Free Trade vs Protectionism
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  Free Trade vs Protectionism
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Question: Which do you believe is the best economic policy.
#1
Free Trade
 
#2
Protectionism
 
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Total Voters: 62

Author Topic: Free Trade vs Protectionism  (Read 13838 times)
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shua
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« Reply #50 on: January 13, 2012, 01:48:13 PM »

Protectionism for export-based countries, Free Trade for import...based (you know what I mean) economies.
That almost seems backwards.  The best argument for protectionism is when you have a country that is flooded with imports and you want to encourage domestic industry. If you have an exporting economy already, protectionism's tendency to start trade wars will be more damaging.
Yeah I should have said "if you [want] to have..."  My bad.
I'm not sure what you're saying then.

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Yelnoc
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« Reply #51 on: January 13, 2012, 08:47:06 PM »

Protectionism for export-based countries, Free Trade for import...based (you know what I mean) economies.
That almost seems backwards.  The best argument for protectionism is when you have a country that is flooded with imports and you want to encourage domestic industry. If you have an exporting economy already, protectionism's tendency to start trade wars will be more damaging.
Yeah I should have said "if you [want] to have..."  My bad.
I'm not sure what you're saying then.


Tariffs should be used to foster home grown industry, while free trade should be supported if one's economy is not export-based.
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Gustaf
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« Reply #52 on: January 13, 2012, 08:59:44 PM »

Why is it an "economic massacre"? If it is, how come the Western manufacturing and farming industries are complaining so much?

Because complaining is part of business. Especially if you're a farmer, but also if your a businessman in general.

I call it an economic massacre when we sell parts if our chicken to western Africa so cheap that it destroys their own agricultural market, which is the only sector they have that may be competitive in the near future on the world market. But they need to improve it first, what they can't when they are flooded with our agricultural goods. Therefor, tariffs would help them.

But...that's only happens because we heavily subsidize our agricultural sector. Congratulations, you just made the argument for free trade for me!

If you think it is realistic for protectionism to apply only to poor countries but not to rich and powerful ones I'm not sure where you're coming from...
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shua
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« Reply #53 on: January 17, 2012, 10:26:57 PM »

Protectionism for export-based countries, Free Trade for import...based (you know what I mean) economies.
That almost seems backwards.  The best argument for protectionism is when you have a country that is flooded with imports and you want to encourage domestic industry. If you have an exporting economy already, protectionism's tendency to start trade wars will be more damaging.
Yeah I should have said "if you [want] to have..."  My bad.
I'm not sure what you're saying then.

Tariffs should be used to foster home grown industry, while free trade should be supported if one's economy is not export-based.
I don't see the distinction here.  If your economy isn't focused on exporting goods, it's probably focusing on home grown industry for home markets, right?  What kind of economy is neither, where you think free trade should be supported?
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republicanism
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« Reply #54 on: January 19, 2012, 11:09:05 AM »

But...that's only happens because we heavily subsidize our agricultural sector. Congratulations, you just made the argument for free trade for me!

Fair enough.

I'*m pretty sure though, that even without any subsidies our industrie and agriculture will compete the third world into the ground.

But at the very last, third world countries should be allowed to implement tariffs as long as the EU and the US subsidize their agriculture. You should agree with that?
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Yelnoc
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« Reply #55 on: January 19, 2012, 03:24:06 PM »

Protectionism for export-based countries, Free Trade for import...based (you know what I mean) economies.
That almost seems backwards.  The best argument for protectionism is when you have a country that is flooded with imports and you want to encourage domestic industry. If you have an exporting economy already, protectionism's tendency to start trade wars will be more damaging.
Yeah I should have said "if you [want] to have..."  My bad.
I'm not sure what you're saying then.

Tariffs should be used to foster home grown industry, while free trade should be supported if one's economy is not export-based.
I don't see the distinction here.  If your economy isn't focused on exporting goods, it's probably focusing on home grown industry for home markets, right?  What kind of economy is neither, where you think free trade should be supported?
A service-based economy.
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Gustaf
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« Reply #56 on: January 19, 2012, 06:34:13 PM »

But...that's only happens because we heavily subsidize our agricultural sector. Congratulations, you just made the argument for free trade for me!

Fair enough.

I'*m pretty sure though, that even without any subsidies our industrie and agriculture will compete the third world into the ground.

But at the very last, third world countries should be allowed to implement tariffs as long as the EU and the US subsidize their agriculture. You should agree with that?

Why would they out-compete the third world?

As for the second point, I guess any country is allowed to do whatever. But since the tariff hurts the country itself it's a bit silly and I think overall free trade would be a better solution.
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republicanism
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« Reply #57 on: January 25, 2012, 07:01:54 AM »

Why would they out-compete the third world?

Much, much higher productivity and much, much better infrastructure.

As for the second point, I guess any country is allowed to do whatever. But since the tariff hurts the country itself it's a bit silly and I think overall free trade would be a better solution.

Sadly, many third world countries are not allowed to do whatever they want, because they receive money from the WTO/IWF.
And the western countries, who rule these organizations, force them to open their markets, while they themself keep subsiding their agriculture and industry. Shameful even from a free market capitalist point of view.
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phk
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« Reply #58 on: January 25, 2012, 04:28:19 PM »

Free trade all the way. Protectionism is xenophobic.
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k-onmmunist
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« Reply #59 on: January 25, 2012, 05:00:29 PM »

Free trade all the way. Protectionism is xenophobic.

This would be annoying if I didn't know you better.
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morgieb
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« Reply #60 on: January 26, 2012, 08:03:27 AM »

Free trade, but make it like fair trade.
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phk
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« Reply #61 on: January 27, 2012, 03:22:12 AM »

Free trade, but make it like fair trade.

Free Trade = Fair Trade
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Joe Republic
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« Reply #62 on: January 27, 2012, 03:24:33 AM »


No.

http://en.wikipedia.org/wiki/Fair_trade
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Napoleon
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« Reply #63 on: January 27, 2012, 03:30:57 AM »


 http://en.wikipedia.org/wiki/FairTax

Putting the word "fair" in the name doesn't make it so.
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Joe Republic
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« Reply #64 on: January 27, 2012, 03:47:16 AM »
« Edited: January 27, 2012, 03:55:13 AM by Joe Republic »

That may be a 'fair' point, but I was merely correcting phk (who was under the impression that both terms were synonymous) on morgieb's behalf.
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Southern Senator North Carolina Yankee
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« Reply #65 on: January 27, 2012, 07:17:36 PM »

I am pretty sure phk knows the dictionary definations and was trying to make a point with that statement.
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shua
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« Reply #66 on: January 29, 2012, 05:39:36 PM »

That entry has to do with promotion of certain products and no relation to trade policy.
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freefair
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« Reply #67 on: February 12, 2012, 02:40:51 PM »
« Edited: February 12, 2012, 02:46:59 PM by freefair »

Multilaterally agreed Global Free trade with protectionist retaliation (and of course a floated currency), because it promotes global economic interdependence and understanding of other nations, spreads the wealth naturally, and can help isolated nations become free, happy, wealthy, and find a place in the world. It aids global economic efficiency and productivity, and encourages competition that leads to innovation.
And though it has been said before, it is far and away the best way to promote world peace , better than global socialism, religion, nationalism or forced tolerance.
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Redalgo
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« Reply #68 on: February 12, 2012, 06:44:08 PM »

I lean strongly toward free trade, but am more comfortable when environmental and labor items are negotiated into agreements. In most cases I would also be alright with developing countries sheltering some of their core industries from rigorous foreign competition, though later down the road when the countries in question are better off I would want more trade barriers to fall away.
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🐒Gods of Prosperity🔱🐲💸
shua
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« Reply #69 on: February 16, 2012, 03:05:33 AM »

I lean strongly toward free trade, but am more comfortable when environmental and labor items are negotiated into agreements. In most cases I would also be alright with developing countries sheltering some of their core industries from rigorous foreign competition, though later down the road when the countries in question are better off I would want more trade barriers to fall away.
This is pretty much my position as well.
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Polsci
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« Reply #70 on: February 20, 2012, 01:31:10 AM »

To be fair to protectionism, America only really got into free trade during Grover Cleveland's two non-consecutive terms, and even them they were only marginal and ineffective.  Only in the 20's did it start showing up again and Calvin Coolidge was against lower tariffs.  It was a major Republican belief up until the second world war.  If protectionism prevented business from doing business, then it is hard to see how the United States was able to decisively enter world war one or two.  During McKinley's administration the budget was doing so good he actually raised the tariff to reduce the money the fed was taking in [because back in those days our government was run only on tariff revenue] and so it worked while also acting as an incentive to move factories to the U.S. and build in the U.S.  The trick of protectionism is that it says you can be a foreign company, and as long as you produce in the U.S. you can keep your money.  So instead of moving one factory to another location, you build another factory to supplement the first one.  Pure protectionism doesn't work and I personally prefer fair trade, but I had to take a protectionist stance for the sake of argument.
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Tidewater_Wave
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« Reply #71 on: March 04, 2012, 12:18:58 AM »

I'm a free market physiocrat on trade. The U.S. can compete with proper policies in place.
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Southern Senator North Carolina Yankee
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« Reply #72 on: March 04, 2012, 12:53:55 AM »

To be fair to protectionism, America only really got into free trade during Grover Cleveland's two non-consecutive terms, and even them they were only marginal and ineffective.  Only in the 20's did it start showing up again and Calvin Coolidge was against lower tariffs.  It was a major Republican belief up until the second world war.  If protectionism prevented business from doing business, then it is hard to see how the United States was able to decisively enter world war one or two.  During McKinley's administration the budget was doing so good he actually raised the tariff to reduce the money the fed was taking in [because back in those days our government was run only on tariff revenue] and so it worked while also acting as an incentive to move factories to the U.S. and build in the U.S.  The trick of protectionism is that it says you can be a foreign company, and as long as you produce in the U.S. you can keep your money.  So instead of moving one factory to another location, you build another factory to supplement the first one.  Pure protectionism doesn't work and I personally prefer fair trade, but I had to take a protectionist stance for the sake of argument.


There wasn't a "fed" in the 1890's. Are you talking about the Federal Gov't?

Also the sentence doesn't seem to make sense.

Any positive that tariffs created in terms of "protecting infant industry" was gone by the 1880's. The McKinley tariff was motivated entirely by misguided economics and by politics. When it failed, the people turned against it and business interests that had long supported protectionism, began to increasingly call for free trade as a way to pickup any slack demand and avoid another 1893-1896 Depression. Mckinley himself voiced sympathy for this in his last speech, before he was shot. Subsquent GOP support for tariffs was motivated by politics.

A good example of how the US was damaged by Smoot-Hawley was Ford. Italy was a prime overseas market for Model T's and subsequent Ford products. For 10 years Fiat had been asking for tariffs to drive the Fords out and Mussolini laughed them off every time. Until 1930 that is. In retaliation to our tariffs, Italy and every other country passed retalitory tariffs. The Fords were driven out and Fiat got to sell thousands of crappy cars to people in Italy. The US got several thousand more laid off in Detroit, at a time when the US economy didn't need any more layoffs. These were followed by layoffs in Pittsburg, Duluth and West Virginia as it cascaded through the supply chain. Cars, to steel, to iron and coal.

The depth of the Depression was mostly a monetary failure by the Fed to ensure proper liquidity in the banking sector, thus contributing to the bank failures. However, the tariff crippled US export industries, like the auto companies at the time. The Depression idled the factories, but they were still there and thus there use in the War. But the tariff did hurt the economy, and extend the length and depth of the Depression. It also contributed to the war by causing world trade to collapse.

The greatest time for the US economy and for auto companies, was the 1950's and 1960's. During that period, you had tariffs reach their lowest points as a result of post-war multilaterial trade liberalization.
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