Saturday, July 30, 2005
Economics, Politics, and Sausage
I’m surprised that we do not hear more conservatives asking our policymakers to "just say no". No to diversions from free trade cloaked in the language of trade agreements. No to the pork in the highway bill. And no to a give away to the shareholders of oil companies (which happens to include me in a wee way) financed by deferred tax bills on the kids
Might I plea with him and other conservative economists in joining pro-growth liberals in telling this White House and Congress to cease with such pork paid for by future taxes on the kids?
PGL (and the rest of the crew at Angry Bear) are some of the best econ bloggers; liberal, but with high quality of statistics, research, and thought. This to let the Reader know I am not picking on PGL or Angry Bear. The second element consists of the Author having heard the Ricardian argument for Trade dozens of times. This Author can now present his own view on Free Trade.
Trade can become disadvantageous to One or Both participants, and still serve the basic Ricardian argument. The competition for cheapest Production Costs inherent in the Ricardian argument must be based on actual geoeconomic advantage. A reduction to simple Wage competition reduces Trade Advantage to simple World Wage Averaging, a Concept which sounds great, but is as destructive as most other Income Redistribution schemes devised. The greatest incentive for growth comes from the knowledge that a better, more comfortable life can be attained. World Wage Averaging would actually destroy economic incentive.
Economics used to utilize a concept called prerequisite growth, an idea this Author has not heard of in a long time. The fundamental idea behind this concept states that Social structures can only be developed under a specific structure of economic development. Lack of this economic development will impact future development. Would the Social Security system have ever developed in this Country, without the development and pressure of Unionism? Conservative philosophy says there should never have been a Social Security system in the first place; this Author suggests they invest Time and energy in What If economic modeling, and determine how elimination of the entire Social Security system since 1935 would have affected Personal Income, total Household assets, and the current level of economic development in the United States. Free Trade, backed by extreme Corporate greed, remains the worst Destroyer of prerequisite growth which exists. lgl