Posts tagged with: free trade

clinton-trumpImagine if Donald Trump made a campaign promise that he would lower the pay of every American, but would ensure that the poorest 10 percent have their pay lowered the most. Would you vote for him then? Or imagine if Hillary Clinton said she would increase inflation substantially to make the economy more “fair” for everyone. Would she win your support?

Neither candidate has made such a claim—at least not directly. The American people would immediate reject such harmful economic policies, and politicians know they’d be rejected for making such inane promises.

In reality, though, both Clinton and Trump (as well as the candidates for the Green Party, Constitution Party, and the American Solidarity Part) have promised to implement policies that would have the same effect as increasing inflation or reducing pay, for all have proposed a means of lowering purchasing power.
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free tradeWhile the Democratic and Republican parties disagree on just about every other issue, there is one area where they seem to have common ground.  That is the issue of trade and, unfortunately, neither of the two major political party’s platform takes a liberal position on the issue.  Director of Research at the Acton Institute, Samuel Gregg, recently highlighted in an article for The Stream how the two parties have taken positions against free trade and how ultimately this will hurt the American economy.  Gregg starts his article by explaining how the alternative to free trade is protectionism which will lead directly to cronyism:

Protectionism also encourages unhealthy relationships between politicians and businesses. The latter have an incentive to lobby for favors rather than improve their performance in the marketplace. And politicians expect something in return for passing legislation that favors particular industries and businesses. In this sense, protectionism feeds a major problem already harming American politics and the economy: crony capitalism.

Gregg goes on to explain both party’s platform on the issue of trade, starting with how the growing skeptic ism of free trade in America has infiltrated the Republican platform.  This is really not surprising when considering how closely Donald Trump’s nationalistic rhetoric aligns with the ideas of protectionism.  Gregg says: (more…)

Today at The Stream I provide some analysis of Donald Trump’s speech earlier this week at the Detroit Economic Club. As I conclude, “The trouble for Trump’s promised future lies in the impossibility of reclaiming a bygone era.”

In Trump’s campaign there is a mix of both nostalgia and optimism, which bookend serious critiques of America’s more recent past and the legacy of his political opponents in particular. This approach is appealing to an important, and often overlooked segment of the American public. These are the new voters who Trump has promised to bring to the GOP, and who have sometimes embraced his campaign with a kind of religious fervor.

But the broader appeal of this vision is dubious. Trump’s larger economic vision certainly does bear some resemblance to Bernie Sanders’ agenda, as they emphasize nationalism, interventionist trade policy, and a revitalization of traditional manufacturing and labor sectors. It remains to be seen how many of Sanders’ supporters will migrate to the similarly nationalist approach of Donald Trump.

The real challenge for Trump is to express this hopeful vision about the future while simultaneously hearkening back to an idyllic past. If Clinton is “the candidate of the past,” it is the recent past, the last few decades of the Obama administration and bad trade deals like NAFTA. Trump, meanwhile, is both the candidate of the future as well as of the more remote, perhaps even mythic past, in which America was first: in jobs, manufacturing, global influence, leadership, and military strength.

As Trump put it in his Detroit speech, “Americanism, not globalism, will be our new credo.” Joseph Sunde pointed out the salient Christian critique of such a credo recently, and I also recommend Abraham Kuyper’s treatise Twofold Fatherland for a proper and penultimate valuation of the nation-state and national identity relative to Christian citizenship in God’s kingdom. Twofold Fatherland is included in the forthcoming On the Church volume of the Abraham Kuyper Collected Works in Public Theology.
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Blog author: TGroenendal
Thursday, June 30, 2016
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Abraham_Kuyper

Abraham Kuyper (1837 – 1920) | Wikimedia Commons

The benefits of free trade are vast, and enjoyed throughout the world.  The alternative — trade restricted by protective tariffs and quotas — concentrates benefits to a protected few who profit due to less competition from foreign competitors.

The morality of free trade is clear. Individuals can choose what they buy from where, linking the world through a network of exchange. Integration through trade and exchange is a major factor lifting people out of poverty. The more and freer the trade, the better for human flourishing. Despite this, there is a growing protectionist movement in the United States political landscape.

In Abraham Kuyper’s book Antirevolutionaire Staatkunde (or Anti-Revolutionary Politics), he discusses his political support of tariff increases in the Netherlands. One of Kuyper’s arguments in defense of tariffs is a moral argument, which stems from concerns over unemployment. He writes:

Excessive enthusiasm for Free Trade and for free movement of population can deprive men of work who would otherwise have it in abundance. Free Trade can have as a consequence that many items are fabricated abroad so that there is no work to be done here. This can be observed in its simplest form in the case of lumber. If unsawed logs are imported, then the wages of sawing can be earned here. If, however, lumber arrives sawed, then the wages for sawing are lost here. (more…)

In the hubbub surrounding Brexit, many conservatives have cheered the United Kingdom’s vote to leave the European Union, hailing it as a win for freedom, democracy, and local sovereignty.

Yet for those who disagree, support for Brexit is painted as necessarily driven by fear, xenophobia, and protectionism. Although fear of immigrants and narrow nationalism have surely played their part, such sentiments and attitudes aren’t the only drivers at play, and they mustn’t be heeded if Brexit is actually going to succeed.

Indeed, for conservatives in the vein of Edmund Burke, the reasons for supporting Brexit are necessarily different. Political withdrawal from the EU needn’t, nay, mustn’t mean isolation from outside markets or a freeze on the movement of labor.

As Hannan outlines in a marvelous speech given prior to the vote, this isn’t about protectionism, but about preserving a tradition of freedom and democracy. It isn’t about a fear of outsiders, but about a basic belief in the principle of subsidiarity.

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edmund-burkeThe Republican Party is fracturing on the topic of trade. Alas, in the same corners where free and open exchange was once embraced as a propeller for economic growth and dynamism, protectionism is starting to stick.

In response, free traders are pushing the typical arguments about growth, innovation, and prosperity. Others, such as myself, are noting that the trend has less to do with economic illiteracy than it does with a protectionism of the heart — a self-seeking ethos that wants “economic freedom” only insofar as it poses no threat to the preferred wage, vocation, or plot of dirt.

We have forgotten that work is not about us. It’s about serving others, and adapting that service when the signals say, “yes.”

On this, the “communitarian” wing of conservatism tends to push back, accusing free traders of being overly comfortable with social disruption and displacement, prioritizing efficiency and cheap widgetry over “stability” and “social well-being.”

Such critics would do well to heed Edmund Burke, one of the movement’s heroes. Burke was a staunch supporter of free trade not because he was indifferent to disruption, but because the alternative would cause much, much more.  (more…)

navy_shipsThe evening news reports there has been a complete blockade of the U.S. On the East Coast of the United States, Russian forces have instituted a naval and air blockade, similar to the one being imposed by China on our West Coast. A similar blockade has been set up on the borders of Canada and Mexico.

The blockade is somewhat porous. People are allowed to pass through freely (but only if they are not trying to enter the U.S. illegally). Exports from the U.S. also are unhindered. But all imported goods from every nation on earth are being kept out.

What would be your reaction? Well, naturally you’d cheer. This is great news! Someone has finally stopped the “invasion” of foreign products into our homeland. Without cheap imports flooding our market prices will have to rise, which means increased wages and better jobs. Factories will have to open since everything will need to be made in the good ol’ US of A. Unemployment will plummet since the demand for workers will spike. Our economy will soon be booming!

Wait, what’s that you say? You don’t think it’s a good idea? You say such provocation would be an act of war?

Okay, what if the blockade was limited. Instead of completely keeping out foreign goods, the blockading countriesmerely require importing countries to pay a “toll” of between 10 and 40 percent. And to keep the peace, the blockaders even give the money collected from the tolls to the U.S government. That would be almost as good, wouldn’t it? Maybe even better?

No? You still say the blockade would be an act of war? That it’d make us all worse off than before?

Of course, you’d be right. A naval blockade by foreign countries would hinder, not help, our economy. So why do we allow in peace what we oppose in war?

That was the question asked in the 19th century by the American economist Henry George. In his book Protection or Free Trade, George explained how voluntary governmental restrictions on trade are the same as blockades in a time of war by foreign nations:
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