Saturday, August 02, 2008

Trade and History

And so it goes

The Doha round bombed because of the agriculture subsidies that everyone gives to their farmers. It used to be that agriculture made money for peoples, now it cost monies. Free trade helps those that buy stuff (everyone) and hurts those that make stuff (not everyone). The problem is that the makers of stuff, in this case the farmers, are well-organized and therefore have the upperhand in lobbying and information control (eg the masses are ignorant on the economics of trade).

Workers had a converstation the other day with a genius engineer with at least one patent to his name. This engineer wanted the USA to be self-sufficient in agriculture, as thought that 'dependency' on another country might cause mass starvation in the US. Leaving aside the fact that our foreign policy is aggressive and if it wasnt so then my friends concerns wouldnt even be an issue, why would producers not want to sell if there was free trade? In other words, producers of goods want to sell and are not interested in hording (not selling) just to hurt others. In fact the more economically interdependent the world is the more peaceful it is.

If you peel back the onion so to speak, you can either be cynical and say that our government does not want peace, or, if not cynical just say that we elect the econonically ignorant cause we don't know any better, and it doesnt really effect us day-to-day. The lack of trade due to government thwarting of liberty is not really unique to today nor to democracies. In fact government control of the economy is called mercantilism and is what Adam Smith wrote against in the Wealth of Nations in 1776. Plus ca change.