Free trade promised that we could buy goods for less. Programs like Nafta promised to bring us cheaper products from our neigbors while opening the world to quality goods from America. It was the classic win-win. The problem is it doesn’t work.
Sure we we’ve been able to buy cheaper cars, cell phones and TV’s but the problem is the best paying jobs moved from America to Bangladesh, China, Mexico and a hundred third world countries where wages were more like slave labor. All while American politicians argued for higher and higher minimum wages to help restore the middle class.
The problem is that even with lower prices if wages don’t keep place with inflation then purchasing power declines.
Trump has it right. A little trade war may be exactly what is needed to balance the scales again.
In the third world wealth moves to the powerful not to the masses. So who do we think is getting enriched by “free” trade with America?
China is a classic case. They steal our intellectual property. Then recreate our products with cheap labor. Americans then get to buy our American designed products for less while American workers struggle to find work that pays a “living” wage.
Let’s examine the basic premise. The assumption is the “free market” should be unfettered in order to insure the lowest priced goods to the market. But when the markets are not competitively equal, there is no balance in the market place.
The result is that the products are not competitively priced. One “provider” gets a competitive advantage over the other.
The question is who ultimately benefits from this competitive imbalance? It’s not the workers of the world!
As always it is the politicians and bureaucrats who produce nothing and do not create jobs.
Well, we have had nearly 30 years of the global economy. The “free” market that will make all of our lives better with cheaper products.
The problem is if you don’t have the money to buy the products because wages aren’t keeping pace with inflation then the entire dream starts to unravel.
That is when the theory and the practice start to collide.
In a world where capitalism is a foreign concept; in a world where workers rights, child labor laws and minimum wages are not on the official government agenda, there is no level playing field.
Unless the masses in the third world have purchasing power that begins to approach American standards they do not have the resources to buy superior, and more expensive, American products. The myth of fair trade unravels.
The result is growing trade imbalances. Wealth transfers from America to other countries and societies whose values we do not always respect.
More importantly, who in those other countries actually benefits from trade with America?
There are so many ways we can help countries around the world improve their standard of living and the quality of the global environment. But pretending that “free trade” programs are working is delusional.
Like too many political solutions they fail the test of practicability. The problem is we are too reluctant to throw them overboard when they prove unworkable.
I for one am willing to consider ways that we can make free trade fair. But when the world is a jumble of competing political systems with unequal beneficiaries I am doubtful that it can ever be totally fair.
In that world it is the primary responsibility of our leaders to make sure they are looking out for American citizens first.
I for one am willing to pay a little more for American made products where higher wages to American workers can flow through the American economy.
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