Well of course

The Chinese need to compromise to secure Doha. So do the Indians, South Africans and Brazilians. But the West should be leading the charge when it comes to freeing-up world trade – not in the name of charity or \”development\”, but as a result of cool, dispassionate analysis combined with naked economic self-interest.

For of course the purpose of trade is imports.

We shouldn\’t care one tiny bit what other people do to prevent their citizens getting access to our lovely cheap and wonderful produce. We should only care that we ourselves don\’t put barriers in the way of we ourselves getting access to all those lovely cheap and wonderful products made by the various different flavours of Johnny Foreigner.

The only logical stance to take on trade is unilateral free trade: for it\’s the imports which are going shopping and exports are only the dreary shit we have to do to pay for them.

5 comments on “Well of course

  1. But one barrier to getting our hands on lovely cheap imports is an inability to sell our exports? A bit like a barrier to going shopping is – as well as the opening hours – not having a job.

  2. Didn’t work so well for 16th and 17th Century Spain when it relied on imports and decided to stop exporting everything other than gold and silver specie…

    Just saying.

    Tim adds: I think you’re getting a tad confused there. Spain at this time was *importing* that gold and silver from Latin America. Because they had lots of specie (ie, the great mercantilist myth) they thought they were rich, rich! Without realising that if you double the money supply without doubling production you get …..inflation.

  3. Matthew – if we can’t sell exports then we can’t buy imports, yes. Consequently the other countries won’t get any money from exporting their goods, as we can’t buy said exports (imports from our point of view). Typically, other countries’ solution to this is to subsidise their exports, so basically they transfer money from their own taxpayers to the importing countries. Or alternatively, they gradually realise the self-defeating nature of their policies, and decide to liberalise trade all around. In the worst case, they insist on maintaining their import barriers and the UK is in the same situation as if the UK had imposed its own trade barriers in response, but has at least saved some money by not needing to write any laws about this.

    Basically, not imposing trade barriers is the best you can do regardless of what the other countries do.

  4. The point I was trying to make, in a round about way, was the one made in Landes’ The Wealth and Poverty of Nations (I was reading it the day before I posted that comment in the LSE Library).

    We may export in order to import, but the production of goods to export has benefits in excess of the imports you can buy. For example, Spain thought it was rich and spent freely but neglected its domestic industries and traders by doing so, this was much to the detriment of Spain for the next…what 400 years?

  5. I understand the issue, Tracey, I just believe that it’s not obviously the case that unilateral free trade is always the best way to encourage multilateral free trade.

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