Are there any economic beneffits from global corporations ?

[danielpalos]

oh how incredibly stupid can a liberal be. In the late19th century Britian led the world in production and 40% of its exports went to the USA!! Competition is good for the worlds standard of living not bad. Competition makes us better. USSR was totally protected and did not produce one single consumer products innovation ever.

At that time the US had tariffs Ed.
The problem with the USSR is that it was a centralized planned economy which left no place for innovation.

I agree to disagree; it was not so much the case with Arms technology.

 

[CultureCitizen]

Not really.

We have never, at any point, had a universal tariff on all imported goods. Never. Some goods are tariff free, and others are not. That's the way it's always been, and still is even to this day.

Second, the US government has rarely actually created a protectionist tariff. It is entirely possible, and easy, to create tariffs that do not prevent imports, but yet raise revenue.

We did have a steady stream of tariff revenue for the first 100 years of this country, because that was original the only source of revenue to the Federal Government. The tariffs went up and down over the century, from 8% to 35%. But usually high protectionist tariffs of 20% or higher, didn't last long. Because the damage caused by the tariff caused massive political pressure to change it.

At this point I stopped reading your post. Because I believe some of your statements are not correct.

First, we must consider the average tariff. From 1820 to 1900 the average tariff on imported goods was 26% which is quite high, it was the main source of revenue , certainly. Hence the statement "high protectionist tariffs of 20% or higher , didn't las long" is false.

Furthermore, that only considers average tariffs. Tariffs on manufactured goods ( used to protect the infant industry) were much higher and lasted longer:
1820 - 34% to 45%
1870 - 40% to 50%
1913 - 44%
1925 - 37%
1931 - 48%

References
Tariffs in United States history - Wikipedia the free encyclopedia

Kicking away the ladder . Table 3.3 page 17.

 

[CultureCitizen]

But you and I will disagree on why. There is no evidence that it was the tariff was the cause of this.

Instead, what is much more likely to be the cause, is that there was very low regulations of business. Zero corporate income tax. Zero personal income tax. People were allowed to keep, and invest as they saw fit, all of their own earnings. Corporations were largely allowed to keep, and invest whatever they wished, as they saw fit, to grow their companies, with virtually no legal red tape.

Well, imagine there had been no tariffs.
Would the local industry have stood any chance against the British industry? I think not.
The 19 century was the poin in which merchantilism started to give way to free trade. This didn't happen overnight. And certainly tariffs were enacted in part because GB had similar laws and to protect the newly born American industry.

"Having just fought a war over taxation (among other things) the U.S. Congress wanted a reliable source of income that was relatively unobtrusive and easy to collect. It also sought to protect the infant industries that had developed during the war but which were now threatened by cheaper imports, especially from England."
...
"Once industrialization and mass production started, the demand for higher and higher tariffs came from manufacturers and factory workers. They believed that their businesses should be protected from the lower wages and more efficient factories of Britain and the rest of Europe. Nearly every northern Congressman was eager to logroll a higher tariff rate for his local industry"

Now, it might be that lower regulations and zero personal income tax can fuel the economy. But you can't have it both ways. You either tax individuals and corporations or increase the tariffs. You can't run a government without revenue.

Tariffs in United States history - Wikipedia the free encyclopedia

 

[CultureCitizen]

Singapore.... South Korea... Taiwan... Hong Kong... Switzerland... Canada... All of these countries have little to no tariffs at all. And most are doing better than we are economically.

Nope
"
Switzerland is extremely protective of its agricultural industry. High tariffs and extensive domestic subsidisations encourage domestic production, which currently produces about 60% of the food consumed in the country.

According to the Organisation for Economic Co-operation and Development (OECD), Switzerland is subsidising more than 70% of its agriculture compared to 35% in the EU. The 2007 Agricultural Program, recently adopted by the Swiss Federal Assembly, will increase subsidies by CHF 63 million to CHF 14.092 billion"

Economy of Switzerland - Wikipedia the free encyclopedia

The Cayley–Galt Tariff of 1858 was the first protective tariff in Canadian history. It imposed duties on imported manufactured goods of 20% and a duty of 10% on partially manufactured goods in an attempt to spur domestic manufacturing industries.
The tariff was only a foretaste of the much more complete system of protection set up under theNational Policy of 1879.


Cayley Galt Tariff - Wikipedia the free encyclopedia

 

[Andylusion]

Not really.

We have never, at any point, had a universal tariff on all imported goods. Never. Some goods are tariff free, and others are not. That's the way it's always been, and still is even to this day.

Second, the US government has rarely actually created a protectionist tariff. It is entirely possible, and easy, to create tariffs that do not prevent imports, but yet raise revenue.

We did have a steady stream of tariff revenue for the first 100 years of this country, because that was original the only source of revenue to the Federal Government. The tariffs went up and down over the century, from 8% to 35%. But usually high protectionist tariffs of 20% or higher, didn't last long. Because the damage caused by the tariff caused massive political pressure to change it.

At this point I stopped reading your post. Because I believe some of your statements are not correct.

First, we must consider the average tariff. From 1820 to 1900 the average tariff on imported goods was 26% which is quite high, it was the main source of revenue , certainly. Hence the statement "high protectionist tariffs of 20% or higher , didn't las long" is false.

Furthermore, that only considers average tariffs. Tariffs on manufactured goods ( used to protect the infant industry) were much higher and lasted longer:
1820 - 34% to 45%
1870 - 40% to 50%
1913 - 44%
1925 - 37%
1931 - 48%

References
Tariffs in United States history - Wikipedia the free encyclopedia

Kicking away the ladder . Table 3.3 page 17.

Yes, that's also true, and if you have read the economist Frank Taussig, on the History of US Protectionism, you'll find that those protectionist tariffs were counter productive, and did not benefit the American economy.

The Truth about Trade in History Cato Institute

“Little, if anything, was gained by the protection which the United States maintained. The intrinsic soundness of the argument for protection to young industries therefore may not be touched by the conclusions drawn from the history of its trial in the United States, which shows only that the intentional protection of the tariffs of 1816, 1824, and 1828 had little effect"
​

F. W. Taussig, The Tariff History of the United States, 8th ed. (New York: G. P. Putnam’s Sons, 1931), pp. 61, 63.

Additionally....

Economist Gottfried von Haberler:

"Nearly every industrial tariff was first imposed as an infant-industry tariff under the promise that in a few years, when the industry had grown sufficiently to face foreign competition, it would be removed. But, in fact, this moment never arrives. The interested parties are never willing to have the duty removed. Thus temporary infant-industry duties are transformed into permanent duties to preserve the industries they protect"
​

Gottfried von Haberler, The Theory of International Trade (London: William Hodge, 1936), p. 281.

Since then, several other economists have shown research indicating the same.

QUOTE:

Thus, the early experience of the United States confirms the weakness of the idea that protection can aid infant industries. In practice, so-called infant industries never grow competitive behind trade barriers, but, instead, remain perpetually underdeveloped, thus requiring protection to be extended indefinitely.

Trade barriers never benefit anyone, except the rich and wealth companies and corporations, that protecting behind trade barriers can screw the consumer with higher prices, and lower quality, and not have to worry about competition from abroad.

In the 1800s, the Republicans were the party of protectionism, and the Leftists were against protectionism for the same reasons we are today. Higher priced, lower quality goods, in a protected monopoly on the market, enforced by government, enriching the wealthy at the cost of the poor.

Now, this old cartoon, need to be redrawn with the belt of the police man reading "Democrat Party".

By the way....

We have seen the same thing happen in India during the protectionism that lasted from the 1950s to the 1990s.

This is the Hindustan Motors Ambassador.

In the 1950s, the company leased the design from a small car company in the UK. The car remained almost completely unchanged, for over 40 years.

Why? Because they didn't have to. Behind the protectionist walls, the company never had to update the design to compete with other imports. It wasn't until the 1990s when protectionism was starting to be repealed, that for the first time customers could buy the car without waiting 3 years for delivery, and the actual design was updated with better handling and braking.

All protectionism did was allow the company to make millions in profit, of off a poor, old, obsolete design.

 

[Andylusion]

But you and I will disagree on why. There is no evidence that it was the tariff was the cause of this.

Instead, what is much more likely to be the cause, is that there was very low regulations of business. Zero corporate income tax. Zero personal income tax. People were allowed to keep, and invest as they saw fit, all of their own earnings. Corporations were largely allowed to keep, and invest whatever they wished, as they saw fit, to grow their companies, with virtually no legal red tape.

Well, imagine there had been no tariffs.
Would the local industry have stood any chance against the British industry? I think not.
The 19 century was the poin in which merchantilism started to give way to free trade. This didn't happen overnight. And certainly tariffs were enacted in part because GB had similar laws and to protect the newly born American industry.

"Having just fought a war over taxation (among other things) the U.S. Congress wanted a reliable source of income that was relatively unobtrusive and easy to collect. It also sought to protect the infant industries that had developed during the war but which were now threatened by cheaper imports, especially from England."
...
"Once industrialization and mass production started, the demand for higher and higher tariffs came from manufacturers and factory workers. They believed that their businesses should be protected from the lower wages and more efficient factories of Britain and the rest of Europe. Nearly every northern Congressman was eager to logroll a higher tariff rate for his local industry"

Now, it might be that lower regulations and zero personal income tax can fuel the economy. But you can't have it both ways. You either tax individuals and corporations or increase the tariffs. You can't run a government without revenue.

Tariffs in United States history - Wikipedia the free encyclopedia

And yet we compete with companies all over the world with zero tariffs.

You do know that prior to 1776, there was tons of industry in the American colonies, and under British rule, there of course was ZERO protectionism on goods imported from there.

So the entire claim falls flat, given that obviously if it were true, than there could not have been any manufacturing in the colonies. And there was.

Medieval Technology and American History - In-Depth Articles - Perfection in the Mechanical Arts

John Adams visited Bethlehem, Pennsylvania, and discusses all the manufacturing that had sprung up under British rule, with zero protectionism.

Saddle-tree maker, Sadler, Glover, Shoemaker, Stocking-weavers..., Button maker, Taylor & Women Taylor, Hatter, Ribband-weavers; Linnen-weavers..., Woollen-weavers..., Wool-comber, Dyer, Fuller, Dresser, Tanner, Currier, Skinner, Butcher, Miller, Chandler, Oil-maker; Baker, Cooper, Joiner, Carpenter, Mason, Glazier, Brick maker, Stone Cutter, Turner, Potter, Stovemaker, Wheelwright, Blacksmith, Gunsmith, Nailmaker, Lock-smith, Pewterer, Tinman, Silver-smith, Clockmaker, Harries-maker, Hemp dresser, Boat-builder, Surgeon, Apothecary.

All of these industries here are are directly competing with imported goods. But according to you, "Would the local industry have stood any chance against the British industry? I think not. " and yet.... they did. In fact, the Brits were very discouraging of domestic productions, specifically because it competed with their imported goods, and made no attempt to help domestic manufacturing of anything.....

And yet.... there they all were. Weavers, testiles, silver smiths, clockmakers, gunsmiths, tanners, boat builders.....

Now how could this be, against London with cheap labor, and more advanced and efficient, as well as much larger and profitable companies and businesses?

The same exact reason that Service and Repair at my company, will likely never be outsourced. Cost of transport.

The home team, always has the advantage of not having to ship it very far. I purchased a $169 9MM Luger Pistol. How did I get such a gun for that cheap? It's locally made, just a half hour drive from Columbus Ohio. Lower shipping charges, cheaper price.

So as I said, that claim is completely garbage. Just not true. With zero tariffs, American business would have competed, and likely done better than they did, even against the Brits.

 

[Andylusion]

Singapore.... South Korea... Taiwan... Hong Kong... Switzerland... Canada... All of these countries have little to no tariffs at all. And most are doing better than we are economically.

Nope
"
Switzerland is extremely protective of its agricultural industry. High tariffs and extensive domestic subsidisations encourage domestic production, which currently produces about 60% of the food consumed in the country.

According to the Organisation for Economic Co-operation and Development (OECD), Switzerland is subsidising more than 70% of its agriculture compared to 35% in the EU. The 2007 Agricultural Program, recently adopted by the Swiss Federal Assembly, will increase subsidies by CHF 63 million to CHF 14.092 billion"

Economy of Switzerland - Wikipedia the free encyclopedia

The Cayley–Galt Tariff of 1858 was the first protective tariff in Canadian history. It imposed duties on imported manufactured goods of 20% and a duty of 10% on partially manufactured goods in an attempt to spur domestic manufacturing industries.
The tariff was only a foretaste of the much more complete system of protection set up under theNational Policy of 1879.


Cayley Galt Tariff - Wikipedia the free encyclopedia

Subsidies are not the same as protectionism.

If they are, then you have no argument at all, because we subsidize agriculture too. Therefore, we are just as protectionist as ever before, and thus you need to explain why it isn't boosting our economy.

Further, a subsidy doesn't have the same effect as protectionism. Protectionism, keeps imports out of the market. Which is the whole point.

Instead, the people of Switzerland still imports 40% of all the food they eat, from outside the country.

The Trouble With Subsidies - Farm Futures

So they are still importing food.

As for Canada, that doesn't change my point.

TODAY... Canada is doing even better than we are, and the have lower tariffs than we do.

Again.... TODAY... which protectionist country would you point to, as being an example to follow? It's not Japan. Japan tried that, and end up with the lost decade, which ended up almost two decades. Today they are finally starting to pull out of the slump, and unsurprisingly, they are slowly repealing their protections.

So which country would you point to?

 

[Pksimon2007]

Singapore.... South Korea... Taiwan... Hong Kong... Switzerland... Canada... All of these countries have little to no tariffs at all. And most are doing better than we are economically.


Subsidies are not the same as protectionism.

If they are, then you have no argument at all, because we subsidize agriculture too. Therefore, we are just as protectionist as ever before, and thus you need to explain why it isn't boosting our economy.

Further, a subsidy doesn't have the same effect as protectionism. Protectionism, keeps imports out of the market. Which is the whole point.

...

So they are still importing food.

- Subsidies are protectionism. Both lower the price of domestic products compared to foreign ones. That is the effect of both.

Switzerland is still importing food?

Yes - proving that protectionism can work without stifling international trade.

 

[Andylusion]

Singapore.... South Korea... Taiwan... Hong Kong... Switzerland... Canada... All of these countries have little to no tariffs at all. And most are doing better than we are economically.


Subsidies are not the same as protectionism.

If they are, then you have no argument at all, because we subsidize agriculture too. Therefore, we are just as protectionist as ever before, and thus you need to explain why it isn't boosting our economy.

Further, a subsidy doesn't have the same effect as protectionism. Protectionism, keeps imports out of the market. Which is the whole point.

...

So they are still importing food.

- Subsidies are protectionism. Both lower the price of domestic products compared to foreign ones. That is the effect of both.

Switzerland is still importing food?

Yes - proving that protectionism can work without stifling international trade.

So 40% of the jobs are being wiped out by imports.......... because they are importing 40% of their food, which means those farmers are out of work.... is proof that protectionism is working?

You have a very odd definition of what protectionism is supposed to do then.

The entire point of protectionism is to have goods purchased, purchased domestically.

Like India's auto market. That was protectionism. 100% of the cars purchased, were built domestically. Of course few could afford the drastically over priced, terrible quality cars, and waiting several years to get each one.... but.... that was protectionism succeeding.

When 40% of the domestic market is wiped out by imports.... how you call that successful protectionism is beyond me.

And again, don't tell me "well without protectionism the other 60% wouldn't exist", because there are many many countries with zero protectionism, and they have plenty of domestic production.

Like protectionism of sugar for example. We have protectionism on sugar. That's why the US price for sugar is at least double the world price of sugar. That's protectionism. There are quotas and restrictions on importing sugar.

Thus we consumers get screwed, while the rich wealthy few sugar farmers in the US, make big money.

That's protectionism.

 

[CultureCitizen]

And yet we compete with companies all over the world with zero tariffs.

You do know that prior to 1776, there was tons of industry in the American colonies, and under British rule, there of course was ZERO protectionism on goods imported from there.

So the entire claim falls flat, given that obviously if it were true, than there could not have been any manufacturing in the colonies. And there was.

Medieval Technology and American History - In-Depth Articles - Perfection in the Mechanical Arts

Sory , I can't accept this argument at all.
The US wasn't simply a fully industrialized country during the colonial period. There was some industry true, but stretching dat to "tons of industry" is not true.
Also , the shipping costs from GB were a lot higher than today , so the Atlantic ocean took part in protecting the American industry too.

 

[CultureCitizen]

Subsidies are not the same as protectionism.

If they are, then you have no argument at all, because we subsidize agriculture too. Therefore, we are just as protectionist as ever before, and thus you need to explain why it isn't boosting our economy.

Further, a subsidy doesn't have the same effect as protectionism. Protectionism, keeps imports out of the market. Which is the whole point.

Instead, the people of Switzerland still imports 40% of all the food they eat, from outside the country.

The Trouble With Subsidies - Farm Futures

Yes , it is a form of protectionism. And indeed agriculture is one of the areas in which the US has a protectionist policy , it has been quite a hell for Mexico under NAFTA, but it has ensured the US remains self-suficient in food production.

 

[CultureCitizen]

When 40% of the domestic market is wiped out by imports.... how you call that successful protectionism is beyond me.

And again, don't tell me "well without protectionism the other 60% wouldn't exist", because there are many many countries with zero protectionism, and they have plenty of domestic production.

Switzerland is a tiny country ( with huge mountain ranges). It may simply be that the amount of arable land is not enough to produce all the food for the whole country. So , I am not buyin the "40% of domestic market is wiped out" . It is completely out of context.

 

[CultureCitizen]

As for Canada, that doesn't change my point.

TODAY... Canada is doing even better than we are, and the have lower tariffs than we do.

Again.... TODAY... which protectionist country would you point to, as being an example to follow? It's not Japan. Japan tried that, and end up with the lost decade, which ended up almost two decades. Today they are finally starting to pull out of the slump, and unsurprisingly, they are slowly repealing their protections.

So which country would you point to?

My point of view is that some areas must be protected.
Agriculture is protected. I find that a valid point because food autosuficiency is a matter of national security. The same goes for weapons and water .
Some areas could be addes for a different reason : because they employ a large amount of people.
It may be that such area becomes stagnated , but it will still employ thousands of workers .
So you want an example of a successfull protectionist state?
Well , look at China :
It has an undervaluated state controlled currency , so all the imports are VERY expensive relative to their purchasing power ( again , they import less than Mexico, an economy which is 7 times smaller than China in absolute terms).
It opened to free trade and investment through special economic zones hence controlling the spread and level of influence foreign trade could have in their economy.
It still has a huge set of SOE (State owned enterprises) which contribute with at least 4 Trillion USD to China's GDP ( the amount is so huge I tend to think that Chinese are under reporting their GDP for reasons I can't quite figure out).
It all boils down to this: a protectionist state which uses captialism and free trade to spur development, without loosing control of key areas.

Skim the Beijing Consensus and compare it to the Washington Consensus. They are VERY different.

Special Economic Zones of China - Wikipedia the free encyclopedia
Beijing Consensus - Wikipedia the free encyclopedia
Washington Consensus - Wikipedia the free encyclopedia

 

[Andylusion]

And yet we compete with companies all over the world with zero tariffs.

You do know that prior to 1776, there was tons of industry in the American colonies, and under British rule, there of course was ZERO protectionism on goods imported from there.

So the entire claim falls flat, given that obviously if it were true, than there could not have been any manufacturing in the colonies. And there was.

Medieval Technology and American History - In-Depth Articles - Perfect

And yet we compete with companies all over the world with zero tariffs.

You do know that prior to 1776, there was tons of industry in the American colonies, and under British rule, there of course was ZERO protectionism on goods imported from there.

So the entire claim falls flat, given that obviously if it were true, than there could not have been any manufacturing in the colonies. And there was.

[URL='http://www.engr.psu.edu/mtah/articles/perfection_mechanical.htm']Medieval Technology and American History - In-Depth Articles - Perfection in the Mechanical Arts

Sory , I can't accept this argument at all.
The US wasn't simply a fully industrialized country during the colonial period. There was some industry true, but stretching dat to "tons of industry" is not true.
Also , the shipping costs from GB were a lot higher than today , so the Atlantic ocean took part in protecting the American industry too.

ion in the Mechanical Arts[/URL]

Sory , I can't accept this argument at all.
The US wasn't simply a fully industrialized country during the colonial period. There was some industry true, but stretching dat to "tons of industry" is not true.
Also , the shipping costs from GB were a lot higher than today , so the Atlantic ocean took part in protecting the American industry too.

Have you shipped anything from here to China recently? Shipping is always a factor.

Shipping is a factor even if you are going from Kansas to Ohio.

The home team always has that advantage.

And by the way, I already said this twice. You never seem to read anything, but spout off rather quickly.

Just like I never said that America was "fully industrialized". Can I make up crap you didn't say, and claim you are wrong too?

And as I ALREADY SAID, the Brits were hostile to colonial industry. They wanted British colonies to be captive markets.

In fact, they specifically banned the colonies from exporting hats, because the manufacture of hats competed with British hat making. And, additionally, they banned colonies from selling hats to other British colonies. They even placed a limit on the number of apprentices that hat makers could train in hat making.

Yet even so, the 13 colonies had a thriving hat making industry, even though they had to export their wares illegally.

Again... you claimed that American business could not possibly compete with matured British industry... and yet even before we existed as a nation, the people of the American colonies were already competing.

That argument simply doesn't hold water.

 

[Andylusion]

When 40% of the domestic market is wiped out by imports.... how you call that successful protectionism is beyond me.

And again, don't tell me "well without protectionism the other 60% wouldn't exist", because there are many many countries with zero protectionism, and they have plenty of domestic production.

Switzerland is a tiny country ( with huge mountain ranges). It may simply be that the amount of arable land is not enough to produce all the food for the whole country. So , I am not buyin the "40% of domestic market is wiped out" . It is completely out of context.

Well that's kind of my point. You assume that with imports, that they are wiping out jobs in the US, and yet perhaps there are other factors that have wiped out jobs, like minimum wage, health care mandates, and government regulations.

Just like perhaps imports of food is not automatically an indication the farmers lost their jobs.

Because I know with absolute certainty that if we were importing 40% of our food, you'd be screaming that imports were kill American Farms.

 

[Andylusion]

As for Canada, that doesn't change my point.

TODAY... Canada is doing even better than we are, and the have lower tariffs than we do.

Again.... TODAY... which protectionist country would you point to, as being an example to follow? It's not Japan. Japan tried that, and end up with the lost decade, which ended up almost two decades. Today they are finally starting to pull out of the slump, and unsurprisingly, they are slowly repealing their protections.

So which country would you point to?

My point of view is that some areas must be protected.
Agriculture is protected. I find that a valid point because food autosuficiency is a matter of national security. The same goes for weapons and water .
Some areas could be addes for a different reason : because they employ a large amount of people.
It may be that such area becomes stagnated , but it will still employ thousands of workers .
So you want an example of a successfull protectionist state?
Well , look at China :
It has an undervaluated state controlled currency , so all the imports are VERY expensive relative to their purchasing power ( again , they import less than Mexico, an economy which is 7 times smaller than China in absolute terms).
It opened to free trade and investment through special economic zones hence controlling the spread and level of influence foreign trade could have in their economy.
It still has a huge set of SOE (State owned enterprises) which contribute with at least 4 Trillion USD to China's GDP ( the amount is so huge I tend to think that Chinese are under reporting their GDP for reasons I can't quite figure out).
It all boils down to this: a protectionist state which uses captialism and free trade to spur development, without loosing control of key areas.

Skim the Beijing Consensus and compare it to the Washington Consensus. They are VERY different.

Special Economic Zones of China - Wikipedia the free encyclopedia
Beijing Consensus - Wikipedia the free encyclopedia
Washington Consensus - Wikipedia the free encyclopedia

China is the exact opposite of an example of protectionism. GM sells automobiles in China. When we talk about Apple iPhones being manufactured in China, what most people fail to grasp is that the vast majority of the parts in the iPhone built in China, comes from outside China. China imports parts from Taiwan, Italy, Japan, S.Korea and other countries, including.... The US. That's right, China is importing manufactured goods from the US, to make iPhones which is then exported back to the US.

If China was engaged in protectionism, as you claim, then it would be horribly expensive, if not prohibitive to import all those manufactured goods, and make the iPhone with them.

Prior to 1978, China was in fact a highly protectionist country, and getting things imported in China was nearly impossible. Which is why China was a 3rd world, backward country, where 63% of the population lived under the Chinese poverty level of $2 a day.

Today, China is anything but protectionist. A ton of people don't know, that China is actually our 3rd largest export partner. Behind Canada and Mexico, we export $130 Billion a year in manufactured goods to China.

One of the biggest sections of that, BMWs made in South Carolina, shipped to China.

http://www.chinabusinessreview.com/from-cars-to-soybeans-us-exports-to-china-are-booming/

 

[CultureCitizen]

As for Canada, that doesn't change my point.

TODAY... Canada is doing even better than we are, and the have lower tariffs than we do.

Again.... TODAY... which protectionist country would you point to, as being an example to follow? It's not Japan. Japan tried that, and end up with the lost decade, which ended up almost two decades. Today they are finally starting to pull out of the slump, and unsurprisingly, they are slowly repealing their protections.

So which country would you point to?

My point of view is that some areas must be protected.
Agriculture is protected. I find that a valid point because food autosuficiency is a matter of national security. The same goes for weapons and water .
Some areas could be addes for a different reason : because they employ a large amount of people.
It may be that such area becomes stagnated , but it will still employ thousands of workers .
So you want an example of a successfull protectionist state?
Well , look at China :
It has an undervaluated state controlled currency , so all the imports are VERY expensive relative to their purchasing power ( again , they import less than Mexico, an economy which is 7 times smaller than China in absolute terms).
It opened to free trade and investment through special economic zones hence controlling the spread and level of influence foreign trade could have in their economy.
It still has a huge set of SOE (State owned enterprises) which contribute with at least 4 Trillion USD to China's GDP ( the amount is so huge I tend to think that Chinese are under reporting their GDP for reasons I can't quite figure out).
It all boils down to this: a protectionist state which uses captialism and free trade to spur development, without loosing control of key areas.

Skim the Beijing Consensus and compare it to the Washington Consensus. They are VERY different.

Special Economic Zones of China - Wikipedia the free encyclopedia
Beijing Consensus - Wikipedia the free encyclopedia
Washington Consensus - Wikipedia the free encyclopedia

China is the exact opposite of an example of protectionism. GM sells automobiles in China. When we talk about Apple iPhones being manufactured in China, what most people fail to grasp is that the vast majority of the parts in the iPhone built in China, comes from outside China. China imports parts from Taiwan, Italy, Japan, S.Korea and other countries, including.... The US. That's right, China is importing manufactured goods from the US, to make iPhones which is then exported back to the US.

If China was engaged in protectionism, as you claim, then it would be horribly expensive, if not prohibitive to import all those manufactured goods, and make the iPhone with them.

Prior to 1978, China was in fact a highly protectionist country, and getting things imported in China was nearly impossible. Which is why China was a 3rd world, backward country, where 63% of the population lived under the Chinese poverty level of $2 a day.

Today, China is anything but protectionist. A ton of people don't know, that China is actually our 3rd largest export partner. Behind Canada and Mexico, we export $130 Billion a year in manufactured goods to China.

One of the biggest sections of that, BMWs made in South Carolina, shipped to China.

From Cars to Soybeans US Exports to China Are Booming China Business Review

There is a severe trade imbalance between US and China. Tariffs are not the only way in which protectionism can be enacted (subsidies, currency controls and tax breaks are the other ways).

"At $35.6 billion, the trade gap with China represents more than 80% of the total U.S. trade deficit of $43.0 billion.

The data’s likely to revive U.S. lawmaker calls to penalize Beijing for keeping a lid on the value of its currency. U.S. manufacturers complain the policy gives Chinese companies an unfair advantage, especially as the value of the dollar appreciates."

U.S. Trade Gap with China 80 of Trade Deficit Hits Historic High - Real Time Economics - WSJ

If in spite of the evidence you still consider China an example of free trade, then I can do nothing but admire the subtle strategy they crafted. Fooling the US government and citizens with the free trade gimmick while doing the exact oposite, Sun Tzu would be proud of the result.

Finally you need to widen your definition of protectionism:

A variety of policies have been used to achieve protectionist goals. These include:
Tariffs
Import quotas
Administrative barriers
Anti-dumping legislation
Direct subsidies
Export subsidies
Exchange rate manipulation
International patent systems
Employment-based immigration restrictions
Political campaigns advocating domestic consumption
Preferential governmental spending

Alas, one sector in which the US has been consistently protectionist is the labour market.

Protectionism - Wikipedia the free encyclopedia

 

[Andylusion]

As for Canada, that doesn't change my point.

TODAY... Canada is doing even better than we are, and the have lower tariffs than we do.

Again.... TODAY... which protectionist country would you point to, as being an example to follow? It's not Japan. Japan tried that, and end up with the lost decade, which ended up almost two decades. Today they are finally starting to pull out of the slump, and unsurprisingly, they are slowly repealing their protections.

So which country would you point to?

My point of view is that some areas must be protected.
Agriculture is protected. I find that a valid point because food autosuficiency is a matter of national security. The same goes for weapons and water .
Some areas could be addes for a different reason : because they employ a large amount of people.
It may be that such area becomes stagnated , but it will still employ thousands of workers .
So you want an example of a successfull protectionist state?
Well , look at China :
It has an undervaluated state controlled currency , so all the imports are VERY expensive relative to their purchasing power ( again , they import less than Mexico, an economy which is 7 times smaller than China in absolute terms).
It opened to free trade and investment through special economic zones hence controlling the spread and level of influence foreign trade could have in their economy.
It still has a huge set of SOE (State owned enterprises) which contribute with at least 4 Trillion USD to China's GDP ( the amount is so huge I tend to think that Chinese are under reporting their GDP for reasons I can't quite figure out).
It all boils down to this: a protectionist state which uses captialism and free trade to spur development, without loosing control of key areas.

Skim the Beijing Consensus and compare it to the Washington Consensus. They are VERY different.

Special Economic Zones of China - Wikipedia the free encyclopedia
Beijing Consensus - Wikipedia the free encyclopedia
Washington Consensus - Wikipedia the free encyclopedia

China is the exact opposite of an example of protectionism. GM sells automobiles in China. When we talk about Apple iPhones being manufactured in China, what most people fail to grasp is that the vast majority of the parts in the iPhone built in China, comes from outside China. China imports parts from Taiwan, Italy, Japan, S.Korea and other countries, including.... The US. That's right, China is importing manufactured goods from the US, to make iPhones which is then exported back to the US.

If China was engaged in protectionism, as you claim, then it would be horribly expensive, if not prohibitive to import all those manufactured goods, and make the iPhone with them.

Prior to 1978, China was in fact a highly protectionist country, and getting things imported in China was nearly impossible. Which is why China was a 3rd world, backward country, where 63% of the population lived under the Chinese poverty level of $2 a day.

Today, China is anything but protectionist. A ton of people don't know, that China is actually our 3rd largest export partner. Behind Canada and Mexico, we export $130 Billion a year in manufactured goods to China.

One of the biggest sections of that, BMWs made in South Carolina, shipped to China.

From Cars to Soybeans US Exports to China Are Booming China Business Review

There is a severe trade imbalance between US and China. Tariffs are not the only way in which protectionism can be enacted (subsidies, currency controls and tax breaks are the other ways).

"At $35.6 billion, the trade gap with China represents more than 80% of the total U.S. trade deficit of $43.0 billion.

The data’s likely to revive U.S. lawmaker calls to penalize Beijing for keeping a lid on the value of its currency. U.S. manufacturers complain the policy gives Chinese companies an unfair advantage, especially as the value of the dollar appreciates."

U.S. Trade Gap with China 80 of Trade Deficit Hits Historic High - Real Time Economics - WSJ

If in spite of the evidence you still consider China an example of free trade, then I can do nothing but admire the subtle strategy they crafted. Fooling the US government and citizens with the free trade gimmick while doing the exact oposite, Sun Tzu would be proud of the result.

Finally you need to widen your definition of protectionism:

A variety of policies have been used to achieve protectionist goals. These include:
Tariffs
Import quotas
Administrative barriers
Anti-dumping legislation
Direct subsidies
Export subsidies
Exchange rate manipulation
International patent systems
Employment-based immigration restrictions
Political campaigns advocating domestic consumption
Preferential governmental spending

Alas, one sector in which the US has been consistently protectionist is the labour market.

Protectionism - Wikipedia the free encyclopedia

Again, I don't see a problem with this. China is taxing it's people, in order to sell us goods a lower price.

This is not a negative, but a plus. We benefit from their loss.

Yes, China is very free-trade. Again, we wouldn't be able to sell them hundreds of billions in manufactured goods, if they were not open to trade.

Having a trade imbalance, does not indicated that there is not free-trade. The China free-trade area already includes 11 countries, plus separate free-trade agreements with Switzerland, Peru, Iceland, Singapore, Pakistan, Chile, New Zealand and others.

China FTA Network

China had no free-trade agreements of any kind, prior to 2002 (at least as far as I've been able to determine). And clearly before 1978, they had very little trade.

Again, the claims that the Chinese Yuan is undervalued, is garbage.

I don't care what some ignorant mindless politicians in Washington say. Half of them can't even use a smart phone.... but they think they have international monetary valuations figured out? I don't think so.

When Venezuela tried to devalue their currency intentionally, they had a massive black market currency exchange. Why? Because the real market value of the Bolivar was difference from the government rates.

The government can't just say "This is how much our currency is worth", because the market will react accordingly, and exchange it for the real market rate.

http://www.nytimes.com/2015/03/07/o...rothy-kronick-venezuelas-currency-circus.html

Venezuela Live Economic Data

The clear divide between the black market rate for bolivar, verses the official exchange rate is clearly documented.

If China was in fact devaluing their currency, the same should be easily documented. Instead, we don't see that.

Maybe China s Currency Isn t Undervalued After All - China Real Time Report - WSJ

What we do see is people abusing the subsidies you were just referring too. Recently a high profile case showed what the government is doing, and the problems it's caused.

http://www.economist.com/node/10180842

Subsidized oil, at a huge cost to tax payers, was being purchased, and then resold at the market price outside China. Yeah, what a great system that is.

Or subsidized export products, sold to subsidiaries in free-trade countries like Singapore, being resold at market price from the outside country. The company in China gets the subsidy, and then the full price. Double dipping.

Screwing the tax payers over and over, to benefit the wealthy. That's what your subsidies do.

I think we should end that.

 

[CultureCitizen]

When Venezuela tried to devalue their currency intentionally, they had a massive black market currency exchange. Why? Because the real market value of the Bolivar was difference from the government rates.

The government can't just say "This is how much our currency is worth", because the market will react accordingly, and exchange it for the real market rate.

China has its own black market (see link) . It can do what it does because it is a police state and it is sitting on top of 4 Trillion of USD reserves, and on top of that the trade balance with the US is 5 to 1. So China and Venezuela have very different economical situations.

http://www.economist.com/node/10180842

And by your own posting :
"Last year, the IMF said the yuan was “moderately” undervalued—IMF lingo for 5% to 10% undervalued."
That is after a significant valuation over the past 10 years. That means that during the last 20 or 30 years the yuan was certainly undervaluated.
The article doesn't claim it wasn't undervaluated in the past it just claims it is probably no longer undervaluated as of may 2014. And I must point out the IMF still thinks it is undervaluated.

 

[EdwardBaiamonte]

. It can do what it does because it is a police state and it is sitting on top of 4 Trillion of USD reserves,.

1) "The composition of foreign exchange reserves is presently regarded as a state secret in China. All financial records pertaining to the foreign exchange reserve have been poorly documented. The official sources elaborate that US dollar holdings make up 60% of the reserve, and that a fifth (up to 400 billion USD) of the reserve is held in Fannie Mae and Freddie Mac bonds."

2) If the Yuan is undervalued that means lower prices and more wealth for us

3) Irrelevant anyway since all nations trade with China so we cant be the exception and hope to keep up with the world.

4) global corporations are great since they enable us to get virtually free bananas
as opposed to growing our own. A child would know that just not a liberal.