Protectionism

[Mr. Harley]

Actually, free trade is a Republican fantasy, and because of that - see Whoha's post above - we are getting killed in International trade, because other countries, for a variety of reasons, do a better job of protecting, developing, and supporting their industries. Thus we have Toyota, Airbus, Eurocopter, and the name escapes me of the Chinese company that bought out IBM's PC manufacturing. Protectionism and government supports CAN work if done intelligently. If you don't believe me - look at the Current Account deficit, or the trade deficit. $600 plus billion a year.

[MOBIUS]

Originally posted by Urban Ranger
A country either backs free trade or not, but can't support free trade only when it suits its interests.

That all depends on whether one country's idea of free trade involves doing it off the backs of virtual slaves...

[DanS]

Protectionism is a losing proposition. Always. I thought the economists on Poly had made this clear to everyone.

Some women going bra-less is just an unintended feature.

[Mr. Harley]

DanS - there is no question that trade wars are losing propositions. However, if you look for example at Eurocopter and Airbus, since they are in my industry - they have shredded US Aerospace companies, they are gaining market share, and have definitely hurt our current account balance.

Given that success, how can you make a blanket statement that Protectionism is a always a losing proposition? Look at China right now. Account for the success stories in your statement, rather than make a pronouncement. Note, when quoting the US economic miracle, please track median wages corrected for inflation and budget deficits as well as "unemployment". Speaking of which, also track real unemployment, not unemployment claims. The US underreports those numbers due to our methodology. Finally, track research and education quality. The WSJ just had a humdinger of a column on the US research gap, BTW.

(note - I won't be ignoring you, I'm just going to sleep. I'll try to check your reply tonight. )

[DanS]

The cure is always worse than the disease. The fact is that there is a net benefit to free trade, no matter that your trading partners are protectionists or wasting their own money on subsidies.

[Tattila the Hun]

I have something to say, but as I'm boycotting this thread, I will not say it.

[Imran Siddiqui]

However, if you look for example at Eurocopter and Airbus, since they are in my industry - they have shredded US Aerospace companies, they are gaining market share, and have definitely hurt our current account balance.

Good for them. What's the point?

[Mr. Harley]

Highing paying jobs, with their grabbing market share from US companies (want to buy a McDonnel-Douglas jetliner - you cannot, they de facto folded). That's the point for them. My point was that Free Trade does not necessarily work, and that instead well thought out and carefully targeted protectionism instead can be an excellent strategy. Instead of global economic principals, I am giving precise examples where not only have the protectionists come out ahead, but the Free Trade proponents have definitely been hurt. As I stated before, Free Trade per se, as practiced in the real world, is a fantasy, and one that IMHO (with multiple examples given) has hurt the US in multiple areas. If protectionism doesn't work - look at the Chinese economic "miracle".

[DanS]

My point was that Free Trade does not necessarily work

And I'm telling you that the best available economic theory shows that free trade is a net benefit no matter what our trading partners do.

That's why the US has had a free trade policy for decades, through both Republican and Democratic administrations and congresses.

[Ted Striker]

Didn't Greenspan this week warn against too much protectionism?

[notyoueither]

Originally posted by DanS

That's why the US has had a free trade policy for decades, through both Republican and Democratic administrations and congresses.

*cough* lumber *cough*

[Mr. Harley]

Thats what's paticular irritating, notyoureither not only makes a good point - but US targeted protectionism is STUPID. We protect a lumber industry where at times the US Government essentially pays the lumber companies to cut the lumber - and we let the Euros gut our Aerospace Industry. Not only does the US engage in it's own protectionism - we're stupid about it, and both parties win the moron award on that one.

DanS - not everyone agrees, though I will grant your point that mainstream US academic theory agrees with you. The problem with many of those "proofs" is that they use a strawman - so-called free trade against broad-based protectionism. If you look carefully at my choice of words, I stated "carefully targeted protectionism." I gave concrete examples, you give academic thoery.

[DanS]

Originally posted by notyoueither


*cough* lumber *cough*

The exception proves the rule.

[DanS]

I gave concrete examples

I hate to be the one to break this to you, but the American aerospace industry needed to be shaken up. It would be best if this shakeup was from completely fair outside competition, but having unfair outside competition is still better than having no outside competition at all.

[Mr. Harley]

DanS - so now we deserve unfair trade that guts our industry? That is a unique perspective, to say the least. Let's get into farm subsidies (the Euros have almost forced us into that one, IMHO), which have also hurt US farmers and our budget, and which have been devastating to small, third world farmers.