the great bugaboo in Free Trade

[rdh1...@gmail.com]

Trump is reawakening schools of thought that were found to be antiquated in academia. Autarky, or protectionism was seen as one reason that divided nations and was at least a precursor to the rise in fascism early last century.

Carlos Ricardo gave the world it's theoretical reasoning of competitive advantage created through 'specialization', given any particular region's given natural resources, or man power wage dynamics. Just let things 'flow' to their natural aggregation...and prices will fall under more efficient resource management.

Of course, economics has cleverly been called the 'dismal science' for any number of reasons, but mainly because it always 'seems' to give credence to those policies that 'also' dehumanize people.

FREE TRADE is no different [though you'd never convince an economist of that].

People like their origins. Human Beings NEED a sense of connectivity; for belonging...and for this, nation-state existence has given us as creature some sense of 'organization' based upon 'past aglomerations'...that enculcate such things as language, history, heritage, incorporating acestorage as a vital part to 'what we are' [as our own personal definitions]. We ARE what has come before us; and we only 'extensions' along long chains dating back to antiquity.

Economics, being the dismal science it is, of course has no great theoretical Law or thought out dynamic that supports such a thing. Human culture, in all it's spectrum of different expressions across the globe, just the 'ignorant' musings of cluster 'fucking' animals that know no better [so the scientist and objective rationalist might think].

All that matters is OUTPUT; things like EFFICIENCY and MATERIAL standard of living. Of course.

But not fast. Here come the new wave of "Trump"eters, who INSTINCTIVELY [mostly NOT thought out like that scientist might], who are acting more on simple inner need than reasoned 'output'...to understand that our CULTURES across western civilization [for one, but all human culture in time]...are now in great jeopardy.

WHY?

That same comparative advantage of FREE TRADE as being impetus behind such integrations as the European Union...or how the ELITES now, seem to only want to circumvent public will, to obliterate ages old cultures overnight...all to serve this idea of greater economic efficiency [and supposed standard of living].

The mixing of cultures across the world 'willy nilly', without real concern for 'organization' of any kind [just let things fall where they may], has become an equation for chaos really. A LOSS of center; where people see their way of life, and time honored traditions, mores, values...the whole shebang of personal FAMILYHOOD that once inspired all civilizations, go south in a big big way. Of course, terrorism has only brought this rotting pimple to a head, and has inspired a great swing by many BACK toward the old sensibilities of autarky.

We see foreigners everywhere [in all ways] taking our very jobs, our welfare via the taxes we pay, our languages changing, and a social morass that simply leaves us feeling that the ship is sinking overall [even as the price of soap at walmart has fallen].

The church bells grow silent [in the west] as the loud horn speakers grow louder...and then of course, we see the mass killings; just the nuts atop the new socials sundae that has been in the works for decades now.

FREE TRADE certainly sounds great...on paper. You won't pass many economics tests without doing summersaults in dire support of the 'free flow of capital and labor'. But no test in academia today measures the deeper 'intrinsic' nature of what are as creatures, that NEED that sense of connectivity, nor how this 'will nilly' re-organization of human socialability might be far more damaging to our internal structures than the cars we drive or the size of the house we can build.

FAMILY...remains important to most people.

ANd so, the big bugaboo that no economist talks much about. That the 'new' science that gives us so much in greater economic efficiency, also destroys our human cultures in a reformation that is based not on 'family', but on OUTPUT; and we no more than the slaves that built Pharoh's great pyramids [in effect].

No one in their right minds would have thunk Trump to get this far; but there you go...here's here...and ain't going away. Just today, another predominant free trader [most politicians have necessarily HAD to embrace free trade for political survivability for some time now], Newt Gingrich 'turned coat' to embrace at least SOME of Trump's new autarky.

The clever politician will understand that the mass murders in Paris and now the USA [and UK and elsewhere], has the world turning another way. How far it might turn, one can only wait and see. But the FREE TRADERS...those 'dismal ECONOMISTS" who always seem to turn everything upside down some way [remember, Karl Marx as an economist]...had better learn how to pick tar and feather off their bottoms [if the Trumps of the world ever get the REAL upper hand...socially].

Human beings are tired of their culture's being ripped apart for sake of $$$$ [in any form].

[nickname unavailable]

keynes never believed in free trade, he thought it was stupid to undermine ones own economy.
there has never been a trade war. but free trade always collapses into a war. two world wars were fought over the collapse of free trade.
there is no such thing as comparative advantage, if there was, america, great briton, nor china would have become manufacturing power houses.
ricardo was a banker, that wanted more profits, to get more profits, one must justify starving workers, so he elaborated a rube goldberg scheme, with all of the trappings that con artists and grifters like bill clinton could latch onto, to collect bribes for selling out his peoples to slavery and poverty.

the creator of the crank theory free trade, advocated for the starvation of workers: The Dismal Science: Avoiding Ricardo's Trap: For Ricardo, the reduction in number of workers is the result of mass starvation as their wages drop below what can maintain their families.  People are thought to be no different than herds of any other animal.



http://www.americaneconomicalert.org/view_art.asp?Prod_ID=1158


The Dismal Science: Avoiding Ricardo's Trap
William R. Hawkins
Sunday, July 18, 2004

On July 13, the trade figures for May were released and again the United States suffered a massive trade deficit in goods – $50.8 billion for the month to be exact.  Though the monthly  deficit was slightly less than in April, it was $5.1 billion higher than in May of last year.  Since trade in services was essentially unchanged, it was trade in goods which accounted for the continuing bad economic news as American industry continues to suffer in world competition.  At the current rate, the trade account is on course to reach a goods deficit of $600 billion this year, a truly alarming amount of red ink.  

Ideological defenders of this dark status quo have resorted to a staggering array of arguments, all of which collapse immediately upon examination.  For example, Brink Lindsey, director of the libertarian Cato Institute’s Center for Trade Policy Studies claimed in a policy paper published in March,  Between 2000 and 2003, manufacturing employment dropped by nearly 2.8 million, yet imports of manufactured goods rose only 0.6 percent.  Actually, manufacturing imports were up 1.01 percent ($13.9 billion) according to the Commerce Department, and that was over a period which included a recession, when demand for imports is supposed to be reduced.  Lindsey also neglected the other half of the equation, American manufacturing exports, which dropped by $131.6 billion (19.1 percent).

The combined effect of higher imports and lower exports was a trade deficit in manufactured goods that was a staggering $469.5 billion in 2003.  Only someone completely blinded by ivory tower theory could fail to see how such a swing could harm the U.S. economy.  But then what can be expected from someone who has argued that the true value of the World Trade Organization is not that it opens overseas markets to American exports (that support American jobs), but that it keeps the U.S. market open to foreign producers (who employ foreign workers).

More and more, defenders of the trade deficit are citing how  cheap imports  benefit consumers since they have clearly lost the argument about jobs.  This is not, however,  a new argument.  Indeed, it goes back to the very first debates over trade policy in the 19th century.  It was then called the  cheap bread  argument because bread was literally the main staple in working-class diets.  The basic claim was that cheap imported grain was a substitute for higher wages, but the setting of the argument was even more ominous.  

David Ricardo (1772-1823), an English banker and member of Parliament, is best known for the economic theory of comparative advantage in international trade.  But he also authored the  iron law of wages  theory in 1817, which held that wages  naturally  tended towards a minimum level corresponding to the subsistence needs of the workers.   The power of the labourer to support himself, and the family which may be necessary to keep up the number of labourers, does not depend on the quantity of money which he may receive for wages, but on the quantity of food, necessaries, and conveniences become essential to him from habit, which that money will purchase.  The natural price of labour, therefore, depends on the price of the food, necessaries, and conveniences required for the support of the labourer and his family.  With a rise in the price of food and necessaries, the natural price of labour will rise; with the fall in their price, the natural price of labour will fall.  

In other words, workers need a certain amount of consumer goods to survive and raise the next generation of workers.  They cannot expect to earn more than this subsistence level.  It is in the interest of employers to keep the cost of living down, so that wages can also be kept low.  As Ricardo noted,   A rise of wages, from the circumstance of the labourer being more liberally rewarded, or from a difficulty of procuring the necessaries on which wages are expended, does not, except in some instances, produce the effect of raising price, but has a great effect in lowering profits.  

The value of trade then is not to the worker, who cannot expect his living standards to rise above their  natural  low level, but to the employer and factory owner who make a profit from the difference between what is paid in wages and what is earned from the sale of products.  There was no notion in Ricardo that workers would increase their real wages as their productivity increased.  They would  earn their keep  but nothing more.  Increased productivity was the result of capital investment in new technology, and the higher profits would go to the owners of these improved  means of production.  This is very much what has been seen today, as productivity and profits have been soaring, but real wages have been stagnant at best and falling in many industries.  

In is thus not surprising that the first great  free trade  movement in England was that of the  Anti-Corn Law League  led by firebrand Richard Cobden in the decades following Ricardo s  iron law of wages.   The Corn Laws created a system of protectionism for British farmers.  The Anti-Corn Law argument was that food prices would be lower if England opened itself up to foreign grain imports.  And if food prices dropped, so could wages and British industry would be more competitive.

There were other arguments made as well.  For example, it was said that foreigners needed to sell agricultural goods in England to earn the money needed to buy British manufactured goods.  A modern version of this argument is now being used in support of the campaign to cut U.S. farm support programs and open the American market for agricultural imports from Latin America and elsewhere.  The problem with the argument today is that the United States  is already running a trade deficit that provides foreigners with more than enough money to buy American goods –  they just are not buying.

The view that workers were merely a factor of production, just another commodity, with no more chance of improving their condition than does a ton of pig iron or a pair of boots, was a major factor in the rise of anti-capitalist movements of which Marxist socialism became the leading doctrine.  The socialists did not add anything new to economic theory.  They accepted the dismal science of classical economics, but rejected as unacceptable its consequences.  

Ricardo held that  like all other contracts, wages should be left to the fair and free competition of the market, and should never be controlled by the interference of the legislature.  But it was this very  interference  that allowed the United States to escape the Ricardian trap.  The great success story of America is the transformation of the working class into the middle class.  Trade protectionism kept the demand for labor higher and the supply of labor lower than the  natural  order favored by the classical economists.  The result was higher real incomes, as the creation of a mass market of affluent workers supported the advancement of industrial science and growing productivity.  Unions and professionals were able to bargain for their share of the higher profits.  America became the envy of the world.  Higher incomes are always preferable to lower prices because they impart more control to the wage-earner over how his money will be spent, or saved.  

Now, the return to prominence of classical theory in the service of transnational corporations has branded the achievements of American society as commercial liabilities, harming the competitiveness of American industry in the face of underdeveloped societies where Ricardo s  iron law  still rules and workers receive the barest subsistence.  Ricardo is very clear about what happens when  the number of labourers is increased, wages again fall to their natural price, and indeed from a reaction sometimes fall below it.  When the market price of labour is below its natural price, the condition of the labourers is most wretched: then poverty deprives them of those comforts which custom renders absolute necessaries.  It is only after their privations have reduced their number, or the demand for labour has increased, that the market price of labour will rise to its natural price, and that the labourer will have the moderate comforts which the natural rate of wages will afford.  

For Ricardo, the reduction in number of workers is the result of mass starvation as their wages drop below what can maintain their families.  People are thought to be no different than herds of any other animal.  Today, the increase in the labor supply in the United States is not from domestic overpopulation, but from the mass surge of foreign populations into the global labor pool.  The way to restore a favorable balance for the American middle class employee is to cut the foreign workers out of the U.S. market.  Nations progress by improving their own means of production and boosting incomes, not from the  consumption of cheap imported goods that boosts production somewhere else.

[rdh1...@gmail.com]

---------
First, apologies and correction; I wrote 'carlos' ricardo...an obvious mind fart of some sort [degenerative brain matter setting in no doubt].

Second, the dynamics of world trade played out in forecasting models where, wealth would slowly amass in the upper crust [even more than otherwise distributed before free trade policies]. We've read where the once powerful industrial economies of the west [high in manufacturing] would evolve into 'service' economies, with growing corporate class, but a exponentially expanding 'low wage' service industry [the burger flipper syndrome].

This all due to the migration of capital to low paying 'emerging' nations [like India, China, and Pacific Rim]...while the low wage workforce of those same nations would migrate INTO the once industrial, but higher wage western economies.

So, yes, this all plays into those naysayers who see conspiracy behind it all; where the common worker [the massive majorities of any economy] are slowly undermined into low wage 'slavery' [of sorts], while the 'class warfare' scenario of accumulating wealth in very narrow high end percentages of people [ie the preverbial .1%] that is a political weapon for those advocating more social welfare [and socialism et.al. as a system, ie the rise of popularity of the Bernie Sanders dynamic that is taking place in otherwise enscounced capitalistic domains].

The free traders have essential knifed themselves in the back for not take the time to understand human nature and in their 'greed' [as it were] to promote higher material wealth, have undercut FAMILIAL existence; that structure by which human beings find meaning and purpose within [making it dysfunctional and even disenegrating].

[nickname unavailable]

no worries, i have them all of the time:)

> Second, the dynamics of world trade played out in forecasting models where, wealth would slowly amass in the upper crust [even more than otherwise distributed before free trade policies]. We've read where the once powerful industrial economies of the west [high in manufacturing] would evolve into 'service' economies, with growing corporate class, but a exponentially expanding 'low wage' service industry [the burger flipper syndrome].
>
> This all due to the migration of capital to low paying 'emerging' nations [like India, China, and Pacific Rim]...while the low wage workforce of those same nations would migrate INTO the once industrial, but higher wage western economies.
>

that was all a fairy tale. it was not inevitable, it was done on purpose, as ricardo proposed to do, was to drive down wages. first we were going to be the service economy, that was a lie, that was exposed as a lie, then the knowledge economy, that was also a lie, and also white supremacy. its been exposed as a lie, and exposed as white supremacy.

> So, yes, this all plays into those naysayers who see conspiracy behind it all; where the common worker [the massive majorities of any economy] are slowly undermined into low wage 'slavery' [of sorts], while the 'class warfare' scenario of accumulating wealth in very narrow high end percentages of people [ie the preverbial .1%] that is a political weapon for those advocating more social welfare [and socialism et.al. as a system, ie the rise of popularity of the Bernie Sanders dynamic that is taking place in otherwise enscounced capitalistic domains].
>

all through this, hucksters like bill clinton told the world this would be a win win, but we must take compensate the losers. if its win win, how can there be any losers? and how can we compensate the losers, when he was cutting the safety net, and trying to cut social security to boot.
then of course how can we compensate the losers in the third world, we all but destroyed mexico's economy, let alone haiti, the carribbean, and central america. hundreds of millions of lives destroyed.

> The free traders have essential knifed themselves in the back for not take the time to understand human nature and in their 'greed' [as it were] to promote higher material wealth, have undercut FAMILIAL existence; that structure by which human beings find meaning and purpose within [making it dysfunctional and even disenegrating].

correct. it all boils down to this simple statement, demand for goods and services is wage driven.
in the free trade fairy tale world, demand for goods and services is driven by magic.
people like their own sovereignty to address their own affairs. they do not like corporations(fascism)telling them this is the way its going to be, or we will kill you.

[wien9al...@gmail.com]

Free trade works for countries with positive trade balances. It helps the businesses that find free markets in other countries and that are therefore selling a lot more there. In countries with negative trade balances free trade increases their unemployment and consequent miseries. On Saturday, July 2, 2016 at 9:57:05 AM UTC-4, rdh1...@gmail.com wrote something.

[rdh1...@gmail.com]

On Sunday, July 3, 2016 at 11:50:28 AM UTC-4, wien9al...@gmail.com wrote:
> Free trade works for countries with positive trade balances. It helps the businesses that find free markets in other countries and that are therefore selling a lot more there. In countries with negative trade balances free trade increases their unemployment and consequent miseries. On Saturday, July 2, 2016 at 9:57:05 AM UTC-4, rdh1...@gmail.com wrote something.

As stated, free trade is more about 'free flow of labor and capital' rather than JUST the exchange of goods. It is this 'free flow' that is undermining former industrialized countries [their nation-state existence as unique cultures...heritages, language, traditions...their 'way of life']. The impact is not just on material gain, but upon our 'social existence' where loss of 'center' in our belief systems, dysfunctional and disenegrating family ties, and a slow extraction of our sense of BELONGING [ie to a certain culture as those nation-states].

While material standard of living might be improving [the argument exists], we are less happy, often very demoralized seeing our cultures dissolved into a kind of cacophony balkanization with government no longer representative of our foundations. GOVERNMENT is NOT the nation. OH yea, and free trade slowly causes structural shifts in those former industrial nations that rob us of manufacturing while increasing service industry...ergo, lower wages for the working stiff and a declining middle class overall. But...Free Trade does result in more rich people; and whatever trickle down effect that might result in as re-investment. But, does improving material standing offset that loss of culture and family dysfunction? A better argument is to recognize that FAMILY IS OUR LIFE...and all else really subservient. It's like the Iroquois trading Long Island for trinkets; or what gaineth human beings the world, if he must trade for his/her soul [so to speak]?

You may be one of the lucking ones of course; and all is well in your human relationships. Most of the rest of us however, are watching on as Bedford Falls transmutates into Pottersville [I'll let you figure that one out].

[nickname unavailable]

its way more than that. even materially, its failing. free trade is deflationary in nature. it relies on the wages of the western workers. free trade has destroyed that. see the u.k. free trade destroyed the u.k.'s middle class, and it can no longer even consume those cheap materials.
this of course ripples to the cheap labor countries, because they rely on the wages of the western workers to keep them employed. because their wages are so low, they cannot consume what they produce. so now cheap labor paradises like china, are plunging into deflation and depression.
twice now free trade has deflated the worlds economy into depression and world wars. no amount of cheap trinkets can make up for that. its heading that way again. unless enough countries have the balls to untangle themselves from the mess before its to late, which it most likely is already.
america is not to far behind the u.k., where its middle class is about to disappear into a orgy of deflation.
hillarys answer will be more police state, the gutting of social security and other safety net programs, and if that does not goose the economy, which it won't, austerity never works, it makes things worse, then its russias turn to feel the effects of bombing to make free trade work.