person."

Me: "Mooooooaaaaaan globalist!!!"

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## showpan

You still haven't proven anything with actual facts like I have. Your opinion does not count as facts. Stop insulting me.
Facts...doctors and lawyers are professional jobs as defined by our founding fathers and any real university professor and the data that is collected by the census bureau. I have taken management and economic classes and your claims are completely false.
Fact, Reagan's unemployment was due to the loss of defense revenue, I was there, I was working...where were you?
You don't even know how to read your own chart that actual shows worker efficiency, it has nothing to do at all with manufacturing output...it only shows that American workers can produce more than they did in 1950.
Stop embarrassing yourselves.
Globalists = the idea that profits and share prices for people who do absolutely nothing are worth more than the actual people who do the work.
Stop insulting me and show me actual figures that support free trade...you can't because this country has never had free trade and has been on the downhill slide ever since tariffs were reduced and personal taxes replaced that revenue.

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## ProIndividual

> You still haven't proven anything with actual facts like I have. Your opinion does not count as facts. Stop insulting me.
>  Facts...doctors and lawyers are professional jobs as defined by our founding fathers and any real university professor and the data that is collected by the census bureau. I have taken management and economic classes and your claims are completely false.
>  Fact, Reagan's unemployment was due to the loss of defense revenue, I was there, I was working...where were you?
>  You don't even know how to read your own chart that actual shows worker efficiency, it has nothing to do at all with manufacturing output...it only shows that American workers can produce more than they did in 1950.
>  Stop embarrassing yourselves.
>  Globalists = the idea that profits and share prices for people who do absolutely nothing are worth more than the actual people who do the work.
>  Stop insulting me and show me actual figures that support free trade...you can't because this country has never had free trade and has been on the downhill slide ever since tariffs were reduced and personal taxes replaced that revenue.



This is what it's come to. Anti-free market capitalists, anti-property rights, anti-reason, anti-wealth, anti-growth, anti-jobs...for the sake of nostalgia, dogmatism, and other assorted nonsense.

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## Carson

We haven't had free trade or a capitalist system for decades.



When we started allowing people to tap into the honest people profits and wealth the free market and capitalism withered on the vine. You just can't impose that much socialism and expect anything to survive.

The little bumps during time of war were other times the government introduced fiat money into the system. It was later withdraw and the system returned to a dollar you could bank on.

The line showing the devaluation of the dollar responds to any type of counterfeiting no matter who does it. Without and audit of the central banks we have allowed others out side of our country the ability to print up what ever it takes to get their way. The problem now is world wide. We're not the only country that has been taken in. 

We may stand up to them for a moment but they are like the walking dead. You may put them down and they may lay there for a while but anyone that has ever watched a science fiction movie know as soon as your guard is down they will rise up and get you.

Welcome to the new world order.



Actually this picture is pretty unjust. As you can see the problem has been around and quit acute regardless of who the latest new world order shill is.

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## Southron

Not worth it.  Sometimes I forget that this is just the internet.  I am here to get guys like Glen Bradley elected and not get into a pissing match with some kid.

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## ProIndividual

> First, you have already called me most of those names so you can't stoop much lower.


You have no clue how low I can stoop...lol. And no I didn't call you those names, unless you earned them.




> Second, China is already supplying parts for our military planes.


And how does this endanger national security, to get ball bearings or hinges? Obviously they aren't assembling our stealth and no idiot would or could allow that to happen, so the point is moot.




> Third, China's economy is set to overtake ours in 2016.


No it's not, that cap, cut, and whatever pledge is a scare tactic (I'm guessing that's where you got that number from, or from the erroneous source they site for it). No one with half an understanding of economics thinks China is about to overtake us in the next decade, let alone in 4 years. We could go through national bankruptcy and still emerge with a larger GDP, per household income, individual real compensation rate, and lower unemployment rate.




> Finally, I hope you don't talk to people like that in person or "someone" is going to knock your teeth out and laugh at your NAP.


I highly doubt that would happen...and if you want to threaten me, I'll call you a lot more than what you think I have already, dim witted keyboard tough guy.

Only a punk makes idiotic statements like that. You aren't that "someone", and I ain't the type who fights fair. Let's just drop this bully bull$#@! talk now. Are you a child? Or a man who can't win an argument? You are definately one or the other.




> I'm through with your arrogant $#@!. Don't bother replying to anything else I post.


Perhaps my arrogance is real, but I know for sure your willful ignorance is. You'll wake up eventually, or be on the back side of the Kuhnian Paradigm Shift like all the other old people who are giving way to young who still have open minds.


Hey Zombie:

"Moooooaaaannnnn China."

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## josh b

Holy crap, I go on vacation for five days and this thread is still here.  

Props to ProIndividual and Cutlerzzz.  You guys are much better at explaining this than I am.

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## tpreitzel

Thankfully, regardless of the "free trade" crusaders, this view of global "free trade" will likely never be adopted voluntarily by the American people.

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## showpan

> Thankfully, regardless of the "free trade" crusaders, this view of global "free trade" will likely never be adopted voluntarily by the American people.


I doubt we will even make it to another election. It's just a matter of time before the tens of millions of unemployed who know they have been snookered start to revolt. Something is going to snap soon as people are becoming more desperate.

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## The Grinning Maniac

I have a few points to make, to respond to some things to ProInd and some others have said. Will post soon. Hopefully the thread hasn't turned into a total flame war by then.

"NO, YOU SIR, ARE THE SUCKER OF COCKS!"

"NO YOU"

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## osan

> I agree...and since we only should debate this, really, on the state level, is we are really Constitutionalists, we cannot advocate for the feds to govern the economy AT ALL.


Agreed.  I am, however, not even sure the states should be interfering.

Taken to the global level, it is not clear that a perfectly free market would be able to thrive in an environment of global governmental interference.  The phenomenon of lowest denominator seems to hold a position of great significance in such affairs.  Consider warfare - an example from our own revolution might serve well to illustrate how it is so.  While the Brits were standing in straight ranks, our guys were hiding behind trees, picking off their officers.  This was considered disgusting and cowardly by the Brits, yet in the end we prevailed over them and in time their "noble" method gave way to that of the "cowardly" Americans.  Why?  Because it worked better and in the end, winning became more important than how one played the game.  This is as it is today.  The lowest denominator of pure pragmatism triumphs over higher principle in virtually all governmental decision making.  

Another example come from contact with police where we find no consideration of the humanity and dignity of people whatsoever.  Just cold, spiritless treatment of one's fellows as objects.  This is now standard procedure in virtually all police procedures.  Note that objectification of a population is an age old method for prepping another population to treat them not as their fellows, but as aliens - as enemies.  This is precisely how police now generally view everyone else.  Once again a lower denominator has become the new standard because it brings an ever greater number of once taboo behaviors into acceptability, which in turn grows the power of the state and further marginalizing the mundane individual.

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## osan

> Thankfully, regardless of the "free trade" crusaders, this view of global "free trade" will likely never be adopted voluntarily by the American people.


It will be adopted involuntarily.  Result is the same.

Way too much "don't worry, be happy" syndrome here these days to be confident that enough will just say no.

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## osan

> Sencond...China doesn't make our defense stuff...we do.


Yes and no.  I have worked in defense and at one point knew the inner workings of some state of the art ECM and FC systems.  Many of the chips were made outside of the USA.  So in fact we are not making everything in the USA and Rifleman's question is valid.

Do not make the mistake of conflating the rational self interest of China or any other nation with that of the USA.  Under most circumstances there will be significant overlap, but when circumstances introduce strong diversions from the status quo, all bets may be off.  All manner of things alter one's notion of rational.  We find Muslim suicide bombers wholly irrational.  I suspect they see us precisely the same way.  The point here is that if a nation such as China decides upon a broad stroke, strategic agenda item that for them is very important, and it happens to involve taking an opportunity to de-nut the USA in some way, it may well turn out that the price they pay, as well as the risks they assume in taking such course of action are looked upon as being worthwhile.  It may also superficially appear to us as utterly irrational.  People do all manner of seemingly wild stuff.

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## Danke

> Not worth it.  Sometimes I forget that this is just the internet.  I am here to get guys like Glen Bradley elected and not get into a pissing match with some kid.


Slow learner.  :collins:

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## ProIndividual

> some kid


No kids here. Don't threaten people, and then play like you're the adult. BTW, it also doesn't erase your original threat to edit it out. YOU are the child here...incapable of debate without threatening someone. Too bad you are intellectaully in over your head, huh?

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## ProIndividual

> Thankfully, regardless of the "free trade" crusaders, this view of global "free trade" will likely never be adopted voluntarily by the American people.


Free trade is defined as trade with NO government interference. Therefore, it will be put in place voluntarily, as soon as protectionists stop using govt guns and laws to trample the American peoples property rights. 

You mean "fair trade", or "balaced trade", or "reciprocal trade" will never be put in place voluntarily...as they are not voluntary at all!

The only kind of trade that is voluntary is that which has NO government influence beyond prosecuting harm (fraud, etc.)...that's free trade, not protectionism at all.

How can you think governments telling you what you may or may not buy (or sell, or who to hire), to protect domestic oligarchs, is somehow "voluntary"?

The logical conflict is self evident. You do not respect private property rights to do anything else but FREE trade.

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