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Obama champions free trade

Schadenfroh

Schadenfroh

Elite Member
http://www.reuters.com/article/idUSTRE6B31D220101204
President Barack Obama vowed on Saturday to work with Republicans and Democrats to pass a free-trade pact with South Korea that he said was a model for future agreements he would seek in Asia and around the world.
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I must applaud Obama for seeking to expand ties with friendly countries that have similar domestic labor costs to ours. Hopefully, this will open up new markets to U.S. corporations and lead to increased competition to improve our own industries. We still have some protectionist tendencies to overcome with Korea in regards to the automotive industry (America's darling) and the beef industry (Korea's protectionist fear of U.S. agriculture).

Now, there is always the issue of government subsidies to select industries. That makes free-trade deals like this one so tricky.
 
Obama prefers the East over the West. He is seeking a US/South Korea/Japan/India/Indonesia type of alliance to oppose the EU/Russia/Iran/China/North Korea alliance. This is just another step in the realignment of US foreign relations.

It's been happening with our previous presidents, too. Clinton, Bush, and now Obama are setting the future foundation of American foreign relations.
 
senseamp said:
Korea is very protectionist. I hope any trade agreement with them does not give away the house.
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From what I've read about it the agreement seems pretty equitable for both parties.

I guess we can thank ole Kim for propelling SK yet further into our corner.
 
Looks like The Big Three stand to gain in this more than I thought:
http://www.npr.org/2010/12/10/131968047/south-korea-free-trade-deal-could-be-boon-for-gm
The United Auto Workers union is backing the plan
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But, not everyone is quite so happy...
Lee says while the trade pact may help the auto industry, it will only encourage U.S. manufacturers to move to South Korea
...
Recent polls have shown Americans increasingly skeptical of free trade
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Similar domestic wage costs? Think again-
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From your links, average net monthly income for manufacturing jobs:
America: $2,372
South Korea: $2,598
 
I'd rather have US automakers building cars in South Korea than Mexico. How come people are OK with cars from a country where you can't even drink the water?
 
Looks like the Panama and Columbia FTAs have hit snags, unfortunately.

http://www.bloomberg.com/news/2011-...ade-deal-delays-cost-u-s-jobs-lugar-says.html

The top Republican on the Senate Foreign Relations Committee said failure to ratify free-trade accords with key allies Panama and Colombia would further cede market share to countries including China, costing U.S. jobs.
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Looks like Obama will have to overcome challenges within the Democratic Party to get this one passed.

We are losing market-share in these countries fast. But, these treaties bring hope.
“Ratification of the free-trade agreements would help to reverse these trends and solidify market opportunities for U.S. goods and services,” Lugar said.
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The wonky thing about agreements with certain countries is how a lot of products in Europe or Asia can be used in North America but a lot of North America shit cannot be used in Europe or Asia. It usually comes down to sizes and design philosophy.

Let's try a few examples of this. In North America, it's pretty standard to have a hot water tank in your basement. You turn on the hot water tap and water comes from a hot water tank. So then theoretically you could sell things like that to Europe since they use hot water too, right? Not so fast. In Europe, water tanks are not the standard. The standard there is tankless water heaters which heat water on demand and don't store any of it. Those tankless heaters are also catching on in North America. The result here is that people in America would buy tankless heaters from these other countries, but people in these other countries don't want your domestically produced hot water storage tanks.

Car design is another example of how something only goes one way. You can drive a mini cooper on an American road. You might have a hard time driving a Ford F150 on an English road.

Hopefully I'm wrong and things ship both ways in approximately equal amounts :whiste:
 
Jhhnn said:
Similar domestic wage costs? Think again-

http://www.worldsalaries.org/usa.shtml

http://www.worldsalaries.org/korea.shtml

Better than China, whose grossly undervalued currency accounts for a lot of this-

http://www.worldsalaries.org/china.shtml

And then there's Germany, still the world's leading exporter-

http://www.worldsalaries.org/germany.shtml
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So you think Americans should take large paycuts to make us more competitive with the Germans? Is that the message to take away here?
 
ShawnD1 said:
Car design is another example of how something only goes one way. You can drive a mini cooper on an American road. You might have a hard time driving a Ford F150 on an English road.
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Since most cars are already made by huge multinational companies with production spread across the world (and different models to suit) I think that's largely a wash.
 
What we need is a group of experts to answer the question, how can we best pull the world's bottom up without pulling the top down - independents, not corporate agendas.
 
Korean's aint idiots like Americans. They will sign it but it won't be worth paper it's printed on, the people won't buy, called cultural tariffs - they understand buying local keeps more money at home and someone will buy something they make. Germans too, while Germans cars are more expensive that's almost all you see on German roads.
 
Zebo said:
Korean's aint idiots like Americans. They will sign it but it won't be worth paper it's printed on, the people won't buy, called cultural tariffs - they understand buying local keeps more money at home and someone will buy something they make. Germans too, while Germans cars are more expensive that's almost all you see on German roads.
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Didn't the US pull the same shit when signing NAFTA? Even with "free trade" there are still import taxes in Canadian goods. Why bother signing an agreement if you won't honor it? We should have known this would happen just by looking at how well treaties with the abidigitals were honored.
 
Craig234 said:
What we need is a group of experts to answer the question, how can we best pull the world's bottom up without pulling the top down - independents, not corporate agendas.
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You can't pull anyone anywhere, at least not for long. If I pick a cripple up out of a wheelchair, he'll fall back down unless I've fixed whatever crippled him in the first place or he's been rehabilitated. There is more empirical evidence for this than I can shake a stick at, and surely even you've heard of some of it - the lottery winners who go bankrupt almost immediately after rising from poverty to millionaire. People need to learn how to manage themselves before throwing money at them can achieve any lasting good for them.
 
Zebo said:
Korean's aint idiots like Americans. They will sign it but it won't be worth paper it's printed on, the people won't buy, called cultural tariffs - they understand buying local keeps more money at home and someone will buy something they make. Germans too, while Germans cars are more expensive that's almost all you see on German roads.
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Americans are really the only ones who are stupid enough to truly believe the Free Trade religion. Every other country is smart enough to protect itself.
 
Looks like Obama should have things wrapped up soon with South Korea. Congress hampered Bush's efforts to put these free trade agreements in place, now that Obama is pushing them as well, it should convince a number of Democratic law makers that it is the right thing to do. But, Colombia and panama are taking a little extra time to analyze, so hopefully they will be finalized as soon as possible to ensure American trade relations remain dominant in South America.


http://www.npr.org/2011/03/07/134316904/s-korea-trade-deal-may-be-delayed-by-other-pacts
The Obama administration is hoping to win quick approval for its new free-trade pact with South Korea, but that deal may be held up by two trade agreements with Colombia and Panama
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The Bush administration negotiated trade agreements with both Colombia and Panama, but they were never approved by Congress. The main objections concerned labor rights. The Obama administration is now working to strengthen those agreements, as it did with the South Korean deal.
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Create 70,000 jobs? LOL, right. Maybe in the fantasy world where American labor is cheaper than Korean. Are politicians and economists really that stupid?
 
I'd have to see the terms of the deal to pass judgement. To say libertarians/conservative/faux democrats believe in 'free trade' is laughable. What we have with China is not 'free trade' when they a) Socialize the cost of doing business (heavy pollution), b) subsidize their industries ('dumping' their products into foreign markets with government subsidies to destroy competitors), and c) manipulate their currency.
 
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Phokus said:
I'd have to see the terms of the deal to pass judgement. To say libertarians/conservative/faux democrats believe in 'free trade' is laughable. What we have with China is not 'free trade' when they a) Socialize the cost of doing business (heavy pollution), b) subsidize their industries ('dumping' their products into foreign markets with government subsidies to destroy competitors), and c) manipulate their currency.
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China is violating WTO policies with their mercantilist policies. The problem is that the USA and other countries are completely unwilling to call their bluffs so they keep doing it.

Overall, free-trade agreement is a good thing if done right provided that both countries keep to the spirit of the agreement (unlike China).
 
sMiLeYz said:
China is violating WTO policies with their mercantilist policies. The problem is that the USA and other countries are completely unwilling to call their bluffs so they keep doing it.

Overall, free-trade agreement is a good thing if done right provided that both countries keep to the spirit of the agreement (unlike China).
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We're unwilling to call their bluff because the owners of capital are making money hand over fist and they have their ideological attack dogs (heritage foundation/CATO/the libertarian party/the Koch brothers/Republicans/Democrats in the pocket of big business) to call anyone who disagrees with the terms of trade 'communist', even though one side doesn't play fair.

If anything, China and other Asian nations KNOW free trade doesn't work and that's why they have smarter policies regarding trade than we do.

In any case, the underlying argument for free trade, comparative advantage, is a farce to begin with:

http://en.wikipedia.org/wiki/Comparative_advantage#Free_mobility_of_capital_in_a_globalized_world

Ricardo explicitly bases his argument on an assumed immobility of capital:

" ... if capital freely flowed towards those countries where it could be most profitably employed, there could be no difference in the rate of profit, and no other difference in the real or labour price of commodities, than the additional quantity of labour required to convey them to the various markets where they were to be sold."[5]
He explains why, from his point of view, (anno 1817) this is a reasonable assumption: "Experience, however, shows, that the fancied or real insecurity of capital, when not under the immediate control of its owner, together with the natural disinclination which every man has to quit the country of his birth and connexions, and entrust himself with all his habits fixed, to a strange government and new laws, checks the emigration of capital."[5]
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We know this to be BS because capital is HIGHLY mobile in the modern world. As long as a country is politically stable, owners of capital will gladly move it there as long as they get better returns.

Libertarian economics is based on some outdated 17th/18th century economist. What a fucking farce.
 
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I agree that Libertarians most liberterians are borderline retarded, but it doesn't mean free trade is a bad thing. NAFTA is widely regarded as a success.
 
sMiLeYz said:
I agree that Libertarians most liberterians are borderline retarded, but it doesn't mean free trade is a bad thing. NAFTA is widely regarded as a success.
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But you're comparing apples to oranges, Mexico is a much smaller country (in terms of population) than China is, so it's effect is harder to measure. Also, Libertarians aren't borderline retarded, they're just retarded period 🙂
 
SammyJr said:
Americans are really the only ones who are stupid enough to truly believe the Free Trade religion. Every other country is smart enough to protect itself.
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No, America just benefits more from free trade than most countries do. That's why we push it. As a general rule you'll see wealthy, industrialized nations push for fewer trade restrictions while developing nations try to protect their markets. As one of the biggest and most advanced economies and one that holds the international reserve currency, the US is in a good position to maximize trade gains and minimize the social costs.

(our big problem is that the Republicans heard about the trade gains, but forgot about mitigating the internal social costs of displaced labor factors.)
 
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