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Column misrepresents concept of free trade

Originally Published: 10/12/09 8:09pm 3 comments

I disagree with Eric Thieleman’s recent guest column, Service industry killing America (SN 10/8), on several points. In the beginning of his article, Thieleman expresses his concern at the increasing influence that corporate America has on our system of government. He agrees with Michael Moore that “corporate America has a very influential role in American government and that leads to many of our nation’s problems.”

However, by the end of his article, Thieleman is arguing for a return to protectionist trade policies: “Instead of allowing more that 90 percent of items in Wal-Mart (to) come from China and other foreign nations, why don’t we bite the bullet and force those items to be made in America?”

Thieleman asserts that corporations should have less importance in the United States government, and then states that this same government should be made to operate in their favor. This is a direct contradiction — does he favor more corporate influence, or less?

Additionally, Thieleman misunderstands the concept of free trade. At its core, the argument for free trade is this: Free trade stimulates persons, cities, regions and countries to produce what they can produce most efficiently by introducing foreign competition. When everyone is doing what they are best at, the economy can be at its most productive.

The question the United States needs to address is not, “How can industry be revived?” but rather, “What can we produce most efficiently?”

Thieleman argues a return to protectionism and local production of goods would benefit us all. Where, then, does his argument stop?

Clearly Michigan’s economy is struggling because of foreign imports; perhaps it would be prudent to cut off all trade with Ohio, Indiana and Wisconsin? Or perhaps Ingham County should be made into a self-sufficient economic state?

The economic strength of the United States was made possible in part by the free movement of trade across state borders. How are things any different on the international level?

A return to protectionism merely would be a return to the feudal economy of the Middle Ages on a colossal scale.

On an unrelated note, Thieleman also suggests that when someone has been laid off, “on many occasions it is their own doing. The trick is to be indispensable.” How, exactly, is one supposed to do that? I challenge Thieleman to find a job for which he is the only qualified applicant.

In summary, Thieleman’s opinion did not take into account many of the realities of global economics. He also displays some confusion as to whether corporate influence in government is beneficial or problematic.

Clearly, a return to the protectionist trade policies of the past is not the solution to the current economic crisis.

David McWilliams

jazz studies senior


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Me
(10/13/09 9:04am)
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YAY rational thought on the opinion page!


Jason
(10/13/09 9:05am)
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“Clearly Michigan’s economy is struggling because of foreign imports; perhaps it would be prudent to cut off all trade with Ohio, Indiana and Wisconsin? Or perhaps Ingham County should be made into a self-sufficient economic state?

The economic strength of the United States was made possible in part by the free movement of trade across state borders. How are things any different on the international level?”

This whole article is brought down by this section. You clearly have no grasp of the world economy. The reason that Detroit’s auto industry has imploded revolve around two points: increased cost for workers and limited ability to sell globally. Foreign workers work for 1/4 to 1/3 the cost of domestic workers. Couple this with China and Japan enforcing brutal rules to keep American vehicles out of their showrooms. How exactly is this fair and free trade?

The problem is not just limited to Michigan. Silicon Valley and Silicon Hills (Austin) engineering companies are being gutted by foreign companies who pay their engineers ridiculous salaries because they can. American companies in search of the unholy dollar move their engineering to Shanghai, Taipei, or Bangalore. So what’s left here?

No one is suggesting isolationism. But we could start by creating incentives to keep corporations from going overseas with their labor and increasing tarriffs and import restrictions to match what our foreign “partners” are doing. The difference between state trade and international trade is that when states break the rules, the federal government can step in. When China breaks the rules, who fixes it? The UN? Not a chance.

Captialism is great, but when it comes at the expense of the very populace it sustains, eventually you have nothing left.


Jay Edward Tremlett
(10/13/09 2:30pm)
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I’m fat.