An (Indomitable) Argument for Protectionism

Leave a comment


Seagate Wuxi China Factory Tour

Protectionism helps us at home and our friends abroad

The expired Multi-Fiber Arrangement left thirty million people across the world unemployed.  These workers were unfortunate victims of globalized free trade.  Free trade leads us to believe that goods should always be produced by the firms competing under pure capitalist conditions.  This idea is not wrong; it is only the dangers of free trade should be mitigated in emerging markets around the globe to give them the opportunity to succeed.  Protectionism, the antagonist of free trade, is the solution to best prepare infant industries and emerging economies anywhere in the world; this policy employees more denizens, produces stronger industries, and cultivates stronger markets than free trade ever could.

Inefficiency creates more jobs.  If the entire world can exploit a market then only those countries with the most efficient industries will be able to sell.  Protectionism erects a wall of tariffs that prevents foreign goods from ever contaminating domestic markets by driving prices up to an inclusive level for domestic products.  Under protectionism, small industries gain a foothold, bloom, and employ more denizens in every country across the world.  There are minor concessions; on a global level less of goods are produced and the cost is driven up slightly as well.  These negligible effects diffused throughout the consumer markets means the world to the now employed workers who can support their families.  Protectionism is more humane than free trade.

Stronger industries are built under the shield of protectionism.  Behind a wall of tariffs the United States built mighty firms of  industry that dominated the world for the second half of the twentieth century.  Preceding the Americans, the British had done the same when the pioneered the Industrial Revolution and built an empire upon which the sun never set.  Since the 1970’s China used numerous protectionist policies, notably keeping its currency artificially low.  It is predicted to have the world’s largest GDP by 2020.  Examples of booming economies that got their start in free trade are scare.  Columbus and Admiral Perry opened up trade to the Americas and East Asia respectively.  In both countries widespread exploitation of natives and complete sterilization of domestic industries ensued following the introduction of cheap free trade imports.  Free trade is a tool of the strong to stay in power and collect wealth; for weaker nations and industries free trade is a poison which cripples.

Stronger markets evolve under protectionism.  Protectionist policies protect infant industries and prevent exploitation of weak economies.  In an international market of free trade monopolies are certain to emerge.  Monopolies are established when there is not industrial competition.  This problem hurts everyone.  Consumers suffer from an inferior product; without the Darwinian survival of the fittest threat the producers have no incentive to innovate.  Marginal producers are harmed.  Any attempts to breach the market are squelched under the monopoly.  The monopoly hurts itself through stagnation.  Protectionism is the best means in a globalized economy to give marginal producers and infant industries the time to create a profitable industries despite the monopolies.  Consumers and marginal producers benefit from better products and pay checks while potential monopolies are broken out of self-defeating cycles of stagnation.  Protectionism helps everyone.

Protectionist protects countries.  It harbors citizens and gives them jobs.  It cultivates infant industries under a cocoon of tariffs.  Better products and firms are brought to market thanks to protectionism.  It seems almost silly to even think about introducing globalized free trade to emerging economies; it corrupts infant industries and kills jobs.  If it were not for multinational corporations, who preach fallacious free trade to all for a better profit margin, protectionism would indisputably hold in its rightful place as protector of firms, consumes, and employees.

Advertisements

Developing Countries Hoodwinked: Ditch (of) Free Trade

Leave a comment


3rd world work force
While free trade is the optimum interdependence policies of developed countries it does not aid developing nations.

Free trade endeavors to help workers in developing countries; the problem is that it cannot succeed in our cut-throat, capitalist world.  When corporations go into developing countries they are not being philanthropic: they want to make money.  In order to succeed in our globalized world, companies purge themselves of humanity and squeeze every last cent out of their production.  This is not necessarily good or bad, it is just how the world of business works.

Growths of industries in developing countries create working class jobs.  This class of jobs is both rudimentary and menial.  Some examples are textiles, agriculture, and manufactured devices.  They do not build human capital or financial gains; they are effectively powerless to better themselves.  Karl Marx mourns them as: “that class of modern wage labourers who, having no means of production of their own, are reduced to selling their labour power in order to live.”

These laborers in developing countries, who have opened themselves to free trade, are arrested by wage slavery.  Their occupations pay them just enough to live, but not a cent more.  Free trade, cut-throat capitalism, and nations full of alternative workers guarantee that payrolls will be capped at the living wage.  Budding domestic industries, termed infant industries, are unable to thrive because full-fledged foreign competition steamroll over them.  Once infected by free trade developing countries are in an unfavorable position to ever become developed.

Ayn Rand, the most important philosopher on capitalism, believes that free trade is along the optimal path for economics.  However, she also knows that under free trade, “the good of some men takes precedence over the good of others, with those others consigned to the status of sacrificial animals.”  Developed countries are benefited, while developing countries are left by the wayside.

In conclusion, free trade is not the solution for developing nations because it polarizes their populations into numbed working classes, trapped in loops wage slavery and human capital erosion until a new force, perhaps protectionism, stems the drudgery.  If not, developing nations are, “consigned to the status of sacrificial animals.”

%d bloggers like this: