Tag Archives: Free Trade

News

Obama’s naive trade policy angers Canada, China, France, Mexico, etc.

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The economic effects of massive government waste and naive protectionism
The economic effects of massive government waste and naive protectionism

(Source: Wall Street Journal)

The Wall Street Journal explains the high costs of economic ignorance.

Excerpt:

The smell of trade war is suddenly in the air. Mr. Obama slapped a 35% tariff on Chinese tires Friday night, and China responded on the weekend by threatening to retaliate against U.S. chickens and auto parts. That followed French President Nicolas Sarkozy’s demand on Thursday that Europe impose a carbon tariff on imports from countries that don’t follow its cap-and-trade diktats. “We need to impose a carbon tax at [Europe’s] border. I will lead that battle,” he said.

Mr. Sarkozy was following U.S. Energy Secretary Steven Chu, who has endorsed a carbon tax on imports, and the U.S. House of Representatives, which passed a carbon tariff as part of its cap-and-tax bill. This in turn followed the “Buy American” provisions of the stimulus, which has incensed much of Canada; Congress’s bill to ban Mexican trucks from U.S. roads in direct violation of Nafta, prompting Mexico to retaliate against U.S. farm and kitchen goods; and the must-make-cars-in-America provisions of the auto bailouts. Meanwhile, U.S. trade pacts with Colombia, Panama and South Korea languish in Congress.

The article goes on to explain how the Smoot-Hawley tariff helped cause the Great Depression. This is exactly the path that President Teleprompter is treading. He is taking us head-first into the next Great Depression because he knows less about economic policy than my keyboard. He did legal work for ACORN, for God’s sake – have you seen who ACORN hires? I’m sure that woman can read a Teleprompter, too.

What do economists think of Obama’s economic policies?

I noticed this post on Greg Mankiw’s blog, where links to a survey of economists.

Click here to read the results of a new survey of AEA members. This updates previous survey results, summarized in Chapter 2 of my favorite textbook.

Note that 83 percent agree that “the United States should eliminate remaining tariffs and other barriers to trade.” I presume that would apply to tariffs on Chinese tires.

Greg Mankiw is a Harvard University professor of economics.

UPDATE: New Michele Bachmann video!

Wow, is she ever pretty when she’s explaining free trade! Sigh.

Podcasts

MUST-LISTEN: Dr. Jennifer Roback Morse explains basic economics!

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Wow, I thought that her earlier podcast on marriage and family was good.

This new podcast is a MUST for social-conservatives who nevertheless like big government, taxing the rich, public schools, and single-payer health care. I listened to this twice already, and it’s going to become one of my favorites for sure!

The MP3 file is here.

Topics:

  • The study of economics is anti-postmodern – there is objective truth independent of what people think
  • The study of economics believes in fixed principles of human nature
  • Economics studies the allocation of scarce resources that have alternative uses
  • Economics studies how people exchange resources
  • How both people who engage in a voluntary trade always believe that they will be better off
  • How both people who engage in a voluntary trade both benefit from the exchange
  • How incentives motivate people to act
  • Understanding supply and demand
  • Understanding how “free” government services are rationed
  • Understanding opportunity costs
  • How prices signal producers to produce more or less, and consumers to buy or not buy
  • Market-driven prices versus price controls
  • The role of substitution
  • The necessity of allowing failure in a free market

The requirements of economic growth:

  • private property
  • contracts
  • the profit motive
  • competition
  • free trade
  • entrepreneurship, creativity and innovation
  • the rule of law

DOWNLOAD THE PODCAST. LISTEN TO THE PODCAST. REPEAT.

The Ruth Institute accepts donations. I sent her TWO already this year. She does on-campus events, just like William Lane Craig. If you want to have an impact on the university, she should be considered for funding.

You can find more economics lectures at the Acton Institute.

News

Canada signs free trade deal with Panama, tracks Russian subs on east coast

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Two pieces of good news for our neighbor to the North.

First, while Obama has been embracing protectionism, Canada has signed yet another free trade deal.

CTV News reports:

Canada has signed off on a free-trade agreement with Panama, which will immediately slash tariffs on a number of Canadian exports.

Excerpt:

[…]The new agreement with Panama will cut more than 90 per cent of tariffs on various Canadian exports, including agricultural exports and high-tech machinery. Any remaining tariffs will be eliminated within 10 years under the terms of the deal.

Beef producers will also benefit, as Panama will lift a six-year-old ban on Canadian beef as part of the deal, CTV’s Roger Smith said Tuesday.

[…]Beyond reducing tariffs on export goods, the deal will help Canadian businesses gain greater access to the Panamanian market, Smith said.

[…]Panama is the eighth country to reach a trade pact with Canada in the past year. Canada has also reached trade deals with four European countries and Peru. Similar deals with Colombia and Jordan have been signed, but not implemented.

Previously, I wrote about Obama’s naive protectionism. Anti-free-trade policies (= protectionism) is the kind of policy favored by people who do not know the first thing about economics. Being anti-free-trade is right up their with being pro rent-control. We are talking about amazing levels of economic ignorance, coupled with pandering to his ignorant special interest groups.

CTV also reports that Canada’s anti-submarine warfare (ASW) aircraft detected nuclear-powered (= quiet) Russian attack submarines patroling off the east coast.

Frankly, I am surprised that Canada was able to detect Akula class SSNs by using airborne ASW aircraft. I’ve used the S-3 Viking and the P-3 Orion fixed-wing platforms before, (as well as helicopters), and this CP-140 doesn’t look much different. If I had to bet, I would bet that they got the contact on the SOSUS network and that this press release is fudging things to make the Canadian forces look more effective than they really are.

Excerpt:

It’s unclear whether Canada took the initiative to have a CP-140 Aurora patrol plane watch the vessels, or whether there was a request from the U.S. Northern Command which tracks submarines.

My guess is that this is a SOSUS contact that was delegated to the Canadians for PR purposes. I just don’t believe that you are going to get a contact cold on an Akula-class attack submarine from a fixed wing aircraft. Akulas are quiet. These are not SSBNs like a Typhoon class – they much smaller. ASW aircraft are usually brought in after a sonar contact – otherwise you’re just wasting sonobuoys looking for a needle in a haystack.

Did you guys miss the story from earlier this year about Canada chasing off Russian bear aircraft?