I read hundreds or even thousands of op-eds, editorials, blog posts, and other opinion pieces every week, commenting on only a few. One of the things I’ve noticed is how padded so many of them are. Just as one example I think that Allan Golombek’s RealClearMarkets article on the U. S., China, and free trade can be distilled into just this paragraph:
The first thing to keep in mind is that free trade opponents are not just looking for a fair deal. They’re looking for a mercantilist advantage. But the goal of free trade isn’t to export more than you import; the goal is to facilitate the overall creation of wealth, by fostering competition, opening import alternatives, providing consumer choice, and ensuring conditions the economy needs – secure access, stable relationships, a positive business environment and a large base of workers.
Now focus on just the portion I’ve highlighted above. Is that actually the goal? Or is the goal, rather than “ensuring conditions the economy needs” ensuring conditions that the people of the country need? The two are not synonymous.
Getting to specifics and dealing solely with the U. S.-China relationship, what specific measures that liberalize trade and that can be implemented by the U. S. alone will effect the goal?
I don’t think there are any but the list of reforms that China needs to implement is enormous—everything from instituting a robust system of civil law to allowing wages to grow, expanding the ownership of banks, allowing the yuan to be exchanged freely, ending the subsidies to government-owned enterprises, and import and export quotas, and so on.
There’s a great lesson of which I think that Mr. Golombek should be reminded: some times you must climb a hill to descend into the valley below.
Heh. People like me would argue the former should be the goal. And would argue further that, no matter how well intentioned some are (and the rest wolves in sheeps clothing) the latter goal will eventually be so bastardized as to only benefit those pulling the levels of power.
In a related frequent topic at GE. Interesting article today about California. Migrant farm workers are in short supply. US citizens won’t take the work (reportedly at $22/hr plus bennies). And consumers won’t pay the prices to support the increasing wage structure. This is similar to what I have commented about in FL. The result is predictable. Farmers falling by the wayside or seeking to automate. SOS.
And “ensuring the conditions the economy needs” isn’t? Let’s restate it another way. If “the economy needs” is defined narrowly as “so as to boost GDP”, what about policies that split an additional trillion among Warren Buffett, Bill Gates, and Larry Ellison? That would improve the economy (as defined). It would also be meaningless to most of us.
Neither bothers me but particularly the latter. The U. S. is the leader in producing farming equipment. We export a lot of it. I think that increasing the domestic market for farm equipment pushes the U. S. economy in the right direction much more than importing a million unskilled workers does.
But a lot depends on the kind of country you want the U. S. to be. I like the idea of a Jeffersonian America with lots of jobs for engineers, skilled manufacturing workers, and mid-level managers. That idea is in competition with the objective of maximizing the number of minimum and sub-minimum wage jobs.