Regardless of what some of the things I’ve written may sound like I’m actually very sympathetic to free trade. I’m probably the only person you’ve encountered who’s actually read (and understood) David Ricardo’s “On the Principles of Political Economy and Taxation” (in which the theory of trade that later came to be called “comparative advantage” was laid out). Ricardo himself also pointed out that it only applied when capital was immobile which is not the case today.
I’m seeing lots and lots of criticisms of our increasingly protectionist trade policies. Some of that is purely partisan but some is ideological.
I have a question for the free trade absolutists. How does the United States remain secure while being dependent on other countries both for manufactured goods and materials? Security is the bottom line even if it means that goods become more expensive.
My own preference is for us to be buying more from Canada and Mexico (in particular) and I find it perverse that the “Buy American” push falls disproportionately on imports from those two countries. But that’s another subject.
I think we are all sympathetic to free trade, unless we are arguing naked self interest because we are simply not competitive. I think you hit on a point that few actually understand. Capital today moves at the speed of light. That has happened largely in our lifetimes. The second issue of course is that countries cheat. aka “What is this ‘free’ trade of which you speak? I think the increasing protectionist talk is mostly a byproduct of cheating. But let’s not let the consumer off the hook. With their employee hat on they want to be protected. With their consumer hat on they will turn 180* and want lowest prices, even if its dreck they are purchasing. Or more real world: say, clothing and consumer electronics.
As for the security issues, what we have done is nothing short of reckless. Absolutely reckless. And its cousin, environmental policy. EV’s using batteries with materials controlled by hostile nations, and sometimes mined by child abusers. Nice.
Free Trade requires goods to be traded. The US does not have and cannot have Free Trade. What Free Traders consider Free Trade is actually the Wimpy Principle: “I will gladly pay you next Tuesday for imported goods today”
What is more laughable is that Libertarians support a trade deficit but abhor fiat currency.
It should be noted that today’s capital is the product of the private sector creating legal tender. I would call that “free stuff”.
TastyBits: What Free Traders consider Free Trade is actually the Wimpy Principle: “I will gladly pay you next Tuesday for imported goods todayâ€
Why isn’t that free trade, freely giving you goods in exchange for a promissory note?