Ep. 29 We’re Told to Fear Globalization, but We Shouldn’t

2 April 2016     |     Tom Woods     |     62

This week Krugman says we ought to acknowledge that there are losers in international trade, and that we should introduce government subsidies, rather than trade restrictions, to help them. He says right-wing ideologues have failed to make note of these losers, even though he himself failed to mention them in his own scholarly work on trade.

But we spend much of the episode defending the unpopular view that globalization is overwhelmingly and indisputably a good thing.

Krugman Column

Trade, Labor, and Politics” (March 28, 2016)

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Contra Column

Globalization: The Long-Run Big Picture,” by George Reisman

Book Mentioned

The Politically Incorrect Guide to Capitalism, by Bob Murphy

Episode Mentioned

Ep. 6 Enough About Denmark Already: Here’s What Krugman and Sanders Left Out

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  • garry baker

    Best episode yet! So many good economic points in this one, and some good humor to wrap it up at the end… The government ain’t going to tell me I can’t take a cruise to a foreign country!

  • tz1

    That word doesn’t mean what you think it means.
    Agenda 21/Agenda 2030 land and other grabs, unifying, meaning the most socialist, most highly regulated, most crony policies of any two trading partners, carbon credits, climate change are all part of what everyone else means by “Globalism”.
    Open Trade (I won’t use “free trade” after NAFTA) has nothing to do with hit.
    The 5000+ page TPP treaty is part of “globalism”.
    Heidi Cruz’ report on the “North American Union” is part of “globalism”

    You mentioned a magic box where I could get things out of it cheaply. Will it report what I get to the government, because I could use some more guns, bullets, tannerite, toxins and all kinds of other things banned by one or more levels of government. Or will the magic box be regulated. I can already get interesting “toys” (at least that was on the customs form) from China.

    Also, why is it never the people advocating to open up some regulatory area that will be the ones losing their jobs? Wouldn’t it be nice if all your works behind a paywall were available for free on a server that didn’t recognize our archaic IP laws – you might have to find another way to get income. Since I don’t make my living that way, should I care?

    Finally, on the errors with Ricardian trade (as well as SJWs) you should have Vox Day (http://voxday.blogspot.com) on – in “The Return of the Great Depression” and “Cuckservatives” he deals with the errors involved in the Ricardo tautology. Perhaps you can arrange a debate. (And have him on separately discussing SJWs and the other parts of cuckservatives).

  • Eileen

    The show is all fine and dandy as long as the government stays out. One of the reasons why there is big brouhaha over globalization, free trade, job outsourcing is that it is extremely difficult to start another career that isn’t of medium skill level (like on-par with general office help or librarians). So once a person gets laid off, there are too many younger people competing for these medium skilled jobs that the person ends up dropping out, getting government assistance or if old enough, social security.

    The economy must be healthy in order for the benefits of free trade, without government interference and removal of most licensure laws to lower barriers to entry. When those occur, then a lot of what libertarians preach about free trade and globalization will be true and apply to richer countries. Unless those change, the ones impacted by it will see globalization as an attempt to steal something that they think is rightfully theirs.

    This partially explains the popularity of Donald Trump, where it is obvious to the political elites that it doesn’t matter what he says, the people will still back him and any attacks by the media pitbulls will only make him more popular. (I love pitbulls, btw). Try telling a person whose attempts at “doing everything right” only landed a portfolio that is worth 50%, an underwater house and nothing but junky part time jobs.

    Note that I do not agree with most Trump backers that globalization is the issue. I do, however, agree with them that the political elites can’t be trusted; they don’t understand economics as well as I do, but I throroughly understand their frustration with their economic condition.

  • Adrian Gutierrez

    Excellent podcast, great stuff. Indeed government ruins everything, and lowers our standard of living when it intervenes.

    • http://timidsoul.wordpress.com/ Caspar Milquetoast

      How does worker safety rules and regulations “lower our standard of living”? Surely you don’t think the fabulous, unfettered “Free Market” would provide that, do you? More costs equals less profit, no?

      • Michael Nolan

        Defining terms helps.

        For example, at a lab I once worked in, the Environmental Health & Safety department told us that no drains could be installed in the lab because there was “too much risk of a toxic release from chemicals going down the drain.” Well, one of our cooling lines on a reactor broke late at night, and we got our toxic release… through the floor and into the secretarial offices on the first floor and to the outside as water flowed down the stairs. Maybe drains and some kind of collection system would have helped?

        Not every regulation is helpful. It’d be nice to debate actual rules instead of “safety” in he abstract.

        • http://timidsoul.wordpress.com/ Caspar Milquetoast

          I would be all for periodic reviews of rules and regulations.

          But how did that particular regulation “lower our standard of living”?

          • Michael Nolan

            By costing the people involved tens of thousands of dollars in cleanup costs, and in thousands more in various research and projects to figure out how to keep the lab operating in spite of the rules. Basically we came up with a way for spills to dump into sinks instead of the absent floor drains, which completely defeated the purpose of the original reg, but did prevent any further surprise spills from flooding the lab.

            Alongside counterproductive regulations, there are also regulations that amount to “spy on yourself and send us reports,” which require companies to hire compliance staff, which again means less money for productive purposes. There is no oversight or review of any of this, and I’m not sure if its possible given the size of the CFR.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            But that doesn’t answer the question of how that particular regulation lowered “our standard of living”.

            If anything, the clean-up costs affected gross profit margins of the company and had an impact on shareholder return.

          • Adrian Gutierrez

            Caspar, it does have an effect on net profit margins as the young gentleman just pointed out. On the Income Statement this would fall under operating expenses. Gross profits fall on the top line, while Net Profits fall on the bottom line. You may have heard many CNBC pundits use the term “strong bottom line.”

      • Teapolicy

        “How does worker safety rules and regulations “lower our standard of living”?”
        Legislation mandating a certain level of safety that exceeds the level an employee might prefer in its absence lowers the standard of living of that employee by forcing her employer to make fixed investments in plants and equipment that she would have preferred to have been paid to her in the form of a higher wage. She could have satisfied more of her preferences (or some of her higher ordered preferences) if she had been paid cash compensation, ergo she is left with a lower living standard.

        How do we get such legislation if it isn’t more valuable to workers than some other form of compensation? Through the perverse regulatory competition between employers via the legislature. The essence of this perverse regulatory competition: a business lobbies for regulations that apply more pressure to its competitors’ business models than they do to its own. General example: a company operates on a business model that requires highly educated employees seeks to have the state regulate its own industry in order to require higher and higher minimum levels of education/certification within the industry. What does this do? Prevents potential disruption from competitors who might’ve found a way to deliver the same services using less trained employees in a different manner that satisfies some consumers that, at least when combined with saving a few bucks, they would have preferred. Who’s standard of living is lowered? Any consumer who would have chosen the cheaper service in the absence of the occupational licensure requirement as well as anyone who wants to enter the now-privileged industry. Who benefits? People who already have the license, required number of hours of training, or those who already employ people who do.

        “Surely you don’t think the fabulous, unfettered “Free Market” would provide [such perverse levels of worker safety regulation], do you?”
        Of course I don’t, because I think a decent number of regulations we currently have on the books simply cannot be justified by any relation to the costs and benefits they confer on the parties subject to the employment agreement. But the market can certainly provide some worker safety protections, and in amounts that more closely track consumer preferences than can a legislature. Why? Because legislatures are subject to perverse competition, while competition on the market obliges employers to offer salaries and conditions that are better than any potential employee’s next best alternative. Since it makes no difference to the employer whether she pays her employees in cash or by upgrading her employees from regular tennis shoes to a more professional, “non-slip” variety. The test would be whether or not the benefits of upgrading their shoes are valued by the employees as highly as the benefits of a slight increase in pay or other benefits. If only legislatures subjected their dictates to the same scrutiny.

        “More costs equals less profit, no?”
        Actually, no. If that were the case, no investment would ever be made as the initial cost must always mean less profit.
        It’s also not true in the case of perverse regulatory competition. If you successfully get a regulation passed that forces all of your competitors to make an investment you already wanted to make (or felt you were already going to have to make) anyway then you can simply add the cost of doing business into the final price you charge your customers.

        • http://timidsoul.wordpress.com/ Caspar Milquetoast

          Yawn …. What a boring cut and paste job. Are you one of those jackass Libertarians who are so full of self-esteem with their pre-Industrial Revolution mindset responses?

          What’s so sad is that you think your word blizzard was actually coherent.

          Enjoy your life in Mom’s basement and let me know when you acquire some real world experiences.

          • Teapolicy

            Lol! So this is how a troll deals with a substantive response to his snarky bullsh*t?

            “What a boring cut and paste job. ”
            Actually, I typed it, not that it should matter. Do you have anything of substance to say about it? Sorry the answer to your snarky question is boring. Perhaps you should find another discussion that better suits your interests.

            “Are you one of those jackass Libertarians who are so full of self-esteem with their pre-Industrial Revolution mindset responses?”
            ? What does answering your questions have to do with my self esteem or the industrial revolution? Dont believe I referenced either one.

            “What’s so sad is that you think your word blizzard was actually coherent.”
            Ookay. Invective aside, your statements required a bit of unpacking. I dont believe I repeated myself any more than necessary to clearly explain the points, if at all. I’ve reread it and it clearly makes sense even if you disagree. Where did you get lost?

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            You’re just a boring little boy Libertarian jackass who just doesn’t have any concept of the post-Industrial Revolution world.

            You probably have fantasies about having sex with Ayn Rand. What’s Mom serving you tonight in her basement, your fav mac and cheese.

            Someday, you’ll grow up and move beyond being a Libertarian jackass.

          • Teapolicy

            Another reflexive non-response. Tiiight. I’ll just assume you’re conceding that occupational safety regs are provided better without a legislature, then. Good day.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            Yes, little boy Libertarian, whatever you and your pre-Industrial Revolution mindset tell you.

            Enjoy your Mommy’s mac and cheese dish for dinner. I’m sure she’s longing for the day when you grow up and move out.

      • Adrian Gutierrez

        I would recommend you reading Dr Robert Murphy’s work or Tom Woods’ other work as well on a completely privatized society. Simply because there is no government does not in any respects mean there are no safety standards within corporate regulations.


        • http://timidsoul.wordpress.com/ Caspar Milquetoast

          Both Murphy and Woods have pre-Industrial Revolution mind sets. If anything, their writings are more Libertarian theatre that is far removed from modern day realities. I find “libertarian thought” to be more comedy than serious thought. I suggest for you to read up on the economic history of this country.

          • Adrian Gutierrez

            Interesting you suggest reading the economic history of this country seeing as though both Woods and Murphy go over this in great detail. I’m not sure you read or listen to their podcasts as their theories and analysis are also applied to present time. Are you a follower of their work at all Caspar? It may serve well for you to look deeper into what you criticize lest you mislead your own perspective.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            I find both Woods, Murphy, and most “Liberatarian Thought” to be juvenile, boring, and intellectually dishonest. It seems there can be no acknowledgment of modern day realities with these people, especially when they’re so trapped in a pre-Industrial Revolution mindset.

            There is no gray in the Libertarian mindset ; only black and white. There is only the purity of the mythical Free Market and no place for any authority such as government. The wise and all-knowing “Invisible Hand” will guide the marketplace.

          • Adrian Gutierrez

            Why do you feel it is intellectually dishonest? To me it seems Libertarianism is radical realism. Libertarianism is not stuck in one set period of time, it transcends time. Libertarianism is a state of being, and it is also a way of thought. People can be pro-freedon without being Libertarian. A good example are the Quakers, or the Abolitionists. Both were looking to maximize freedom without looking towards government for a solution. I would also suggest reading a book on Austrian Economics. There you’d find your answer as to why Capitalism, or “the invisible hand” always exists, and that government only hinders the free-market process of raising standards of living.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            Libertarian thought is trapped in a pre-Industrial Revolution mindset that isn’t compatible with modern day society. I don’t know how extremely illogical your particular Libertarian thought is and it really doesn’t matter. Libertarians really don’t want to engage in meaningful discussions about the role of government in society.

          • Adrian Gutierrez

            I’m not sure you have the idea of Libertarianism correctly analyzed. Many Libertarians are very willing to engage people who support government in a respectable debate. As a matter of fact both Tom Woods and Robert Murphy go over these topics in their podcasts and writings all the time. Furthermore, to me Libertarians base many of their beliefs on the laws of economics and reality as well. If you are interested in understanding the negative ramifications of government intervention, I would happily love to explain to you. As indeed it is true, all government intervention is bad for the economy, or simply undermines morality in general.

  • http://tklist.us TKList

    Fear big government not globalization.

    • http://timidsoul.wordpress.com/ Caspar Milquetoast

      What’s the difference?

      • http://tklist.us TKList

        Globalization is global trade, beneficial for everyone. Big government reduces your liberty, freedom and chances for prosperity.

        • http://timidsoul.wordpress.com/ Caspar Milquetoast

          How is global trade beneficial for everyone? NAFTA resulted in a net job loss in this country.

          Explain how “big government reduces your liberty, freedom and chances for prosperity”. Surely there’s a need for government regulations when it comes to public safety and health.

          • http://tklist.us TKList
          • http://tklist.us TKList

            Big government is owned by the wealthy and paid for by the middle class and poor one way or another. The tax code is manipulated by the wealthy; cost to comply is paid by consumers through higher prices. It increases lobbyists, corrupts politicians – increases difficulty of entry for competition, which causes less employment opportunities for workers and higher prices.

            Excessive regulation increases cost for consumers, decreases job opportunities, corrupts politicians, increases lobbyists – increases difficulty of entry for competition. National debt: $154,000 cost per household paid by the consumer not the rich, through higher prices or lower standard of living. Federal Reserve: low interest loans for wealthy and connected, by the time it reaches lower rungs, rates higher, prices higher – including CEO pay increasing the inequality gap.

            We have more socialism now than the liberal left’s golden age of the 1950s. We have the FHA, HUD, Freddie Mac and Fannie Mae, Community Reinvestment Act, Social Security, Medicare, Student Loan Programs, Obamacare/ACA, Snap Program, Earned Income Tax Credit, Unemployment Insurance Program and more. So the theory is false and the opposite is true. Socialism hurts the middle class. Big government equals more income inequality, smaller government equals less income inequality.

            The national debt keeps increasing because of deals, aka compromises, between Democrats (social programs and entitlements) and Republicans (corporate welfare and defense). The middle class pays the heaviest burden for the debt; as it goes up, it further increases the inequality gap by lowering their standard of living. National Debt: $19 trillion costs or is financed by each household, who is ultimately responsible for that debt. This comes out to $154,000 per household if paid for in one lump sum. Financed for 15 years at 5% interest it would take a monthly payment of $1218. Do not be fooled each household pays this one way or another, not the rich; whether you pay it directly in taxes and fees, higher prices or by a lower standard of living than you would otherwise have if the government had not spent that money. The question is: Is your household getting its money’s worth?

            Politicians promise you a fantasy land, that they can make your life golden by decree, raise your pay, give you free education, free health care, paid retirement, cheap housing, easy credit and protect you from the evils of the greedy businessman. In reality they can do nothing of the sort.

            To give you anything they have to take something from you, do not be fooled when they say they will take it from the rich, the rich get it from you (increased prices), in the end it always comes from you. Politicians point at the rich guy as they pick your pocket. They are selling you an illusion that does more harm than good, because in the process they disrupt the free flow and balance of the market causing unintended consequences.

            Politicians that promise to fix your life by taxing the greedy rich to cover the cost are really the sleaziest of middlemen that are selling you pixie dust while they take their cut, which is power.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            Do you consider federal agencies like the FDIC and the SEC to be “excessive regulations”? I assume you know what those agencies are. So absolutely NO government regulations in your perfect Libertarian fantasy world?

            Also, cut and paste postings are boring. Brevity is the soul of wit as Shakespeare once said. A brief, coherent paragraph will do, no need for the word blizzard that Libertarians who are full of self esteem are known for.

          • http://tklist.us TKList

            The collusion between the federal government and banks with the Federal Reserve, FDIC, FHA, HUD, Freddie Mac, Fannie Mae, Community Reinvestment Act and more is what led to the financial crisis.

            When government gets in bed with big business we get: ratings agencies rubber stamping investments, regulators looking the other way, banks giving liar loans, the government bailing out banks and taxpayers paying for everything.

            Abolish the Fed, FDIC, FHA, HUD, Freddie Mac and Fannie Mae. Repeal the Community Reinvestment Act.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            So in your perfect Libertarian fantasy world, there simply isn’t any need or purpose for Federal agencies like the FDIC and the SEC. Interesting. Where would you keep your savings, under the couch in your Mom’s basement apartment?

          • http://tklist.us TKList

            In the bank I choose.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            But in your perfect Libertarian fantasy world, there wouldn’t be any FDIC insured banks. What protections would you have against fraud or theft? Do Libertarians ever think things through or they just like to chant and recite the glories of the “Free Market”?

          • http://tklist.us TKList

            Your problem is ignorance, your question shows that. Due diligence, laws against fraud and theft, and competition are your protection.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            “Laws against fraud and theft”???? Isn’t that government regulation? As I said, Libertarians simply don’t think things through. You’re Exhibit A for that. Thanks for the laugh.

          • http://tklist.us TKList

            Basic laws, limited government is not zero government. You continue to show your ignorance. Enjoy your ignorance.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            So you’re for basic laws and limited government. Then what’s your problem with Federal agencies like the FDIC and SEC? After all, they enforce “laws against fraud and theft”.

            Before you respond, take those silly Libertarian blinders off and think.

          • https://www.facebook.com/david.rogers.hunt David_Rogers_Hunt

            There is no need for violence to make self regulation work. Regulatory bodies operate on the presumption they are God on Earth as far as the very embodiment of absolute good intentions. I just don’t buy it.

            Violence, at best, can serve as a shield against violence,… but not as the source of creativity, new merit, or new value. Violence destroys at worse, protects at best, and creates not at all.

            Consider my Anarchist Constitution…

            The Anarchist’s Constitution

            1. There is no Sovereign Immunity. Any Person (or Persons) who commits force, fraud, or trespass against any other Person’s life, body, or property is liable for restitution to repair the victim to their original condition.
            2. The Right to be left alone is Absolute, subject only to the enforcement of the first rule. Any Person (or Persons) may deny the use of their life, body, or property to anyone else without any necessity to justify the reasons for their denial.
            3. There are no exceptions to these 4 rules.
            4. These rules being observed,… do whatever you will.

            Now I ask you,… what coercively imposed rules do you believe are necessary for a free people to exist?

            For a full explanation of how one group of libertarians would handle voluntary regulation see http://www.cato.org/regulation/about

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            Hey, thanks for the great cut-and-paste laugh.

            So let’s focus on what my main point is (which you silly Libertarian children can’t seem to accept) – what is wrong with government regulation like the FDIC and the SEC?

            I’m assuming you know what those Federal agencies are. Usually, Libertarian children are so ignorant of economic history.

            And a brief, concise paragraph will do as a response. No need to bloviate with cut-and-paste babble.

          • https://www.facebook.com/david.rogers.hunt David_Rogers_Hunt
          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            “violent institutions”??????? ha ha ha ha ha ha!!!

            Again, without the cut-and-paste responses, in your own words, what is wrong with government regulations like the FDIC and the SEC?

            and you’ll have to explain the “violent institutions” thing to me. Does this mean the FDIC and SEC take property at gunpoint?

            You Libertarians are such the funny people. What’s so sad is that you actually believe that nonsense.

          • https://www.facebook.com/david.rogers.hunt David_Rogers_Hunt

            The fact that it is a government agency is conclusive proof in and of itself that it is a violent institution.

            Their violence is made manifest in that otherwise free peoples have to comply with their regulations before being allowed to take any action at all. Why do we see this differently? Because you are judging actions by their professed intentions and I am judging actions by their process. If I must comply with a stranger’s orders before I am allowed to go about my business,… that’s Violence!

            Or to be really specific on another subject,… government charity is to voluntary charity as rape is to consensual sex.

            I believe you’ve made no attempt to examine any of my references discussing either the FDIC or SEC. You really should, at least, make some minimal effort to peruse them for yourself.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            You Libertarians are such the comical people. A government agency is a “violent institution”? Really?

            So where does a “thinking” Libertarian like you keep your savings? I can’t think of any non-FDIC insured banks out there. There’s not much of an interest rate return on hiding your savings in a lockbox under the couch. Seriously, do you use things like a checking account in your daily life?

            Why do Libertarians want to live in a pre-Industrial Revolution mindset? Do you have access to a flush toilet at home? Isn’t that violence imposed by government? After all, you have to flush that poop and pee through government-owned sewage systems.

          • https://www.facebook.com/david.rogers.hunt David_Rogers_Hunt

            All the items you mentioned,… banks, savings account, toilets can be provided for without the necessity of violent oversight. It is the difference between effective, voluntary warranty agencies, such as Underwriters Laboratories or Good Housekeeping seal of approval, and violent, coercive agencies with whom everyone must first comply with before they can take any action at all. https://uploads.disquscdn.com/images/4ed485b64f3ebae320dfb47775cebfc6ef05a871b39850b361fff8679308b3e3.jpg

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            “violent oversight”?????? Really now.

            I notice you didn’t answer my initial question so here it is again:

            So where does a “thinking” Libertarian like you keep your savings? I can’t think of any non-FDIC insured banks out there. There’s not much of an interest rate return on hiding your savings in a lockbox under the couch. Seriously, do you use things like a checking account in your daily life?

          • RobertRoddis

            Hey smart guy, it’s not a “government” if there is no threat of violence to enforce its rules. If someone asks you “pretty please” and you can say “no” without consequence, that’s not government and there is no violence. You statists are so dishonest and so inept that you’ve had to sink to the level of distorting the meaning of well known words and concepts to support your fantasy worldview.

          • http://timidsoul.wordpress.com/ Caspar Milquetoast

            It’s another comical Libertarian chanting about “violence” by government.

            So tell me, “thinking” Libertarian, what is wrong with government regulation like the FDIC and the SEC? I’m assuming you know what those Federal agencies are. Usually, Libertarians are very ignorant of U.S. and economic history.

            I’m so looking forward to your response, especially the name-calling like “statist” and the flash words like “violence”.

  • tz1

    I see you already tried to discuss on Twitter.

    Vox is a serious scholar of economics and unlike Krugman, a worthy opponent. Such a discussion is not possible on Twitter.
    His point was that if you include full open border Labor mobility as part of “free trade”, it means that either the productive will leave for tax havens, or that the “takers” will have to leave for some place that can maintain subsistence benefits.

    • Luke Perkins

      So, let me get Vox’s argument straight. A country with low taxes and low regulations (i.e. a “tax haven”) draws the most productive/talented workers from the rest of the world thereby benefiting the tax haven country and damaging the other countries. Ergo, a nation should seal its borders to prevent the loss of talent to tax havens instead of… oh, I don’t know… becoming a tax haven itself? Have I got that about right?

      If so, put another way, we should abandon free trade (i.e. peaceful social interactions) in favor of figuring out how to imprison workers (i.e. closed-borders-gun-point-nationalism), rather than abandon the oppressive regime that encourages workers to flee.

      Yeah, I can see that making life better…

      I think Vox would only be a slightly… slightly… better opponent than Krugman in the intellectual category, though he scores exactly equal in the arrogance/rudeness category, and far, far worse in the audience size category.

      • tz1

        That is NOT Vox’s argument nor mine. First, he points out it isn’t free trade if you don’t also have free movement of labor. If you are closing the border to people, or setting up barriers (visas), then it should apply to trade.
        Free trade is NOT peaceful social interaction because there are more than the two parties doing the exchange involved. If I steal something and sell it to you cheap, ignoring the victim of the theft is wrong.
        Do you know how many people visit Vox’s blog each month? Probably more than here or Woods’.

        • Luke Perkins

          Rereading Vox’s comments about Woods’ comments, in light of your claim Vox is not making the argument above, I must confess I can’t see the argument you say he is making. Perhaps Vox was too busy being a condescending fool to get around to his point? Whatever. I’ll take your word as to what was meant.

          The border is not a binary switch being either open or not. Rather the border is more like a semipermeable membrane. Therefore the argument has never been between just open borders and closed borders, but rather what to allow and what to restrict. All discussion of border restrictions necessarily apply to both goods and people in varying degrees raging from:

          Trade axis

          all goods of any type no goods, not even personal clothing

          Migration axis

          any person any direction without challenge no person any direction for any reason

          So, there is nothing inherently contradictory about saying the border should be completely open to goods on the trade axis and only open to the people who carry goods on the migration axis. I would say a person then could legitimately use the words “free trade” to describe such a position because the *goods* are entirely unrestricted.

          Since a person could use the term “free trade” to describe a circumstance where movement of labor is prohibited, I find Vox’s argument (it isn’t free trade if you don’t also have free movement of labor) unpersuasive. He would have to flesh out precisely what he means by the words to ensure he is not talking past his opponents.

          As for free trade ignoring the victims of theft, just for fun, let us suppose you have a valid argument against free trade and let me rephrase the argument.

          “[Buying any product from any person] is NOT peaceful social interaction because there are more than the two parties doing the exchange involved. If I steal something and sell it to you cheap, ignoring the victim of the theft is wrong.”

          So, *if* we take your argument as valid, I have just constructed a valid argument for prohibiting all trade between all people. Which means we either have to hold your theft argument against free trade invalid, or accept the theft argument against all trade as being valid. I’ll let you decide 😉

          Lastly, how many people visit Vox’s blog each month compared to Woods’ is entirely irrelevant when considering the question of whether Vox or Krugman would be a “better” opponent for the contrakruman podcast. Since I know the number of visitors to Vox is smaller than Paul Krugman, Woods will have a larger potential audience by going after Krugman than after Vox, which was the comparison I was making previously.

        • Teapolicy

          “First, he points out it isn’t free trade if you don’t also have free movement of labor. If you are closing the border to people, or setting up barriers (visas), then it should apply to trade.”
          Agreed, trade in practice is not nearly as free as many of us would like.

          “Free trade is NOT peaceful social interaction because there are more than the two parties doing the exchange involved. If I steal something and sell it to you cheap, ignoring the victim of the theft is wrong.”

          1. How is selling stolen property akin to trading with anyone across the world on the terms that I trade with the fellow across the street?
          2. If free trade is somehow just like selling stolen property, how does a tariff rectify the injustice? Surely it isn’t okay to resell stolen property but only if you give the government a cut of the proceeds..

          • tz1

            Note Vox had a debate and the transcript and followup discussion is available on his blog http://voxpopoli.blogspot.com

            1. If you have “actually” free trade, I would find it hard to argue, but you need similar cultures and laws. Before NAFTA, Ontario and Michigan had more “free” trade because things were very similar across that border. Adding Mexico ruined it because it had to be “managed”. Trading with a dictatorship or where there is a kleptocracy is different.
            2. A tariff imposes a penalty that discourages the theft in the same way getting fined for buying stolen merchandise would. Most of the theft is governmental (currency manipulation, they build the factory after stealing land, or allow pollution and prevent suing for damages). If the government’s subsidies don’t work, they are less likely to happen

          • Teapolicy

            1. I don’t see any reason why we would need similar cultures in order to trade with one another. Also, if we can’t trade with people trapped under kleptocratic governments, why are we allowed to trade with other Americans?
            2. “A tariff imposes a penalty that discourages the theft in the same way getting fined for buying stolen merchandise would.”
            Tariffs discourage honest trade between people living in separate countries just as much as they do dishonest/subsidized trade, though, don’t they? Isn’t that like adding a general sales tax in order to stop a particular gang of thieves from selling their stolen merch? It doesn’t seem to follow.
            2b. “Most of the theft is governmental”
            Agreed. Most theft domestically is governmental as well, though. Our currency manipulation, our use of eminent domain, our uneven enforcement of environmental protection laws, our use of government subsidies, etc. all undoubtedly corrupt much of our economy as well (if not the whole thing?). Are we now to pass a law banning trade with other subjects of our own government? How does that fix the problem?

          • tz1

            Islam has pirates and slaves. Trade with the devil, but the cost will be your soul. If you had ideals, you wouldn’t trade with those who destroy those same ideals. Sacrifice yourself on the altar of inordinate principle, but don’t sacrifice others. You have no rights over their lives, fortunes, and liberty.

          • Teapolicy

            Lol. Fades into empty rhetoric when prompted with serious questions…
            “Islam has pirates and slaves. ”
            1. Our nation was founded on pirates and slaves, and our government does/has done many/most of things you accuse others of doing yet you dont encrouage us to stop trading with each other. Why?
            “Sacrifice yourself on the altar of inordinate principle, but don’t sacrifice others”
            2. Good. Allow me to trade with whomever I want without imposing your tariffs on me. Dont make me sacrifice my livelihood to promote your inconsistent principles. Im not forcing you to trade with any of these cultures you apparently hate. You can trade with your neighbor.

          • tz1

            Ah, can someone pay an assassin to murder this annoying person – and then a thief to take all his substance? I don’t need it, but removing an outlier on the wrong side of the bell curve would improve many things.

          • Teapolicy

            “can someone pay an assassin to murder this annoying person – and then a thief to take all his substance?”
            No. Im not sure what that has to do with 1 or 2. Does instituting a general sales tax on honest trade as well as that practice make sense as a way of combatting it?

  • Luke Perkins

    Here’s an odd thought experiment. Suppose a law were passed allowing a certain section of the population to make withdrawals from any person’s bank account regardless of ownership. Now suppose we were discussing the repeal of such a law. Would not the person allowed to take money from anyone be hurt by said repeal?

    In like manner, protectionists are allowed to rob the general population by preventing competition thereby jacking up prices, so of course thieves are harmed when their activities become illegal.

    I think this one falls under the “no duh” principle.

  • Matt J.

    Devil’s advocate question: If in the example given on the show, the American radiologist won’t lower his price to $1.50 to match his Indian counterpart because there are $10-12 hr. jobs available (doing something else) and this example is happening 10 thousand times throughout the economy, where does he find the $10-12 hr. job? Won’t those jobs be cut to a fraction of the domestic price, too?

  • Robert Dawson

    Any nation that will adopt the economic policies of Henry Hazlitt (or Murray Rothbard) will soon find itself in another Great Depression.