Sunday, August 24, 2008

The Real Deal

Here are Joe Biden's votes on trade issues, via Marginal Revolution. Summary: JOE BIDEN HATES FREEDOM! And puppies, but that part is just a guess.

Very unfortunate. Especially considering the results of a recent study on free trade, also posted on Marginal Revolution.
We find evidence that a specific treatment, liberalizing tariffs on imported capital and intermediate goods, did lead to faster GDP growth, and by a margin consistent with theory (about 1 percentage point per annum).
Oh well. Who cares if we're poor?! At least we won't be buying fruit from Chile!


fatrat said...

We don't know if those votes were necessarily bad. Remember Ron Paul's campaign -- a lot of these "free trade" deals aren't really free trade. They're managed trade deals and forms of corporate welfare.

Young Vader, you need to learn to use the force to see through the labeling of government proposals. Was "The Patriot Act" patriotic? Hell no. No reason to believe that these free trade votes were really about free trade.

Sean said...

Whatever you think of these specific votes, Biden is against free trade in general.

fatrat said...

I acknowledge the benefits of free-trade between two societies that have similar values, but I'm not really excited about trade like what we have with China. I'd impose tariffs on China on products that use slave/prison labor for manufacturing. Labor arbitrage where country B uses slave labor and where country A doesn't use slave labor hardly makes any sense at all from a humanitarian perspective. If Biden were objecting on this basis, I wouldn't be so opposed. I'm not so eager to extract purchasing power out of my dollar if it comes at the expense of human rights somewhere else in the world.

Sean said...

No! You sound like a damned liberal! Low-paying "sweatshops" are not slave labor; the people who work there have low skills, and they are their best chance of escaping poverty. Globalization and free trade help make future generations richer--just compare China today to China 30 years ago. The poverty reduction has been tremendous. Policies like a minimum wage would only prevent people in these countries from working, and keep them poor.

For more on this issue:

fatrat said...

Sorry, but I don't think we should be subsidizing slave and prison labor. Think about the consequences of such actions: 1) You take away jobs from locals, AND, 2) You promote the values of a police state that believes in slavery. This isn't the same thing as sweat shops where people work hard. This is where people work against their will. (Similar things exist in the US, where prisons utilize prison labor here and arb the difference between what they bill the state and what they pay the prisoners.)

I just don't see labor arbitrage as a legitimate arb because it almost always comes at the cost of quality of life for humans -- you could easily view this as a kind of externality. Tariffs address the externality, so there's nothing here that violates the sort of economics we're all taught in school.

Really, there's nothing that a widget builder in China has over an uneducated widget builder in the US. Why would we want to transfer wealth to a tyrannical regime?[1] There's no reason to do so.

[1] I mean this in a theoretical sense, since we know the US is no longer a true place for the free and the brave.