Sunday, November 28, 2010

the oft-repeated argument

I read this Post of Don Boudreaux on Trade, and think how much people organize their own arguments on Trade, never directly answering the charges of other people. I here want to declare there is nothing wrong with the Boudreaux argument, just with the concerns which he does not address. I would like to get a more balanced prospective on the issue of Trade, if it can be devised. Understand my opponents will declare I am just as evasive as what I criticize simply because I have not answered some of the key questions which they would declare as paramount. It is not easy to get discussion, kids!

Almost every Country in the World has a different Price structure and given standard of living. This means that Wage scales must differ from country to country, simply to maintain the Living Standard customary to the Country. International Corporations recognize this fact, and alter their Price schedules country by country to maximize both Sales and Profits. They refuse to follow this program wherever possible when it comes to Wages, where it would cost them Profits. They also happen to do this with taxation, not paying the Tax rates consistent with the their activity in the country in question through false Income reportage. There is also no doubt there is a Carbon Consumption to Trade as well; I estimating that every Trade Dollar adds about 7 Ounces of Carbon Emissions from Transportation to the Carbon Emissions of actual Production; out of which almost 4 Ounces of Transportation Carbon Emissions could be eliminated by domestic production.

An uniform Tariff of 6% would have the impact of an Operating Cost on the actual Business format. Yet it would make domestic production 6% more profitable versus foreign production. The gain to Living Standard maintenance could reach almost double this amount of Profit over the Long-Run, as added domestic Wages increased the consumption of Business products. It is time to recognize that Trade is not the salvation of the economy, or is it the Savior of Business Profits. A tariff also possesses the capacity to suppress unnecessary foreign Products purchased by the domestic Consumers, all due to the added Cost; something which will lead domestic Producers to concentrate on Products devoted to fulfillment of domestic Consumer desires. I await the widespread Protest to my truisms. lgl

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