What are some arguments AGAINST free trade?

[battleknight24]

I am writing a paper on the pros and cons of free trade. I am just about done with the part arguing for free trade. What are some of the best arguments against free trade?

[mountainvue]

1. Well,

I hate to point you in this direction but Google some of Pat Buchanan's columns and you should be able to find plenty there. Good luck.

[sasquatch]

2. Go read some Jim Hightower articles about Free Trade

They present the best argument against Free Trade.

[DaveSZ]

3. Free trade without labor and environmental standards

is the equivalent of child slave (basically) labor for corporations.

Ever wonder who stiched together your NIKE shoes?

[DesolationRow]

4. Here are some, off the top of my head.

Fair trade requires a level playing field to achieve the results free trade is trying to achieve. But, there isn't a level playing field. So what happens often is that the more wealthy countries dominate the action. Subsistence farmers either have to produce for export or go get factory work. Often the wages they receive, due to poor labor laws, are no longer enough to feed themselves and their families. This is exasperated by the subsidies the wealthy nations use to flood the third world markets with cheap goods. Once the profits are made they can go basically anywhere. So any wealth created is not necessarily staying within the country. That is a very poor way to build up a society. South Korea became such a success story by doing the exact opposite. They even had the death penalty for capital flight and tough laws on foreign investment. That is how you build a society up; keep the money flowing within it.

Also, the way free trade is practiced now there is a lot of speculation (currencies and such) and very little real investment. I've heard numbers like 90% speculation and 10% real investment.

Maybe the simplest way to see what is wrong with it comes from Noam Chomsky. When discussing embargoes against Haiti which were carefully crafted to allow western companies to still export their goods and allow exotic foods to be exported to "yuppie markets" he made the comment "That's food and nuts off a starving island." Don't need many fancy formulas to figure out how wrong that is imo.

That's just some quick thoughts. Sorry if they are a little disjointed, but I'm off to bed, so I won't be able to respond back tonight.

[the Kelly Gang]

5. well from an Australian point of view this :

the USA is demanding we drop restrictions on TV content which currently must be a certain percentage of local content and is responsible for our booming film industry..so it will be nipped in the bud.

We have a generous drug subsidy scheme were no patient pays more than about $17 for a script..and the government negotiates to buy drugs at reduced prices in big quantities from US drug firms..who naturally are writing into the current US/Aust FTA a clause to change that..

so someone looses in a FTA..but never the US !

[Nevernose]

6. It has ALWAYS failed

Every time it has been tried, it has failed miserably. Chile, for instance, which went from a 4% unemployment rate in 1971 to a 40% unemployment rate by 1981. In Palast's book, "The Best Democracy Money Can Buy," he mentions the existance of a certain economist at Johns Hopkins -- he's made an average of 73% profits in the speculation market that whatever the IMF/WTO/WB does, it will fail. In every case, this is not a result of left wing fanatics, but a result of the inherent weaknesses of the philosophy (unlimited greed).

I am fairly moderate -- at least by DU standards -- but it seems to me that there are three major points to be made here:

1. It has been tried already (look at the facts of Chile, not the Chicago Boys' hype). It has failed. "Fair trade" has been instituted in other countries as well, though not to the extent of Chile, and it has failed there as well.

2. "Fair Trade" -- MUCH LIKE COMMUNISM -- is absolutely perfect in theory, but leaves a lot to be desired in actual practice. Even most uber-conservatives I know cite communism as being "great in theory, terrible in practice." Same with unrestricted Free Trade. Neither theory accounts for the base human emotion of greed. Augustine has been warning us against this deadliest of deadly sins since the eight century; the current Chicago Boys'/Ayn Rand/Reaganomics utopia of unrestricted, world-wide greed fails to account fo this most basic failing of humankind.

3. We HAVE tried the current model of "Free Trade" before. It was called "The Middle Ages." Mankind has moved past this. This, as you may know, failed.

There is clearly a place between the extremes of Free Trade and Communism that works. WORKS. It's called Keynsian economics. It's been working for us just fine for the last seventy years. In fact, Keynes' ecomics have made us the most powerful nation in the history of the world.

I should mention that free trade on a small-scale -- often referred to as simple capitalism -- isn't such a bad system, unless someone abuses it or we don't take steps to protect ourselves (federally insuring banks for every account up to 100k, for instance, or preventing insider trading).

[Slickriddles]

8. I'm really reluctant to reply to a person named Argumentus

But here's my two cents worth of understanding. Free Trade is only called for when a nation has the economic advantage to benefit from the trade. In the history of England, or the US, mercantilist (gov. regulation) theories or protective tariffs come first. Only after these economies are pumping and need markets do they become converts to Free Trade. It's a little bit like Free Speech -- you're perfectly free to buy a radio station and a TV station and a couple of daily news papers..uh what's that you don't have $1000s? Well, whose fault is that?

Also Keynsian economics, at least here in the US, are tied in with enormous amounts of military spending and also rely to some extent on markets and really cheap labor in the 3rd World.

[Nevernose]

9. I registered as Argumentus because.... (free trade rant, too)

i registered as Argumentus, originally, because I wanted to argue. I wanted to use all of those fancy things like "syllogims" and "that's an ad hominem attack" that I learened in some logic class that I was taking for --get this -- fun. I've forgotten all of that shit now. Literally. I was also concerned at the direction that DU, my favorite lurking place, was taking -- seriously anti-Israel and seriously anti-Southern United States. I wanted to argue those points. Alas, I am stuck with the name. But, as I've posted on many other threadsm, it took me over three years to get this far; why should I change now?

You wrote: Free Trade is only called for when a nation has the economic advantage to benefit from the trade. In the history of England, or the US, mercantilist (gov. regulation) theories or protective tariffs come first.

The first part of this quote rewuires that one nation has an ecomomic advantage over another. Then, in itself, is not a bad thing. In any trade, one party will have the advantage over another. Yet there is a diffference between having an advantage and using said advantage, and taking advantage. In the original post, I mentioned Palast's book; he himself mentioned the situation of Ecuador. I don't think that a netion, even a third world one, has a right to broadband interent communications or their own space program; they do, however, have a right to clean water. And that is what a total economic destablization, encouraged by the IMF/etcet, has brought on them.

Fifty percent of their popualtion that used to have access to clean water had that stripped from them (I believe that it was a Euro/American conglomorate that did it, but I could be wrong).

This is immoral. IMMORAL. A business has the right to make money for its shareholders until it becomes harmful to someone else. You can insert Michael Moore's infamous argument of "why doesn't GM sell crack" here; it would be good for the stockholders, right?

As far as Keynsian economics is concerend, it doesn't have to be based upon military spending. As I understand it, that is a perversion. The real basis of Keynsian economics is in the unpopular-to-the-far-right-things. Increasing, slowly and wisely, the minimum wage. Above all, big-time spending on government projects. The reason the South has electricoty today is due to Keynsian economics (the TVA); it doesn't have to be military. It might do the U.S. a hell of a lot more good, in the long run, to invest in solar panles for gov't buildings than it would be to threaten other nations with imminent destrucion that everybody already knows that we can deliver to them.

I will say, once again, that the United States only came to power when truly under the sway of Keynsian economics. Not Stalinism, and not "Free" Trade; Keynsian economics. Why fix it if it ain't broke?

[Slickriddles]

12. No Argumentus Here ;-)

Hey it's a good handle, as we used to say on the CB radio. Not quite as psychologically evasive as Slick Riddles, but the latinate ending gives an air of early modern university disputation.
My point originally, and I don't think we disagree, was demands for Free Trade arise at a time when the European powers have gained an advantage in technology (steam powered gunboats, military hardware in general) that allows these nations to dominate almost any trade relationships.
I was thinking mainly about the Opium Wars in China in the 1840s as a classic example of what is meant by Free Trade. England at that time had an unfavorable balance of trade with China. England bought tea, and because China didn't need or want any English goods England paid in silver. The English decided that selling opium to the Chinese would redress this balance (they had plenty of opium coming out of India -- a colony of theirs.) Without,I beieve, morality ever being considered the English used their gunboats to "open China" to opium all under the banner of "Free Trade." More interesting still is that US companies insisted on their share in the opium trade under the Open Door policy.
See, if China refuses to allow the wide open sale of opium within their borders they're against "Free Trade." I don't think there is a better argument agaisnt free trade than the opium wars.

[TreasonousBastard]

7. Truth is...

there are no good arguments against free trade. It's like arguing against domestic trade. I suppose there's some difference assumed between free trade and fair trade.

It's all in how you define things.

There are plenty of arguments against how trade is currently being played, though. I'll leave you to the research, but here are some starting points:

The World Bank and IMF have avoided local microloans and indigenous economic growth in the third world, preferring megaprojects that upset local economies and destroy the social fabric without significant overall economic gain. The IMF insists on "corrections" that squeeze local economies to the point where they can barely survive, much less grow internally.

Capital can be instantly moved around the world for the best short-term gain, and this disrupts local economies when there are major inflows and outflows.

Low cost of capital in third world countries is initially a good thing, but squeezing production costs often means squeezing labor and flouting environmental rules. People are taken off of local production, whether agricultural or crafts, and put into factory jobs that pay less than a living wage with no opportunity to grow their own food, find housing, etc. They make more, but their standard of living is often less then when they were subsistance farmers.

Competition often reverts to simple price competition, and many commodities and products are overproduced, leaving little or no profit. An example is coffee production, where countries like Viet Nam went into production of cheap robusto beans, glutting the market and driving prices in South America and Indonesia to below the cost of production, and destroying those indigenous markets.

Foreign companies often move in and simply extract resources, leaving little for the local economies but corruption. Examples are oil drilling in Africa and gold, copper, and diamond mining.

Rich countries can make demands on weaker ones that can bring those weaker ones to their knees and destroy whatever gains they might have made. Argentina and Chile are excellent examples.

Free trade does not exist in the real world. Just like domestic competition, there are 600 pound gorillas who will screw things up, and a whole host of smaller players who will also screw things up while trying to get their piece of the action.

[JCMach1]

10. How about 'FAIR TRADE'

What we call FREE TRADE is just warmed-over neo-colonialism...

[durutti]

11. The first thing to understand is that "free trade" is a misnomer.

What's typically called free trade in this country (and pretty much only in this country) is more properly termed neoliberalism. The very fact that it's termed as the former is really a sad indicator of who controls the range of debate.

In practice, "free trade" essentially means allowing Western corporations to establish monopolies in the Third World. Prohibiting African countries from purchasing or producing generic AIDS drugs (much cheaper than American brands but just as effective) is supposed to be "free trade".

The most obvious negative consequence of neoliberal policies is that it forces a "race to the bottom" in terms of wages. Without barriers to investment, corporations can now invest wherever they'll find cheap labor. Countries are forced to "bid down" one another, depressing wages in First World countries. In the U.S., for example, real wages have fallen steadily since 1973.

This bidding down extends to social wages as well -- so things like healthcare and education are cut -- water is even privatized -- in order to attract investment. And in advanced capitalist countries like the U.S., it's no longer possible to enact New Deal-type programs successfully, because companies can now just invest elsewhere.

So it's a lose-lose situation. Neoliberalism hurts living standards both in the First World and the Third World. And because Third World workers are getting paid so little, they don't generate enough demand to develop their own indigenous enterprises; they're completely dependent on First World investment.

Of course, protectionism is just as bad. Tariffs protect First World workers at the expense of the rest of the world.

What we really need is to make progressive reforms at the international level by pursuing things like an international minimum wage. Another idea is to impose a tax on investment abroad and put the revenue in a fund for Third World development.