Monthly Archives: March 2018

Free trade and the modern left

Posted on by
Reply

From a note I wrote to a friend.
_____

I have had two articles of mine put up at Powerline Picks, one I have done on tariffs and the other on Jordan Peterson, which Peterson himself tweeted a link to. My reason for mentioning them is that by concentrating on all of this, I have had a penny drop that I discussed in a note I wrote to someone else, which might interest you since we are both forever trying to unravel the latest scams and tactics of the left. These were the articles: Economic theory is all right in theory which dealt with tariffs and my Quadrant review of Peterson’s 12 Rules for Life.

Mulling the issues over, thinking of tariffs in the context of Peterson, it has very strongly come to mind that oddly, but almost with certainty, the left are now the big free traders because it is the most certain means they have at their disposal to bring our economies down and Western Civilisation along with it. They are no more pro-market than they have ever been, and in no sense are supporters of entrepreneurial capitalism, but with open borders structured to allow Chinese goods to undermine American manufacturing, especially when accompanied by mass immigration from third world hordes lacking any marketable skills, there has never been a better opportunity to bring the West down, and to do it with the connivance of large elements of the right. I don’t think PDT will have seen things as a coordinated set of actions, and perhaps it is just an uncoordinated series of policies that in sum all end up working in the same direction. Perhaps for him it was merely intuitive, in the same way it has been for me, in recognising what must be done to beat back the left without appreciating what the left is up to. But wherever his approach has arisen from, his actions are all necessary as part of a program to maintain the American economic system and its historical constitutional form of government in place even in the face of the kinds of challenges not even the Soviet Union could mount.

There is no need for a central committee of the left to work this out, but once various elements fall into place and their destructive value is recognised, their aim is to keep them where they are. The madness is that these are parody versions of the traditional policies of the right, which has led to an ocean of opposition from those who would normally be expected to support him. Will need to think these things through some more.

I have had some flack on my shared right-of-centre blog over supporting PDT on tariffs, but the flack really comes from the alliance of the Wall Street Journal and the governments of China, Mexico, Canada and Australia. I don’t know whether Trump sees these things as I now do, or he is just working things through one policy at a time, but I don’t know how this can be fought off. The single most important personal characteristic in looking at Trump may be his personal wealth since he cannot be bribed in the way the entire American Congress is at constant risk of being. If classical economic theory – which he is applying although he may not know that either – were not so accurate in creating wealth and jobs, it would truly be the end of the game for us in the West. It may be anyway, but here we are at least being given something of a respite and an opportunity to fight again another day.

Jordan Peterson in Australia

Posted on by
Reply

https://youtu.be/hcDKNNvUR4I

Sounds just like JBP everywhere else. And here he is talking to Bettina Arndt.

And if you are just looking for the highlights.

And with Leigh Sales on the ABC.

https://youtu.be/MzF0dQgcHBk

And on a supposed comedy interview.

This is how this last interview is described.

Controversial Canadian psychologist Dr Jordan Peterson explains to Tom why keeping his room clean is important, why identity politics suck, and why the ABC should be less Marxist.

And the heading is absolutely right: “Jordan Peterson DESTROYS Tom Ballard.”

And this is the audio from his presentation in Melbourne.

Jordan Peterson with Mark Steyn

Posted on by
Reply

https://youtu.be/4AJqFDaGjhw

From June 2017. About Free Speech. You might even wonder whether this conversation could happen today, never mind a decade from now.

Some quotes from JBP but you need to watch it all for yourself. And there is also Mark Steyn!

“I’ve studied the development of totalitarianism for a very long time and one of the things I know is the issue of ceding control over language, and the Government has carelessly made a precedent and the precedent is compelled speech essentially.”

“I think I am a classical liberal in the old school sense. I am an individualist.”

In reference on the form of sex and gender education that is happening in schools, “people have no idea it is happening. . . . The average person has no idea that it is happening.”

“We take free speech for granted, we actually take our whole civilisation for granted and we don’t understand that it rests on certain foundation blocks and if you remove those blocks all hell will break loose. And I think our civilisation is a whole lot more fragile that people understand and it is also in a lot more peril than people understand.”

“We’re also in a situation right now where your right to say anything about religious beliefs, unless they’re Christian, is seriously in danger, and that’s so dangerous that it’s almost beyond comprehension. It puts us back in Mediaeval times.”

“The patriarchy is just Western Civilisation. Patriarchy is just a code word for that. Governed by their Marxist dogma and post-Marxist dogma, they think it needs to be re-tooled from the bottom up. It makes them natural allies of any other system that opposes our system.”

“Jacques Derrida may be is the most dangerous person of the last forty years.” His writings are the basis for “an all out assault on Western categories of thought. . . . Categorisation is the basis of cognition. And so he has basically made the claim that thought itself is an agent of oppression.”

“As the politically correct movement inches forward. . . . [The Social Justice Warrior types] find a hypothetically vulnerable group – it doesn’t matter what it is – and then they use them as a protective shield while they move incrementally forward and so if you object you are targeted as if you are picking on the poor vulnerable people.”

Why I had stood out was not that I was speaking in generalities but that “I had said there was something I would not do and so had drawn a line so it was the combination of generalities with specificity that made the issue real for people.”

“Many of the kids on the left equate argument for free speech with racism.”

“Why I took these issues on now is because I believe it will be worse later.”

While the world reeled

Posted on by
Reply

https://youtu.be/1-3sFcQo7_w

I was going to keep away from this for a while, but having watched the above last night and then found this in The Oz today, I’m afraid that it’s once more unto the breach dear friends:

“While the world reeled after ­Donald Trump signed off on his trade tariffs …”

Meanwhile, on the editorial page of the very same edition of the very same paper we have: Steel tariffs show Australia isn’t fair dinkum when it comes to fair trade, where we find:

In January an anti-dumping investigation concerning steel ­reinforcing bars imported from Greece, Spain, Indonesia, Thailand and Taiwan concluded that anti-dumping duties ranging from 4 per cent to 42 per cent would be required. They came into effect last Wednesday.

I will leave it then with this. Is it at all conceivable that a country might do something so unfair that another country would then justifiably put on a tariff, or increase an existing tariff, as a means to limit some potential harm? No? OK. Yes? Then when might that be?

And just for added irony, in 1778, Adam Smith, yes that Adam Smith, was appointed as commissioner of customs in Scotland.

How to deal with an Alpha dog

Posted on by
Reply

The last three of 34 from The Art of the Deal on the International Stage. It’s about the US and Chinese relations.
__________

32. Facing a Red Dragon who wears a Panda mask is a challenging enterprise. ONLY, for this U.S. administration, President Trump has dealt with this level of Beijing *cultural thinking* before.

33. When it comes to the use of economic leverage to create U.S. national security outcomes, well, we are learning at the knee of an economic master player. The media will now do everything they can to stop people from realizing how effective President Trump is…

34. End

 

The sharpest statement on Russian collusion in the American election

Posted on by
Reply

https://youtu.be/CYVzxYqfGlI

An article you only need to read if you aren’t the slightest bit interested in reading what it says. From Diana West: Is it a surprise to find a Stalin apologist at the center of the Steele dossier scandal? This gets to the very core:

I asked a retired (Cold War vintage), extremely experienced intelligence professional what he thought of the news of the day (which is still the news of the day): that the Russians “hacked” the DNC, and therefore “hacked” the election. He replied that the Russians were more than good enough to mask any such activity if they wanted to; further, they were more than good enough not to mask such activity if they wanted to.

Russian collusion in American elections runs through ABC, CBS, NBC, CNN, the NYT and Washington Post. False flag ops to their very core. Willing stooges on behalf of the enemies of Western civilisation. Seriously, is there anyone more objectively on the side of Russian interests than Rachel Maddow? So let me quote from the end of the article:

Isn’t it at least conceivable that the Putin-wants-Trump line contradicts sensible Kremlin strategy? To me, Putin-wants-Trump (who wants next-generation nuclear anything he can get) sounds like a classic Moscow influence operation, another iteration of “fake newski” to manipulate the ignorant West. From Lenin is a capitalist, to “Uncle Joe” supports religious freedom, to Andropov likes jazz, to Putin (ruthlessness incarnate) is a devout Christian: We fall for it every single time.

If I am correct, where does that leave this Russian-American disinformation campaign, paid for by the DNC/Clinton campaign, assisted in still-mysterious ways by Stalin apologist Ohr, now developing the rigor mortis of Washington conventional wisdom? Four legs good; two legs bad. Putin loves Trump, Putin hates Hillary — and here’s the “dossier” to prove it and “collusion,” too.

Which is worse: to be a traitor or stupid and ignorant? Morally the answer is obvious, but in practical terms, it doesn’t mean a thing?

Pandering to ignorance

Posted on by
Reply

“Just woke up—anything bad happen yet?”

This is from the Financial Times, sent to me by my Porsche-driving California-based Silicon Valley high school friend who finds it his mission in life to complete my day with the worst of Donald Trump. The certainty is that if I returned the favour, my email account would be instantly blocked, but I let it continue for its interest. He is a perfect representation of the anti-Trump madness and is highly instructive. The cartoon is from him as well, and truly puts you in mind of the mindset. The story today is from the Financial Times in London, comes with the heading, “Trump, Kushner and the businessman fallacy” and this is how it starts.

When Warren Harding was 19, in 1884, he bought a small Ohio newspaper, probably for $450. By the time he ran for president in 1920, it had made him rich. Harding campaigned as an entrepreneur, promising “less government in business and more business in government”. He is often described as the worst US president, until now.

C’mon, we’ve had Carter and Obama since that time, but as with all media, for the past hundred years the best Republican is automatically ranked lower than the worse Democrat. But as it happens Harding was among the best, and it was his handling of the recession of 1920-21 for which he is best remembered, or by the likes of my mate and the Financial Times, best forgotten. Try this instead: How Government Inaction Ended the Depression of 1921.

Warren Harding was philosophically inclined to oppose government intervention and believed a downturn of this kind would work itself out if no obstacles were placed in its path. He declared in his acceptance speech at the 1920 Republican convention:

We will attempt intelligent and courageous deflation, and strike at government borrowing which enlarges the evil, and we will attack high cost of government with every energy and facility which attend Republican capacity. We promise that relief which will attend the halting of waste and extravagance, and the renewal of the practice of public economy, not alone because it will relieve tax burdens but because it will be an example to stimulate thrift and economy in private life.

Let us call to all the people for thrift and economy, for denial and sacrifice if need be, for a nationwide drive against extravagance and luxury, to a recommittal to simplicity of living, to that prudent and normal plan of life which is the health of the republic. There hasn’t been a recovery from the waste and abnormalities of war since the story of mankind was first written, except through work and saving, through industry and denial, while needless spending and heedless extravagance have marked every decay in the history of nations.

Harding, that least fashionable of American presidents, was likewise able to look at falling prices soberly and without today’s hysteria. He insisted that the commodity price deflation was unavoidable, and perhaps even salutary. “We hold that the shrinkage which has taken place is somewhat analogous to that which occurs when a balloon is punctured and the air escapes.” Moreover, said Harding, depressions followed inflation “just as surely as the tides ebb and flow,” but spending taxpayer money was no way to deal with the situation. “The excess of stimulation from that source is to be reckoned a cause of trouble rather than a source of cure.”

You know the Roaring Twenties. With PDT as president, we may end up with our own version. Harding died in 1923 so this period of prosperity is attributed to Coolidge, but it was Harding who set the prosperity in place. As for the Financial Times, like with my Californian mate, ignorance gives them peace of mind, but hopefully is not contagious.

A lesson in trade theory

Posted on by
Reply

“Every economic answer is a political question.”

Here then is a question for all you experts on international trade, taken directly from my Free Market Economics [pp. 248-249]. Picture two countries, A and C.

Suppose in Country A, in one hour it can produce either one car or 1000 shirts. [It’s also the same answer if Country A can produce ten cars and 10,000 shirts per hour!]

Meanwhile in Country C, in two hours it can produce either one car or 500 shirts.

According to the economic theory of comparative advantage, how many cars will Country A produce? OK, once you’ve worked that out, now tell me if you get the same answer using common sense. As chrisl said, “economic theory is all right in theory”. Personally, I’m not even sure of that, but you get the idea.

So here’s the thing. It is entirely possible that the US is tired of carrying most of the burden for the defence of the West and would like a bit of sharing the burden. It might also find some respite for itself in strengthening those parts of its economy which are more closely associated with its defence industries. And it might even wish for some kind of gratitude from others, supposedly on the same side, in trying to assist the US in resurrecting its strength. And then there are the straightforward economic issues, which are not the same as the political. So let us go to these.

And of course the issue economically is comparative advantage, and not pure let the most efficient producer produce each product. With comparative advantage, it is not always the most efficient low-cost producers who produce. If you don’t even understand that, you should keep right out of this debate.

Why encourage free trade:

  • competition is what drives improvement and growth – without competition most businesses would just coast along to the fullest extent they could
  • innovation is driven by competition – the way to take on an established business is to find a better way to do something
  • all other things being equal, free trade is best

Why “free trade” is not working for the US:

  • cheating is rife – try to sell an American car in Japan – not possible for all kinds of products in all kinds of countries
  • many countries subsidise exports while imposing non-tariff barriers to trade on imports along with tariffs themselves
  • currency manipulation – artificially holding exchange rate lower to discourage imports and encourage exports is not unknown
  • $US is world reserve currency it is unable to adjust to repair a balance of payments deficit
  • there are many forms of approved trade restrictions everywhere you look – the EU for example – such as:

Trading blocs

A regional trading bloc is a group of countries within a geographical region that protect themselves from imports from non-members. Trading blocs are a form of economic integration, and increasingly shape the pattern of world trade. There are several types of trading bloc:

Preferential Trade Area

Preferential Trade Areas (PTAs) exist when countries within a geographical region agree to reduce or eliminate tariff barriers on selected goods imported from other members of the area. This is often the first small step towards the creation of a trading bloc.

Free Trade Area

Free Trade Areas (FTAs) are created when two or more countries in a region agree to reduce or eliminate barriers to trade on all goods coming from other members.

Customs Union

A customs union involves the removal of tariff barriers between members, plus the acceptance of a common (unified) external tariff against non-members. This means that members may negotiate as a single bloc with 3rd parties, such as with other trading blocs, or with the WTO.

World Trade Organisation

There are then the WTO rules of trade engagement which are not designed to create a world where free trade is on the only answer. The rules were devised when the US economy was a lot more robust than it now is, and when the US was both willing and able to make sacrifices of all kinds to help others withstand the spread of communism. None of this is applicable today. The US is therefore no longer willing to watch others cheat their way into a stronger trade position, at the cost of its own national security, economic strength and domestic employment. Here is part of what the WTO is up to.

WTO Rules

1. Most-favoured-nation (MFN): treating other people equally Under the WTO agreements, countries cannot normally discriminate between their trading partners. Grant someone a special favour (such as a lower customs duty rate for one of their products) and you have to do the same for all other WTO members.

2. National treatment: Treating foreigners and locals equally Imported and locally-produced goods should be treated equally — at least after the foreign goods have entered the market. The same should apply to foreign and domestic services, and to foreign and local trademarks, copyrights and patents.

3. Developing countries have transition periods to adjust to the more unfamiliar and, perhaps, difficult WTO provisions — particularly so for the poorest, “least-developed” countries – so these basket case economies are allowed to whittle away at the economic strength of the developed world.

Meanwhile, economic ministers around the world increase unproductive public spending every chance they get, add new regulations on top of old, and increase business taxes at every turn, and then job on their chairs screaming, “Eek, a tariff!’

The quote at the top, by the way, is from Joan Robinson, who has quite a lot to say about free trade that ought to be read by the economic illiterates who populate the world, who are now found speaking on behalf of the status quo, as harmful as the status quo is to most of the lower half of the income distribution. Robinson was not just a Keynesian but also a big supporter of Mao, so I’d be very careful, but the above quote seems as accurate as anything else you are likely to hear about economics.