For the past 20 years, I've heard Republican, free-trade, free-market hacks talk endlessly about Adam Smith and global economics. They've been big on talking about how countries should specialize in 'what they do best' in much the same way that different departments in a factory specialize in different tasks, and how these efficiencies maximize production. I had one Republican teacher who told me that this doctrine would mean that some countries should focus on cars, others on airplanes, others on gold production, others on coffee production, others on banana production, others on cotton production and so on.

Feeling brave, I once asked him, "well, what if a country only gets a certain, limited standard of living from such an arrangement? I mean, if all you're doing is growing and processing coffee, your citizenry may not make enough money to create a viable middle class. They might be paid so little that the government can't sufficient taxes to create a viable state necessary for solid infrastructure, health care, education and the like. What's your take on this?"

The professor answered more or less in this way: "certain countries should stick with what they do best in the international economic system. We need to maximize efficiencies. If Costa Rica is best at banana production, then they should only make bananas. That's how they will fit best into the global economy. This may mean that their people may be poorer than Canadians, because they're agricultural, but this is far better and more stable for them, and the global economic system, than if they tried to diversify their economy by focusing on science, industry and the like. Besides, they have a healthy tourism industry, fueled in large measure by Europeans and Americans, and this helps them make more money. Being relatively underdeveloped helps Costa Rica maximize their efficiencies. They should keep doing what they're doing and not do anything else." There was something fatalistic here that made me uneasy---in this free-market system, countries would not be allowed to change their economic base. If they are the best at ABC during a given decade, they would be strongly discouraged from ever doing anything else. How could countries progress if they were forever kept in a single economic state? And why should a country willingly do this for the sake of the "economic order?" Whose economic order was this, anyway?

That's when I started to question the premises of any and all doctrinaire, one-size-fits-all approaches to economics and politics. Princes back in the days of Henry VIII lacked such dogmatic approaches to politics and economics, and I was curious as to why ideological canon and rigid dogmatism so riddled statecraft in the modern age. Further, I was skeptical that free-trade was being used "to maximize benefits for all" in the way that many of its adherents proposed.

Many free-traders (most of whom came from the West) hated governmental interference in the economy, through either tariffs, subsidies or infrastructural investment. That said, many of these countries developed, went through an industrial revolution, and became first-world economic powerhouses through the utilization of tariffs, subsidies and infrastructural investment. Once they reached G7 Status, and created a global economic system, it seems they decided that they would deny developing nations the use of these same tools. Rather, they seemed like they wanted to relegate them to the status of permanent suppliers of raw-materials, labor, or low-cost goods which were imported into the G7 nations for purposes of refinement, processing and higher-level manufacturing and industrial production. And if this wasn't the conscious intent, it was at least an unintended side-effect and consequence of the wishful idealism and doctrinaire economic canons espoused by the G7.

On another day, I asked my Republican economics teacher why we should be outsourcing and off-shoring industrial and manufacturing capacity to other countries? My worry was that, if America lost its manufacturing base, we would be at a disadvantage in some future geopolitical conflict. Being a student of history, I knew that these happen with great regularity and that the newfound "Pax Americana" of the 1990s (when I was in college) would be short-lived. As Confucius said, "All things that are unified, eventually fall apart. And all things which are apart, eventually come together."

My professor told me that off-shoring helped cement US alliances abroad, reduced the power of organized labor within the United States, maximized profits for job-creators in the United States, and the lower-cost goods brought into the country by way of free-trade agreements would ensure that the lower wages created by the emasculation of organized labor would not have any detrimental impact on consumption and consumerism in the United States. He said that even if such things happened, that it would be short-term and that credit cards and financial instruments would ensure that consumption and consumerism continued unabated.

I asked him if it was a good idea to send our most advanced industrial and manufacturing techniques and processes to China? I told him that they might duplicate our industrial practices and techniques, gain needed experience, and start beating us at our own game at some point in the future. He assured me that this was a way to control China, and that the Chinese, because they were communist, lacked the inherent ability (due to their governmental structure) to compete with the United States industrially, or pose a real threat to the world in terms of military power. Ever. He told me that the Chinese may be good at manufacturing low-cost pencils and toys, but that they would never have the ability to manufacture high-grade electronics, compete with us in terms of computers, biology, chemistry or anything of the sort. He said that Western nations have a longer history of academic freedom and intellectual inquiry and that China was a closed society that focused on rote memorization and that they lacked the ability to compete with us, long-term.

I told him that Hermann Goering once said that "America can make good refrigerators, but they'll never make good fighter planes." I told him that Goering was a fool, because he failed to realize how top-notch consumer manufacturing directly influences top-notch military manufacturing. And how, during WW2, all of our weapons production was carried out by businesses and factories which had, only 2 years prior, been wholly devoted to consumer products---Ford, GM, Chrysler, etc.....An Ivy League educated economist (a modern day Mandarin or Brahman)---he was naturally dismissive and did not consider my concerns.

Well, more than 20 years have passed and history has proven me right. America's problems right now are wholly of our own doing.

China is about to become a Superpower of a kind the world has never seen---far more powerful than the United States ever was. And it will upend the world-order and help further erode the legitimacy and endurance of liberal democracy throughout the world. I do not foresee major world war with China. Rather, I see her becoming so mighty that her size and wealth alone not only deter any and all challenges, but ensure a state of economic and political subservience among all other powers, even members of the G7.

Our leadership class has utterly and absolutely failed us in almost every conceivable way.The Republicans failed America by putting the interests of their financial contributors above the interests of America. And the Democrats, in the past, failed us by not doing enough to fight the GOP in the most important forums, and on the most important issues. That they ceded the "high ground" on so many important issues in the 1990s continues to astound and befuddle me.

Views: 86

Comment by Ron Powell on January 26, 2018 at 10:08am

As I have stated in several ways, the the Democrats have been winning the debates and losing the elections since the days of the 'Southern Strategy' and the 'Silent Majority'.

Apparently satisfied to have the rhetorical upper hand and the capacity maintain popular majorities cycle after cycle, the Democrats have allowed the Republicans to beat them at that part of the process that makes the other parts matter:

Winning the elections by any means becessary..Including deception and lies.

The Democrats haven't been able to articulate a winning political narrative since FDR who would have been reelected in perpetuity...

The Dems  must develop a winning narrative and bumper sticker slogan that will appeal to an electorate that has an attention span that is shorter than the life cycle of a the fruit fly.

It has occurred to me that if they can make the truth sound like a lie and make it work in 30 second sound bite  which can be condensed to a message on a bumper sticker which is no longer than 4 words they have a shot at gIning and sustaining a political edge that can out live the electoral cycles in between Super Bowls....

Comment by alsoknownas on January 26, 2018 at 11:08am

Manufacturing a well built aluminum foil three cornered hat to be worn by the isolationists could lead the inventor to riches and be the last product ever with a made in USA label.

Comment by Ben Sen on January 26, 2018 at 11:19am

The most stupid thing a country can do is rely upon one asset or product.  In this country, look what happened to Detroit.  Your teacher was nuts.

Comment by koshersalaami on January 26, 2018 at 11:40am

Your professor was a dogmatic fool, preaching a gospel he should have thought through. Let’s start with his most obvious mistake, and it’s not even ideological:

In the 1960’s, Made In Japan was a joke. That label indicated cheap unsophisticated junk. By the time your professor was teaching you, life had changed, Big Time. 

His second mistake is what happens when the price of your national specialty commodity takes a nose dive and takes your economy with it. One of my manufacturers was doing a lot of business with the Saudis. Oil fell, so now they can’t. 

Comment by Rob Wittmann on January 26, 2018 at 11:49am

The weird thing is that I’ve read Adam Smith. He doesn’t say (or mean) many of the things that the free-market folks  attribute to him. His writings are more complex and nuanced. I think he’s intentionally misquoted and misinterpreted by folks at think tanks, et al, in order to advance certain agendas. 

Comment by Tom Cordle on January 26, 2018 at 12:08pm

Where to begin? I guess by stating that Adam Smith and Thomas Hobbes have been usurped by reactionary conservative and both men's writings have been misinterpreted and misappropriated  to justify suspect economic and political theories. Both Smith and Hobbes clearly stated that the purpose of government, and capitalism in the case of Smith, was to promote the Commonweal.

The Founders borrowed that idea in the Preamble, where two major purposes were laid out – two provide for the common defense and promote the general welfare. Reactionary conservatives seem to have all in favor of the former, but react as though they never heard of the latter.

If universal healthcare doesn't fall under the umbrella of general welfare, pray tell what does?

Comment by koshersalaami on January 26, 2018 at 1:53pm

Whatever promotes the welfare of Generals

Comment by Tom Cordle on January 26, 2018 at 10:11pm

Kosh is right, that prof is a fool. But hey, let's take his advice and specialize in America as the country that concentrates on producing bananas. Then we'd only need professors who taught about banana production. Your prof should be all for that, since he'd have job security, seeing as how he IS bananas.

Comment by Maui Surfer on February 4, 2018 at 10:03am

American Politics is the South's REVENGE for the Civil War ... b. buckley, so argue with him conservative dipshits.

China has ruled the majority of Earth's commerce for three thousand years (and I'm part Chinese!) We had a one century dip with the Boxer Rebellion and Manchuka, etc., but that is all passed, and so is the USA. Second place, this country is now the Silver Medal country, and the full blame belongs on what is now the modern Republican Party after several re-alignments. In the end, cash wins, and China has it, again, the only time they were short was when Mao was screwing them and starving them. Well, that is all over and get used to it. Your professor is a whitewashed, brainwashed, idiot. As pointed out, his "thoughts" come out of the Southern Strategy and so can't be anything but evil when put under the microscope. As to just growing Bananas, as Lincoln said, "Let those for it have it practiced on them ..." Fucking elitist piece of shit. Pure racism masquerading like a Halloween Party. I clearly remember, just before the Oil Embargo that screwed Carter, thousands of Hondas, the tiny little early Civic models that got like 45 gallons a mile, just sitting there, who let them in, I don't know, but once gas prices rose like a fake stock market run, they sold like hotcakes, and formerly embarrassed muscle car drives headed to work in little go-carts. Kosh has pointed out how Japan manipulated the Marshall Plan and then dumped under-priced from manufacture electronics on the US, killing Sylvania, RCA, and so many other US institutions that had UNION JOBS where people could live with dignity. We better get these half-witted idiots and Russkie Red Pinko Lovers out in November or we may even kiss the Silver Medal good-bye, it could go to Western Europe and we would be stuck with the Bronze. One thing I've learned, they are all in it for the money, traitors each and every one, would rather live in gated communities with armed guards then share the wealth with the workers who build the best products in the world, or, used to anyway, before they got hooked on Oxycontin.

Comment by Tom Cordle on February 5, 2018 at 11:31am

I once test-drove one of those first little Hondas; it had a 600 cc motorcycle engine and was chain-driven – that's right, chain-driven!

Anyone interested in an expose of what happened to American manufacturing is directed to David Halberstam's brilliant book "The Reckoning", which was a sort of twin biography of Ford and Nissan that lamented the rise and dominance of bean-counters. You know, the guys who gave us "planned obsolescence" and Ford Pinto's that burst into flames in small accidents.

That book came out in 1977, the same year as Graf Crystal's "In Search of Excess", a scathing expose of the corrupt CEO compensation scam. And CEO compensation has become even more glaringly obscene in the interim. Adam Smith must roll over in his grave every time a crapitalist apologist uses Wealth of Nations to try to justify such obscenities.

1977 was also the year the movie "Network" came out. In that film, writer Paddy Chayefsky predicted the news would be turned into infotainment and presaged the rise of multi-national corporations – the infamous Jensen speech from that movie ought to be required viewing in every high school in America. Forty years ago, these three writers predicted the future with stunning accuracy. I'm still waiting for Americans to shout from their windows and the streets "I'm mad as hell, and I'm not going to take it anymore!"

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