Conservatives and the Free Trade Straw Man

[TheTexan]

We do buy stupid plastic stuff from them, because they can make those things more efficiently than we can (and - again - I'm not arguing on behalf of the current quote-unquote free trade paradigm, but, for the sake of argument...)

That's just the thing- in terms of human manpower, we can make that stuff just as efficiently as they can. Exactly the same amount of human effort.

They aren't any better at it than we are.

They are just poor.

That's their economic advantage: they are poor and desperate.

That's not a "specialization" in the sense that Adam Smith was envisioning.

We're securing our wealth by purchasing goods that we want, by discerning that they can provide it at a more economical cost. You refer to "we" and "them", but I'm not sure how I'm benefitted by thinking of "the Chinese" as "them" and people here as "us: I want a good; other people have that good to offer to me at various prices. So, again, why shouldn't I seek that good at the most economical price?

This logic is fair. However it does not address the counterpoints of protectionism. Protectionism asserts that by reducing imports and keeping manufacturing domestically, it raises wages across the board for the protectionist nation. Logic and basic economics back that up as indisputably true.

Which however begs the question: does it raise wages enough, to counter-balance the opportunity cost of buying stuff from China? It's a complicated question with complicated math - I don't know the answer, and I think anyone who says they do know the answer is full of shit.

 

[A Son of Liberty]

That's just the thing- in terms of human manpower, we can make that stuff just as efficiently as they can. Exactly the same amount of human effort.

They aren't any better at it than we are.

They are just poor.

That's their economic advantage: they are poor and desperate.

That's not a "specialization" in the sense that Adam Smith was envisioning.

Okay. Why should I spend more money to buy a piece of plastic from someone on the other side of the Potomac than I should from someone on the other side of the Pacific?

 

[TheTexan]

Okay. Why should I spend more money to buy a piece of plastic from someone on the other side of the Potomac than I should from someone on the other side of the Pacific?

See my ninja edit above.

 

[A Son of Liberty]

See my ninja edit above.

Because "America"?

 

[TheTexan]

Because "America"?

It's as valid reason as any.

I get the whole "I'm an individual I hate collectivism cus I'm a cool state hating anarchist" thing.

But collections of people have existed since the beginning of time and to assert they have no value or purpose I think is misguided.

 

[TheTexan]

Another way to look at this is this:

It's a general rule that wealthy people get wealthier. It's because wealth is exponential. If you have a great deal of wealth, it becomes easier and easier to generate more and more wealth.

At the end of World War 2, America was the wealthiest country in the world.

Then free trade happened. America began spending its wealth, distributing it across the world.

If America had instead closed its borders, and focused inwards, and retained our manufacturing here, instead of subsidizing the development of 3rd world countries,

America would be above and beyond the wealthiest country in the world, far beyond what we are today.

The rest of the world would be a complete shithole, moreso than today.

But here in America we'd have cool robots that wash our dishes and sucks our dick like Rosey in the Jetson.

 

[TheTexan]

Instead, we're all gonna be speaking Chinese in 30 years because "omg free trade derp"

 

[A Son of Liberty]

It's as valid reason as any.

I get the whole "I'm an individual I hate collectivism cus I'm a cool state hating anarchist" thing.

But collections of people have existed since the beginning of time and to assert they have no value or purpose I think is misguided.

It's also as invalid a reason as any.

Don't be pedantic, man. This has been a good conversation. Don't ruin it.

Also I don't ever remember Rosie sucking a dick.

 

[TheTexan]

It's also as invalid a reason as any.

If you hate America, look at it then at a smaller scale.

Replace "America" with "your family & friends".

Would you rather:
1) Buy a $30 lawn chair from your friend, who frequents your shop often in turn, or
2) Buy a $29 lawn chair from some random dude in China so he can spend it in China

Is the $1 savings worth it?

 

[Brian4Liberty]

Another way to look at this is this:

It's a general rule that wealthy people get wealthier. It's because wealth is exponential. If you have a great deal of wealth, it becomes easier and easier to generate more and more wealth.

At the end of World War 2, America was the wealthiest country in the world.

Then free trade happened. America began spending its wealth, distributing it across the world.

If America had instead closed its borders, and focused inwards, and retained our manufacturing here, instead of subsidizing the development of 3rd world countries,

America would be above and beyond the wealthiest country in the world, far beyond what we are today.
...

But there would be less billionaires in America. The Walton family would have a business which may have grown enough to compete with JC Penny. They would not be billionaires. Jeff Bezos would be working as a programmer somewhere.

 

[TheTexan]

But there would be less billionaires in America. The Walton family would have a business which may have grown enough to compete with JC Penny. They would not be billionaires. Jeff Bezos would be working as a programmer somewhere.

True, although I think Wal Mart was quite successful even before it went international.

 

[TheTexan]

Even from a global wealth perspective free trade is a dumb idea.

Option 1) Buy a wooden chair from your neighbor for $30, hand-made with lumber from his land
Option 2) Buy a wooden chair from China for $25, and pack and ship it 8,000 miles

With option #1, the world as a whole gained $30 in wealth.

With option #2, the world only really gained $5 in wealth. $20 was literally thrown in the ocean to get it shipped 8,000 miles.

 

[Brian4Liberty]

True, although I think Wal Mart was quite successful even before it went international.

Yep. They were regional, and could have gone national under your scenario. But they wouldn't do it via importing cheap products from China.

 

[A Son of Liberty]

If you hate America, look at it then at a smaller scale.

Replace "America" with "your family & friends".

Would you rather:
1) Buy a $30 lawn chair from your friend, who frequents your shop often in turn, or
2) Buy a $29 lawn chair from some random dude in China so he can spend it in China

Is the $1 savings worth it?

I don't hate America. Your appeal to emotion is probably working on douche nozzles like Swordsmyth, but I'm entirely uncompelled by it.

"America" and "my family & friends" are in nearly no way analogous.

 

[TheTexan]

I don't hate America. Your appeal to emotion is probably working on douche nozzles like Swordsmyth, but I'm entirely uncompelled by it.

It was sarcasm. I don't care if you hate America. I hate America. But as long as I'm an involuntary member, I may as well want the best for America. Because it involuntarily includes me.

"America" and "my family & friends" are in nearly no way analogous.

They are, though. Economic effects that happen at the micro level, happen exactly the same at the macro level, unless there's a compelling reason to think otherwise.

 

[TheTexan]

If tomorrow every country except the US just disappeared from the globe, the people gone, and the land replaced with oceans,

It would take like 1 year to recover economically.

Then things would keep going on as they always have.

And we would be just as productive as we have always been.

And you would still have affordable lawn chairs.

Trade with other nations, is overrated.

 

[Krugminator2]

I use China as an example but really the above formulation applies to every transaction with any person or any country.

If we are in agreement that:
A consumer purchase is a transfer of future economic security from one person to another.

Can we agree then that the below is true?
When America imports consumer goods, it has a negative effect on America's economic future and corresponding positive effect on the other country's economic future
When America exports consumer goods, it has a positive effect on America's economic future and corresponding negative effect on the other country's economic future
When America builds and then consumes those consumer goods, it has a positive effect on both America's present and America's futures

If you disagree with the above statements, can you tell me why we can agree that it can be true for an individual transaction, but is no longer true when considered in the aggregate?

I already did. Green squares aren't eaten or used as decoration. They ultimately flow back to the US either in the form of investment or in purchasing products that will be exported to China. If imports made the US poorer, then the value of the dollar would drop relative to Yuan until you hit a new equilibrium where imports and exports would be in balance if you include investment.



A pretty good rule of thumb in life is whatever Milton Friedman says on any topic is correct. And if you think you know better you need a really good explanation and it helps to have other smart people in the field of economics on your side. Instead the only economists against free trade are far left wing economists like James Galbraith and Joseph Stiglitz and Dean Baker. That is not good company. You are choosing between Milton Friedman and the guy who thinks Hugo Chavez was doing a great job. https://www.nbcnews.com/id/wbna21246144

 

[TheTexan]

I already did. Green squares aren't eaten or used as decoration. They ultimately flow back to the US either in the form of investment or in purchasing products that will be exported to China. If imports made the US poorer, then the value of the dollar would drop relative to Yuan until you hit a new equilibrium where imports and exports would be in balance if you include investment.



A pretty good rule of thumb in life is whatever Milton Friedman says on any topic is correct. And if you think you know better you need a really good explanation and it helps to have other smart people in the field of economics on your side. Instead the only economists against free trade are far left wing economists like James Galbraith and Joseph Stiglitz and Dean Baker. That is not good company. You are choosing between Milton Friedman and the guy who thinks Hugo Chavez was doing a great job. https://www.nbcnews.com/id/wbna21246144

First off, USDCNY has indeed dropped since its peak in 1994. (though I disagree that should be used as a measuring stick of relative wealth anyway)

Second, you're making a lot of assumptions that aren't backed up by reality. You are assuming that every dollar sent out flows back to the US. They don't. You're also assuming that the dollars flow back to the US for the same class of goods (consumer vs b2b). Again - they don't.

 

[TheTexan]

A pretty good rule of thumb in life is whatever Milton Friedman says on any topic is correct. And if you think you know better you need a really good explanation and it helps to have other smart people in the field of economics on your side. Instead the only economists against free trade are far left wing economists like James Galbraith and Joseph Stiglitz and Dean Baker. That is not good company. You are choosing between Milton Friedman and the guy who thinks Hugo Chavez was doing a great job. https://www.nbcnews.com/id/wbna21246144

I don't need someone else to tell me how I should think. Economics is not hard - its just human action, and I am just as much human as any of those "economists".

 

[Krugminator2]

I don't need someone else to tell me how I should think. Economics is not hard - its just human action, and I am just as much human as any of those "economists".

That's a point of difference. I know that I know nothing. Therefore I listen to people who spent their life to studying a topic and have a track record of being right and who have worked critiqued and debated among other people who have spent their lives studying a topic.

Maybe you are Ray Dalio and worth listening to. Most likely you aren't so I'll stick to citing Milton.