I don't disagree that a lot of what you say above is
happening. But I disagree that it's all because of free
trade and that govt has let corporations run amock.
In some cases, it's govt that has forced companies
to look overseas. Look for example at what the
current administration is doing to Boeing with it's
plant in SC. Boeing is trying to build in America and
the Labor Dept is suing them, telling them they can't
open the plant that will employ 2,000 because it's
retaliation for a strike years ago in WA. And in this
case it's not just a plant that the govt is screwing
with. That plant makes parts for the 787 which
involves jobs all across the USA and world. But
even in a poor economy, the administration would
rather defend an extremely poor to non-existent
claim by the union. That's a classic example of
where govt regulation gets you. Here you have a
great American company, one of our largest
exporters and the govt is screwing around with
For the most part, those US companies
are doing what any business does. They are
responding to market demand. Put a pack of
fittings on the shelf that are higher quality and
they don't sell as well as the cheap ones. The
builder is too cheap to pay for them, many of
the plumbers will use the cheapest components,
as will homeowners. Companies focus where
they can make the most money, just like you.
The net result is that many products are now
made based more on price than performance.
The problem begins with us. And I don't see
how any more govt regulation is going to fix it.
Yep. There is a conceptual "thing" out there called the "general
marketplace." The general marketplace is the instantaneous sum total of all
exchanges of goods and services.
Since time immemorial, governments have tried to control, or at least
interfere, with the general marketplace. They do this through embargoes,
taxes, tariffs, prohibitions, and other, more clever, ideas. Virtually all
these methods are detrimental to the public at large.
The good news is, however, that the general marketplace always wins. When
governments erect a barrier, the general marketplace finds a way to flow
Consider Prohibition; the circumventions were smuggling and bootlegging.
In sum, virtually any restriction on trade has a short-term effect of
hurting consumers and a longer-term effect of hurting those it was designed
Here's the classic example from Adam Smith's "Wealth of Nations." France
made excellent wine and mediocre cheese. Italy, conversely, made superb
cheese by indifferent wines. To protect the few hundred people in making
French cheese, the French government put an impossible tariff on the
importation of Italian cheese. Likewise, to protect the few hundred people
involved in producing wine, the Italian government imposed a similar
outlandish tax on French wines.
The result: Millions in France were destined to eat crappy cheese and
millions in Italy were doomed to consume crummy wine.
But a few French, those who made wine, and a few Italians, those who made
cheese, made out like bandits.
As of today, the U.S. government is considering a significant tariff on
Chinese solar panels. Oh, such a tariff will help the few hundred or
thousand Americans employed in the solar panel industry, but thousands
(millions?) of American consumers will pay more.
Bottom line: In spite of over 200 years of examples to the contrary since
Adam Smith first observed the deleterious effects of protectionism,
governments are STILL employing the technique.
And we know why, don't we?
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