Originally posted by mnemeth1
reply to post by David9176
Basically protectionism hurts the common man more than it helps him, as do all State interventions in the market.
The only thing that helps the poor people is when government stays out of the market and monetary system entirely.
[edit on 10-3-2010 by mnemeth1]
Every economic graduate or Phds, or even Economic Nobel Prize winners who wrote long thesis or led others to believe in Comparative Advantage or
Globalisation, better known as Anti-Protectionism, should surrender their degrees and awards!
And if they had stupidly believed that governments should not intervene in markets, then they should also do the same and return to schools and
This financial crisis had driven home the realities of their views which resulted in the big mess they had created on national economic policies. If
not for government intervention – convincing taxpayers, even putting their own careers on the line to help stabilize the markets, the poor would all
had starved and the rich murdered already!
The basic premise of anti-protectionism is that it would only make the employer or biz owners rich, by restricting trade between other nations that
could have provided cheaper similar products to the masses.
For example: - Country A produces wheat and sells a bag of it at $5 to its citizens. Country B, due to its low labor and land costs, could produce the
same wheat and sell to any country at $3 per bag.
However, Country A farmers would be bankrupt if Country B is allowed to do so, therefore, they appeal to the authorities to impose tariffs/taxes so
that the wheat from Country B will eventually be sold at $7 to consumers in Country A, thus A citizens will continue buy local wheat as it is
So protectionism must be scraped in order to help the citizens buy the ‘true’ cheaper wage from Country B
But such beliefs only work if Country A farmer is a single monopoly resource or a cartel of wheat farmers. America however has laws against monopoly,
and furthermore, they are plenty of other wheat farmers to provide competition which will keep the prices in check within US.
Comparative Advantage is a lie! Country B could sell wheat at a lower price was due to its low regard to human development, such as China which has
low social spending programes in education and health. Secondly, many corners had been cut in its productions such as tainted or toxic processes
resulted. Thirdly, corruption is rife, which often results in the workers there kept under slave conditions while the employers and foreign
Fourthly, even at $3 a bag in China, with ‘free trade’ that removes trade barriers, the Globalist Corporations still sells to the American
consumer at $4.50, pocketing the difference. ‘Free trade’/Globalization only made the greedy Excessive Capitalist bastards Corporations rich.
Should America not adopt protectionist policies and re-invent manufacturing processes, the poor in both nations will only continue to suffer in the
hands of the Globalist Corporations.
I can continue to write more, but guess many would have a better pic of what's going on now...