Posts tagged with: protectionism

trade-flow-international2In their defenses of free trade, advocates routinely focus only on the long-term, economic benefits, and understandably so. The overall expansion of trade in recent years has led to greater economic growth, innovation, and prosperity for all, including America.

Protectionist policies may offer immediate relief and security, including a host of short-term political and economic solutions and benefits for particular industries or corporations. But on the whole and in the long run, politically directed tariffs and taxes are more likely to spur crony capitalism, harm consumers, cramp innovation, and delay the necessary re-tooling to remain a strong and dynamic nation in a globalized world.

Given our newfound national appetite for protectionist policies, free market advocates have plenty of work to do in better communicating those concerns, as Samuel Gregg recently pointed out. Yet in addition to more carefully making the economic arguments, we should also be mindful that free trade presents an opportunity for something else: namely, the expansion of creative collaboration and connection.

Part of that lesson was famously illustrated in “I, Pencil,” the popular essay by Leonard Read which urges us to have “a practical faith” in the economic and material good that might happen if we simply “leave all creative energies uninhibited.” Yet even here, readers tend to focus too heavily on the material ends and outcomes, rather than reflecting on the social, cultural, and spiritual benefits of the exchanges themselves. (more…)

Global-Communications-900Free trade and trade agreements are not the same thing. In fact, they are often times in direct contradiction with each other. Acton Director of Research Samuel Gregg recently wrote an article about this at The Stream. Gregg explains how all trade agreements are ‘managed trade,’ not free trade. He explains how free traders should approach the issue of economic nationalism and the best ways to work toward freer trade. Concerning the issue of trade agreements and managed trade, Gregg says this:

There’s no-one-size-fits-all form of trade agreement. Some are bilateral arrangements between two nations. Others are multilateral and embrace several nations. Within that framework, there are several possible arrangements.

You can have, for instance, single markets like the European Union. These involve the free movement of goods, services, capital and labor between all member-nations of the single market. But barriers are maintained or created against all non-single market members. Another model is a preferential trade area. Participating nations give preferential access to certain products from all the area’s members. Tariffs are reduced, but not completely abolished.

Note, however, that all trade agreements involve two or more governments negotiating how their citizens economically interact with each other. That also means they’re indirectly deciding how the same citizens will economically engage with people from nations who aren’t part of the trade agreement.

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In a new article at The Christian Science Monitor titled “Can ‘economic nationalism’ keep more jobs in US?” Acton Director of Research Samuel Gregg is interviewed about President-elect Donald Trump’s stated goal of keeping jobs and businesses from leaving for foreign countries. In the analysis piece by reporter Patrik Jonsson, he cites Gregg as a critic of protectionism:

In short, the United States cannot step back from the world without losing out, critics say.

Trump’s plans are in the short-term “likely to have some benefits for some local communities, but in the long term no amount of protectionism is going to stop you from losing your competitive edge,” says Samuel Gregg, research director at the Acton Institute for the Study of Religion and Liberty in Grand Rapids, Mich. “At the moment, the pendulum has shifted toward fixing an immediate problem … but those programs will all have to be wound back precisely because they’ll cause inefficiencies.”

Acton Institute Director of Research - Samuel Gregg

Acton Institute Director of Research – Samuel Gregg

This is not a surprising position for Gregg.  He has been a consistent advocate for free trade and whenever possible has opposed the ideas of protectionism and crony capitalism.

The author closes out his article by quoting Trump’s adviser Stephen Moore, who says this: “Trade and immigration are unambiguously good for the country – but it will have to be done in ways that are supported by the American people, not shoved down our throats by the elites.”  While this is an appealing statement, it comes across in a way that portrays Trump’s economic populist ideas as willing to accept the harmful long-term effects for the short-term benefits.

You can read the full article at The Christian Science Monitor here.

bannon-capitalismSoon after winning the election, President-elect Donald Trump created waves of controversy by naming Steve Bannon, his former campaign CEO, as chief strategist and Senior Counselor in the new administration.

Yet while Bannon’s harsh and opportunistic brand of political combat and questionable role as a catalyst for the alt-right are well-documented and rightly critiqued, his personal worldview is a bit more blurry. Much has been written of Bannon’s self-described “Leninist” political sensibilities and his quest to tear down the GOP establishment, but at the level of more detailed political philosophy (or theology), what does the man actually believe?

Offering a robust answer to that question, BuzzFeed recently unearthed a transcript from an extensive Skype interview Bannon gave to a conference held inside the Vatican in 2014. Though the topics range from ISIL to Russia to the racial tensions within the conservative movement, Bannon spends the bulk of his initial remarks on the intersection of economics and Christianity, offering what’s perhaps the most detailed insight to Bannon’s own thinking that I’ve found.

Given the growing mystery of the man and his newfound position of influence in the next administration, it’s well worth reviewing his views on the matter. (more…)

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…)

Untitled1Throughout our debates over foreign policy, trade policy, immigration policy, and otherwise, the 2016 election has seen increasing concentrations and divides between nationalism and globalism, each blind in its own way.

Those who promote a (supposedly) “America first” agenda, ignore the impacts to our neighbors across the globe, each created in the image of God and deserving of the same rights and freedoms we enjoy. Meanwhile, the globalists ignore the benefits of local community and national sovereignty, promoting inclusion to the detriment of distinction.

This needn’t be an “either-or” divide, and for the Christian in particular, the choice is particularly ill-suited to our basic theological vision. (more…)