tag:blogger.com,1999:blog-502356674750161309.post765542599581164904..comments2008-11-30T17:51:14.644-08:00Eric deCarbonnelhttp://www.blogger.com/profile/08023745289801416061noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-502356674750161309.post-71351668267744341502008-11-30T17:51:00.000-08:002008-11-30T17:51:00.000-08:00The "free trade" ideology as promoted by Washington and some CEOs should be held responsible for today's mess, because it is a direct cause of all our current problems. Under the "free trade" ideology, our governtment has been pursuying a flawed, irresponsible trade policy:<BR/><BR/>1) In the name "free trade", our government has unilaterally opened up US markets to countries which haven't returned the favor. One-way "free trade" agreements have decimated our manufacturing and left our country's economy weak. True "free trade" works both ways!<BR/><BR/>2) In the name "free trade", the US has struck up trade agreements disproportionally with low-income countries. These low-income countries are poor markets for US goods, but are excellent low cost areas to outsource US manufacturing. The end result is that the US focus on "free trade" with poor countries destroyed most of our manufacturing sector.<BR/><BR/><A HREF="http://www.americaneconomicalert.org/view_art.asp?Prod_ID=773" REL="nofollow">U.S. Trade Deficit Endangers the American Economy</A><BR/>Essentially, no one can know just when America's trade deficits and foreign debts will reach the tipping point in investors? minds. But here's what we know for sure: First, the higher these deficits and debts become, the closer we get to that point. Second, the Bush administration's trade policy is bringing this day ever closer -- <B>by unilaterally offering to open the U.S. market to prospective allies in the Iraq/anti-terror campaign, and by pursuing a trade agenda focusing on low-income countries that can only become major suppliers to the U.S. market, not major customers of U.S. products.</B><BR/><BR/>Finally, Labor markets tend towards equilibrium. If Americans workers who enjoy a high standard of living are forced to directly compete against third world workers living in poverty, then equilibrium will force Americans into poverty. This is the reason US consumers are so in debt: as direct result of competition with the world's poor forcing down their income and compensation, Americans have been using debt to maintain their standard of living. Without the disastrous "free trade" policy of the last two decades, Americans would still have a strong manufacturing sector with high paying jobs and would not need to borrow money from foreigners to finance consumption.<BR/><BR/><BR/>Washington's current outsourcing-friendly "free trade" policy has deeply harmed our country, and they show that <B>an unbalanced "free trade" policy is worse then protectionism.</B> At the very minimum, trade agreements should be mutual and should be distributed evenly between low-income and high-income nations.Eric deCarbonnelhttp://www.blogger.com/profile/08023745289801416061noreply@blogger.comtag:blogger.com,1999:blog-502356674750161309.post-89146673867972537672008-11-29T17:54:00.000-08:002008-11-29T17:54:00.000-08:00Eric<BR/><BR/>I agree with all your points but I take issue with your hostility towards CEOs who offshore and out source. <BR/><BR/>The problem is actually two fold. Our borrowing and the rest of the worlds lending. <BR/><BR/>If we had a non-fiat based currency based on real things IE.gold, these distortions would never have happened.<BR/><BR/>Outsourcing to another region which has better competetive advantages than your own is the epitome of specialization of labor and makes a whole lot of sense IF there is trade in goods and NOT<BR/>debt instruments. <BR/><BR/>In such a trade relationship both parties benefit, where-as in the current system both sides suffer (I think us more than them due to the reasons you outlined in your post.)<BR/><BR/>We have rotten money and it's no surprise that our economic system shouldn't be rotten as well, however free trade should not be made the scape goat in this mess.occdudenoreply@blogger.com