Free Trade and Fair Trade: SIEPR 2008 Economic Summit Conference

The question of "free" versus "fair" trade, has three baskets: an environmental regulation basket, a labor-standards and freedom basket, and a "wages basket."

The first two can, I think, be disposed of quickly. We don't want those able to bribe governments in other countries to poison people or the globe by turning other countries into pollution havens. We don't want environmental standards to be used to freeze the world distribution of wealth and keep people in other countries hungry, illiterate, and barefoot. The difficulties that remain are those of implementation.

Similarly, we want expanding trade to be a force for opportunity rather than for oppression: we like it when expanded trade gives ordinary people a path to a better life; we don't like it when expanded trade gives rich and powerful people in the cloud city of Stratos an incentive to round others up and put them to work in the xenite mines. As then-Principal Deputy IMF Managing Director Stanley Fischer warned the great and good at the 2000 Federal Reserve Bank of Kansas City's Jackson Hole Conference, there is nothing in the ILO's principles that we cannot and very little that we should not be eager to endorse, all of us. The difficulties that remain are, once again, those of implementation.

The question of trade and wages remains: To what extent are rich countries obligated to open their markets to poor countries when the consequence is falling wages for the poor in the rich--bearing in mind that the poor in the rich are often wealthier and have more opporunity than the rich in the poor? To what extent do rich countries do themselves well--serve their national interest--by opening their markets to poor countries even when the consequence is falling wages for the poor in the rich?

Let me make four remarks on this "trade and wages" basket:

First, between 1950 and 1997 trade and wages weren't an issue: our foreign trading partners raised their own relative wage levels at least as fast as globalization enhanced their influence, and there was no net effect of trade on wages--no link from greater openness to the global economy to greater inequality here at home.

Second, at times between 1950 and 1997 trade and wages became a political issue as a way of distracting attention from true problems. The voters of Michigan in 1985 did not want to hear that the problems of Michigan's manufacturing industries were home-grown--in the fecklessness of management and in the Reagan administration's budget deficits that pushed up interest rates which pushed up the value of the dollar and made the goods they made uncompetitive on world markets. They wanted, instead, to hear that the Japanese were doing something clever and illegitimate.

Third: since 1997 or so the link between expanded imports and wage inequality has become real, as our imports now embody a much larger amount of factors competing with our own lesser-skilled than they used to. How large? I don't think we know. Paul Krugman is now writing a paper for the Brookings Institution in which he essentially throws up his hands at the question. But there are two points worth noting: (a) the effects of trade on pre-tax wage inequality are much smaller than the effects over the past generation of changes in the tax system on after-tax income inequality; (b) the effects of trade on inequality of opportunity are much less than the effects of educational inequities on inequality of opportunity.

Fourth, to the extent that we in the United States begin thinking of trade restrictions as a way to fight inequality, we are setting ourselves up for extraordinary trouble late in this century--extraordinary damage to our long-run national security.

Think of it this way: Consider a world that contains one country that is a true superpower. It is preeminent--economically, technologically, politically, culturally, and militarily. But it lies at the east edge of a vast ocean. And across the ocean is another country--a country with more resources in the long-run, a country that looks likely to in the end supplant the current superpower. What should the superpower's long-run national security strategy be?

I think the answer is clear: if possible, the current superpower should embrace its possible successor. It should bind it as closely as possible with ties of blood, commerce, and culture--so that should the emerging superpower come to its full strength, it will to as great an extent possible share the world view of and regard itself as part of the same civilization as its predecessor: Romans to their Greeks.

In 1877, the rising superpower to the west across the ocean was the United States. The preeminent superpower was Britain. Today the preeminent superpower is the United States. The rising superpower to the west across the ocean is China. that was the rising superpower across the ocean to the west of the world's industrial and military leader. Today it is China.

Throughout the twentieth century it has been greatly to Britain's economic benefit that America has regarded it as a trading partner--a source of opportunities--rather than a politico-military-industrial competitor to be isolated and squashed. And in 1917 and again in 1941 it was to Britain's immeasurable benefit--its veruy soul was on the line--that America regarded it as a friend and an ally rather than as a competitor and an enemy. A world run by those whom de Gaulle called les Anglo-Saxons is a much more comfortable world for Britain than the other possibility--the world in which Europe were run by Adolf Hitler's Saxon-Saxons.

There is a good chance that China is now on the same path to world preeminence that America walked 130 years ago. Come 2047 and again in 2071 and in the years after 2075, America is going to need China. There is nothing more dangerous for America's future national security, nothing more destructive to America's future prosperity, than for Chinese schoolchildren to be taught in 2047 and 2071 and in the years after 2075 that America tried to keep the Chinese as poor as possible for as long as possible.

And let me stop there.

Comments

[jerry]

A lot of stuff is in that wages basket. Stuff that our mothers and fathers and grandparents and their grandparents died for.

40 hour week, 8 hour days.
Paid overtime.
Paid vacation.
Paid holidays.
Sick leave.
Safe places of employment.
Medical care.
Parental leave.

People died for this stuff. People DIED for this. People continue to die for this.

It's not simply what the "wage" line on your paystub says.

[jerry]

Seriously, you would have a better grasp of this stuff if you didn't have tenure.

[Alan]

You know, the British and us had a fair amount in common, like democracy and shared history. We want to tie ourselves to a totalitarian government? So, if they are going to win, who will change? The answer: the weaker country, us.

Of course Mr. Bush and the Republicans (helped by a bunch of corrupt Democrats) have been doing their best to implement a Chinese style surveillance state and a corrupt government/oligarchy here in the US. So maybe by time we are supplanted we will have much more in common with the Chinese then we do now.

[DavidW]

Yeah, I don't get it. If you look at the great free trade experiment since the late seventies until now, something very unmistakable and obvious happened: we lost our retail manufacturing sector, and we have lost millions of manufacturing jobs. It is probably safe to say that we will loose most of our manufacturing in the future, although it is certainly debatable. Certainly we are mortgaging our future by selling off the country. If this is comparative advantage, it is an odd advantage indeed.

At the same time our agricultural exports - which we heavily subsidize have managed to maintain growth.

I think it is easy to say that our free trade experiment was a failure, which is why most industrialized countries don't practice it. It seems to me modern neo-classical economics - which assumed that the loss from all those consumer and producer surpluses were so significant instead of trying to prove it - is also a failure.

[Alan]

The totalitarian Chinese government will teach their kids whatever is politically expedient, including that "America tried to keep you poor" even if we never tried to do so. Then the totalitarian Chinese government will use the "Great Firewall of China" to keep out any information that might conflict with this politically expedient spin. And the totalitarian Chinese government will use the technology of the future to keep control of their people at a level the world has never seen before (unless "our" government beats them to it). GPS tracking embedded in people from childhood on, transportation and biometric tracking, sophisticated electromagnetic brain scanning "treason and terrorist" detectors in every home and public venue, etc. etc.

Oh yes, lets tie our future to the Chinese. That will just work out just wonderful.

[Colin Danby]

"You know, the British and us had a fair amount in common, like democracy and shared history. We want to tie ourselves to a totalitarian government?"

I'm not sure how far back into the 19th century I would try to push the "democracy" bit, and "shared history" is kinda vague. If anything Brad's point is that the useful parts of that shared history were deliberately made, rather than just happening. (And the coast I'm sitting on has had significant Chinese immigration over the last century-plus. Does that count as shared history?)

China may currently have a totalitarian gov't, but China is not the same thing *as* a totalitarian gov't. Beyond what its schoolchildren are taught, folks in China have the ability to make up their own minds about the world, and they remember stuff. I would much rather appeal to their ambition and creativity than be seen as trying to stifle it.

[foo]

Two quick observations:

1. How is it possible to have cultural or blood ties with China ?

2. Where will India be in 2075 ? There is already a cultural, linguistic and blood tie with the India, since all North Indian languages are Indo-European and the majority of India (700 million) are self-classified as followers of the Aryan religion (The Dravidians are about 300 million but though they don't speeak Hindi, they all speak English these days).

[Rich C]

Ummm ... didn't the British support the Confederacy in the Civil War? How does that square with embracing and nourishing ties of culture, language, and blood ? The UK may have benefited from a friendly relationship with the US, but its not clear that this outcome had much to do with UK policy, especially trade policy.

[Colin Danby]

No they didn't Rich. There was certainly some interest in official British circles in recognizing the Confederacy, but it never happened. The lack of support was in fact a critical blow to the CSA.

I would characterize ties in different language than "culture, language, and blood," especially since it seems to point some commenters in idiotic directions, but you can make a case that both abolitionist sentiment in Britain, and official unwillingness to alienate the U.S. gov't, (see the settlement of the Mason-Slidell affair) contributed to Brit unwillingness to back the Confederacy. Those strike me as ties of shared purpose and values, not to mention an official understanding that long-term comity is a good idea.

[save_the_rustbelt]

Brad forgot his last sentence....

"It will be necessary to depress the real wages and benefits of American blue collar workers for at least two generations to achieve our trade and diplomatic objectives, perhaps we can help them by throwing them a few tax credits and letting them shop at Wal-Mart."

[jerry]

A lot of stuff is in that wages basket....

The right to unionize
The right to collective bargaining
The right to strike
Outlawing of child labor

Why should we subsidize any country that does not provide their workers with these basic rights? That's not good for their citizens. It is not good for our citizens.

50 years from now, what the Chinese may remember is how OUR Big companies VETOED the Chinese Government's willingness to provide these rights to their citizens. They may look at us and say, YOU kept us down all these years.

[P.M.Lawrence]

"In 1877, the rising superpower to the west across the ocean was the United States." Rubbish. This is a generation too early, at least.

"Throughout the twentieth century it has been greatly to Britain's economic benefit that America has regarded it as a trading partner--a source of opportunities--rather than a politico-military-industrial competitor to be isolated and squashed." Only in relative terms. If it had been practical to squash the USA at that late stage, Britain would have been much better off still.

"And in 1917 and again in 1941 it was to Britain's immeasurable benefit--its veruy soul was on the line--that America regarded it as a friend and an ally rather than as a competitor and an enemy." Completely wrong in 1917 (although without hindsight the allies did not know that they were on a winning course - which was lucky, since US help hadn't arrived strongly enough to make a difference by 11.11.18 due to the insistence on delaying to build a distinct force), and wrong about the stakes both times. In 1941 British survival was at stake, not its soul - it had to give that up anyway as part of the price paid for survival. Hence today's relationship...

[Winston]

A lot of stuff is in that wages basket....

The right to unionize
The right to collective bargaining
The right to strike
Outlawing of child labor

Why should we subsidize any country that does not provide their workers with these basic rights? That's not good for their citizens. It is not good for our citizens.

Actually, all of those things are guaranteed by the ILO's labour conventions, and anything that is within the purview of the ILO falls in the labour-standards basket. Remember, Brad agrees with Fischer (as do I) that the ILO's international labour standards should be implemented, so don't be too quick to declare him a "Washington Consenter."

[jerry]

Thanks Winston, that's interesting. I am not sure what ILO is, or its significance. I do know that in October 2006, America's big business tried to veto the Chinese government when the Chinese Government tried to give the Chinese the right to crack down on sweatshops and protect workers’ rights by giving labor unions real power for the first time since it introduced market forces in the 1980’s.

http://www.nytimes.com/2006/10/13/business/worldbusiness/13sweat.html

Very ironic when the Chinese Government wants to give citizens rights and American Businesses try to stop that.

I'm just not convinced that with such pressures, ILO labor conventions will always be satisfied. (It helps I have not a clue what ILO is.)

[leo]

There is nothing more dangerous for America's future national security, nothing more destructive to America's future prosperity, than to gut our industrial base for the benefit of bankers at home and totalitarian regimes abroad.

Spent powers get no respect. You need more to spread democracy than an army of impoverished hamburger-flippers.

And let me stop there.

[save_the_rustbelt]

ya, what leo said........

[divadab]

How exactly could the largest, oldest country in the world, with enormous cultural depth and sophistication, EVER be "Rome" to the US's Greece? The US is at best an adolescent, culturally and historically. Certainly, the Chinese are acquiring, by all possible means, our technology and our treasure. But they consider us to be their social and cultural inferiors. And incredibly stupid to just give them, for a pittance, the means to defeat us.
And to assert that China could ever be "America to our Britain" is mind-bogglingly wrong-headed and simplistic. America was founded by Brits, our legal system is British, our ideas of democracy and governance and freedom are British, and our bloodlines (genetic and cultural) are significantly British. No similar relationships exist in any form with China.
By all means trade with China - business relationships foster understanding and reinforce common interests in stability and rule of law. Beggaring your neighbor does not work. But to beggar yourself in a fraudulent hope that your beneficiary will return the favor is foolish.

[david]

Enough with the trying to keep the Chinese poor bit. Nobody is trying to do that. Lots of people disagree on what's to be done, and you don't have a great deal of emprical support for the idea that current neoliberal trade regime promotion is the quickest way to end poverty.

The line "trying to keep the Chinese poor" is rightly associated with the nasty rhetoric coming from a bunch of businesses and gov't officials trying rig the game in favor of themselves and their friends. It's right-wing claptrap, and you shouldn't use it.

[Slocum]

"There is nothing more dangerous for America's future national security, nothing more destructive to America's future prosperity, than for Chinese schoolchildren to be taught in 2047 and 2071 and in the years after 2075 that America tried to keep the Chinese as poor as possible for as long as possible."

I agree that this is both true and important. Except that I think protectionism would likely to bear bitter fruit long before those dates.

But none of others commenting here seem to agree. Nor, if you judge by their public statements, do Clinton or Obama agree (whatever they may think privately and whisper to the Canadians).

So where does this leave DeLong (in supporting candidates and party that disagree with him so clearly on such a vital issue)?

Let me also say that in a political environment where free trade with China is no longer welcome, participation by the U.S. in Kyoto (or anything like it) is doubly unthinkable, since Kyoto wouldn't just result, at worst, in "falling wages for the poor in the rich" (though I'm skeptical trade has had this effect), but Kyoto would actually put the U.S. at a disadvantage (that Krugman would have no trouble at all measuring) by making carbon emissions (and energy) more expensive here than in China and elsewhere in the developing world.

Democrats profess to want restrictions on free trade with developing countries and also to sign Kyoto. This is schizophrenic.

[jerry]

Slocum,

My quick thoughts on Kyoto:

We're told that free trade is a positive sum game, but that's not the only outcome (perhaps not even the likely outcome.) (As shown by the stand up economist. http://www.youtube.com/watch?v=VVp8UGjECt4)

Trying to halt global warming does seem to be a positive sum game, but if we can use our participation to get other players to join in the game, the win-win grows even larger. If we think that eventually everyone will be playing the game, that unilateral moves in that direction can actually lead us to progressing down the learning curve, reducing costs, and creating a new industry before our competitors feel a need to get into the action.

Right now, where I live, a very large Spanish company is going to build the world's (or the US's) largest solar farm. This seems incredibly dumb of us. At the end of this we'll have a very experienced Spanish company and lots of US company's looking with envy at their knowledge, technology, and infrastructure.

[leo]

@save_the_rustbelt:

Our rust is better than your rust!

[Free To Choose]

Mr. Delong,

I completely reject your comments. Going by your logic, we dont need to trade with countries in Africa because none of them are going to become superpowers in the near future!

Free trade does not need these tortured apologies. Free trade is freedom. I want spend my dollar in whichever way I want and I want buy stuff from whomever I please. No politician in Washington or his economic advisors have the moral right to tell me how to spend my money.

The sheer presumption of your article is that the "elite" like you have the right to control the lives of others in the name of geopolitics. I reject that notion.

[joe]

The sheer presumption of your article is that the "elite" like you have the right to control the lives of others in the name of geopolitics

...says the guy who wants to make sure that nothing will interfere with multinational corporations' ability to call on the totalitarian government to squash unions.

[Mr. Noah]

So, this fascist enemy that China is going to help us fight off in 2071...will it be worse than China?

[jerry]

They'll be the damned Bill of Rightzers from the Republic of the Pacific and when they decide to secede they will threaten our United Corporations of America. We are going to need all the help we can get from our freedom preserving Chinese Business Partners.

[non_econ]

"The voters of Michigan in 1985 did not want to hear that the problems of Michigan's manufacturing industries were home-grown--in the fecklessness of management and in the Reagan administration's budget deficits that pushed up interest rates which pushed up the value of the dollar and made the goods they made uncompetitive on world markets. They wanted, instead, to hear that the Japanese were doing something clever and illegitimate."

Boy the politics are never far away:
1. Management made mistakes. Always true in any business anywhere and anytime. Many US car companies did go out of business along the way.

2. Reagans intrest rates were needed to kill inflation caused in the 1970's left over from Johnson, Nixon and Carter. It wasn't bad monetary policy to kill inflation - the current fed should heed that, rather than feed the moral hazard of our leaders in business schools and wall street.

3. I don't see how compartive advantage helps us if capital and technology are are infinitely mobile - but labor isn't easily moved. Therefore the prices on labor (and all work is labor), will come to global equalibrium (maybe at a net higher level in the end), but for developing countries that engage most fully in 'trade', wages must fall and are falling. If it doesn't work in the models - then perhaps the models are wrong. Happens all the time. In my mind we should pay for results. As an American in Europe I know how free trade 'works'. Nothing from the US is sold here for transport costs. The same item from China sold here is (taking out exchange rate) still 1.5X more expensive on average here than in the US. Hey - I don't know about no model and theory - but it's a fact. When I travel to Japan and look at a camera within 5 miles of Nikon factory and then fly to Los Angeles and look at the same exact model within 5 days and it's cheaper by 40% in LA. Me thinks it odd.

I agree with freedom - but we should stop arrogantly thinking other people value that freedom as much as we think they should. We should prepare for war, keep our factories, trade with like minded countries where we need things (oil), and we should adapt value added taxes or other consumption taxes. For good measure, just go to 90% container inspections on ports of entry - each container pays for it's inspections. That's not a tariff - that's an inspection fee - the cost of keeping lead and antifreeze out. These inspection fees and requirements are with all our partners.

As to engaging them - open our borders to immigration and assimilation. Bring them here.

[Randolph Fritz]

I think the next century holds more superpowers than two: Common Europe, Latin America, the Islamic-Arab world, South Asia all have a shot at it. Perhaps some sort of Slavic federation as well, if those nations can ever stop hating each other. We're just the first, and soon not the only. The other problem with this line of argument is that China doesn't buy it, and this only works if China does. They are undertaking a neo-mercantilist strategy that seems to be backfiring on the whole world.

[Larry Mishel]

Brad,
I don't think there's much evidence to support:
"But there are two points worth noting: (a) the effects of trade on pre-tax wage inequality are much smaller than the effects over the past generation of changes in the tax system on after-tax income inequality;"

By far, most of the growth of inequality has been among pre-tax incomes rather than shifts of the tax burden. Even a modest assessment of trade's effect, say 20-25% of the total, would imply serious economic harm to the vast majority of workers. Instead of minimizing the impact of trade, I would prefer you state the challenge as how can we make sure whatever gains we obtain from trade (which presumably you think are sizable)are shared with the entire population so the bottom 70% are not net losers from trade. This can be accomplished with domestic policies regarding health care, retirement, labor policy/unions, and so on. The people don't believe that trade has minimal effects nor should they.
Larry Mishel
EPI

[AWC]

I don't necessarily disagree with the broad argument, but I must contest the historical comparison. In the Gilded Age, wages were often higher in the US than in England; that's why there was massive immigration to the US. If those conditions held today, no one would question whether the US should lower trade barriers with China.

And of course, national security concerns also go the other direction: towards creating an American economy that is diverse and independent. Not to mention the fact that trade might be the lever to encourage further Chinese democratization.

[Slocum]

"jerry: We're told that free trade is a positive sum game, but that's not the only outcome (perhaps not even the likely outcome.) (As shown by the stand up economist. http://www.youtube.com/watch?v=VVp8UGjECt4)"

That's an economics stand-up routine (pretty funny, I'll grant you). I hope your linking to it is also intended as a joke.

"Trying to halt global warming does seem to be a positive sum game, but if we can use our participation to get other players to join in the game, the win-win grows even larger."

Global warming seems to me to be a 'tragedy of the commons' problem, where coordinated is required and the potential for free-riding is great -- so great that, as with a real commons, unilateral action is likely to harm the unilateral actor without providing *any* benefit whatsoever to the commons (if I pull my whole flock off the commons, there is every reason to expect others to expand their flocks to make up the difference).

That is, if we cut oil consumption, which results in lower demand and lower prices, which results in other parties buying and burning that same oil -- CO2 levels are no lower than they would have been, and we are worse off having forgone access to cheaper energy.

"Right now, where I live, a very large Spanish company is going to build the world's (or the US's) largest solar farm. This seems incredibly dumb of us. At the end of this we'll have a very experienced Spanish company and lots of US company's looking with envy at their knowledge, technology, and infrastructure."

I'm really not sure why you see this as a problem. If you think this will be a great boon, go ahead and buy stock in the Spanish company. But given the strong relationship between solar cells and computer chips, I'd be surprised if U.S. companies didn't end up prominent in that business (I don't see any Spanish companies in this article for example: http://www.environmentalleader.com/2007/03/19/sunpower-tops-list-of-best-solar-panel-manufacturers/).

But, as in the case with advances in battery technology, I don't care *who* perfects cheap alternative energy sources, only that it happens. If the cost of solar power drops below the cost of mining coal and drilling and pumping oil, then the GW problem solves itself and we have no need for Kyoto or carbon markets or anything of that sort.

But barring any such breakthroughs and as long as coal and oil are the cheapest sources of energy, we have a problem that's going to require coordinated action and, inevitably, the U.S. accepting more carbon restrictions and higher energy costs than developing countries.

If the Democrats can't even stomach free trade with developing countries, I just don't see how anyone thinks they're going accept putting the U.S. as a whole at a distinct economic disadvantage due to carbon/energy costs.

[jerry]

"I'm really not sure why you see this as a problem."

Because labor doesn't move as swiftly as capital. Because I think I want a job as something more interesting than Wal*Mart Greeter. Because I think it's better to collect rents on patents than pay rents on patents. Because unlike economists, I think that building an industry is hard and creates a barrier to entry, AND I think that tearing down an industry (as in our aircraft industry) and spreading our knowledge (teams) to the wind is trivial and makes it just about impossible to ever recreate that industry. And I don't consider moving a factory from A to B to be "creative" destruction.

So I think that as we watch the Spaniards create the solar industry in the US, we can expect a future where we have to pay the Spaniards for more solar energy and where our jobs consist of guarding the plant, landscaping the plant, and selling the Spanish executives fries for lunch.

Do I have anything against Spain? No. Does this mean I don't believe in trading with Spain? No. I just think it's particularly stupid of us when we have the sun and the land, the brains and the brawn, not to be doing this ourselves. If American Business is not being stupid, I think it says there is something fundamentally wrong with our business incentives, because developing solar energy should be a f'n no brainer.

The standup economist's routine is funny. But it's funny because it's not a joke. It's funny because if you don't laugh, you have to cry. The part about it being possible for trade to make everyone worse off, is true, and I think you can see many examples of that (particularly when "free trade's" benefits like increased pollution, child labor violations, occupational safety are factored in as costs, but not factored into prices.)

[Ponzi Q. Globalization]

Professor, when you say 'free-trade' you really mean 'global labor arbitrage', right? I know the latter doesn't sound so, uh, American, with the word 'free' but it is more accurate.

"There is a good chance that China is now on the same path to world preeminence that America walked 130 years ago. Come 2047 and again in 2071 and in the years after 2075, America is going to need China. There is nothing more dangerous for America's future national security, nothing more destructive to America's future prosperity, than for Chinese schoolchildren to be taught in 2047 and 2071 and in the years after 2075 that America tried to keep the Chinese as poor as possible for as long as possible."

What silliness! If we will need China it will be thanks to economists like yourself who are blinded by ideology and an over-confidence in their unrealistic models of reality.

When neolibs switch from ballyhooing their policies as being a "win-win for all involved" to the use of threats along the lines of "accept the global labor arbitrage today or else your masters will be very very angry in the future" then you know they're on their last legs. Good riddance to yet another utopian ideology with pretensions of universality that eff'd over the most vulnerable!

Anyway, a question come to mind. When China surpasses us, will they get to colonize or quasi-colonize the Philippines & other Pacific islands, South & Latin America (goodbye Monroe Doctrine!), much of the Middle East, etc. just like we did? If so, then I hope they're a bit more civilized than we were during their take over.

Oh, but I forget! Neoliberal utopianian doctrine sez that all such nastiness will be a thing of the past now that everyone in the world has seen the light. Mother Earth's finite resources will become essentially infinite. Human beings will go from being somewhat violent animals driven to a large degree by the irrational urges of the moment to super-rational peaceful beings who maximize their long-term gain (which, of course, doesn't ever mean the long-term pain of others). The world will be one big happy family awash with goods and services that come from the infinite bounty of the ideas in the heads of economists. Ideas backed up by MATHEMATICS so you know they gotta be good!

And, finally, when neoliberal globalization reigns supreme, monkeys dispensing food, homes, pornography, family entertainment, religious/spiritual/emotional fulfillment, cellphones, ipods, top-notch health care, and gold bullion to the teeming tens of billions of people on this ever expanding globe will forever fly out of the butts of these same economists.

Amen.

[Ponzi Q. Globalization]

assman wrote: "America is basically one of the richest and most powerful countries in the world. So how is its freed trade policy a failure."

Lets not go all Stalinist on our history or the history of other developed nations. Almost all the current industrial or post-industrial powers went through a protectionist phase. Some still practice protectionism in some areas. Including the USA. Of course, the existing forms of protectionism in the US don't protect blue collar workers. It's been decided by their betters that they and what they do are not worthy of protection.

I guess ideology trumps facts for most economists. We shouldn't be surprised. One expects fundamentalists to twist and distort history in a pathetic attempt to bolster their own world views. At least anti-Darwinian Christian fundamentalists (for example) don't claim to be practicing science.

[jerry]

Cribbing from Atrios last week,
http://www.haloscan.com/comments/atrios/567056849429404072/
"Free Trade

Since we'll probably be subjected to know-nothing bloviating from very serious pundits about the joys of this mythical thing called "free trade," I thought it was worth linking to the US tariff schedule."

http://www.usitc.gov/tata/hts/bychapter/index.htm
By Chapter of HTS :2008-01-01 - Basic, Official Harmonized Tariff Schedule of the United States Annotated

(Note to fetishists: Section III, Chapter 15 is about Animal Cleavage.)