The Religion of Free Trade

[Peter1469]

And interesting anti-free trade view:

http://www.wnd.com/2012/06/the-religion-of-free-trade/

The chief legacy of David Ricardo’s free-trade doctrine, beyond its pernicious utilization by globalists and fascistic, anti-democratic organizations such as the European Union, is one of intellectual dishonesty. In Europe and the Americas, every so-called free-trade agreement has been signed over the objection of critics who object, correctly, that the effects will be precisely the opposite of those promised by those pushing the agreements. From the European Coal and Steel Community to NAFTA and the recent trade agreement with South Korea, the real objectives and eventual results have been very different from those promised. As Pat Buchanan demonstrated in his recent column titled “We need more economic nationalists,” free-trade doctrine fails catastrophically every time it is forced to prove itself as a predictive model.

[Chris]

As Pat Buchanan demonstrated in his recent column titled “We need more economic nationalists,” free-trade doctrine fails catastrophically every time it is forced to prove itself as a predictive model.

Naturally, like Krugman, Buchanan puts politics ahead of economics, one's a pundit for socialism (social democracy) and the other for nationalism.

Nations don't trade, people do.

Free trade is not a predictive doctrine, it is a descriptive theory of what works better than any other system.

[Peter1469]

Naturally, like Krugman, Buchanan puts politics ahead of economics, one's a pundit for socialism (social democracy) and the other for nationalism.

Nations don't trade, people do.

Free trade is not a predictive doctrine, it is a descriptive theory of what works better than any other system.

Read the article. It describes how that simply is not the case.

This legacy of shameless dishonesty can be seen in the desperate attempt of free traders to separate the free movement of labor that has always been a part of the doctrine of free trade (and is in fact absolutely necessary to it) from the free movement of capital. Due to the public disaffection with mass immigration that is belatedly sweeping the West, free traders are now attempting to artificially distinguish the free trade in goods, which does not necessarily require immigration, from the free trade in services, which does, in order to make their doctrine less politically unpalatable. It can also be seen in the writings of Gary North, an elderly historian and self-styled “tea-party economist,” as he asserts that skepticism concerning free-trade doctrine amounts to nothing more than “trust in state power” and “faith in the economic productivity of men with badges and guns,” and that free trade is the litmus test of economics.
The idea that such an intrinsically flawed doctrine, one which has literally nothing to do with the economic operation of a domestic market that serves as the basis for most economic theory, could serve a litmus test for economic knowledge is absurd on its face. But North is guilty of far more than absurdity, as he also lies about the critics of the free-trade doctrine, even though he is, by his own admission, almost entirely ignorant of what their actual arguments are.

[birddog]

I'm for Free Trade as long as it's Fair Trade. The economist Elliot Janeway used to preach to trade the same value of wheat for the same value of oil for example. We need to greatly decrease our trade deficit. Do it properly and we can also get rid of oor debt deficit.

[Peter1469]

I'm for Free Trade as long as it's Fair Trade. The economist Elliot Janeway used to preach to trade the same value of wheat for the same value of oil for example. We need to greatly decrease our trade deficit. Do it properly and we can also get rid of oor debt deficit.

Bingo!

[Chris]

Read the article. It describes how that simply is not the case.

This legacy of shameless dishonesty can be seen in the desperate attempt of free traders to separate the free movement of labor that has always been a part of the doctrine of free trade (and is in fact absolutely necessary to it) from the free movement of capital. Due to the public disaffection with mass immigration that is belatedly sweeping the West, free traders are now attempting to artificially distinguish the free trade in goods, which does not necessarily require immigration, from the free trade in services, which does, in order to make their doctrine less politically unpalatable. It can also be seen in the writings of Gary North, an elderly historian and self-styled “tea-party economist,” as he asserts that skepticism concerning free-trade doctrine amounts to nothing more than “trust in state power” and “faith in the economic productivity of men with badges and guns,” and that free trade is the litmus test of economics.
The idea that such an intrinsically flawed doctrine, one which has literally nothing to do with the economic operation of a domestic market that serves as the basis for most economic theory, could serve a litmus test for economic knowledge is absurd on its face. But North is guilty of far more than absurdity, as he also lies about the critics of the free-trade doctrine, even though he is, by his own admission, almost entirely ignorant of what their actual arguments are.

Read it, it's political hackery. I see no rational argument in it at all. The part you cite is barely a step above name calling.

[Chris]

I'm for Free Trade as long as it's Fair Trade. The economist Elliot Janeway used to preach to trade the same value of wheat for the same value of oil for example. We need to greatly decrease our trade deficit. Do it properly and we can also get rid of oor debt deficit.

So you're for managed trade. How does a central planner determine the value of oil or wheat? Hint, he cannot.

[Chris]

Just scrolled up to see the OP author is none other than Vox Day. Peter, as you know from our rather extensive discussion of his The Irrational Atheist, he is rather loose with facts and logic.

What you've wandered into is a pissing context between him and Gary North a regular contributor over on LewRockwell.com. The current contest is over Vox's attempt to argue with North's Free Trade: The Litmus Test of Economics

Free trade is the litmus test of economic reasoning. It has been ever since David Hume wrote his 1752 essay on commerce.

Foreign trade, by its imports, furnishes materials for new manufactures; and by its exports, it produces labour in particular commodities, which could not be consumed at home. In short, a kingdom, that has a large import and export, must abound more with industry, and that employed upon delicacies and luxuries, than a kingdom which rests contented with its native commodities. It is, therefore, more powerful, as well as richer and happier. The individuals reap the benefit of these commodities, so far as they gratify the senses and appetites. And the public is also a gainer, while a greater stock of labour is, by this means, stored up against any public exigency; that is, a greater number of laborious men are maintained, who may be diverted to the public service, without robbing any one of the necessaries, or even the chief conveniencies of life.

His friend Adam Smith made it the touchstone of economic logic and policy. His great work, The Wealth of Nations (1776), challenged the mercantilists, who believed in the mixed economy: free markets, legal monopolies, and tariffs.

Mercantilism is the default setting for most people. It is based on trust in state power. As I have put it, it is faith in the economic productivity of men with badges and guns.

I have never had any illusions about persuading people who trust in the creativity of badges and guns. The universal trust in state power in every area of life is an extension of what I call the power religion. It is the religion of every empire.

Free trade means free choice. Power-lovers hate free choice, so they hate free trade.

In 1972, I wrote an Introduction to the reprint of my 1969 article, "Tariff War, Libertarian Style." I reprinted it in my book, An Introduction to Christian Economics (Craig Press, 1973). It deals with the inability of rational people to understand the logic of economics. In my Introduction, I wrote this:

We come now to the economic issue that separates the economists from the special interest pleaders. There are a lot of supposedly free market capitalists who shout the praises of open competition, but when the chips are really down, they call for the intervention of the monopolistic, coercive State to keep Americans from trading with other Free World countries. Competition among Americans, but not between American companies and foreign companies: here is the cry of the tariff advocates. The fact that less than 5% of our economy is directly involved in foreign trade never phazes these enthusiasts: free trade is "destroying" the other 95% of the American economy! Somehow, the principles of capitalism operate only within national boundaries. Somehow the intervention of the State will "protect" Americans. Henry Hazlitt's classic little book, Economics in One Lesson, so completely destroys the arguments of the tariff supporters that there is nothing left of their position; still they keep coming. For two centuries their position has been intellectually bankrupt; still they keep coming. Tariffs hurt all consumers except those on the public dole of tariff intervention, e.g., the "infant industries" such as steel or textiles. Yet the advocates say that all Americans are "protected." The logic of economics cannot seem to penetrate otherwise rational minds.

Postscript: I rejoice that the 5% of GDP figure is now close to 24%. The idea of free trade has spread. The world is richer than it was in 1973.

The defenders of mercantilism have a religion: the religion of state worship....

Thus the copy cat title of Vox's diatribe against Ricardo, Hazlitt, and others.

And actually this is just the latest, since if you go to Vo'c's blog you see more in Free Trade and Gary North, which I won't site as none of the personal pissing and puffery and pontifications are worthy of it.

It's an attack on North's Tax-Loving Conservatives

This may sound odd. Conservatives don't love taxes. They want lower taxes. Right? They want lower taxes and smaller government.

I wish that were true. It isn't.

Alexander Hamilton was a crusader for higher taxes and a larger national government in the 1790s. He wanted higher taxes in order to raise money for a higher federal debt. He wanted higher federal debt because he wanted investors in government IOUs to commit to the survival of the United States. Free market economist Thomas DiLorenzo has summarized Hamilton's position, which he accurately identifies as crony capitalism.

In a lengthy "report" to Congress on the topic of the public debt Hamilton said that "a national debt, if it is not excessive, will be to us a public blessing." He would spend the rest of his life politicking for excessive government spending – and debt. The reason Hamilton gave for favoring a large public debt was not to finance any particular project, or to stabilize financial markets, but to combine the interests of the affluent people of the country – particularly business people – to the government. As the owners of government bonds, he reasoned, they would forever support his agenda of higher taxes and bigger government. (He condemned Jefferson's first inaugural address and its minimal government message as "the symptom of a pygmy mind.") No wonder one historian entitled his book on Hamilton American Machiavelli.

In 1791, he persuaded George Washington and then Congress to transfer to a group of private investors the right to set up a central bank that was not answerable to Congress or anyone else in government. The Bank of the United States had the right to create fiat money out of nothing, lend it to the government, and keep the interest paid by the government. This was the supreme institution of crony capitalism in America from 1791 to its expiration in 1811.

He was also a big supporter of tariffs. Tariffs raised the money the government needed to pay interest to the Bank of the United States, which was independent of the government of the United States. Tariffs were taxes favored by big-government conservatives. They still are....

Assume Vox does muster facts and logic and refutes that. Then his claim to being a libertarian is pure baloney. He's not a Madisonian libertarian like North is. At best he's a Hamiltonian conservative, just another statist.

But we already knew that from his citing Buchanan, another statist.

When did you start supporting neocons?

[Peter1469]

Just scrolled up to see the OP author is none other than Vox Day. Peter, as you know from our rather extensive discussion of his The Irrational Atheist, he is rather loose with facts and logic.

What you've wandered into is a pissing context between him and Gary North a regular contributor over on LewRockwell.com. The current contest is over Vox's attempt to argue with North's Free Trade: The Litmus Test of Economics

Thus the copy cat title of Vox's diatribe against Ricardo, Hazlitt, and others.

And actually this is just the latest, since if you go to Vo'c's blog you see more in Free Trade and Gary North, which I won't site as none of the personal pissing and puffery and pontifications are worthy of it.

It's an attack on North's Tax-Loving Conservatives

Assume Vox does muster facts and logic and refutes that. Then his claim to being a libertarian is pure baloney. He's not a Madisonian libertarian like North is. At best he's a Hamiltonian conservative, just another statist.

But we already knew that from his citing Buchanan, another statist.

When did you start supporting neocons?

Nice try. Neither Vox nor Buchanan are neocons. That was a silly charge on your part considering how opposed to foreign adventures both men are. I choose to think that it was simply an emotional outburst. Nobody in their right mind would make such a claim actually believing it was true.

But both men, and myself, live in real-ville. We have government; we have had government for thousands of years; I don't see a fantasy non-government "society" popping into existence any time soon. And if we did, it is very likely that the far right libertarians would end up with the same complaints about whatever class end up on top. The closest thing that I know of was the Old West. And these non-government pioneers did all that they could do to become Territories of the US and then States.....

That is one area where the free trade argument falls apart. If people from Norway give people from the US X amount of whale fat for X amount of Georgia pine, we can be reasonably sure that the trade was free for both parties, or they would not have traded their goods absent extenuating circumstances.

If the Chinese government subsidies a Chinese factory to produce t-shirts at 500% less the cost of the American t-shirt factory and the Chinese floods the US markets with those t-shirts, what results is not free trade. And lots of Americans are out of work.

I forgot that you were incapable of separating ad homs from logical argument. I will try to remember that in the future. Very linear; one, two, three, conclusion. No humor. No distractions......

[Chris]

Neither Vox nor Buchanan are neocons.

I realize they may not self-identify as such but in their words and views they are nothing but.

But both men, and myself, live in real-ville.

Here we go with that argument again, you claim you're dealing with reality and everyone else is not. That's not an argument, it's classic poisoning the well of discussion.

I don't see a fantasy non-government "society" popping into existence any time soon

No one is arguing that, Peter. Not me, not North.

That is one area where the free trade argument falls apart.

So far you've got poisoning the well and straw man. Come up with an argument to defend your position. Make it a counter argument to what I or North has argued.

what results is not free trade

No one's arguing about that either, not Vox or North or I.

I forgot that you were incapable of separating ad homs from logical argument.

Poisoning the well is a form of ad hom. I've shown where you do that. Where did I engage in ad hom?