The Wall Street Journal poll released today illustrates that a whopping 60% of Republicans feel free trade is BAD for the US economy. It is amazing how convenient protectionism's blanket can be now that the rest of the world is dismantling the US at our own game. The past decade has been marked by NAFTA, CAFTA, FTAA, unilateral, and bilateral agreements that forced global economies to open up to our cocktail of democracy melded with capitalism. The World Trade Organization used to be the weapon of choice for US corporations to hold international governments hostage in their own countries, using tort to extract as much profit from those economies, and flooding markets with subsidized US goods and services, such as corn, which dessimated the Mexican domestic corn market which may never recover. Then Brazil took the US to task in the WTO over those very subsidies, arguing that there is nothing remotely 'free trade' in such subsidies as they give the US farmer an unfair advantage to be able to sell their products at below-"market" rates.
Economists who argue for free markets are merely voiceboxes for protectionism. Now that jobs 'swam' across both oceans, Americans are screaming for Uncle Sam to beef up security, not in the form of rifles and bombs, but in terms of regulating deals. They argue that US companies should not be bought up by certain foreign countries' firms. This can be seen in the CNOOC deal for Unical, the Dubai Ports deal for NYC harbors, or the protection over investment in US telecom companies so that 'no one else gets our technology'. Let's face it: there is NO SUCH THING as a FREE MARKET. It doesn't exist. It's laughable that people still like to wrap themselves in the myth that democracy and free markets is best, when inside, we Americans secretly know we want unidirectional open markets, meaning protect our workers while forcing the rest of the world to open up.
Republicans are now arguing that imported goods should be taxed higher. What's free and open about that? If foreign economies can produce cheaper goods or do services for lower wages, that's the market baby. It is abhorent that many Americans 'resent' the Chinese and Indians for 'taking their jobs' when in reality, it is the CEO's of US corporations who FIRED those Americans and actively sent the jobs overseas. It wasn't some poor Indian who 'stole' that job at all and jobs don't passively migrate overseas: they are actively shipped their at the behest of Big Business.
The joke is that protectionism will only HURT the US economy: tariffs on foreign goods will only make the price of goods in general go UP not down. That will force the US consumer to spend more of their disposable income for less goods and services in exchange. Lowered buying power will lead to lower spending, which translates to lower corporate profits, which leads to missed earnings for companies, which leads to lowered stock prices, which hurts major pension funds, which hold the retirement accounts of millions of those very US consumers.
What is evident, therefore, is the US has painted itself into a corner: without protectionism, the US is seeing its assets being bought by internationals who salivate at the freefall of the US dollar's value, are able to buy such assets on the cheap, and able to play the game once dominated solely by the US. With protectionism, the economy will falter. The reality is we are seeing a major shift in global capital towards the east. In a reversal of America's 'Go West Young Man' ethos: It's now "Go East Bold Dollars".
Do I think America is 'going down' tomorrow. No. Do I think a massive tidal wave of economic change is underfoot? Absolutely. The Chinese will not be pushed around, nor will the Indians, or the Europeans (who are finally working more and being more productive after years of 35-hour-workweeks and 6-weeks-vacation-time historically).
Bush has grossly dimished America's position in the world and it is a shame that American's tolerate it and haven't impeached him. It has been leaked that we absolutely support torture, have killed hundreds of thousands in Iraq and Afganistan, spent $100's of billions on wars for nothing, and now face a malaise in the credit markets that could send the country into recession. Where is the fiscal conservancy? America needs a leader who can adequately navigate the tidal shifts in the global economy, which is why I am hoping Bloomberg joins the race. He is by far the ONLY potential candidate who could guide the US internationally economically while also finding solutions to healthcare and social security.
Protectionism is the latest Republican rally and it will never work. We have opened the markets up and it is time to play by the very rules we imposed on the world, not cower and run home to mommy. It would be like the Yankees screaming that the Royals shouldn't be allowed to jack up their payrolls now to compete...(Sorry, Yankee fans, I know these days are tough for you...)
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment