Game of Thrones: Japan Looks West
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  • To the extent it does become a truly free trade area it will benefit ordinary people in the poor countries (China, Peru, Mexico, etc) at the expense of ordinary people in the already developed countries (Japan, Australia, Singapore, etc.). Of course it will also benefit the already better-off segments of the population in the rich countries too. After all, they are the ones that are pushing such agreements — they and their paid lackeys in the mainstream media.

    Good journalists like Mead should highlight these trade-offs when discussing this issue. Along with immigration and automation, which are eroding the social fabric of our society and blighting the prospects of ordinary young people.

    All else equal, free trade makes (almost ) everyone better off in all of the countries involved. That’s why I support free trade with Europe and Japan.

    But in a lopsided world of poor and rich countries this is no longer the case. The gains of trade are dwarfed by the losses to labor in every sector of the US economy, which is what we see happening everywhere we look.

    In the best of all worlds we would tax income from capital and subsidize wages, which could leave everyone better off than before. But since that is not about to happen I think we should begin to take seriously the conclusions reached by Paul Samuelson in his classic essay, “Protectionism and Real Wages.”

    • J R Yankovic

      “To the extent the Pacific rim does become a truly free trade area it will benefit ordinary people in the poor countries (China, Peru, Mexico, etc) at the expense of ordinary people in the already developed countries (Japan, Australia, US, etc.).”

      What on earth are you talking about, man?

      All individuals in rich countries, without exception, are as free as birds to profit from the very freest of trade with developing nations – why, so long as they’re willing to become rich! And lest you dare to question my blithe reasoning, remember, pal: In this Bold New World of globally aggregated prosperity, the simple truth (aberrant Obama detour notwithstanding) is that, wherever
      you live, you’re as rich as you wannabe. Of course that may require leaving
      your country(men) way behind, not to
      mention never looking back. So what of it? Nobody ever said the Impregnably Prosperous Future we plan to leave our great-great-great-great-great-great grandchildren wouldn’t involve some brutally hard choices. Now spread your wings and fly, you timid soul.

      More seriously, I do agree with the above comment:

      “Trade between rich countries, it needs to be emphasized, does not
      benefit one class at the expense of another.”

      But given the present global climate, I’d rather stress how it doesn’t have to benefit one class at another’s expense. That, to me at least, would cut most cleanly against the grain of our modern globalist dogmas, which seem to imply that those classes which don’t benefit don’t much matter anyways (hard choices, you know; besides which, what wealth do they create? etc, etc).

      Finally, while I lean towards cheerleading
      for the TPP (for which I’m more grateful than ever to Prof Mead; he’s been one
      of the keenest out there for spotting whatever light there is at the end of our
      present tunnel), I’m also grateful for Mr Lea’s comments. Not to mention the re-opening of comments. As usual he gives a solid, well-thought-out AND thought-provoking counterpoint to a lot of the austerity hysteria making the rounds these days. Not, mind you, that that’s likely to
      stop some Very Serious People from at once setting to work (pretending they’re)
      demolishing his arguments.

    • Jim Luebke

      The problem with taxing capital for redistribution instead of allowing that capital to employ people is simple.

      Money’s power is in its motivating properties. If government simply redistributes money, the transfer of money doesn’t motivate the creation of any goods and services. It doesn’t contribute to the economy.

      On the other hand, if that capital can be profitably invested at a good ROI (ROI is eroded by taxation, by the way), that will employ people. Employment means that the transfer of money is motivating the creation of goods and services. That means there are more goods and services to go around, making everyone better off.

      Whatever comedian said, “I don’t do this for the money… I do it for everything you can buy with the money” is more deserving of a Nobel in economics than any NYT editorial writer.

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