Protectionism?

[Die Neue Zeit]

http://www.cpgb.org.uk/worker/763/letters.html



Regarding Mike Macnair’s article, I have a few points of agreement and disagreement on the question of protectionism (‘Revolutionary charades and musical chairs’, March 26 (http://www.cpgb.org.uk/worker/762/revolutionary.html)).

On the one hand, nation-based protectionism is a non-starter, unless perhaps it’s the United States, and even then should exclude protectionism for small farmers against third world products.

On the other hand, continents do need to have at least a minimum level of self-sufficiency, and the Third World does need some form of "protectionism" (not to mention debt forgiveness) in order to develop properly.

I propose that any sort of demand for "fair trade" - necessarily at the transnational level - should merely follow up on the "reverse globalization" resulting from the oil spike before the economic meltdown, restarting industrial production in the developed world, while leaving small farmers there at the proletarianizing mercy of third world produce.

As for "nationalizations," there should be a demand for the European Union equivalent.



So, any thoughts on my e-mailed letter above?

[Pawn Power]

We can talk about what global economic regulations look like but when it comes down to it, it is a question of power and not what is best for the global market. What is important is the markets of those making the decisions (like the G8). So protectionism can be used by the US, like they have so tremendously in the past, to secure an economic advantage, but it cannot be used by developing nations. These nations must deregulate and be open to global economic competition.

When these economic regulations are discussed we have to frame it in terms of power to understand the double standards that take place. The 'third world' needs protectionism sure, they also need to not to have been plundered by imperialist countries. But they don't get to dictate economic policy, they must get in line or face the punishment of embargo (like Cuba, Iraq in the 90's etc.) When they get in line and 'accept' deregulation in the global market then you get massive inequality, like Chile, Argentina, and Mexico. It is a loose loose situation.

There are exceptions of course, the Asian 'Tigers' had enough economic clout to maintain the protectionist policies and it paid of with tremendous economic growth.

[Cult of Reason]

The 1930s Technocrats advocated protectionism/self-sufficiency for the North American continent. It applies equally to any area that could operate as a self sufficient unit. Protectionism within a minimum self-sufficient unit is bad as it increases the scarcity of various products in different areas and goes against comparitive advantage, while between such areas there is only a small bad-side to protectionism, as each area, by definition, has all the stuff it needs within itself.

Of course, what areas these would be need to be determined. Since these areas would probably be similar to what areas would be able to support Communism (since Communism must be self-sufficient), the article linked to in my signature may be relevant.

[cyu]

On the one hand, nation-based protectionism is a non-starter, unless perhaps it’s the United States, and even then should exclude protectionism for small farmers against third world products.


I think one of the key failures of anti-protectionism rhetoric is that it assumes a competition-based market economy (ie. international capitalism).

If we threw out international capitalism and replaced it with a cooperation-based economy, then protectionism would be no problem - in other words, your local policy would be to both protect your own industries, while at the same time improve economies around the world.

If your own industries didn't have to outcompete everyone in order to survive, then they wouldn't be afraid to freely give out their trade secrets and patent rights to economies around the world.

Excerpt from http://knol.google.com/k/j-y/capital-flight/gcybcajus7dp/5#

Self-reliance is the only secure form of wealth. Trade with other nations can still be conducted, but do not hold on to their money - money is mere promise of future wealth, promises that can be broken whether from malice or from inability to fulfill them. Exchange any money for real wealth as soon as you can...

People can probably be trusted when times are easy and when prosperity reigns, but when times are tough, promises are much easier to break than the laws of survival. This is what makes self-reliance of an economy important. This is why local industry and agriculture should be protected. Productively ability is the real source of wealth of the nation.

However, natural disasters also occur. While the world as a whole may be fairly stable, the area around you is much more prone to random fluctuations of climate and geology. Thus self-reliance is not the entirety of a secure economy, but merely the supporting structure. The secondary source of security is prosperity in other geographical locations. The more prosperous others are, the more likely they will come to your aid in times of trouble. The more they have to thank you for their prosperity, the more likely they will come to your aid. Again, merely being creditors to their debt is not enough. Nations are sovereign, whether anarchist or authoritarian. They can break their promises - they can ignore any legalistic claims to debt. It is the general goodwill that can be fostered between two nations or people that will be your salvation in case your own self-reliance fails.