Economics 101

This is a libertarian blog. It advocates freedom, small government and free trade in goods and services. It is supposed to criticise those who want to erect barriers to competition from foreigners. And it has been a constant critic of efforts to expand government through new expenditure programs and regulations. To a libertarian the burden of proof for new government expenditure is extraordinarily high.

I hold these values closely – small government, balanced budgets, efficient taxation with low rates and free trade. Not fair trade – free trade. It is sophistry to argue for fair trade.

Yet I see examples of creeping mercantalism in this blog – surely an anathema to a libertarian? People who say that because other countries are imposing new forms of protection so should we.

That argument is a nonsense – something I would expect to see in Green Left Weekly.

If other countries are foolish enough to increase protection and add barriers to trade that’s their problem. Our solution should always and everywhere to cut tariffs and reduce protectionism. And this includes the new form of protection, that of selective specifications (eg: Australian design rules quite different to other countries, or arbitrary limits to pesticide residue unrelated to science or practice elsewhere).

We should always campaign for other countries to reduce trade barriers, but we should always pursue that in our own backyard.

The defence of Trump – who is not only increasing trade barriers but also increasing US government spending and increasing the US government deficit and debt – is sad. Why do the apologists here try to excuse his every behaviour? Sure, welcome those things he does that are consistent with libertarian thinking. But be consistent and criticise him for those which are inconsistent with libertarian thinking.

On one of the posts here, I read that Trump imposing tariffs was fine because it would help cement Republican majorities in both houses. What an absurd and appalling argument. The very premise is flawed – the US is governed best when the executive and legislature are in conflict, not aligned.

There are plenty of other blogs for those who favour larger government, more spending and protection from foreign competition. The Cat has long been the bastion against such woolly thinking. Sadly I think it is aligning itself with those other blogs.

About Lucius Quinctius Cincinnatus

I'm a retired general who occasionally gets called back to save the republic before returning to my plough.
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151 Responses to Economics 101

  1. Rafe Champion

    There is a good Trump and a Bad Trump. Good Trump needs a majority in the Houses to get good stuff done. Politics is a delicate balancing act to get outcomes which are the lesser of two weevils.

  2. Barry 1963

    Well said. Unlike many from various political persuasions, you are principled, and correct. By the way, I’d love some delicious Thai bananas.

  3. Alexi the Conservative Russian

    “I’d love some delicious Thai bananas” – I’m sure there is a law against that!

  4. stackja

    DT can be ‘pure’ and lose or get a little ‘dirty’ and win. Free trade for who? Lets wait and see.

  5. Lucius Quinctius Cincinnatus

    Sorry Rafe, but an argument on the basis of pragmatism over principle never stacks up. If abolishing free speech would lead to a greater chance of a Republican majority in Congress would you support that too?
    In any case, (1) I don’t see how increased protectionism will ensure Republican rule in Congress (2) I don’t accept that the US is better off with a Republican presidency and a Republican Congress. History shows that the best policy outcomes in the US has been when one party holds the Executive and the other the legislature (3) Trump has not achieved much despite having a Republican majority in the House and Senate (4) you overstate the importance of the US Government to its citizens. It seems to me that the outcomes in the US between a Trump presidency or a Clinton presidency would be similar, even though the rhetoric would be quite different. The US does well because of its innovation, dynamism and entrepreneurial spirit. The US Government is extremely inefficient and bloated and no government – Republican or Democrat – has ever addressed that. The US functions despite its government.

  6. stackja

    So making some overseas businessmen richer helps the USA?

  7. Lucius Quinctius Cincinnatus

    stackja:

    DT can be ‘pure’ and lose or get a little ‘dirty’ and win. Free trade for who? Lets wait and see.

    False premise. Getting ‘dirty’ may help him lose. Also, the job here is to criticise bad policy, not uncritically defend Trump’s ever action. If Trump cannot explain to the people of the US that free trade is in their own interests he doesn’t deserve to be president. So, like Rafe, stackja you would be happy if Trump wound back free speech in the US if it increased the likelihood of him winning? Where would you draw the line? I think you have lexicographical preferencing: having DT in the White House trumps (excuse the pun) everything else.

  8. Lucius Quinctius Cincinnatus

    So making some overseas businessmen richer helps the USA?

    Yes indeed it does. That’s the wonder of free trade.

  9. stackja

    HRC would have done what?

  10. Driftforge

    Our solution should always and everywhere to cut tariffs and reduce protectionism.

    This is either daft or insidious – and exactly the opposite of what is suggested in the great arguments for free trade.

    Free trade doesn’t work better if one side does not tax, and the other side simply increases taxation to make up for it. It works better, if and only if, the burden of taxation is removed from both sides.

    Otherwise our government is just letting the other government collect our share of the taxation burden, which is great for them – not so great for us.

  11. Malcolm Thomas

    Thanks Lucius for outing the mercantalist nonsense (actually, it makes sense to the economically illiterate) infecting this blog recently. As for Kates, his blinkered and reflexive adulation for any lunatic policy or utterance from Trump are laughably pathetic.

  12. 2dogs

    While tariffs are bad, bilateralism in trade is a good approach.

    It is worthwhile to threaten to impose tariffs strategically in the hope of negotiating a trade partner’s decision to lift theirs. This may mean, from time to time, that one should actually impose tariffs to demonstrate the seriousness of the threat.

  13. Herodotus

    Libertarianism and free trade, free speech, you name it, yadda, yadda – is all being blown away by the left-green-politico-media drip, drip, seep, seep, meep, meep.
    Apart from Trump, the Hungarians, the Czechs, and some of the Poles, the entire western world is diseased. Leftism is more than a mental condition, it is a cancer. Only IT in his Pinochet regalia can put this right, ultimately, since politics is increasingly ineffective as a process for reversing decline.
    Calling for libertarians to bad-mouth Trump is pissing in the wind, Lucy.

  14. Sinclair Davidson

    Rafe – if Trump were good enough he wouldn’t to resort to protectionism to bolster Republican majorities.

  15. Tel

    Not fair trade – free trade. It is sophistry to argue for fair trade.

    Free trade must also include the freedom to not trade at all.

    Consider the Amish for example, they refuse all kinds of things, and presumably they think they are better off because of it, at any rate there’s no way to prove they are worse off.

    Perhaps what you are really upset over is that Trump gets to make the key decision, but that’s the democratic process isn’t it? Always someone ends up disappointed by election outcomes.

    So making some overseas businessmen richer helps the USA?

    What is “the USA” and how do you measure it’s objectives? What I see is several hundred billion people each with somewhat different intentions.

  16. Singleton Engineer

    My undergrad economics has grown somewhat rusty.

    I suspect that “Mercantilism” deserves a modern definition, in line with the descriptions of both free and fair trade in order for this to lead to a conclusion, rather than a division of opinion.

    Free trade has also been described in different terms above, eg whether or not taxation systems must be equal.

    Which brings us to the old but real issue of tax havens, seemingly many (most?) of which are or were British islands and outposts.

    Surely, Britain, having created the mess, bears primary responsibility for cleaning it up – especially if/because tax inequity leads to trade inequity and Prime Ministers who demonstrate their attachment to the tax system for which they are responsible by parking slabs of their assets in the Caribbean.

  17. Ƶĩppʯ (ȊꞪꞨV)

    The only “free trade” with the chicoms is their unfettered theft of the west’s intellectual property.

  18. Tel

    Our solution should always and everywhere to cut tariffs and reduce protectionism.

    I would argue that only government spending matters, and the severity of regulations imposed on regular people (both business and lifestyle). Once the government learns to live within a small budget, it doesn’t matter a whole lot where they raise the money from… although on a one for one basis tariffs are BETTER than income tax, because tariffs keep government’s mind focused on the border while income tax keeps their focus on ordinary people’s wallets. Also, tariffs are self-limiting in as much as if the tariff is too high then government collects less income so they will be careful with that. If they can rob the citizens directly then that self-limiting property doesn’t happen until the society starts to collapse.

  19. Singleton Engineer

    @ Tel:

    Trump gets to make the key decision, but that’s the democratic process isn’t it?

    “Trump” and “democratic process” in the same sentence. Who’d a thunk it?

  20. stackja

    If DT said pretty please, Xi out of the goodness of his heart will agree to fair trade with the USA?

  21. Tel

    “Trump” and “democratic process” in the same sentence. Who’d a thunk it?

    You aren’t swallowing that “Wussia stole the election” rubbish I hope?

    Hillary and Bernie were both shit candidates. The American people picked the best option available to them. Some Russians ran a small number of Facebook pages on a random assortment of clickbait topics and had precisely zero influence on the election.

  22. Jack

    You still need buy in from all parties for free trade to work. If one player throws away the rule book it doesn’t work. Ask Neville Chamberlain bout them apples…

  23. Procrustes

    Lucius Quinctius Cincinnatus. Thanks for this post. Needed saying. From a few of the comments, it seems it needs repeating every day.

  24. Gary

    I think turning this blog into a fundamentalist libertarian site, is not libertarian at all.

    Thankfully for now Sinc agrees.

  25. Malcolm

    Tel – the example of the Amish is wrong. It is they who decide what to buy. What we are talking about here is the Government trying to restrict people’s choices,

    And threats to retaliate – geez don’t any of you know the evils of beggar thy neighbour policies?

  26. C.L.

    Unfortunately, there is no such thing as free trade. It has never existed and it never will exist. What Trump is doing is rationalising trade arrangements that were absurdly skewered in favour of America’s trading partners for decades – back when the US could afford to be generous and had a geo-strategic interest in encouraging capitalism (over against communist bloc statism). Arguing that if one country practices free trade, other nations will follow suit is like arguing that if you disarm, other nations will too. It’s a childish, leftist argument. As Peter Clemenza re-assures Michael in The Godfather, sometimes the families have to go to war. Clears away all the bad blood and allows the emergence of a new, more advantageous modus vivendi. Don’t be a sap.

  27. Macspee

    Interesting and spot on. If I remember correctly the US has no tariffs on car imports from Europe which raises the picture of an interesting reaction from Brussels if they decide to retaliate against Trump by imposing tariffs on US imports and he whacks one back on them. Here comes a trade war!

  28. JC

    Good post, Luce. Agree and it needs to be said.

  29. thefrollickingmole

    Speaking for myself economics comes some way behind his pushback against cultural rot.

    Both major parties in the USA have agreed they can spend until the money breaks, deficits are just numbers to be inflated away or created at whim.

  30. johanna

    In this month’s Quadrant (sorry, paywalled, shell out a few measly bucks for a sub you cheapskates!) Jim Spigelman has a surprisingly good article about international trade. I say surprisingly, because his lifelong ALP loyalty makes a lot of his output suspect. But JJ is a polymath, exceptionally bright guy, and he makes some interesting arguments about the issue of trade negotiations.

    One of the most compelling, to my mind, is that if a country simply dismantles all trade barriers in this imperfect world where others have lots of them, you have nothing left to negotiate with. If you rule out ever in any circumstances erecting trade barriers, how can you put pressure on other countries that are screwing you with theirs? They will just tell you to rack off, and there is no real penalty for them doing so.

    To my mind, that is the thinking behind Trump’s latest move, and Presidents before him have done similar things to give a short, sharp lesson to certain players. We are not talking about omnibus, permanent protectionism here, which undoubtedly is bad for the economy in the medium to long term. But Trump and some of his predecessors judged that you cannot negotiate if your weapon is publicly and permanently unloaded.

  31. MichelLasouris

    Surely, a mechanism to control the flow of trade is a Good Thing? The mad rush to dismantle Tarriffs seems to me to be senseless; unless, that is, one wishes to facilitate the absolute rape and destruction of domestic manufacturing and the export of raw material. The Chinese have been rubbing their hands with glee at the stupidity of the “round eyes’ by exposing their economies to utter destruction by the dumping of Chinese manufactured goods. The application of reasonable tariffs is the only way to regulate rogue behaviour in international trade. The dismantling of liberal global trade is a good thing. the destruction of mammoth trade blocs is essential and why the Uk is leaving the EU. it’s all well to say ” leave the manufacturing to the third world…we clever people will revert to selling services instead…” That will only lead to a weak indefensible State, ripe for the inevitable invasion from the ever expanding Chinese influence and ready made tentacles of the Belt and Road to their military.

  32. Tel

    Tel – the example of the Amish is wrong. It is they who decide what to buy. What we are talking about here is the Government trying to restrict people’s choices,

    As I said, your real problem is that Trump gets to make the decision. In the case of the Amish I’m not sure who makes the decision but they have some kind of collective system, it’s not an individual decision.

    Of course you can leave the Amish if you want to, but it would be a big shock, and to be fair Americans can leave America (or businesses can leave quite easily by offshoring their manufacture).

  33. Roger W

    A nun can still get pregnant.
    In other words, it doesn’t matter how virtuous you are, someone else can still fuck you.
    In the long term, the nun may go to heaven and the rapist end up in hell, but in the short term shit has happened.
    None of the other big players – especially China – are playing by the Free Trade rules, so it is by no means a perfect world. Has it ever been? I suspect the ideal is rather like the ideal of Socialism – constantly tried but always failed because supposedly it has never been applied properly.
    Open boarders often seem to be a favourite with pure Free Traders and I’m not sure most Europeans would tell you they like the way that is playing out in the real world, either.
    The Donald has done much good – think 22 regulations gone for every new one introduced, significant tax cuts, conservative Supreme Court judge to name just three – as well as preventing the horror of a Hilary presidency.
    Be grateful for small mercies!

  34. bollux

    Trump was elected to look after American interests, nobody else’s. Free trade is, and always has been an oxymoron, exploited by who is willing to cheat the most. In the political world, that means everyone. I wish we had an Australian leader who cared more about Australia than the U.N. If that’s nationalistic, then I’m a nationalist. And don’t give that bullswool about saving the world, it’s everyman for himself out there so don’t kid yourselves.

  35. Harald

    Already at full employment in a still growing economy, why would Trump make decisions based on primarily economics?
    First of all, he’s the president, not an economist (thank God).
    Second, I’d say, the economics box has already been ticked for now.

    Now that the immediate problem of the flailing Obama economy has been tackled, the focus can shift to other things. Put differently: Trump first needed to create a position of strength. From a position of strength Trump can effectively negotiate.

    With Trump’s opening bid: “Trade wars are good!” , I guess the topic of conversation is China ripping off the US by currency manipulation and IP theft, the EU creating unfair conditions by subsidising agriculture, etc.. The cronies and their political bedfellows are the targets he has in his sights.

    Yes, here and there a tariff may go up, but with Trump in charge, when the dust settles, the trade will be fairer and more reciprocal – and trade will be yuge. Yuge trade. Fairest, most reciprocal trade ever. And free. Freest trade under any president.

    And by the way, the fact that Trump uses “fair trade” instead of “free trade” should be of concern to libertarians, but not in the way it’s discussed above by Lucy. The real concern in my opinion is that “fair” apparently still does better with the public than “free”.

    Trump does the best he can after the right wing lost that battle over the words “free” versus “fair” by constantly coupling “fair” and “reciprocal” – quite clever, actually. I think it works.

    That said, I don’t care particularly what Trump calls it, nor what he says as long as it works to make the change necessary. And as long as, once done, trade can take place with low/no barriers on a reciprocal basis. I have no doubt that is Trump’s goal.

    In the meantime, buckle up. It will be a bumpy ride for those libertarians who overly care about wording (since that’s all they have had to show for their efforts for decades). 🙂

  36. Vocal minority

    I’ve never understood the mentality of gangs or clubbish loyalties. Kates and others have so wound themselves up with Trump that I imagine there are tattoos. Otherwise I’m absolutely certain that the random violence of Trumpist rhetoric would be getting the flak it deserves. As for the trade argument I would think most people are aware that the US was the global proponent of open trade for all the post war period for the reason that it’s good for the US. Just as it’s been good for Australia. If anyone wants to test that relativity go visit a protectionist oligopoly environment like Indonesia or Myanmar and see how people are doing.

  37. RobK

    Luci, the article is good comment but to conflate free speech and trade is problematic.
    Where does strategic industrial capacity and food security fit into this?…..especially vs dumping to break the competition.
    I like Tel’s comment of tarriffs vs income tax, especially because it shows there are multiple layers of preference open to government but there’s little encouragement for government to downsize. To me, this is were the challenge is. The comment about tax havens is valid too because it is a burden on the producing country.

  38. Craig Sargent

    As a libertarian, I support imposing significant tariffs on countries based on the degree of freedom of that country. I have no desire to allow products made by slave labor be made available. I would expect most libertarians, who would find slavery an abomination would agree with me. But disappointingly, I see very few comments on slavery and trade in this regard

  39. Marcus

    There is a good Trump and a Bad Trump. Good Trump needs a majority in the Houses to get good stuff done. Politics is a delicate balancing act to get outcomes which are the lesser of two weevils.

    According to everything I’ve read, Good Trump’s prospects of maintaining his majorities in both Houses had been growing for months before he announced the new tariffs. It seemed that cutting taxes and regulations, and allowing the Democrats to beclown themselves at every opportunity, was enough.

  40. JC

    Craig

    You are not a libertarian. Stop pretending .

  41. Bruce of Newcastle

    Seems to me that LQC would rather the Goths sack Rome than let Trump succeed.

    The incredible Trump agenda — What most Americans don’t know about the war the president has waged (2 Mar)

    From pulling America out of the unaffordable and unworkable Paris Protocol on Climate Change to ending the damaging Obama era regulations on net neutrality, the Trump administration has advanced a broad conservative agenda on dozens more fronts in 2017.

    But make no mistake, 2017 was a banner year for conservative policy victories. On that score, President Trump can confidently stack his record right up there next to President Reagan’s first year.

    Still prefer the Goths to Trump?

  42. C.L.

    Nathan is present and accounted for.

  43. closeapproximation

    There’s another angle on protectionism, which is not often discussed, as a robustness/national security measure:

    If you’re into free markets and efficiency, you’d argue that nations should gravitate towards their own competitive advantages, and outsource what they can’t do competitively in the global economy.

    But if your native population forgets how to build/repair/do “X” then we are introducing fragility and weakness into the nation, indeed, potential national security risks.

    Obviously this is not true for all industry sectors.

    A fairly benign example along these lines: outsourcing all of our recycling to China, assume they’ll be our rubbish tip forever, but now China says they’ve had enough. (In the meantime, some of our local recyclers have closed due to high power bills – another lesson here – don’t shoot yourself in the foot).

    Outsourcing may be optimal at a given instant in time & geopolitical state, but abrupt change will come. Think Nassim Taleb and his fat tails.

    Maybe tariffs create robustness.

  44. Mundi

    If a regulation is passed that makes production in Australia more expensive, Lucius would seemingly care more about making sure free trade allows the unregulated foreigner to out compete, rather than just removing the regulation.

    Free trade starts with an unregulated internal market, not at the federal border.

    Trump does not seriously believe something should move back just for the sake of it. He is targeting thinks that went only because of regulation, which he knows he can’t pull back (the republicans are NOT libertarian).

  45. Yet I see examples of creeping mercantalism in this blog – surely an anathema to a libertarian? People who say that because other countries are imposing new forms of protection so should we.

    That argument is a nonsense – something I would expect to see in Green Left Weekly.

    It’s called a “Trade War” for a reason.
    Let’s try your claim in a slightly different way…
    “People who say that because other countries are lobbing missiles and destroying our cities, so should we.”
    That sounds like something a Nimbin type bare-footed “peace to the World” hippie fool would say.
    It wasn’t military missiles that created the American rust belt destroying whole cities and millions of lives, it was economic missiles.
    Some here believe defending ones self is OK and it doesn’t make them war mongers (read mercantalists).

    Keynesians have doggedly stuck to their economic theory despite countless real evidence to the contrary. I’d say the ‘Free Trade at all Costs’ types are no different.
    Ever since the WTO ‘Free Trade’ agreements came into force, countries like USA, Canada and Australia have run large trade deficits, have seen stagnant incomes and ever lower growth rates not to mention productive jobs being replaced by paper shuffling and coffee making.
    Only the fact that Canada, Australia and the US can dig up dirt and convert it to cash (to pay for stuff from China we used to make ourselves) has delayed the inevitable impoverishment. ECONOMIES CAN’T SURVIVE ON MAKING COFFEE AND COUNSELING EACH OTHER.

    When the great Milton Friedman was asked about the growing trade deficits with Japan and others, he said Japan can’t use US dollars domestically so they had to spend those dollars back with the US.
    What he didn’t say was that the US dollar is a reserve currency, meaning Japan didn’t have to spend those dollars in the US, they could (and do) spend them elsewhere. The growing trade deficits are irrefutable evidence.

    To explain why trade deficits are not a bad thing, Friedman used the analogy of a consumer buying an item from a store. He said the buyer has a trade deficit for all intents and purposes, but he also has a product in exchange.
    True, but what happens when the buyer spends more than his income month after month, year after year? And what happens when the store you’re trading with buys the business you work for and fires you? You end up on welfare.
    That’s exactly what’s happened to the US economy.

    But it gets worse. Trades people formerly making things for a living, don’t even have the option of getting a low paying low skill work to restart their lives BECAUSE THOSE JOBS HAVE BEEN TAKEN BY UNSUSTAINABLE IMMIGRATION OF LOW SKILLED LABOR. The same open border immigration you Libertarians support.

    Despite the mounting evidence, you Libertarians doggedly stick to academic theory just like climate zealots, just like Keynesians and just like Socialists. You hand wave and dismiss others who are trying to point out this evidence.

    The defence of Trump – who is not only increasing trade barriers but also increasing US government spending and increasing the US government deficit and debt – is sad.

    Welfare spending is causing government spending and increasing debt. People have been heaped on to the welfare pile because their productive jobs have gone to China. Anyone not seeing the circular firing squad is willfully blind.

    There are plenty of other blogs for those who favour larger government, more spending and protection from foreign competition.

    In other words, if we don’t agree with you, if we put forth a different opinion, we should go elsewhere, right?
    THE NEW CATALLAXY FILES. A SAFE SPACE FOR LIBERTARIANS.
    Putz.

  46. Not Scott Morrison

    “If other countries are foolish enough to increase protection and add barriers to trade that’s their problem. Our solution should always and everywhere to cut tariffs and reduce protectionism…. We should always campaign for other countries to reduce trade barriers, but we should always pursue that in our own backyard.”

    Yes Australian scum, remove your tariffs, don’t question the wise bi-partisan leadership from the Liberals and Labor Party.

    Don’t consider that Bastiat wrote his treatise regarding trade between European countries of similar sized economies and output and that the Chinese economy is is 10x greater than Australia and that there is a slave class of workers in China 10x the population of Australia.

    Just accept our wise Liberal/Labor leadership. If all Australian non-mining industry goes broke in the next 4 years we will be better off, we will still have ample residential land to sell off for foreign currency.

  47. struth

    What a dickhead.
    Pure libertarians are completely theory driven and unrealistic when taking in the entire picture.

    It’s a simple as government involvement.
    Which there always is, and always is with who Trump’s USA are dealing with.
    There a huge global socialist U.N. corruptions to deal with .
    Etc, etc.
    So stop pouting about your theories not being applied and wishful thinking about how things should be in a utopia that doesn’t exist , and never will.

    When you are dealing with corruption, you don’t play fair either, and if you do, at least realise that you will most likely lose.
    This world isn’t an old type Hollywood movie.
    In the real world the angelic Christians get fed to the lions.
    How much of a win is that?
    Spare me your bullshit.
    If you want to be fed to the corrupt lions, leave Trump and his supporters out of it.
    We’d rather fight.

  48. I’m glad that others are explaining my thoughts better than I ever could. LQC reminds me of a combination of Emma Alberici, Jessica Irvine and Ross Gittins.

  49. stackja

    Liberty Quote
    It is a free market that makes monopolies impossible.

    — Ayn Rand

  50. Confused Old Misfit

    Struth,

    love yah!

  51. Liberty Quote
    It is a free market that makes monopolies impossible.

    — Ayn Rand

    But was Ayn Rand talking about an internal market free of government obstruction, or international markets?

  52. max

    which part of “free trade” you do not understand ?
    it means you should have choice to buy from any one you chose.
    I do not care if that person is next door or 10 000 miles away.
    I only care about price and quality.

    if you can not economically justify tariffs ( taxes ) between any town in your state, than you can not economically justify tariffs ( taxes ) between any place in the world.

    Wealth Isn’t Just Measured in Money — It’s Measured in Choices

  53. Brian

    Yes this is a libertarian blog – one presumes that is why you get to put up many articles.
    Yes it has posts which are not pure libertarian.
    Because of that, a lot of people are frequent readers here who would not come if it was pure libertarian.
    We admire Sinclair’s pragmatism here.
    Better to be a high traffic web site than a pure libertarian echo chamber that nobody knows about. Well done Professor.

  54. max

    Mercantilism is economic nationalism for the purpose of building a wealthy and powerful state.

    Adam Smith coined the term “mercantile system” to describe the system of political economy that sought to enrich the country by restraining imports and encouraging exports.

    The goal of these policies was, supposedly, to achieve a “favorable” balance of trade that would bring gold and silver into the country and also to maintain domestic employment.

    the mercantile system served the interests of merchants and producers such as sugar producers, whose activities were protected or encouraged by the state.

    These pro-tariff arguments are deceptive. They lead to policies which reduce most people’s freedom, and most people’s wealth.

  55. Lucius Quinctius Cincinnatus

    Gosh there’s some ignorance of basic economics here. Who is harmed by Trump’s tariffs? The poor working guy in the US, consumers in the US, manufacturers in the US using steel as an input. And so on. Trump’s tariffs are disgraceful and harm the US and the rest of the world. Struth go and study economics- not just theory but history. Because you will see that Trump’s tariffs are god damned awful and show he is unfit for office,

  56. max

    We come now to the economic issue that separates the economists from the special interest pleaders. There are a lot of supposedly free market capitalists who shout the praises of open competition, but when the chips are really down, they call for the intervention of the monopolistic, coercive State to keep Americans from trading with other Free World countries. Competition among Americans, but not between American companies and foreign companies: here is the cry of the tariff advocates. The fact that less than 5% of our economy is directly involved in foreign trade never phases these enthusiasts: free trade is “destroying” the other 95% of the American economy! Somehow, the principles of capitalism operate only within national boundaries. Somehow the intervention of the State will “protect” Americans. Henry Hazlitt’s classic little book, Economics in One Lesson, so completely destroys the arguments of the tariff supporters that there is nothing left of their position; still they keep coming. For two centuries their position has been intellectually bankrupt; still they keep coming. Tariffs hurt all consumers except those on the public dole of tariff intervention, e.g., the “infant industries” such as steel or textiles. Yet the advocates say that all Americans are “protected.” The logic of economics cannot seem to penetrate otherwise rational minds

  57. max

    We hear calls for fair trade. Who is to decide what is fair trade? Congress. Ah, yes: Congress. The source of fairness if ever there was one. No special interests there, putting their PAC-filled fingers on the balance scale of justice.
    The evil dragon used to be Japan. Now it’s China. India will get its turn soon enough. Americans are supposedly out of work because of China

  58. max

    Our politicians simply do not care that America is bleeding jobs.
    The politicians talk about little else than creating jobs, as if the government had the power to create jobs. The government has the power to reduce business regulations, reduce taxation, and let entrepreneurs create jobs.

    Yes, we are losing manufacturing jobs. We have been losing them since 1950. How many Americans send their kids into a factory job instead of college. “Son, I want you to work in a factory. Forget about college.” No? I thought not. (Actually, a factory job in a high tech factory is probably a better idea these days than a B.A. in sociology.)
    What the handwringers never mention is that the USA is the largest manufacturing nation on earth, with 20% of the world’s total manufacturing output.

  59. struth

    if you can not economically justify tariffs ( taxes ) between any town in your state, than you can not economically justify tariffs ( taxes ) between any place in the world.

    I can.
    If some one is tariffing you, tariff them back.
    If someone is using the mighty corrupt powers of global socialism via U.N climate agendas to stifle you and letting your competitors out of those obligations and you just become a buyer and not a seller, because they have gained the upper hand THROUGH CORRUPTION that may or may not be in the form of Tariffs, you do not roll over and live by some idiotic theory that only exists in a utopia that has never existed.

    The similarities between leftism and libertarianism to me, are not what is often quoted.
    The similarities are purely that they think their theories will bring about a utopia that will never occur in the real world, and in fact the reverse will happen.
    That’s why they think mussie immigration is fine.

    These people are theorists, and an embarrassing noose around the neck of common sense conservatives due to association.
    Grow up.

  60. max

    Keynesianism is an economic philosophy based on the idea that the free market requires intervention from the civil government in order to maintain justice and efficiency. The free market is both inefficient and unfair to the common man, Keynesianism teaches.
    So does mercantilism.
    The textbooks are officially anti-mercantilistic. There is a reason for this. Mercantilism is officially wrong, because it is undeniably old. Textbooks promote that which is new: “The latest is the greatest.” Mercantilism was believed from 1650 to 1750. It is therefore outmoded.

    Original mercantilism was a widely believed and invariably incorrect theory of trade that insisted that a nation grows rich by exporting more than it imports. David Hume, the Scottish philosopher, refuted this logic over 250 years ago. His fellow Scot, Adam Smith, refuted it in detail in 1776.

    A nation gets rich only if its residents get rich. Residents get rich by increasing their productivity. They stay rich by being allowed by the government to do whatever they want with their wealth, whether counted in gold, bank accounts, or goods. Liberty is the #1 basis of increasing people’s ability to become more efficient and therefore more productive. That was Smith’s argument in 1776. This is denied by Keynesianism.

  61. Lucius Quinctius Cincinnatus

    Why do we export? Simply to pay for the imports we consume. A tariff increases the price of imports and harms consumers. Surely that’s simple enough for you to understand? Free trade is not some high grade theory. It is proven time and time again to raise living standards.

    If the Chinese want to send us products that are subsidised more fool them. We can buy them and not rack up debt.

    The Australian government should retaliate to the Trump tariffs by cutting the general tariff rate from 5 % to zero.

    Bargaining chip? What a ridiculous mercantilist argument. The threat to impose tariffs or the offer of reducing tariffs is not a bargain. Rather than bargaining over tariff rates. A government should just cut them. That’s the lay down misere.

  62. max

    struth:
    “If some one is tariffing you, tariff them back.”

    only “your” government can tax you –not chinese, not japanise.

  63. johanna

    Silly argument, Max.

    In Australia, different jurisdictions have different tax rates on things ranging from property purchases to cigarettes. It’s called competitive federalism, at least what’s left of it, and it is a good thing. Indeed, there are what you would call differing tax rates within jurisdictions as well – for example, local councils have different rates.

    There is certainly a sound economic argument for it, as California, for example, is finding out. Residents and businesses are relocating to places like Texas to avoid high taxes, which operate like tariffs in raising prices.

    That is not an argument for having no taxes or tariffs at all, ever, merely a recognition that there are economic effects. Nobody is disputing that.

  64. max

    did any one ever put tariffs on import of oil in australia or america ?

    why not ?

  65. max

    Myth 10: Imports from countries where labor is cheap cause unemployment in the United States.
    One of the many problems with this doctrine is that it ignores the question: why are wages low in a foreign country and high in the United States? It starts with these wage rates as ultimate givens, and doesn’t pursue the question why they are what they are. Basically, they are high in the United States because labor productivity is high – because workers here are aided by large amounts of technologically advanced capital equipment. Wage rates are low in many foreign countries because capital equipment is small and technologically primitive. Unaided by much capital, worker productivity is far lower than in the United States. Wage rates in every country are determined by the productivity of the workers in that country. Hence, high wages in the United States are not a standing threat to American prosperity; they are the result of that prosperity.
    But what of certain industries in the U.S. that complain loudly and chronically about the “unfair” competition of products from low-wage countries? Here, we must realize that wages in each country are interconnected from one industry and occupation and region to another. All workers compete with each other, and if wages in industry A are far lower than in other industries, workers – spearheaded by young workers starting their careers – would leave or refuse to enter industry A and move to other firms or industries where the wage rate is higher.
    Wages in the complaining industries, then, are high because they have been bid high by all industries in the United States. If the steel or textile industries in the United States find it difficult to compete with their counterparts abroad, it is not because foreign firms are paying low wages, but because other American industries have bid up American wage rates to such a high level that steel and textile cannot afford to pay. In short, what’s really happening is that steel, textile, and other such firms are using labor inefficiently as compared to other American industries. Tariffs or import quotas to keep inefficient firms or industries in operation hurt everyone, in every country, who is not in that industry. They injure all American consumers by keeping up prices, keeping down quality and competition, and distorting production. A tariff or an import quota is equivalent to chopping up a railroad or destroying an airline for its point is to make international transportation artificially expensive.
    Tariffs and import quotas also injure other, efficient American industries by tying up resources that would otherwise move to more efficient uses. And, in the long run, the tariffs and quotas, like any sort of monopoly privilege conferred by government, are no bonanza even for the firms being protected and subsidized. For, as we have seen in the cases of railroads and airlines, industries enjoying government monopoly (whether through tariffs or regulation) eventually become so inefficient that they lose money anyway, and can only call for more and more bailouts, for a perpetual expanding privileged shelter from free competition.

    https://www.lewrockwell.com/1970/01/murray-n-rothbard/ten-great-economic-myths/

  66. struth

    Gosh there’s some ignorance of basic economics here. Who is harmed by Trump’s tariffs? The poor working guy in the US, consumers in the US, manufacturers in the US using steel as an input.

    It may help if you study the real wold and get your nose out of your theory books, Luscious Cunnilingus.

    Basic economics.
    There is no such thing.
    Never get the same answer from two different economists asked the same question, you pompous clown.

    You’re coming from a sense of getting the cheapest product, as it will help those businesses in the states.

    I very well get your theory.
    But a theory is all it is.

    So I ask you, Cunnilingus, should you buy the cheapest product off the biggest crook?

    Do you care if what you are buying is hot?

    Your dumb theory is that if you go down to the pub and buy a hot TV off of the crook who just stole it, you’ll pay less and everyone is happy.

    You don’t care for a second as to why that television is cheaper, because theoretically, it’s a win for everyone.
    If we look harder into the situation, we see that it’s actually bad for the economy.
    So China is the corrupt guy down the pub.

    And you spout insane dribble.
    You also came from a position Americans don’t accept, like Australians do, that on a level uncorrupted by government meddling, they can compete (and are willing to try) against anyone.

    You want one side to play fair, as you think it’s better off for them anyway.
    The recent years of the west have proved otherwise.
    Stick your unworldly theories up your arse.

  67. yarpos

    People confuse what Trump says or does or threatens to do and what he is trying to achieve. Many times its just a silver wobbler that gets people to think, fight amongst themselves or lurch in a direction they would have otherwise resisted.

  68. Confused Old Misfit

    What if the other town is using its coercive taxation power to take money from all of its citizens to subsidize the sale of a product that directly benefits only a few and does not evenly distribute the indirect benefits?

  69. struth

    I’ve said all that I am going to say about this, except to say that if you want to be “theoretical” about it, buying from the seller who has cheaper products due to corruption and criminal behaviour, it will be worse for all in the long run.
    Doing this had made a corrupt communist shithole a superpower.
    In the real world, it very much matters why the product is cheaper, and not just that it is.

    You theory, as usually, applied regardless of real world assessments, is a blessing for the left.

  70. tezza

    Trump’s trade policies are the most dangerous of his initiatives, but I don think Economics 101 provides the answer to them.
    The reason Trump gets so much traction with US voters on trade gripes is that the US has been subject to an unprecedented event – the entry of a few billion Chinese, Indian and SE Asian workers into the internationally traded good sector. The distribution of the ensuing gains from intensified trade between the US and the rest of the world is indeterminate, as even Economics 101 (properly taught) acknowledges. There is good evidence that the adjustment costs in the US to that change, which are usually able to be ignored over any series of modest trade expansions, are in this unprecedented case, quite significant. See David Autor on Trade, China and US Labor markets.
    Trump is saying that China got too much of the benefits, and the US got too much of the costs.
    I understand Trump to be saying that the US could do better by (in effect, although Trump would never use such terminology) imposing ‘optimum tariffs’. (I forget whether optimum tariffs make into Economics 101, but if they do, they are promptly set aside as irrelevant in almost all cases.)
    As I said, Trump’s trade actions are dangerous, but they are not stupid, and not able to be rebutted by Economics 101. There are probably better policies than trade barriers to try to achieve Trump’s objectives, but you won’t find them in Economics 101 either.

  71. mh

    I hold these values closely – small government, balanced budgets, efficient taxation…

    You must really hate Turnbull then.

  72. max

    The heart of the contradictory thinking concerning tariffs is in the statement, “I favor open com­petition, but….” Being human, men will often appeal to the State to protect their monopolistic posi­tion on the market. They secretly favor security over freedom. The State steps in to honor the re­quests of certain special interest groups—which invariably pro­claim their cause in the name of the general welfare clause of the Constitution—and establishes several kinds of restrictions on trade.

    Fair trade laws are one exam­ple. They are remnants of the old medieval conception of the so-called “just price,” in that both approaches are founded on the idea that there is some underlying objective value in all articles of­fered for sale. Selling price should not deviate from this “intrinsic” value. Monopolistic trade union laws are analogous to the medieval guild system; they are based in turn upon restrictions on the free entry of nonunion laborers into the labor market.

    Tariffs, trade union monopolies, and fair trade laws are all praised as being safeguards against “cut­throat” competition, i.e., competi­tion that would enable consumers to purchase the goods they want at a cheaper price—a price which endangers the less efficient pro­ducers who must charge more in order to remain in business. The thing which most people tend to overlook in the slogan of “cut­throat competition” is that the person whose throat is slashed most deeply is the solitary con­sumer who has no monopolistic organization to improve his posi­tion in relation to those favored by Statist intervention.

    https://www.garynorth.com/public/17799.cfm

  73. Dr Fred Lenin

    I think President Trump is using tariffs to pull the Chinese into gear , in any trade war with the USA they would lose the most ,the fall in trade would cause massive unemployment in China , and the last thing the unelected opportunist fascist government wants are masses of aspirational people out of work and out of money ,even the organs of oppression in the aparat would not be able to control this , and the communists would go the same way as their old time soviet Russian mentors . Now if I know this President Trump would know too . The libertarian ideal of purist”free trade” should become “fair trade “ as another contributor said , tariffs aare not bad when used to correct unfairness,its the only weapon available , you can “negotiate “ till you are blue in the face with people who are used to doing the wrong thing ,and achieve nothing actions speak louder than words in this case .

  74. max

    Certain borders in the United States and in most countries have no economic relevance to trade. Borders between counties have little or no economic relevance. Borders between states have little or no economic relevance. In fact, the Constitution of the United States was written by a group of participants who specifically had been assembled in Philadelphia in order to deal with the question of tariff barriers between states. The 1786 Annapolis Convention had been called to deal with this. It had failed. The Philadelphia Convention was the follow-up meeting. This is why the Constitution prohibits any tariffs established by state governments. The United States is a gigantic free-trade zone. It is unconstitutional for any state to impose tariffs against the imports from other states.

    The only state border that is guarded is California’s, and the justification for this is the protection of California agriculture from fruit flies and other bugs that might be attached to agricultural products that people carry in their cars into the state. This justification is entirely bogus. The border patrol system is the remnant of an illegal restriction on people from other states coming into the state during the Great Depression in the mid-1930s. The Supreme Court declared these restrictions unconstitutional. But, once the border patrol set up the restrictive barriers, it did not want to take them down. Those people wanted to keep their jobs. So, the legislature invented a new excuse for restricting entry into the state: fruit flies. The border patrol people all kept their jobs. The bureaucracy still exists 80 years later — a welfare program.

    Tariff barriers and other import quotas that are established for any purposes other than revenue generation assume that the invisible line known as the national border is completely different, economically speaking, from all of the other invisible lines, also called borders, that exist inside the nation. No one accepts any of the arguments for restricting trade across the internal borders. Yet they accept these arguments with respect to national borders.

    These articles detail the economic reasons why arguments in favor of restrictions on voluntary trade across the invisible lines known as borders are invalid from an economic point of view. These pro-tariff arguments are deceptive. They lead to policies which reduce most people’s freedom, and most people’s wealth.

    Most of these arguments have been around for well over two centuries. Most of the arguments in favor of restrictions on trade have been around in the West for over 300 years. They promote a system called mercantilism.

    Adam Smith became famous in 1776 for his arguments against mercantilism. His book, The Wealth of Nations, is a treatise against tariffs and import quotas. Nevertheless, millions of people who claim to be defenders of the free market, and who think they are followers of Adam Smith, hold exactly the positions that Adam Smith wrote his book to refute. It is one more case of self-interest and bad economic logic combining to confuse millions of voters.

    https://www.garynorth.com/public/department162.cfm

  75. Infidel Tiger

    Trump is a throwback to traditional Republican Presidencies, all of which have favoured protectionism.

    The madness of the neo-cons is finally over. That is far more important than some pissy little steel tariff.

  76. max
    #2652423, posted on March 5, 2018 at 12:21 pm

    which part of “free trade” you do not understand ?
    it means you should have choice to buy from any one you chose.
    I do not care if that person is next door or 10 000 miles away.
    I only care about price and quality.

    if you can not economically justify tariffs ( taxes ) between any town in your state, than you can not economically justify tariffs ( taxes ) between any place in the world.

    Wealth Isn’t Just Measured in Money — It’s Measured in Choices

    What choice are you talking about max?
    Do an exercise.
    What are the choices when buying a smart phone? Chinese, there are no other choices.
    What are the choices when buying tools? Chinese, there are no other choices.
    What are the choices when buying toys for kids? Chinese, there are no other choices.
    What are the choices when buying clothes? Chinese, there are no other choices.
    What are the choices when buying electrical goods? Chinese, there are no other choices.
    The list is endless.
    What choice are you talking about?

    Furthermore, you may not care where an item you buy is made, but some of us are thinking long term.
    It is fast becoming apparent that our only competitive advantage with the Chinese and other ASEAN trading partners is in the mining sector.
    But the mining sector can not sustain 25 million people. There is a limit to how many people are needed to dig stuff up and service those who do.
    What does everyone else do? Serve coffee? Preach wymynses studies at uni? Profess the benefits of blockchain technology? Who pays for those services and where does the money come from?
    WHAT THE FVCK DO THE REST OF US DO?

    Go on welfare, that’s what.
    But don’t take my word for it. Look around here and in the US and Canada etc. Scores of people piled on welfare since China entered the WTO in 2001.
    You can preach textbook academic theories all you like, in the end those theories must stack up against reality.
    The reality is, scores of people HAVE NOTHING TO DO. The USA alone has 90 million people under employed. They can’t all flip burgers and serve coffee.

  77. max

    “America Needs to Negotiate Better Trade Deals.”

    A common cliché of protectionism is this one: the United States government needs to negotiate better deals for American companies.

    It is time to call a spade a spade. This is fascism. Fascism is the economics of a government-business alliance. There should be no government-business alliance. The government should not be involved in business. Whenever government gets involved in business, it is always done to favor certain businesses at the expense of all the rest of them. It always involves a repression of decision-making on the part of individual buyers and sellers. There are no exceptions. There are always going to be a few winners and a lot of losers. But we do not see the losers. This is what Frederic Bastiat in 1850 called “the fallacy of the things not seen.”

    If I say this to the standard conservative, he nods his head in agreement. He is convinced that the government is up to no good when it intervenes into the free market. Then, a few minutes later, he tells me that the government should actively negotiate better trade deals for American businesses. In other words, his default setting on trade is fascism. He does not understand this. He does not understand economic logic, and he does not understand the meaning of the so-called business-government alliance.

    There is only one legitimate justification for tariffs: as sources of revenue. In the United States Constitution, originally, the United States government was not allowed to tax individuals directly. This was done in order to restrict the power of the federal government. The federal government was allowed to tax liquor, which it did. The other main source of income was from tariffs. A tariff is a discriminatory tax placed on imports, but the Constitutional justification for it in 1787 was to restrict the power of the federal government to tax people directly through income tax assessments.

    Once the 16th amendment was announced as having been passed, the justification for tariffs disappeared. From that point on, the tariff was just another discriminatory tax against imports and exports.

    Yes, it is a discriminatory tax on exports. Because foreigners cannot sell all that they could otherwise sell to Americans, they cannot get their hands on United States dollars. When they cannot get their hands on United States dollars, they do not order American goods or invest in American companies. So, import restrictions are always export restrictions, and vice versa. I realize that almost no Americans or any other nationality understand this, because it involves economic reasoning, and people are not adept at economic reasoning.

    NEGOTIATING AGAINST LIBERTY

    This brings me to the idea that governments should negotiate tariffs and other quotas with foreign nations.

    Why should any government agency negotiate in favor of any American business? What is the economic logic of this? This is one more example of government interference into the operations of the free market. Yet Americans who claim that they do not want government intervention in the marketplace loudly insist that some American trade negotiator has an obligation to get a better deal for America.

    For America? For a collective? For all of America? How? The government cannot achieve this in any other field of economics. It is always discriminatory. There are always winners and losers. How is it possible for trade negotiators to get a better deal for all Americans? They can’t. It’s a myth.

    https://www.garynorth.com/public/16322.cfm

  78. mh

    The madness of the neo-cons is finally over. That is far more important than some pissy little steel tariff.

    I think some of those neo-cons were sincere, but they were really just puppets for the DAVOS globalist types.

  79. max

    “Tariffs Protect All Americans.”

    Whenever the government intervenes, there are winners and losers. Follow the money.

    A popular slogan in favor of tariffs is this one: “Tariffs protect Americans.” It is an accurate slogan. The question is: “Which Americans are protected?” Another question is: “Who pays?”

    In this world, you don’t get something for nothing. If some Americans are protected, then other Americans are paying to grant them this protection.

    Who are the winners? Who are the losers?

    The winners are a relatively small percentage of American workers who produce goods at higher prices with lower quality than imported goods offered to consumers. The only reason why these workers need protection is because they are not efficient workers.

    Who judges efficiency? Consumers do. The heart of the free market system is this: people who spend money have final authority in the economy. This means consumers. Any attempt by the government to intervene in the economy to help special interest groups always comes at the expense of consumers who would have bought whatever it was that competitors were offering for sale, but who are unwilling or unable to buy the goods because of some government regulation.

    A tariff is a sales tax on imported goods. Therefore, the sales tax is discriminatory. It is not paid by everybody. It is paid by those members of the workforce who are facing foreign competition. It is also paid by exporters in the United States, because foreign buyers cannot get access to the domestic currency, precisely because foreign exporters cannot get buyers in the domestic currency. So, exporters are hurt and importers are hurt. This means that American consumers are hurt.

    Defenders of tariffs basically do not understand economics. They really are economic ignoramuses. They do not understand economic cause-and-effect. They do not understand the fact that consumers are being hurt by the tariffs. They call for these discriminatory taxes, and they do it in the name of liberty. They do it in the name of fairness. Yet discriminatory taxation is inherently unfair.

    Everybody wants somebody else to pay the tax. A tariff is a specific tax on imported goods, and it is an implicit tax on exported goods. Defenders of tariffs never talk about the fact that the tariffs are discriminatory against the exporters in their own country. They are incapable intellectually of following even a simple economic argument. They do not recognize that when foreign sellers cannot sell their products in nation A, exporters in nation A cannot find as many buyers in nation B as a result of the restricted trade.

    This is basic economics, it has been basic economics ever since 1752 when the Scottish philosopher David Hume wrote his essay on trade. These people are not too bright. They really cannot follow basic economic logic. It is unfortunate, but most people are not too bright, and among those who are bright enough to follow an economic argument, they had never heard the argument.

    Am I saying that all supporters of tariffs are economic ignoramuses? No, but most of them are. A lot of them are simply hired economists who are paid by labor unions and by inefficient American producers. In other words, they are on the take. They promote bad ideas to other Americans, because they are well paid to do this.

    https://www.garynorth.com/public/16296.cfm

  80. jupes

    If the Chinese want to send us products that are subsidised more fool them.

    Correct me if I’m wrong but aren’t the Chinese ‘dumping’ subsidised steel into the US?

    Isn’t the reason they do that is to destroy the US steel industry? Then of course they can hike their prices but more importantly the US will have to import steel from China to build their warships.

    How foolish would it be for the US to allow that situation to continue?

    Trump is fighting back.

  81. struth
    #2652465, posted on March 5, 2018 at 1:00 pm

    I’ve said all that I am going to say about this, except to say that if you want to be “theoretical” about it, buying from the seller who has cheaper products due to corruption and criminal behaviour, it will be worse for all in the long run.
    Doing this had made a corrupt communist shithole a superpower.
    In the real world, it very much matters why the product is cheaper, and not just that it is.

    You theory, as usually, applied regardless of real world assessments, is a blessing for the left.

    Exactly.
    Those who have time may wish to watch the following video “Death by China” to get a better sense of the disconnect between unicorn fart theory and reality. Thoery never put food on the table.
    The video is introduced by Peter Navarro. He is Trumps Director of Office of Trade and Manufacturing policy.
    No point debating Trumps tariffs if you don’t know what he is on about, right? Otherwise you’re just talking out of your academic unicorn ar$e.

    https://youtu.be/mMlmjXtnIXI

  82. max

    “Free Trade Has Destroyed American Manufacturing.”

    Manufacturing is going the way of agriculture. But we are not getting poorer. This has been true since at least 1840.

    Free trade in manufactured goods is of marginal overall importance. Free trade in digital services will increase. The government cannot easily tax this kind of international trade. There are no tariffs and quotas on information. But protectionists never mention this aspect of free trade. They are focused on physical production, which is of declining value in our lives. They seek to protect manufacturing jobs — jobs that would steadily disappear if tariffs were at 100%.

    The decline in American manufacturing is not the result of free trade. It is the result of our increasing wealth. We buy services and digits, not space-occupying stuff.

    We can be confident in this scenario: (1) manufacturing will continue to decline in importance as a share in the United States economy; (2) robots will replace a larger percentage of manufacturing jobs than service jobs; (3) per capita wealth will increase, as it has since at least 1840.

    If the federal government raises tariffs and quotas — highly unlikely — this will lead to a displacement of American-made robots by foreign-made robots. It will have no significant impact on the number of workers in manufacturing. The main question is where the robots will be located: on-shore or off-shore. Protectionists make their case in terms of American manufacturing jobs. These jobs will continue to disappear under free trade or protectionism.

    https://www.garynorth.com/public/14455.cfm

  83. EvilElvis

    So, on trade libertarians are all for a free and open global village? How’s globalisation going nowadays?

    FMD, you seem to have more in common with the left than conservatives.

  84. Infidel Tiger

    I think some of those neo-cons were sincere, but they were really just puppets for the DAVOS globalist types.

    They were sincere all right, but they were also the stupidest and most arrogant fuckeits in the last one hundred years.

    The damage they have wrought may never be undone.

  85. Infidel Tiger

    FMD, you seem to have more in common with the left than conservatives.

    Historically free trade is a liberal idea and an anathema to conservatism.

  86. Bruce of Newcastle

    Gosh there’s some ignorance of basic economics here. Who is harmed by Trump’s tariffs? The poor working guy in the US, consumers in the US, manufacturers in the US using steel as an input. And so on. Trump’s tariffs are disgraceful and harm the US and the rest of the world.

    Rubbish. The end price of steel is the issue.

    Trump is raising the price of foreign steel at the same time as reducing the price of domestic steel by means of green tape removal and deregulation.

    Thus he doesn’t harm his blue collar base. But since his base aren’t economists they get the idea that he has their interests in mind.

    Once the dust has settled he will negotiate bilateral trade agreements…ones which prevent abuses like NAFTA cushion shots.

  87. Harald

    Trump is giving Masterclasses in how to get stuff done and instead of listening and learning, the response libertarians keep pushing their circular utopian logic: we assume a perfect world, next we introduce a Trump-imperfection et voila: the world is not perfect anymore and would be improved of course by removing said Trump-imperfection.

    Dissenting opinion is “sad” and probably should not be welcome to preserve this site as libertarian echo chamber – pure & pristine.

    Typical.

    Devoid of any real world achievement for decades now, especially libertarians have become obsessed with ideology and measure success in terms of donations, articles published, interviews, likes on facebook, retweets on twitter and other Kardashian metrics. Not in terms of achievements.

    I guess the libertarians have strayed so far from the real world, they don’t care anymore about the results in that real world if in the process their arguments have not prevailed. The debate over the theory has to be won first, so the achievements and results are to further their glory. Otherwise it doesn’t count.

    That perhaps was the logic behind supporting Hillary: Libertarians rather lose the election and allow 4-8 yrs of poverty and misery under Hillary, then see the actual results under Trump just because he won’t fight on the ideological plane. Instead he just does it without caring about the ideology – and that simply won’t do.

  88. Infidel Tiger

    We can be confident in this scenario: (1) manufacturing will continue to decline in importance as a share in the United States economy; (2) robots will replace a larger percentage of manufacturing jobs than service jobs; (3) per capita wealth will increase, as it has since at least 1840.

    This is true.

    Unfettered Immigration is the real enemy of our societies, not free trade.

  89. max
    #2652489, posted on March 5, 2018 at 1:30 pm

    “Tariffs Protect All Americans.”

    Whenever the government intervenes, there are winners and losers. Follow the money.

    That’s what we’ve done. Stop copy pasting crap you obviously don’t understand.
    Since WTO, the winners are the Globalists, Multi-Nationalists like GE Apple et al and the bankers.
    The losers are mostly middle class men who used to make things for a living but now can’t even get a job driving taxis.
    Following the money trail leads you to the mountains of cash hoarded by Apple, Google, GE, Facebook et al.

    Normally I’m all for companies making mega bucks, no problem. But the above mentioned have not only uprooted factories that make their stuff, but transplanted the intellectual property to China who did nothing but provide slave labor for the factories.
    Now America doesn’t have the factory jobs, but nor do they have the comparative advantage of the intellectual property.

    It’s like the Aussie Sheep Farmers of the 80s who, after decades of breeding fine wool merinos, sold off the rams for a quick buck only to find they no longer have a market to sell their fine wool. STUPID.

  90. Rob MW

    I hold these values closely – small government, balanced budgets, efficient taxation with low rates and free trade. Not fair trade – free trade. It is sophistry to argue for fair trade.

    So what would you propose the default position should be to combat the corruption of the free trade doctrine by powerful ideological regime(s) ? – One Road, One Belt – String of Pearls ?

    It’s not good enough turn the other cheek: “If other countries are foolish enough to increase protection and add barriers to trade that’s their problem.” Bullshit, it’s not a problem for them because they will pursue to control the corrupted flow of goods and services.

    Conflating the argument to a complete strawman by associating a socialist ideology against those that disagree with you just goes to show that you have no idea of the current geopolitical strategies that are using the goodwill of free trade (e.g – back door infiltration of NAFTA) to completely usurp to doctrine of free trade. Given you hold the free trade principle closely and, If you won’t stand up against free trade corruption; what will you stand up for ?

    You closely held principles will die in darkness Sunshine.

  91. Stan

    Harald
    #2652331, posted on March 5, 2018 at 10:18 am

    summed it up best, I think. Trump does want free trade, yuge trade, but the best way to get there is by starting with a position of strength and wielding a big stick.

    The fundamental problem with LQC’s article is because he started with the thought – how can I troll those readers who think Trump is a way better president than Clinton ever would have been? Thus he was blind to Trump’s strategy – read some of Scott Adam’s writings.

  92. Confused Old Misfit

    Whenever government gets involved in business, it is always done to favor certain businesses at the expense of all the rest of them.

    And to buy votes.

    The government should not be involved in business.

    They need to cease all subsidization activities. This includes all tax breaks, tax concessions, tax holidays, tax incentives, etc.; interest free loans, in fact any government concession or incentive, in cash or in kind.
    Until you get ALL governments out of the business of subsidization you are going to have trade wars and tariffs.

  93. NB

    The most interesting comments here revolve around negotiation (Ctrl + F > ‘negotiat’). My inclination is to approve the idea of creating the threat (at least) of a trade barrier to encourage others to behave. However, it is great to read and give weight to the counter arguments.

  94. max
    #2652498, posted on March 5, 2018 at 1:36 pm

    “Free Trade Has Destroyed American Manufacturing.”

    Manufacturing is going the way of agriculture. But we are not getting poorer. This has been true since at least 1840.

    This is not true.
    Agriculture became efficient, we got richer. Agriculture did not disappear.
    Manufacturing is not just getting efficient, it is disappearing.
    And we are getting poorer, especially since 2001 when China was admitted to the WTO.

    Millennials may be first to earn less than previous generation – study
    https://www.theguardian.com/society/2016/jul/18/millennials-earn-8000-pounds-less-in-their-20s-than-predecessors

    So yes, we got richer since 1840, but only until 2001. For the first time since the industrial revolution, the new generation will be poorer than their parents generation BECAUSE THEY HAVE NOTHING PRODUCTIVE TO DO.

    By definition, a person srvicing a maker must earn less than the maker who pays for that service.
    We’ve been sold a bill of goods when we were told that advanced economies must become service economies.
    Then by definition, we must earn less than manufacturing/producing economies AND WE ARE.

    Who in their right mind transitions to a less earning economy?

  95. Perfidious Albino

    Bemused – add Peter Martin to the Alberici, Irvine and Gittins list…

    I see the tariffs as just a stick Trump is currently wielding to try and reach his end goal of fairer trade (for the US). Whether that ends up being ‘free’ trade remains to be seen, but is at least a possibility.

    I also think Trump will be aiming for an overall fairer deal for the US across the trading spectrum, so he is starting with the more egregious examples pour encourager les autres.

  96. Adam D

    Reality 101

    Libertarians are so pure and ideological as to be useless and ineffective in the real world. When was the last legitimate victory for Liberty in the western world?

    Sure I would prefer Trump not to raise tariffs but so far he has played nearly everything perfectly despite an opposition unlike any other so perhaps it is part of a grander plan, or perhaps he is not a perfect libertarian but he was the only one running who could make a difference.

  97. Tel

    Since WTO, the winners are the Globalists, Multi-Nationalists like GE Apple et al and the bankers.

    And quite a lot of the people doing white collar work, managerial work, able to stay a step ahead. Admittedly, computer programming doesn’t pay like it used to, and that’s due to a rush of supply, but kind of expected in as much as when you have a new industry people over time move to that.

    The losers are mostly middle class men who used to make things for a living but now can’t even get a job driving taxis.

    Yeah, well a massive number of women entered the workforce in the 1990’s and someone’s going to get displaced. That’s at least part of it. Also, back when unions had strong leverage they could drive up wages in certain industries by throttling the supply of labour. Other labour throttling devices include the minimum wage and various industry tickets, all of which push up costs for business. Once you offshore your factory none of those things are a problem anymore.

    Some people did OK, others not so much. We have more material goods, but more stress, higher debts and it takes two people working flat chat to pay a mortgage.

  98. Jannie

    So Trump is a disappointment. What a surprise. Does this mean I should have hoped for Hillary instead?

    But since I still sort of like Trump, does that mean I cannot be sort of libertarian anymore?

  99. egg_

    perhaps he is not a perfect libertarian* but he was the only one running who could make a difference.

    +1

    *WTF that is in the real world.

  100. OneWorldGovernment

    Lucius Quinctius Cincinnatus

    Whilst I resent you appropriating that name, just as I resent the so called Australian Union movement appropriating the Eureka Flag, it’s fitting because it reveals your deep instinct for absolute control.

    Just as your namesake did when he took absolute control of Rome.

    Some people call that Communism and most if not all of your posts reveal your dictatorial nature.

    “Free Trade”.

    Let’s have at it.

    By the way, do you know that there was supposed to be ‘free trade’ between the Australian States?

    If we want free trade then let’s have a referendum and delete the entire section of the Australian Constitution that relates to Excise Duties.

    Let us wipe out GST.

    Fact is you marxist that our whole economy is inferred on “The State” being in control of everything we do.

    I say sack the courts and the police ‘forces’.

    I say let anyone with the ability to be a doctor hang out their shingle because the current ‘crony’ system does not protect us from the gibbering idiots but protects them.

    Open up all the bandwidths to anyone that wants to start a paper, radio station or TV station.

    You had to have a licence for all these.

    Our communist in chief imposed a diktat on us over light globes!

    I have no idea if you have ever left your ivory tower and ventured into the bush.

    ‘Free Trade”

    Do you know that to be a Chinese exporter you have to have a licence from Xi?

    Most of the major Chinese manufacturers were, and still are, controlled by Chinese War Lords.

    Seems to me that most libertarians should be wearing pussy hats.

    Where are the libertarians manning the barricades to eliminate the entire Not for Profit sector?

    Where are the libertarians investigating the ‘swags’ of overseas money sent to Australian marxists to stop mining and oil and gas exploration.

    Let alone development of COAL and NUCLEAR power.

    “Free Trade”.

    Don’t make me laugh.

    You wouldn’t know it if it bit you on the bum!

    And don’t get me started on the Labor without U pardee.

  101. OneWorldGovernment

    Isn’t it great that “FREE TRADE” now will let us IMPORT GAS FFS.

    40 years ago I argued that every Australian capital city should be bulldozed into the sea.

    There would be some great fishing!

    Once upon a time long long ago AGL used to stand for Australian Gas Light but now it stands for modern day Enron.

    I have family in South Australia but as far as I am concerned the Nuclear Tests have warped their minds.

  102. DM of WA

    Lucius Quinctius Cincinnatus
    #2652445, posted on March 5, 2018 at 12:35 pm
    If the Chinese want to send us products that are subsidised more fool them. We can buy them and not rack up debt.

    Meanwhile, if we are to believe the experts, China is a major contributor to Catastrophic Man-made Global Warming, the greatest threat to mankind that has ever existed. So libertarians in Australia are happy buy cheap Chinese products while at the same time paying a very heavy price to stave off impending doom by destroying the Australian energy industry and local manufacturing!

    Can a libertarian please explain how this is beneficial to an ordinary Australian? (And “Global Warming is a hoax” is not an acceptable answer.)

  103. EvilElvis

    Libertarians are so pure and ideological as to be useless and ineffective in the real world.

    Agreed. And OWG above is on point.

  104. Anto

    A true libertarian would say that Trump and the USA are free to do whatever they want.

    Let’s say that my opponent and I agree to play a game of chess – we both know the rules. However, my opponent unilaterally decides that he can make two moves to my one. If I continue to play, I will almost certainly lose more games than I win. Does libertarianism demand that I continue playing with such a handicap, based on principle? Or instead, am I at liberty to either demand the same rules as him, or to call him a cheat and refuse to play?

    If he really wants to play the game, he can offer to agree to play by the rules. I am under no obligation to continue playing – having a doubt about his bona fides, however I am at liberty to take him at his word and continue to play.

    A true libertarian believes in the freedom to choose, not in the compulsion to play a rigged game or to pursue principle and honour, even unto death.

  105. Jannie

    If the Chinese want to send us products that are subsidised more fool them.

    Err…No. Its the oldest market capture strategy in the book. Losses made in the market capture phase can be recovered after the alternative producers are forced out of the market. The Chinese are not foolish.

  106. MPH

    I’d hazard a guess it’s actually about getting rid of the trade deficit – the US has a trillion dollar mortgage on the country and the only way to get rid of that is to stop buying foreign goods and start selling more of your own. Can’t blame your own population for the situation though right, thats bad for votes, better to make the Chinese a scapegoat instead

  107. Jannie

    Anto, there is no such animal as a true libertarian. The phrase is an oxymoron.

    But its probably true that libertarians like freedom.

  108. Tel

    Can a libertarian please explain how this is beneficial to an ordinary Australian? (And “Global Warming is a hoax” is not an acceptable answer.)

    It works like this: you stick a Chinese made banana in your ear, and it fixes everything.

    Hey, don’t blame me, you didn’t want to listen to the correct answer. *SHRUG*

  109. OneWorldGovernment

    I want to run DFAT.

  110. OneWorldGovernment

    I want to see that Senators are appointed by their State Government.

    And Tasmania gets one Senator and the other States 2 Senators.

    I am sick of the political crap.

  111. OneWorldGovernment

    ‘They’ knock the turd from Iran.

    Yet both Turnbull and Rudd are wedded to the Chinese System via their family!

    “FREE TRADE”!

  112. Tel

    Err…No. Its the oldest market capture strategy in the book. Losses made in the market capture phase can be recovered after the alternative producers are forced out of the market. The Chinese are not foolish.

    Are there any cases where that’s actually worked?

    Is there a country or company that captured a market by simply producing so much at a loss that the others gave up, and then recouped all the losses in a second phase of high prices? I can’t think of anyone.

    There were cases like the British East India Company where for a while they had a government granted monopoly and their own private military, but they didn’t corner the market by making a loss, they simply used violence and the threat of violence to keep others out of the way… and there was that business with the opium.

    There’s been plenty of other government granted monopolies, but I want to hear about one that traded at a loss for an extended period.

  113. Tel

    Libertarians are so pure and ideological as to be useless and ineffective in the real world. When was the last legitimate victory for Liberty in the western world?

    Better and more open communications technology; mainstream media companies getting dragged out in the light for their dishonesty; easier than ever before to rapidly self-educate thus bypassing institutional indoctrination (for those who want to); difficult for politicians to pretend they said something different last election cycle when thousands of people have a copy of the video; content creators can sell pretty much directly to their audience, on their own terms; government spending available on a website where anyone can check what they waste it on; more difficult than ever for socialists to hide the crimes of Stalin, Castro, and the Kim family.

  114. MPH

    Tel – South Korea and ship manufacturing. They’ve tried it in other industries with some success.

  115. OneWorldGovernment

    MPH
    #2652726, posted on March 5, 2018 at 6:02 pm

    Tel – South Korea and ship manufacturing. They’ve tried it in other industries with some success.

    How come no one noticed that Trump imposed a tariff on South Korean washing machines you libertarian scum?

  116. OneWorldGovernment

    Listen here you “FREE TRADE” arzholes.

    I saw the slave trade developing back in the 60’s and 70’s.

    Which “FREE TRADER” will take on the War Lords of China?

  117. OneWorldGovernment

    Bite your bum you so called “FREE TRADERS”

    And I believe in the concept of free trade but it doesn’t work like that.

    Real politik.

    Look at the shit of the EU and the UN!

  118. Tel

    South Korea and ship manufacturing

    Sure they have been running losses for the past few years, and what have they achieved by this?

    Oh, they can be beaten by Japan… well done chaps.

    http://gcaptain.com/japan-overtakes-south-korea-in-shipbuilding/

    And how are the South Koreans planning on cashing in on this situation? That’s what I want to know. I’m not disputing that big firms can make losses, I’m asking for a case where they used their big losses to make even bigger profits.

  119. Snoopy

    It will be a great day for free trade and Australia when our last fuel refinery closes.

  120. tgs

    Jeez, a few pretty unhinged commenters on this one.

  121. Iampeter

    Thanks for an actual right wing post on what’s meant to be Australia’s leading “centre-right blog” LQC.

    Sad you’re getting so much push back on the basics.

    It’s a testament to how completely dominant left wing ideas are in the culture today.

  122. Tel
    #2652720, posted on March 5, 2018 at 5:54 pm

    Err…No. Its the oldest market capture strategy in the book. Losses made in the market capture phase can be recovered after the alternative producers are forced out of the market. The Chinese are not foolish.

    Are there any cases where that’s actually worked?

    Is there a country or company that captured a market by simply producing so much at a loss that the others gave up, and then recouped all the losses in a second phase of high prices? I can’t think of anyone.

    On a small scale, this is how Woolies and Coles beat off butchers, Green Grocers and Bakeries. (I used to work for Woolies as a manager)
    Right this minute my local Woolies is selling bread, French sticks and a whole variety of bread items so cheaply that I can’t imagine they make much money if at all on the square foot floor space they occupy.
    But the Bakers Delight in the complex went broke and re opened with new owners. I feel sorry for them.
    As soon as they go broke as well and Bakers Delight can’t sell the franchise, I’m sure my French Stick will no longer be $1.50 at Woolies.

    On the scale of what’s happening regards trade with China, I don’t think it’s relevant whether China is profitable or not.
    By the time China goes broke, generations of Americans, Ausies et al will have had their lives devastated. Many regions and areas will become rust belts.

    It’s academic for people like us to discuss these issues in the abstract, but there are real lives at stake.
    It seems to me that we have entered into a negative feedback loop. The more people go on welfare, either partial or full, the bigger governments get. Rinse and repeat.
    Something has to break the cycle. If Trump wants to try something to break this cycle, I’m all for it even though it goes against my own free trade instincts.
    Doing nothing, continuing down the same path for another generation is not an option IMHO.

  123. Drew Shepherd

    Think Trump is channelling the Club of Rome i.e. avoid trade agreements and use tariff walls to protect big players while respecting the nation state’s borders aka ecological economist Herman Daly’s ‘steady-state or balanced economy’, and some lashings of old eugenics keeping immigrants at bay; more like corporatist Italy and nativist Germany of the 1930s?

  124. Tel

    On a small scale, this is how Woolies and Coles beat off butchers, Green Grocers and Bakeries. (I used to work for Woolies as a manager)

    I buy a lot from Woolies, they have randomly rotating discounts which is fine because I’m patient and willing to go hard when I see a good deal. I must admit I don’t buy Woolies meat because in the past the quality has been haphazard. Cohenite and jupes might be unhappy but I buy sometimes from the local halal merchant who costs a buck more but delivers higher quality and most importantly more consistent quality. I also buy from the Chinese BBQ pork shop or drive down to the meat wholesalers who sell a lot of excellent stuff including shrink wrap Bindari fillets. Maybe a few local butchers went out of business, but there’s plenty of others to choose from.

    Woolworths really sells convenience, because all the things are under one roof, and if that’s what people want then I don’t have a problem with it. Have Woolies ever consistently made a loss though? I accept there might be a handful of loss leader items but anyone can do that. They tried it on cheap milk for a while, I tried that milk, wasn’t impressed, buy a slab of longlife in bulk from Costco every so often. If some poor family needed to slurp up the Woolies loss leader milk then good luck to them.

    Overall I think Aldi is cheaper, I’m the sort of guy who will drive to Aldi just to buy coffee and chocolate and nothing else. That’s what shelving is for. There’s more supermarket competition than ever: Costco sells meat, you can watch the guys cutting away at it. You can even order meat on the Internet these days, I tried it once, but the local wholesaler is better.

    By the time China goes broke, generations of Americans, Ausies et al will have had their lives devastated. Many regions and areas will become rust belts.

    Generations? No I doubt it, Americans are very adaptable given an opportunity. The guy who gets shafted is the guy who cannot adapt to change, puts all his training into one skill set in one factory and then doesn’t know what to do when the rug gets pulled out. There’s also been mismanagement, you only have to look at Detroit … the corruption, the unions, the do gooder town planners, the white people running for their lives, the luxurious pension plans built on a Ponzi scheme. Can’t blame China for that lot, and can’t blame the corporations for looking elsewhere. Detroit makes Ayn Rand novels look plausible.

    It seems to me that we have entered into a negative feedback loop. The more people go on welfare, either partial or full, the bigger governments get. Rinse and repeat.
    Something has to break the cycle. If Trump wants to try something to break this cycle, I’m all for it even though it goes against my own free trade instincts.

    Sure, I agree with you there, but that’s the product of free trade in votes, not free trade in goods and services.

    Government and a democratic system of vote buying has led to a result where everyone who gets ahead becomes held responsible for people who can’t get ahead. Historically I think this welfare state business is something of a new thing and not calculated at all in regular free market models.

  125. Leo G

    This is a libertarian blog.

    This is a libertarian and centre-right blog.

    The defence of Trump – who is not only increasing trade barriers but also increasing US government spending and increasing the US government deficit and debt – is sad

    Are you suggesting Trump is a mercantilist?

  126. carol

    This comes from Sundance the brain behind The Conservative Tree House:
    Clearly, nobody was paying attention when Commerce Secretary Ross laid out at the Davos World Economic Forum exactly what the administration was intending to do in the coming months:
    1. POTUS Trump is delivering an awakening to a generation who have never known trade policy as applied to a balanced U.S. economy.
    2. America-First is a nationalistic approach to U.S. economic and trade policy that seeks to protect and elevate the standard of living for U.S. workers and specifically the American middle-class. Obviously the application of “economic nationalism” is adverse to the interests of multinational corporations who have been purchasing U.S. policy through DC politicians for decades with the last 30+ years seeing exceptionally high increases.
    3. Both Democrats and Republicans have been selling out Main Street interests in favour of the financial interests of multinationals on Wall Street. The results have been exported jobs and manufacturing.
    4. Resetting the economics to restore a thriving middle-class requires reversing policy and re-establishing priorities. Government cannot force investment and economic policy can only create the conditions for investment.
    5. Creating the conditions for investment inside the U.S. means shifting policies that previously made investment outside the U.S. the “best play.” That’s where tax policy, trade policy, tariffs and renegotiated trade deals drive the action.
    6. Trump assembled a specific set of economic policies to reverse the 30 year exfiltration of American wealth. Each policy move is connected to the prior policy move. Each initiative builds on the preceding initiative. Each current sequential step is established to deconstruct a historic policy step that might be decades old.
    7. Opposition to America-First economic policy is from those who benefited from the prior policies, i.e., multinational corporations, multinational financials, Wall Street, purchased politicians and corporate media.
    8. The implementation of the policy requires two elements: Tax and Trade. Inside the Trump administration there are economic policy advocates who agree on the tax element but disagree on the trade element. The combined Trump policy is part of the larger America-First initiative. The Wall Street crowd align with Trump on taxes but split with him on trade
    9. Commerce Secretary Wilbur Ross is critical as he is the person creating the fulcrum in the balanced economy reset. Trump and Secretary Ross always knew they would need to jettison part of the administrations’ economic team once they accomplished and moved past tax reform. Their focus is now laser targeted policy toward Main Street.
    10. This is phase #2 of the total policy execution. During a panel discussion at the Davos World Economic Forum, Secretary Ross outlined how the ‘America First’ economic policy and phase-2 platform engages with the global community, conveying to the larger multinational interests an explanation of the high-level shift in U.S. trade policy and reinforcing the Trump Doctrine of economic nationalism. He said: “The Chinese for quite a little while have been superb at free-trade rhetoric and even more superb at highly protectionist behaviour. Every time the U.S. does anything to deal with a problem we are called protectionist.” Cue the audio visual demonstrations over the past few days surrounding Steel and Aluminium tariffs.
    11. At Davos, after three decades of Trump outlining his trade views, Secretary Ross also said President Trump has a forceful leadership style that some people don’t like but “While we don’t intend to abrogate leadership, leadership is different from being a sucker and being a patsy. We would like to be the leader in making the world trade system more fair and equitable to all participants.” He challenged all the panelists, including World Trade Organization Director-General Roberto Azevedo and Cargill Inc. CEO David MacLennan, to name a nation less protectionist than the U.S. He got no responses.
    12. Secretary Ross then cited a study of more than 20 products that showed China had higher tariffs on all but two of the items on the list while Europe had higher tariffs on all but four. The panel sat agape at Ross’s delivery of irrefutable facts to the audience.
    13. “Before we get into sticks and stones about free trade we ought first talk about whether there really is free trade or is it a unicorn in the garden,” said Ross. Again, there was no response from the panel. The Corporate and Financial media never reported on the severity of what Ross said at Davos – because the Main Street policy he was explaining is so directly against their interests.
    14. Despite the tariffs Trump imposed in January on solar panels and washing machines and despite the proposition of Steel and Aluminum tariffs, according to their own Commerce Ministry, China is hoping for a “bumper year” for new trade deals.
    15. For the past 30+ years, DC politicians have been selling out the U.S. economy to corporate interests, Wall Street and multinationals. POTUS Trump is simply saying “no more.” They hate him for it but he doesn’t care.

  127. Leo G

    ” 3. Both Democrats and Republicans have been selling out Main Street interests in favour of the financial interests of multinationals on Wall Street. The results have been exported jobs and manufacturing.”

    Those Wall Street multinationals appear to be promoting governmental regulation of the US economy for the purpose of reducing US state power to the benefit of other nations and co-incidently to the benefit of the multinational interests (including possibly their interests in the US). If mercantilism is necessarily aimed at accumulating state monetary reserves, then those multinationals appear to be promoting a converse of mercantilism.

  128. OneWorldGovernment

    I argued 30 years ago that we sack every single useless ‘teacher’.

    40 years ago I argued that schools are crap and every single “teacher” should be sacked.

    “FREE TRADE”

    I’ve seen some so called ‘libertarian’ comments up thread.

    Fact is that Australian elections are manipulated by scum from overseas.

    Wipe out the excise duty.

    wipe out non-profit crap.

    And listen you far out folk, I was downloaded with economics and law from RMIT.

    Mind you I was an AUDITOR during the day time.

    I AUDITED scum places down Collins Street.

    You want “FREE TRADE’.

    I know more than some.

  129. OneWorldGovernment

    So why aren’t the ‘libertarians’ wiping out the ACCC?

    Or the Human rights Commission?

    far out the lot of you snags.

    “FREE TRADE”

    xuk off.

    Why7 has the DFAT pyramid not been blown to pieces?

    Why wasn’t there a National Enquiry when scum PM Turnbull sooled ASIO onto the young bloke from WA?

    Xuk off

    “FREE ENTERPRISE”.

  130. OneWorldGovernment

    Whatever Cockheads up above want to have an argument with me then not a problem.

    I will fly into any far out place you nominate.

    But I will never go near the scum EU!

  131. MPH

    Tel – it was back in the 70s. The Koreans were the reason for US and UK shipbuilding collapsing (helped along by the unions I’m sure). Today their problem is that global trade has been artificially juiced, leading to overinvestment in ships, leading to overinvestment in shipbuilding.

  132. OneWorldGovernment

    When do we burn down the scum AGL?

  133. OneWorldGovernment

    How much money does the scum politicians give to Non Profits that stop exploration and development.

    I agree that all banking licenses should be withdrawn.

    You should have seen what the foul scum that are still part of the South Australian filth did with their State Bank.

    Not forgetting the filth that got away with it in NSW and Victoria.

    “FREE TRADE”

  134. OneWorldGovernment

    If we have “FREE TRADE” then why is the CFMEU not shot to pieces?

    $20million The head of the Labor pardee without U is reported to have sucked from the poorest and busiest workers.

    I’ll bet that Williamson is living in the lap of luxury.

    But go you libertarians.

    “FREE TRADE”.

  135. OneWorldGovernment

    I will snap anyone that says they are a libertarian.

  136. max

    Tariffs Are Legal Plunder
    Everybody has an issue he reacts to most intensely. [Frederic] Bastiat’s was tariffs. And his most barbed comments were directed against those who favored governmental protection of national industry from foreign competition. He thought this legal method of cheating consumers by keeping prices above the market was a perfect example of how governments plunder their own citizens while promising them more jobs, lower taxes, better quality, and other rewards they can’t possibly deliver.
    Bastiat’s definition of socialism, i.e., using the law to take money from some people and give it to other people, could more accurately be translated today as “the welfare state.” Even so, I’ll stick with his term— socialism. And he believed that the idea behind tariffs and other restrictions against free trade was the keystone that supported the legal plunder he saw all about him. He was convinced that if tariffs were abolished, the other elements of socialism would begin to collapse.
    He was probably right. For if there were no restrictions against foreign competition— i.e., if foreign goods and capital were treated exactly like domestic goods and capital—the fearful cost we are paying for the other economic compulsions and prohibitions by government would be easily observed by everyone, and would thus soon fall.
    Among the several “story examples” offered by Bastiat to expose the fallacy of improving the domestic economy by restricting foreign imports, his allegory on prohibiting Belgian iron from entering France is a classic.
    https://fee.org/articles/tariffs-are-legal-plunder/

  137. DM of WA

    Personally I cannot wait for this China-is-a-market-economy farce to come to an end!

    China Is Not A Market Economy, And The WTO Won’t Survive Recognizing It As Such.

  138. struth

    Up thread, you can argue against pure free economy for one side of the market is a bad thing, if the other isn’t playing by the rules, shoot pure libertarians in the nuts with facts they can’t argue against, and yet they still keep dibbling the same shit, and never go near what has been put up as an argument.
    Sort of like sticking you fingers in your ears and closing your eyes and chanting “it didn’t happen”

  139. Oh come on

    I don’t like Trump’s lurch towards protectionism. I think that if these tariffs are put in place, this will be foolish and counterproductive. But, Lucy. Where were you when Trump appointed Gorsuch to the HC? Where were you when Trump gutted the EPA? Where where you when Trump took a machete to federal regulations? Where were you when Trump unleashed the US military to finally deal with IS once and for all? Where were you when Trump emphatically guaranteed Israeli sovereignty by recognising Jerusalem as the capital of Israel and expediting the relocation of its embassy? Where were you when Trump gave the UN a long overdue dressing-down?
    Where were you when Trump passed historic corporate tax cuts?

    You were either nowhere to be seen or putting the most uncharitable spin on these actions imaginable. I have never seen you praise, even faintly, a single thing Trump has done while in office. As far as you’re concerned, it’s all bad.

    So, please. Don’t pretend you don’t like Trump because of his silly trade policy, Lucy. Even if Trump’s trade policy was fantastic, you’d still loathe him and find something to complain about.

    You’re a political snob, Lucy. You’re such a dummy that you’d plump for someone like HRC over Trump because you think he doesn’t look and sound the part. It’s true, isn’t it? You’re not at all a deep thinker when it comes to these matters, Lucy. You’re a hack and an ideologue, and a low-rent one at that.

  140. Oh come on

    Supreme Court, not HC!

  141. BorisG

    There is a good Trump and a Bad Trump. Good Trump needs a majority in the Houses to get good stuff done. Politics is a delicate balancing act to get outcomes which are the lesser of two weevils.

    So Bad Trump is needed to ensure Good Trump can enact good policies.

    But if Bad Trump wins votes, then why he will ever switch to Good Trump?

  142. OneWorldGovernment

    Some supposed ‘libertarians’ that post on this site seem to have blinkered views of what constitutes a “Market Economy” and what constitutes “Free Trade”.

    I have two questions,
    1.In which countries can I NOT buy property?
    2. Of those countries that I can buy property does their rule of law allow me to dispose of it as I see fit?

    “FREE TRADE”.

  143. Tom

    12. [At Davos] Secretary Ross then cited a study of more than 20 products that showed China had higher tariffs on all but two of the items on the list while Europe had higher tariffs on all but four. The panel sat agape at Ross’s delivery of irrefutable facts to the audience.
    13. “Before we get into sticks and stones about free trade we ought first talk about whether there really is free trade or is it a unicorn in the garden,” said Ross. Again, there was no response from the panel.

    Great read at 8.53pm last night, Carol. Thank you.

    I resisted the urge to lampoon yet another headless Trump-deranged self-immolation by LQC. Suffice it to say it was the most dishonest dirge he has ever posted here: it took him seven whole paragraphs to even mention Trump, whom the whole post was about. LQC’s rage against Trump is comical and Antifa-esque — just another unemployable academic who has never had a real job in the real world and knows zero about politics.

    I would like to see this rant reposted in two years when the Trump strategy is much nearer maturity. Good heavens, what a coincidence! That would be in 2020, Trump’s re-election year.

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