March 12, 2010
-- by Dave Johnson
Pat Buchanan has a column today on manufacturing, The Disemboweling of America, that hits the nail on the head. In fact, if I fairly excerpt enough of the column and send you over to read it, my work here is done. For today.
Buchanan begins by outlining just how much our country has lost by allowing others, particularly China, to take over manufacturing.
Though Bush 41 and Bush 43 often disagreed, one issue did unite them both with Bill Clinton: protectionism.
Globalists all, they rejected any federal measure to protect America's industrial base, economic independence or the wages of U.S. workers.
. . . From 2000 to 2009, industrial production declined here for the first time since the 1930s. Gross domestic product also fell, and we actually lost jobs.
In traded goods alone, we ran up $6.2 trillion in deficits — $3.8 trillion of that in manufactured goods.
And what are the implication of this loss of manufacturing?
. . . for every dollar we send abroad for oil or gas, we send $4.20 abroad for manufactured goods. Why is a dependency on the Persian Gulf for a fraction of the oil we consume more of a danger than a huge growing dependency on China for the necessities of our national life?
... How many know that every modern nation that rose to world power did so by sheltering and nurturing its manufacturing and industrial base...
. . . No nation rose to world power on free trade. ...
Nations rise on economic nationalism; they descend on free trade.
Buchanan wrote an excellent, important column today and I encourage readers to click through and read the whole thing.
So, this "free trade" stuff has worked out for us about as well as the "free market" stuff worked out for the economy. Free market and deregulation ideology destroyed the economy. Free trade has destroyed our ability to earn money and recover from the destruction of the economy.
It is time to formulate a national industrial policy/economic strategy, impose tariffs as necessary to balance trade - especially in the case of Chinese currency manipulation - and set up taxes and penalties to stop companies from moving any more manufacturing out of the country.
Posted by Dave Johnson at March 12, 2010 11:27 AM
This article is so fallacious, I do not know where to begin. As far back as the nineteenth century, economists have known that specialization according to comparative advantage has been the way to maximize a country's wealth. Pat Buchanan is absolutely wrong that "nations rise on economic nationalism": in fact, most countries lack both the quantity and sheer variety of natural resources to be entirely self-sufficient.
He may well have a point that it is unwise to depend entirely on a region whose demagogic rulers may cut our oil supply at a moment's notice - THEORETICALLY. In practice, however, it is because we buy oil from these despots in the first place that they have been reticent to explicitly act on their demagogery. I would posit that the reason they spew hate from the pulpit, while simultaneously selling us oil by the mega-gallon, is that the rhetoric of hate is politically useful. Yet these rulers are smart enough to realize that to lose the Western world as a market would be just as crippling to them as to us.
I really like the bold assertions made by both Buchanan and Johnson, though. Indeed, I find nothing is so convincing as one's arrogant insistence on being right, without offering any evidence other than the conviction of their opinion that they are. Also, it is...I guess "cute" is the best word...that free trade and free markets are put in quotes. There is nothing as indicative of the utter intellectual bankruptcy of the writer as his demonization of the two most powerful mechanisms for creating wealth - especially for the poorest among us - because the processes inherent in those mechanisms sometimes yield results that do not satisfy his sanctimonious notion of "how things ought to be."
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