Friday, January 21, 2011

Trade Goods, Not People

Interesting article from American Conservative magazine.  Interesting, in that it ignores the history of tariffs and their success in American economic history, and the contrasting destruction of the British economy via free trade in the 19th century.   Article tries to argue against the import of workers, but thinks if the same workers work for less off shore and flood our market with their goods that will somehow work better.  Check out this book by Ravi Batra, "The Myth of Free Trade."  A close reading of this, in many other ways excellent, article, will convince one, unintentionally, of the absolute necessity of tariffs as part of a full employment policy.

One other quibble--the author seems to take the view that the destruction of our culture is the product of short sightedness.  I prefer a more sinister explanation.

At any rate, the Tea Party agenda should be to end outsourcing, offshoring and illegal immigration, oh yes, bring back tariffs.  First party to do this locks up Congress for at least one, maybe two, generations.---rng

Conservatives must confront the economics of immigration.

 

By William W. Chip 

 

     When conservative icon Paul Weyrich died in December of 2008, the Democrats had just won the White House and increased their majorities in the House and Senate. Virtually from his deathbed, Weyrich judged that conservatism had become a movement “without a serious agenda or a means of explaining such an agenda to the public.”

     What would Weyrich have made of the Republican Party’s 2010 comeback? In the contest for power, does having a “serious agenda” really matter? The GOP’s “Pledge to America,” with almost as many photographs as paragraphs, was a pale imitation of New Gingrich’s 1994 “Contract With America,” and it dropped from sight almost as soon as it was released.

     Does having a “means of explaining” the conservative agenda really matter? Time and again we watched painfully sincere Tea Party candidates wander into incoherence when asked even the simplest questions about how they would go about “taking back” their country.
     For Republicans and the Tea Party, promising to extend the Bush tax cuts, repeal Obamacare, and restrain deficit spending proved to be a winning agenda. But it was hardly a serious one. Obamacare was hated mainly because seniors and others perceived that spending on their own healthcare would be curtailed.
     What is the conservative plan to reduce the federal deficit without touching Medicare? “Stimulus spending,” a cornucopia of Democratic earmarks, may have produced monster deficits and few jobs, but what other means does Congress have to counter a recession? Republicans might prefer tax cuts to spending increases, but equivalent tax cuts would have produced equivalent deficits. Moreover, given the determination of American households and businesses to “deleverage,” tax cuts were no more likely than government spending to pump up aggregate demand.
     Inscribed on a stone arch over an entry to the Yale Medical School is a Latin phrase that translates roughly as “most of your patients get better no matter what you do to them.” Republican leaders may be betting that, no matter what Congress does in the next two years, the economy will improve, and grateful voters will reward the GOP for sound economic stewardship.
     If the Great Recession were only a more severe version of a typical business downturn, these Republican leaders might be proven right. Unfortunately, for them and for the rest of us, when the financial dislocations stemming from the subprime mortgage debacle come to an end, it will become evident that the economic anxieties of ordinary Americans have more intractable causes than improvident home equity loans.
     Those causes are mostly rooted in globalization of the economy and the ability and willingness of billions of foreign workers to do the same work that most Americans do, as well as they do it, and for much less compensation. Cutting taxes and government spending may be good things in themselves, but they do not constitute a “serious agenda” for dealing with the threats to our standard of living posed by the changing balance of global economic power.
     In order to pass the Weyrich test, a conservative agenda for addressing the challenge of economic globalization must be both “serious,” in the sense of addressing rather than avoiding the toughest issues, and explicable to the public, even by a politician. I would add an additional test: it must be easy to distinguish from its liberal alternatives.
     Globalization is a complex phenomenon, but its origins are not hard to understand. Twentieth-century advances in medical care and food production engendered population explosions in Asia, Africa, and Latin America, while comparable advances in transportation and communications, coupled with the decline of socialist ideology, put these billions of otherwise isolated Third World peoples into economic contact with much wealthier First World producers and consumers.

To continue.... 

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