Here’s an oldie-but-goody (from October 2005): Sheldon Richman on government’s response to hurricane Katrina compared to the response of the private sector .
This post by Mish is superb . (HT Matthew Thexton) Here’s a slice:
And as long as you have no realistic alternative to industrialization based on low wages, to oppose it means that you are willing to deny desperately poor people the best chance they have of progress for the sake of what amounts to an aesthetic standard–that is, the fact that you don’t like the idea of workers being paid a pittance to supply rich Westerners with fashion items.
Opps! Sorry. My apologies. The above quotation is not from Mish; rather, it’s from something that Paul Krugman wrote in 1997 , and reprinted by Mish. But now here is Mish, from the same blog post:
At some point since he [Krugman] wrote that, his mind turned to complete mush. Now he is in agreement with Mitt Romney about the need for the US to raise tariffs on China.
The fact of the matter is all [freely entered] trade is good. It has to be. For there to be trade, both buyer and seller get something they want at a price they agree on.
However, assume for a second that is not true.
Assume China or whoever is willingly selling us good “too cheap”. Who benefits from that? Why the American consumer of course.
Unfortunately, Krugman and Mitt Romney alike would rather the cost of underwear, auto parts, toys, shoes, etc. cost double what they cost, in the foolish belief it would bring back US jobs.
Well it won’t. Manufacturing would simply move jobs from China to Vietnam or other places unless the US is willing to start a trade war with the world.
Assuming Romney-sponsored tariffs worked (they wouldn’t) and even assuming the jobs returned (that wouldn’t happen either), would the tradeoff be worth it?
The answer is of course not. A protected few union workers might benefit, but the cost of everything would skyrocket. Those on fixed income and those in non-protected jobs would be hammered. Unemployment would soar.
And that is looking on the bright side. The jobs would not come home, even if the manufacturing itself did.