Tag: Free Trade

GLOBAL FREE TRADE: REALLY?

 

The idea of global free trade or that the global market place is an open free market place is a damn lie. This damnation is spread by the World Trade Organization, progressives, many of whom are closet capitalists, globalists, international conglomerate capitalists, so called free-traders, conservatives, RINO’s, business pundits, and most intellectual elites. The lie comes from deep in the elitist Washington, DC, globalist swamp.

A red and white background with the word globalization written in it.
There are at least 6 reasons that the idea of global free trade is a damn lie!

Global free trade does not exist when 1) countries refuse to allow any category of products made in the United States (US) into their country, and we allow the same category into our country; 2) countries impose high tariffs on any category of products imported into their country, and we impose tariffs that are a fraction of those imposed by so-called œtrading partners; 3) other countries subsidize production of categories of products, and we do not subsidize production of the same category of products; 4) other countries do not impose costly environmental, health, and safety regulations on energy and production facilities that are required in the US; 5) other countries tolerate theft of intellectual property for new or improved products from US businesses without paying for use of the intellectual property or imposition of penalties when these products enter US markets; and 6) other countries manipulate international money markets for their benefit. If the so called global free trade experts were honest, they could add to my list of real global free trade impediments. Whether or not the announced Trump Administration tariffs will be good for our economy and labor force in general, the argument that tariffs violate free market principles is void because global free trade does not exit. The argument is based on a lie. No true global free trade market exists.

The result of globalism, as now practiced, is global wealth redistribution. The $800 billion US trade deficit is global wealth redistribution. Virtually all of the so-called œFree Trade agreements involving the US constitute wealth redistribution since they result in trade deficits with the other countries involved. The reality is that the redistribution has cost the US labor force jobs, lost wages, and lowered benefits which were transferred to labor forces in developing countries.

In my opinion, most progressive policy initiatives are based on Marxist philosophy, especially wealth redistribution. Similarly, capitalists seek to expand markets and increase their profitability which requires decreasing costs and opening of new markets in developing countries or increasing income, especially disposable income, in new and existing markets resulting in increased customer purchasing power. Although the ultimate goal, increasing consumer or personal incomes and buying power, is the same for both progressives and capitalists, the method of accomplishing the goal is drastically different. Interestingly, globalism often unites progressives and capitalists when nationalism, protectionism, and tariffs are the subject of debate and discussions.

Unfortunately, US laborers have borne the brunt of the adverse effects of globalism, lost jobs lost opportunities, stagnant wages, and regional economic decline. Through factory relocations to the developing world, capitalists achieve their goal of reducing capital improvement and labor costs, and increased factory productivity. Progressive globalists achieve their goal of global wealth redistribution when new factory wages increase the standard of living, opportunity, and economic development in the regions where new facilities are opened.

Global free trade is a globalist myth. Until a global free market actually exists, the experts should stop insisting that tariffs will impede free trade. Global free trade does not exist. The œexperts should simply tell us that tariffs will increase costs and prices and are the same as taxes. However, if the threat of tariffs, force our so-called trading partners to open markets, reduce their own tariffs, end their subsidies, clean up their own environment, end intellectual property theft, and stop currency manipulation, then tariffs could start progress toward an unfettered global free trade where all the people of the world could move toward greater prosperity.

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THE PROGRESSIVE GLOBALISM CONTRADICTION

 

A cartoon of people standing on top of a globe.
The progressive globalism contradiction is global wealth redistribution from US laborers to foreign laborers.

The goal of global wealth redistribution, globalism, is contradictory to the progressive goal of wealth redistribution within industrialized capitalistic countries. From the beginning of the Industrial Revolution, progressives struggled to increase the wages of the lower and middle classes, the primary work force. Activists on the left called themselves communists, socialists, progressives, and liberals depending on which term was more acceptable to society at large at the time and location involved in the world. These activists were essential to the success of the labor movement in Western Europe and North America. As a result, the wages and benefits of Western workers became the envy of the rest of the world. The contradiction, for progressives, is the fact that Western wages and benefits have resulted in comparatively high disposable income and standard of living in the industrialized Western world. For globalism, global wealth redistribution, to succeed, workers in industrialized countries must expect wage and benefit stagnation at best or decreases in their standard of living through reduced disposable income. In other words, the left gives and the left takes away, the left’s globalism contradiction.

As industrialization expanded to other regions of the world, specifically the Asian-Pacific rim countries and China, global competition also increased. Initially, lower wages and benefits in these regions allowed Asian automakers, consumer product producers, as well as Chinese steel and other consumer good producers to compete effectively in Western European and North American markets. Additionally, the fall of the old Soviet Union brought capitalistic enterprise and increased industrialization to Russia and Eastern Europe which allowed additional low-cost consumer goods to enter Western markets. The result was that Western manufacturers faced competition from newly industrialized areas where wages and benefits were lower than those in the United States and other Western countries. In the United States, our manufacturing plants, steel and special metal mills, textile mills, and consumer product manufacturing plants were old and outdated. The cost of updating these facilities as well as the time required for licensing and construction and the high cost of construction labor made new manufacturing plants even more time consuming and costly to bring on line. The time and expense of environmental impact and economic assessments adds significantly to the time required and the expense of constructing new modern manufacturing facilities.

Faced with low cost competition and the rapidly expanding global market, the globalism contradiction forced corporations to make decisions regarding manufacturing plant locations. The result was plant closures in the industrialized parts of the United States and new plant construction around the world to replace facilities closed in the US. These decisions have adversely affected the number of manufacturing jobs available, wages, and benefits in western countries like the United States. As a result, middle and lower working class wages and benefits have been at best stagnant or declining for at least two decades.

The final globalism contradiction is related to free trade agreements like NAFTA and TPP. When these agreements result in excessive trade deficits for the United States, they are effectively global wealth redistribution. This fact is contradictory to conservative ideology. Although US consumers purchase goods at a lower price, the value of the good paying jobs we lose in the exchange is roughly equivalent to the value of the trade deficit. The free trade competition results in lower cost consumer goods, but we lose good paying manufacturing jobs due to the high costs associated with US manufacturing. From the perspective of the left, opening factories in developing countries is great. Capital is redistributed from developed industrialized countries to underdeveloped Third World countries creating good paying jobs, more disposable income, and increased standard of living, global wealth redistribution. Of course, leaders and planners on the left do not discuss the sacrifices this global wealth redistribution inflicts on the middle and lower class workers of the more advanced industrialized countries. They stress that the top 1% are not paying their fair share of the costs they inflict on our workers. The question is, are workers in the United States satisfied with the answers provided by the Left?

On his last overseas trip, President Obama indicated that globalism has not leveled the world playing field as quickly as he had hoped. The 2016 election demonstrated that workers in the United States are not interested in sacrificing their standard of living to advance global income redistribution. It was the progressive globalism contradiction, stagnant or declining wages and employment in the United States, that cost progressives the Presidency in the 2016 election. This debate will be critical for the future of our country. This issue among others at this point in time and our history places us at America’s Crossroad.

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