Eric,
I'm not clear why you recommend "Buy American."
The more trading partners we have, the more "division of labor" and
"comparative advantage" raises everyone's (world wide) standard of living.
Warm regards, Michael
Starchild & Michael;
Your points here are good ones; and they would make sense if the entire world practiced a free-market economy. But since it doesn't, defensive measures have to be taken to protect the national economy.
As long as government-subsidized corporations exist; and slave-labor economies like China are given MFN status and preferences over American businesses; also when foreign-owned corporations are allowed to operate in the US under unequal tax structures---we've seen the result of 'outsourcing'. It hasn't raised the standard of living overseas much and has lowered ours.
Eric,
Thanks for your response, however I'm afraid I don't find it very persuasive. Government-subsidized corporations exist *in the United States* as well as elsewhere. Are you advocating that other governments take "defensive measures" to protect "domestic" businesses in "their" countries from such U.S.-based corporations? If all governments consistently take such "defensive measures", do you think it will make the overall situation better, or worse?
You make three specific claims which I find dubious:
(1) China is a "slave-labor" economy
(2) "Foreign-owned corporations are allowed to operate in the US under unequal tax structures" (precisely what you mean by this is unclear to me)
(3) Outsourcing "hasn't raised the standard of living overseas much and has lowered ours" (by "ours" I assume you are speaking nationalistically and mean "that of some people in the United States" or something like that)
Do you have evidence to support these claims?
Love & Liberty,
((( starchild )))
Hi Starchild:
I realize that this position isn't an orthodox libertarian one; however, I think a lot of libertarians need to re-think some aspects of economic orthodoxy. The problem, as I see it, is that most libertarian economic theory was really formulated during the post-WW2 era, when there was a real danger of wholesale government expropriation of the economy. Today, the danger is a wholesale expropriation of government by corporative monopolies. That is no improvement over State Socialism; the last major nation that operated a corporate-run government was the Japanese Empire. Yesterday, being the anniversary of Hiroshima, we see how THAT turned out!
To address your points: most other countries DO take such defensive measures. They aren't seeing their entire economies outsourced or their markets flooded with over-priced, low-quality products. I think the situation would be made better if the UN would actually do something useful and ban all tariffs, and tied all world currencies to a uniform Gold/Silver Standard. Then there would be no need for trade barriers and no need for protectionism of any kind.
1. China is not strictly-speaking a slave-labor economy, but they do use a lot of forced labor (although our own prison-industrial complex rivals theirs). It is well known, though, that nominally American corporations have made corrupt bargains with the Chinese government for subsidies, including depressed wages and longer working hours. These same corporations BTW pay off American politicians for higher American wages, taxes and regulations to discourage any actual domestic competition.
2. A good example is the media monopoly, Newscorp. It is registered in Australia, pays lower taxes there and only trades stock in the US, where they pay lower calital gains taxes. Halliburton does this too; they are registered in the UAE and largely tax-exempt, but they glut themselves on profits from US taxpayer-subsidized no-bid contracts. Just like in #1: these corporations want high taxes for American businesses who can't afford (or aren't politcally well-connected enough) to move offshore.
3. Yes, I did mean 'ours' in a general sense. Adjusted for inflation, the dollar has depreciated 80% since the year that the US went off the Gold Standard (and turned the currency over to market-manipulators) and eliminated trade barriers (and turned us into a service-based economy). Wages have gone done 10% since the same time.
In 1960, 55% of Americans owned a farm, today Americans are net importers of agricultural goods. The same year, 30% were factory-workers who raised families on a single income. Today, a single income can barely support a single person---certainly not enough to own property or do much else. In 1960, about 10% were independent businessmen. Today, nearly 75% of the American economy is service-based.