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The word "regulation" was not mentioned once. "Government" was mentioned only twice. Legislating American industry out of existence and then blaming the results on "free trade" isn't really fair.

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This is all *very* interesting, and I will need to put Fletcher's book on my to-read list!

But for any reader here who is not sold on Fletcher, let us keep in mind that in this age of welfare states and heavy income taxation, Free Trade Isn't! The United States has been under a system of subsidized outsourcing since the early Post War era. This was originally intentional. We were trying to keep what was left of the free world from going communist. Today, our policy subsidizes nominally communist (and actually national socialist) China.

Try this thought experiment: what would be the tax on a Chinese consumer product if we had the Fair Tax instead of our income and payroll tax system? Answer: 30%.

We would need 30% tariffs across the board just to have parity with what we tax domestic producers at the federal level. That's not being protectionist. That's just being neutral.

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You can defeat "free tradists" with one argument, if you want: Free trade advocates assume perpetually non-hostile trading partners. e.g. It sucks if whoever is supplying your food/medicine/energy suddenly decides to to jack the price up 20x, or sell it all elsewhere.

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Thank you very much for this post.

I'm still a youthful free trade doctrinaire, living in the worst country possible for the doctrine of free trade: Spain.

But I am also in favor of national self-sufficiency or autarky. As much as possible. One example is the most obvious strategic area: energy self-sufficiency.

These years, they are destroying the last remnants of the autarky project of the Dictatorship: the project of hydroelectric generation.

Nothing makes sense. It's all crazier than ever before in Spain's very crazed history.

Soon, in Pentecost day, local elections. Later in the year, General elections.

I have no hopes of anything changing here. If something would change for the better in the US, maybe that would cause a ripple and Spain, being a vassal state, could see some changes too.

All parties are globalists. Even the so called "far right" party. And they are pro-Ukraine and pro-Israel too and pro-vax and pro-masks.

The covid con has destroyed Spanish culture. There is barely any self-respect left standing.

As you can see, I'm demoralized.

But I keep studying. I'm not a fanatic. If I'm wrong in my Austrian School beliefs, I want to know. I sincerely want the best for me and for my country, and I don't care about the unity of Spain or if Spain explodes in three thousand micro-nations.

I want peace and isolationism. So far, the free-market principles seem to me to be closer to the idea of peace, cultural recovery and political independence. But I will have to re-study everything under this new interpretation of American protectionism of Fletcher.

I prefer peace and prosperity to being right about economics. So I'm open to change.

I have a question: what are your views about pollution and environmentalism in general? Have you written something about those topics?

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Apr 19, 2023Liked by Tree of Woe

Analytical thought isn't easy these days, so I'll keep it short- I got informed about Free Trade via Lew Rockwell back in 1999. While there was far more I agreed with in it than the soporific nightmare of Keynsian Economics, I was always troubled by how much both it & Libertarianism ignored the illogical & emotional aspects of what the Spathi refer to as, 'Hunams'.

Rationality is optional in that Race.

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In Britain during the time of Smith and Ricardo, a free trade policy was progressive. Taxing food imports subsidized the nobility at the expense of the working class.

In the United States, tariffs were progressive. Tariffs taxed southern slave owners and boosted wages of northern factory workers.

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Very eye opening, sadly though we are much nearer a undeveloped country than most people know. You mentioned scrapping are factories, and indeed we are and have. A year ago or so I met a guy riding on my road bike (I live on the trans northern Pacific-Atlantic bicycle way) and his job was traveling around the US buying old manufacturing equipment and wholesale factories and selling them on to China. He of course saw no problem here in gutting the US's capacity to build, well anything. He said his job was getting harder as there was becoming less old industrial facilities that had not been already sold off. So for us to reboot for whatever reason; war, trade, competitive advantage, is going to take starting all over.

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Apr 19, 2023Liked by Tree of Woe

Oh, only tangentially related (I love me some tangents), I just got a notice that Atari is planning on doing a massive reimagining of their huge game library. They just acquired Nightdive Studios (a decent bunch who's latest project is a nearly-complete remake of 'System Shock 2') to facilitate that end.

I won't post the email I got, but FIG is the platform they are using for all schlub-related investing. Coming as this is, directly after the failure of their latest videogame console doesn't fill me with confidence, but going software-exclusive worked like gangbusters for SEGA.

The Risk is likely high, but that's where the fun is, right? :-/ And while thinking about investing in games during the present cultural shenanigans might seem silly, the Film Industry grew explosively during the Depression. So, unless it's a 'try not to die from radiation while avoiding the rape-gangs' type of crisis, people will always need to be entertained.

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Apr 19, 2023·edited Apr 19, 2023Liked by Tree of Woe

The Golden Rule of Hiring Staff is very simple:

1) They save you time.

2) They save you money.

3) They save you some combination of both.

.... If not any from (1) - (3), one ought to cut them loose asap.

Many a business owner often falls into a vicious cycle of debt, headaches, etc after which they are utterly ruined.... all for simply trying to use Mathematical Masturbation (of the sort you succinctly noted) and whatnot in order to supplant aforementioned Golden Rule in part or in full.

That is the micro level. At the macro level where we are dealing with nations + civilizations and their interaction with economies + industries; this analysis carries over (even though we were initially dealing with individuals + businesses and their interaction with employees and staff).

Put simply, The Golden Rule of Economy + Industry is as follows.... Developing an Industry and/or investing in a particular Segment of the Economy must be so that the Nation and/or Civilization:

1) Saves Time for other fruitful pursuits (prayer, charity, etc. Normative activity in general).

2) Saves Goods, Services, Money, etc for other similar Developments and/or Investments.

3) Saves some combination of the two Above.

.... If not any from (1) - (3), nations and civilizations ought to cut them loose asap.

"Free Trade" Dogma is merely one of the many weapons in the Arsenal; an Arsenal that seeks to Mathematically Masturbate away these Iron Rules adhered to since time immemorial by Civilizations and their derivate Nations.

The West (and the Empire in particular) has completely supplanted (1) in order to favour instead Demon Summoning. Meanwhile (2) is likewise being supplanted now with the erosion and Death of Manufacturing in its entirety. De-dollarization will cement this in a few more years.

As with the Business Owner who fell into Ruin.... there is only one way this ultimately ends; and it is not with the Nation (i.e. Yankee-Land) and the Wider Civilization (i.e. the West's) Salvation.

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Apr 19, 2023Liked by Tree of Woe

Would you say that computer software is an industry has high worker productivity without capital investment? I'm wondering if the US's expertise in computer software helps build national wealth as an alternative to manufacturing. Having said that, the wealth built by Google, Facebook, Microsoft has not been spread as widely across the population as would have been true for manufacturing.

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Apr 20, 2023Liked by Tree of Woe

A couple of thoughts.

1) have you read any economists who go long on Says Law? Steve Kates was a guy whose blogging I read in the 2000s. https://www.amazon.com.au/Free-Market-Economics-Third-Introduction/dp/1786431408

2) always thought of myself as a free-trader, but theoretically there’s no reason NOT to use tariffs to raise tax revenue and ease off other streams, AFAIK.

3) looked at another way, a heavy regulatory hand plus zero-T free trade is identical to financial and legal penalties on domestic production. I don’t think Ricardo had a notion of “and then government reliably eliminates the relative advantage, expanding to consume all trade surplus either as money or prestige”

4) the root of the Western economy isn’t any economic system, it’s giving historically impressively immutable property rights to the peasant class, IMO. An overall societal model saving 20% on traded goods will not have the same goods in hand (see Say) as one that creates incentives that drive +50% production for every individual, see “Yeoman’s work”.

Had to get those noted while my brain was working, definitely coming back to see which have been addressed by the comments.

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The best example of how destructive is free trade, is Australia. Up to 1975, Australia enjoyed being the most prosperous and egalitarian nation on earth. I say this, not quoting from a book, but from a life lived in this then paradise. I have lived through WWII austerity and the decade of industrial and agricultural development that, thanks only to the trade unions, was shared between all Australians.

More specifically, every worker had a full time job, 10 days paid sick leave, two weeks paid annual holiday leave, was able to buy his own home if he so chose to, and invariablly had a new car plus a second older one for the maternal ruler of the home to do the shopping in.

Demographic studies needed to class seasonal workers as underemployed in order to provide a tiny poverty section on the graph, the remainder being an enormous rounded hill known as "the middle class bell curve". In point of fact, the seasonal workers... mainly fruit pickers and sheep shearers... invariably had their owned regional home, complete with small livestock holding, orchard, and vegetable garden. For them, employment was not needed for sustenance but for transport, fuel and sundry luxuries. This was the multi-generational regional Australian way of life.

Free trade was introduced by CIA agent Bob Hawke, who became Prime Minister thanks to support by Rupert Murdoch. His successor, Paul Keating, brought us free trade on steroids, plus deregulation of all protections, including tariffs.

Within twenty years, our unemployment was 19% and half the nation was living in poverty. It is much worse today. Meanwhile, all university students were taught that the previous history was one of industrial chaos and poverty, caused by the unions, and that free trade would cause trickledown wealth and prosperity. Most of those graduates still believe this.

Australiam prosperity was destroyed for a specific reason. As the only fully self-sustaining nation, that traded only because this made a certain sector wealthy, even while causing inflation, this meant that if Aussies refused to buy into the NWO, trade sanctions could not force them to comply. And military pressure would be logistically way too expensive, even for the US. Thus, the industrial economy had to be destroyed, just as it was in America.

Our plan is to restore tariffs, rebuild our industrial economy, and gradually wind down all trade, retaining only that needed to prevent financial imbalance. But that too, would end within four years, the sole exception being NZ. Obviously, we need to hang a whole lot of traitors before launching reconstruction. And, yes, we have covered all the angles. None of us are mere dreamers.

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Aha! I just read your Footnote 4. Bingo!

Baumol's Cost Disease applies to basic government services. Subsidized outsourcing is a major reason why we have higher taxes AND crappier government services. It's not the only reason, but it's a biggie.

It's also why Joe Sixpack cannot afford a doctor. Medical care in Europe is lower vs. general income because Europe has sizeable VATs driving up the other costs of living.

(P.S. I now have Fletcher's book on my Amazon shopping list. When time/budget allow...)

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"The famous doctrine of laissez faire, laisser passer, will prove dangerous if accepted in too literal a manner. It is necessary to act on this maxim with prudence and discrimination."—Napoleon

"Free trade for thee but not for me!" —Colonialists

"Yay free trade!"—Rootless cosmopolitan merchants

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I remember being a 'Free Trade' person, as it was part of my Austrian / Libertarian / near zero gov't stage of my career. I owe that era a great debt, but this article, along with "The System is Down" series has advanced my knowledge base greatly.

I've read Vox's material on this on his blog and it was eye opening that the Ricardo Free Trade theory didn't mention labor at all. After all, with NAFTA, GATT, and all the other free trade policies put in by our Foreign Ruling Elite, you'd think that the economy of America would be better than ever. Yet, we have a huge immigration problem (movement of people for labor and handouts), serious issues with the currency, and a hollowed out manufacturing sector. Going back and listening to the critics of NAFTA I see that everything they said would happen has. The Neo-Con lizards aggressively defending NAFTA back then seemed to be hiding their religious desire to use the USA as a stepping stone for their World Gov't, or destroying an independent, reasonably free, citizen-led USA. Such a country simply cannot exist if you wish to rule this realm in all its totality.

"Fletcher goes on to explain that the gospel of free trade was developed by the British after they had industrialized, and it was, Fletcher argues, a strategy specifically designed to prevent other countries from industrializing." I'm reminded of what is still called a 'conspiracy theory', that C. Columbus' bearings in his captain's logs were so off, it was Spain's attempt to mislead the Portuguese and give them the wrong coordinates - send them off to the wrong area so the New World could be Spain's alone. "The Great Navigator's" information in his log is so bad, the Court Historians have a very difficult time explaining it away. How can he be "The Great Navigator" if he is a cloddish, mistake prone Captain so inept as to put amateurishly bad coordinates in the log. I won't go into the writings that the entire story of who CC was is ridiculous, as no way the son of a weaver / cheesemonger would be allowed to marry into a Noble line. ... but I digress.

Anyway, this was a great read. A bit unnerving to think I spent all of that time talking about how protectionism and tariffs were bad. However, I do enjoy learning, and the Fletcher argument and is compelling and fills in some huge gaps when it comes to Ricardian free trade.

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While Fletcher has some good points (none of which are original to him), most of his complaints are nonsense. In fact the typical argument style of opponents of free trade consists of throwing every objection they can think of against the wall to see what sticks, without regard to whether the objections make any sense or even whether they contradict each other.

For example, one of Fletcher's objections is that "capital is mobile" another is that "Resources Get Depleted", i.e., that capital isn't completely mobile. Or contrast his claim that free trade doesn't work in the face of labor mobility, contrast this with Vox Day's claim that one of the problems with free trade is that in requires labor mobility which ultimately leads to cultural problems.

The one semi-legitimate objection Fletcher has to free trade is that protectionism helps shelter fledgling industries. However, this does raise the awkward point that the main complaint of modern American protectionists is that it caused America to deindustrialize. The explanation is simple, America didn't deindustrialize due to free trade, it deindustrialized due to domestic industry being strangled by government regulation. In fact, the effect of this over-regulation on the standard of living was partially mitigated by free trade as industrial production that was no longer possible in America was moved overseas.

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