FREE TRADE is KILLING America

Asian printers can cut the price so much that even of you pay for shipping you are going to spend 35% - 45% less than you would going with an American printer.
Some like to say that this is wrong – sending jobs to Asia is unfair to hard working Americans who are trying to support their families. As I have said, at the end of the day it’s all about the profit. Now, does this make the publisher wrong? Honestly, I’d do the same thing if I was in that position. A smart business owner will finish a rich business owner.

WHY SHIP OVER SEAS?

A 2003 study showed that apperal industry workers in China made an average of $73 per month, compared with $75 in Indonesia, $102 in the Dominican Republic, and $300 in Honduras. Go ahead, compare these figure with the lowest minimum wage in the U.S and you do the math.

ON IMPORTS/EXPORTS

New Commerce Department data show that the United States set a record in 2002, importing $435 billion more than we exported. This trade "deficit" immediately generated howls of anguish. "A real downer," said the president of the National Association of Manufacturers. The head of the AFL-CIO claims it's "a catastrophe for working Americans who are losing their jobs, health care and stable communities due to our nation's failed economic policies."

On the web site freerepublic.com I found this post which was intriguing:

International free trade, while certainly necessary and useful to an extent, can easily be overemphasized to such a degree that it jeopardizes a country's economic self-interest and national security.
The United States is a good example. But first, let's look at Mexico.

Under the North American Free Trade Agreement, all Mexican protections against American or Canadian agricultural imports are about to disappear. That means cheaper Canadian and American farm products are going to flood Mexico. And Mexican farms are going to close down. The impact on Mexican agriculture is going to be immense. Which means Mexico is going to be less capable of supplying its own needs. And it means a ton of farm workers are going to be out of work and headed north. And that's not good for anybody.

Just like it's no good that the United States has a dramatic trade deficit, that it buys far more from overseas than it sells. And that there are entire sections of the American economy which are dependent on foreign goods. For whole product lines, there simply are no American manufacturers anymore. From electronic goods to clothing to steel, we don't make things anymore.
And American corporations are closing domestic factories to shift manufacturing overseas.
All of which fits perfectly into the world of free trade.
And all of which screws us royally.

Because independence is good and interdependence is bad. Because interdependence is the same as reliance and that is the opposite of self-reliance.
And history teaches that -- without exception -- prosperity and security require national self-reliance. Americans should eat American agricultural products and use American manufactured products and channel their income back into the economy that produced it -- the American economy. When a nation becomes reliant on foreign products -- as the United States clearly is -- its comfort and peace are held hostage by the producers of those foreign products.

If a nation cannot produce what it needs -- as the United States now cannot -- it is in a precarious position that weakens and enslaves it.

As this writer had mentioned, free trade goes far beyond the automotive industry and clothing lines. Everything from the food you eat to the household products you purchase comes into play.

Nebraska is facing a possibly devastating free trade law that will directly affect their crops.
"If passed by Congress, it will usher in an all-out race to the bottom, in which companies seek out developing countries with the lowest labor costs and least restrictive environmental laws," a representative for Nebraska said. "We will see wholesale attacks on the laws that protect our health, environment, working conditions and food safety, just to name a few.

THE OPPOSITION

1. Trade agreements such as NAFTA and WTO promote free trade.
Trade agreements as such are meaningless. Any country serious about free trade will commit to it unilaterally because they know import restrictions harm the overall domestic economy. The Bush administration pays lip service to WTO and free trade, then imposes restrictions to shore up political support. So far this year they've threatened to slap steep fines on Canadian softwood lumber and steel imports, and have declared that Vietnamese catfish aren't really catfish, since they take market share away from constituents in the Mississippi delta. [1] Disregarding the WTO, the European Union has threatened retaliatory tariffs targeted at some of Bush's politically-favored states.

Given the political nature of the WTO, the spectacle of leftist protesters trying to hinder trade negotiations is somewhat amusing, in that they believe they are fighting global laissez-faire. The "WTO isn't mainly about trade," according to a writer for the Environmental Research Foundation (ERF). "It is mainly about establishing the kind of economy, worldwide, in which the owning class gets to make all important decisions without interference from governments or from anyone else." [2]

Under laissez-faire, the "owning class"--meaning the producers of goods and services--are at the mercy of consumers, through their decisions to buy or not to buy. The ERF promotes this state of affairs as the ultimate horror and believes, quite naively, that the WTO is working to bring it about.

2. Free trade threatens domestic jobs.
Creating jobs has never been a problem in any economy. Creating productive jobs is the challenge. Free trade encourages the creation of wealth, which means it will destroy some jobs and create new ones, as guided by consumers' choices. Since tariffs insulate domestic firms from competition, the protection keeps some people stagnating in outmoded jobs, thereby discouraging them from seeking more favorable employment in competitive industries.

However, Paul Craig Roberts has identified a trade situation that is fast becoming a problem. He notes that multinational corporations have established factories in underdeveloped countries like Mexico and China and use the low-cost labor of those nations to produce goods for sale in the U.S. And not just unskilled labor, but engineers and researchers trained here but hired in those countries at one-third the salary. "When these facts are mentioned," Roberts says, "free-traders have a knee-jerk reaction and rush to the defense of free trade." [3] He's even asserted that the "end result of the job transfers will be a U.S. population too poor to purchase the products produced by cheap Chinese and Mexican labor." [4]

A policy of free trade with other nations will not guarantee a country's prosperity. How government treats domestic commerce plays a major role in business decisions. From the "law factory" in D.C. to the business-hating culture in Hollywood, America has subverted business with crippling regulation and unearned guilt. Given that companies are always searching for more profitable ways of doing business, is it any wonder many of them are moving operations out of the country?

If we are to stop this "desertion," as Roberts calls it, we need to repeal laws that drive business away. Unfortunately, if Congress ever addresses the problem, we can expect them to have a knee-jerk reaction and make matters worse.

3. It is better to export than to import.
When goods and services are exported, they leave the country. Therefore, less is available for consumption at home. When imports arrive, we have more choices, and because they compete with goods from other countries, including our own, we have better choices--higher quality, lower prices. As Milton and Rose Friedman explained, the "favorable balance of trade" that is so universally sought after really means "sending abroad goods of greater total value than the goods we get from abroad." [5]

Look at it this way: each person's own specialized labor is "exported" to get the imports (goods) he didn't produce. Most of us would prefer to get more for less rather than the other way around. So it is with exports and imports between countries.

4. "Fair Trade," not free trade, promotes world peace through justice.
"Fair trade" means protectionism. As Frederic Bastiat pointed out, protectionists want to do to their country during peacetime what they try to do to their enemies during war--close its borders to imports. Protectionism promotes conflict between nations. When President Hoover went against the advice of over 1,000 economists and signed the Smoot-Hawley Act in 1930, boosting some tariffs to 100% levels, other countries retaliated in kind and brought world trade to its knees. [6] This contributed to our collapse into a depression, where we stayed until World War II. Only free trade is fair, because it does not cater to special interests.

5. Free trade invites "dumping" of goods, which harms the domestic economy.
Wouldn't you love General Motors to "dump" a new Corvette in your driveway for free? In international trade, when goods are "dumped," it means they're sold here at prices below those in the country of origin. Who benefits? The American consumer, because he gets them at a lower price. Any company that slashes its prices below that of its competitors could be accused of "dumping," but most people would benefit from it.

Anything other than free trade is an attack on property rights. Without property rights, no rights are possible, and we end up at the mercy of the State.

My Opinion: Well, I don’t think I really have to go into much detail today since I pretty much all ready shared my views on this topic on the foreword. Still, I will add this;

Another blog I came across discusses similar events. If you are interested in reading it click this link:
http://bloggerparty.com/globalization_0

DO YOU LIKE THIS BLOG? If so Please give your opinion on other great debates:
http://bloggerparty.com/in_god_we_trust_church_v_s_state

http://www.heritage.org/Press/Commentary/ed022503a.cfm
http://www.cropchoice.com/leadstry2fdf.html?recid=2088
http://www.strike-the-root.com/columns/Smith/smith20.html
http://www.freerepublic.com/focus/news/795536/posts