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The Idiocy of Protectionism

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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-22-09 03:04 PM
Original message
The Idiocy of Protectionism
http://www.economist.com/blogs/lexington/2009/09/the_id...

<snip>

FORD makes transit vans in Turkey, with passenger seats in the back. When the vans are shipped to America, the brand-new seats are immediately torn out and recycled.

Why? Because 46 years ago, Europe slapped tariffs on American chickens. America retaliated with a tax on European commercial vans.

To get round this, an American firm's European factory adds passenger seats to its commercial vans so they can be classified as passenger vans, which attract a lower tariff. Then it trashes the seats once the vans are safely landed in Baltimore.

<snip>



I wish Obama understood just how stupid protectionism is in the long run...
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ingac70 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-22-09 03:07 PM
Response to Original message
1. The lack of jobs in today's economy....
Edited on Tue Sep-22-09 03:07 PM by ingac70
shows just how stupid it was to NOT be protectionist.
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Warpy Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-22-09 03:07 PM
Response to Original message
2. Targeted protectionism like that is always stupid
but a lack of protectionism when we're dealing with highly protectionist countries like China and India is truly insane.

Free trade without fair trade has brought this country's people to their knees.

Or hadn't you noticed?
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-22-09 03:13 PM
Response to Reply #2
4. Targeted protectionism
Is precisely what Obama has engaged in.
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BobRossi Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-22-09 03:12 PM
Response to Original message
3. Then the law should be changed.
Tax the living shit out of EVERYTHING coming in from protectionist countries.
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-22-09 03:14 PM
Response to Reply #3
5. Hmmmmm
Edited on Tue Sep-22-09 03:14 PM by Nederland
I wonder how they would respond?

Tariffs do one thing: reduce trade. All trade. Imports AND Exports. If you are opposed to trade, you should be in favor of tariffs.
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