A comprehensive discussion of the economic theories of free trade protectionism and economic fairnes

Day 8 By Barry Reingold November 13,1:

A comprehensive discussion of the economic theories of free trade protectionism and economic fairnes

The Japanese, who bounced back from grievous losses in World War II to astound the world by producing innovative, high-quality products at low prices, are serving as the convenient butt of protectionist propaganda.

Memories of wartime myths prove a heady brew, as protectionists warn about this new "Japanese imperialism," even "worse than Pearl Harbor. Is this "flood" of Japanese products really a menace, to be combated by the US government? Or is the new Japan a godsend to American consumers? In taking our stand on this issue, we should recognize that all government action means coercion, so that calling upon the US government to intervene means urging it to use force and violence to restrain peaceful trade.

One trusts that the protectionists are not willing to pursue their logic of force to the ultimate in the form of another Hiroshima and Nagasaki.

The International Economics Study Center | Trade Chapter Fairness in International Trade The minimum wage is one.
Best Books This piece on free trade and protectionism from October contains data and other details that were current at the time but the core arguments he presented here are every bit as clear and relevant today as they were then. One thing we learn from history is that hardly anyone ever learns from history!

Keep Your Eye on the Consumer As we unravel the tangled web of protectionist argument, we should keep our eye on two essential points: Invariably, we will find that the protectionists are out to cripple, exploit, and impose severe losses not only on foreign consumers but especially on Americans.

And since each and every one of us is a consumer, this means that protectionism is out to mulct all of us for the benefit of a specially privileged, subsidized few — and an inefficient few at that: Take, for example, the alleged Japanese menace. All trade is mutually beneficial to both parties — in this case Japanese producers and American consumers — otherwise they would not engage in the exchange.

In trying to stop this trade, protectionists are trying to stop American consumers from enjoying high living standards by buying cheap and high-quality Japanese products.

Instead, we are to be forced by government to return to the inefficient, higher-priced products we have already rejected. In short, inefficient producers are trying to deprive all of us of products we desire so that we will have to turn to inefficient firms.

American consumers are to be plundered. How to Look at Tariffs and Quotas The best way to look at tariffs or import quotas or other protectionist restraints is to forget about political boundaries.

Political boundaries of nations may be important for other reasons, but they have no economic meaning whatever. Suppose, for example, that each of the United States were a separate nation.

Then we would hear a lot of protectionist bellyaching that we are now fortunately spared. Think of the howls by high-priced New York or Rhode Island textile manufacturers who would then be complaining about the "unfair," "cheap labor" competition from various low-type "foreigners" from Tennessee or North Carolina, or vice versa.

Fortunately, the absurdity of worrying about the balance of payments is made evident by focusing on interstate trade. For nobody worries about the balance of payments between New York and New Jersey, or, for that matter, between Manhattan and Brooklyn, because there are no customs officials recording such trade and such balances.

If we think about it, it is clear that a call by New York firms for a tariff against North Carolina is a pure rip-off of New York as well as North Carolina consumers, a naked grab for coerced special privilege by less-efficient business firms.

If the 50 states were separate nations, the protectionists would then be able to use the trappings of patriotism, and distrust of foreigners, to camouflage and get away with their looting the consumers of their own region.

Fortunately, interstate tariffs are unconstitutional. But even with this clear barrier, and even without being able to wrap themselves in the cloak of nationalism, protectionists have been able to impose interstate tariffs in another guise. Part of the drive for continuing increases in the federal minimum-wage law is to impose a protectionist devise against lower-wage, lower-labor-cost competition from North Carolina and other southern states against their New England and New York competitors.

During the congressional battle over a higher federal minimum wage, for example, the late Senator Jacob Javits R-NY freely admitted that one of his main reasons for supporting the bill was to cripple the southern competitors of New York textile firms.

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Since southern wages are generally lower than in the north, the business firms hardest hit by an increased minimum wage and the workers struck by unemployment will be located in the south. Another way in which interstate trade restrictions have been imposed has been in the fashionable name of "safety.

The principle is precisely the same. Yet protectionist cries arose — fortunately not fulfilled — to prohibit all "imports" from outside of Detroit, and citizens were exhorted to buy only Detroit.

A comprehensive discussion of the economic theories of free trade protectionism and economic fairnes

If this nonsense had been put into effect, general starvation and death would have ended all other economic problems for Detroiters.

So why not restrict and even prohibit trade, i. Starvation would quickly wipe out this ludicrous drive for self-sufficiency. And yet we must realize that this absurdity is inherent in the logic of protectionism.

Standard protectionism is just as preposterous, but the rhetoric of nationalism and national boundaries has been able to obscure this vital fact. The upshot is that protectionism is not only nonsense, but dangerous nonsense, destructive of all economic prosperity.Aug 15,  · Search Protectionism and Free Trade for how government policies and intervention protect certain areas and markets, while they hinder and make those markets less responsive to the will of the consumer.

But we need not reread the economic literature to realize that the impetus for protectionism comes not from preposterous theories, but from the quest for coerced special privilege and restraint of trade at the expense .

Comparison Of Protectionism And Free Trade Economics Essay. Print Reference this. Another reason why today’s economists are opposed to protectionism is because it hinders economic growth (Hoyt, ).

The opponents of free trade employ the development economics theory in their effort to support protectionism. Economists . Oct 05,  · Economic system: Economic system, any of the ways in which humankind has arranged for its material provisioning.

Three basic types of economic system have arisen: that based on the principle of tradition, that based on central planning and command, and that based on the market.

The Federal Trade Commission (FTC —even in cases touching on control of personal data. 80 The framework proposed herein applies then in cases where theories of harm are less clear and economic reasoning can be used to justify enforcement action or acquittal decisions.

This is particularly true in dominance investigations (focus of this. Learn why Great Britain was an early champion of free trade, and see how the economic crisis of led to a reversal of free-trade ideals." 29 Middle-Class Catalogs and Mass Consumption Welcome to the world of mass consumption, which brought humanity into the modern economy for good.

A comprehensive discussion of the economic theories of free trade protectionism and economic fairnes
Free Trade, Protectionism, & the Limits of Economic Analysis - The Imaginative Conservative