The removal of trade barriers would, it was always argued, increase growth and so employment and well-being. This was a core idea at the heart of the Washington Consensus, that delivered neoliberalism around the globe.
The problem was, as has now been realised, that even if tariff free trade did deliver growth (and that was open to question in some cases) it was also apparent that the benefits were not equally shared. Data in the disparities of income growth in society over the last thirty or more years are now well known: most benefits have gone to a few. This leaves obvious questions for many on the benefits of growth.
These decades of neoliberalism and global trade have been the most pro-poor eonomic movement ever, the cause of the largest decline in absolute poverty in the history of our species.
This leaves a question on the benefits of growth?
Is it me or does he decry cheap imports? Apparently they’re just job destroyers. Forget they improve our material well-being, consumption being the point of production etc.
No; down with imports!!
Interestingly, he does acknowledge that:
“…labour loses out not just to capital but to other labour. Disruption to domestic markets as cheap import substitutes become available has been a feature of modern economic history”
A laudable display of patriotism: Murphy says that foreigners being paid is bad if it leads to British people being paid less.
You can complain all you like that the foreigners are being lifted out of poverty, but the fact is that they are foreign, and the money is (according to Murphy) wasted if it does not go to Britons.
C’mon, be fair. If it were not only the very richest in society who owned smartphones, reliable cars, LED televisions, designer glasses, silk stockings, fridges, and washing machines, and ate out-of-season fruit and drank imported wine then you’d have a point.
But given you only find all these in Buckingham Palace or the mansions of Russian oligarchs, I think we ought to listen to him.
It’s amazing, the grasp the idea that new technological advances will only ever be available to the rich has on the popular imagination. People really believe it at a visceral level. I find it’s a standard response from your average person when confronted with some amazing new advance that can make life better: “Yeah, but that’ll only be available for the rich, won’t it? What about the rest of us?” Half the time, they post this response online using their smartphone.
What happened to that promise of silk stockings for shop girls?
They must be freezing in this weather.
Ritchie’s not wrong on the facts here. As Tim also says, the benefits have disproportionately gone to a few: the poorest people on our planet. Of course, those are people who overwhelmingly tend to have darker shades of skin. That is what Ritchie’s straight-up objecting to, in what is for him an unusually naked bit of racist ranting.
We have empirical evidence that the Chinese, Indian and Russian economies, to name but 3, all started to grow when they started to free their markets. That it was free markets that led to the growth is strengthened by seeing growth in India and Russia stagnate when politicians started messing about to protect their mates.
But hey, a guy sat with thumb in bum and mind in neutral in a house in Ely is far more convincing evidence for the left.
Due to this being accessed at work I have to limit the length of post but suffice it to say TIm, I think your column in Forbes relating to Wallonia offers an ideal counterweight to a column which while unusually literate has to qualify as one of the single most idiotic I have ever seen. To say he is ignorant would be massively understating the case.
‘Last, we should not forget the tax angle: someone has to make good the loss of tax revenues that trade deals involve and that is rarely, if ever, business. So ordinary people pay.’
Can anyone dissect that statement and not say that the person making it is a clod of the highest order? I mean it is q just shocking that anyone capable of writing such a thing could be considered as anything other than a fringe crank.
‘Disruption to domestic markets as cheap import substitutes become available has been a feature of modern economic history and hollowed out economies are the consequence, with social stress following.’
This sounds like he is advocating some kind of North Korean (or indeed Apartheid South Africa) seige economy. Keep Imports out!! I mean, just, WTF?????? I am surprised Donald Trump has not picked him up as an advisor for Christ’s sake – just idiocy on stilts.
He does seem to have quite a downer kn “bipartisan trade deals”. His opinions on bilateral trade deals are less easy to discern.
Ironically, I think Tim is keeping Ritchie alive.
Were it not for TW reposting the dribbling ramblings of this remarkably idiotic idiot, he would have sunk, like Corbyn did, from what was already an iceberg type position, rising only briefly when he mentioned to socialists the existence of the Magic Money Tree.
Personally, I don’t get as much fun as I used to from the Ragging series. It’s now a bit like kicking an offensive retarded cripple.
“the loss of tax revenues that trade deals involve and that is rarely, if ever, business. So ordinary people pay”
Because ordinary people don’t pay for the tax business would pay otherwise? Do businesses have magic tax money trees?
What actually is the loss of tax revenues that trade deals involve?
Jack C – I’m interested in the increase in tax as a result of increased profit due to trade deals. Presumably that also happens?
If there’s an import tax of 10% and a company imports £100m of goods, they pay (presumably) £10m tax. If we set up a free trade agreement, this tax is no longer paid.
The tax gap is getting bigger and bigger by the minute!
Martin,
Understanding Murphy is a job for God alone.
John Miller
‘Ironically, I think Tim is keeping Ritchie alive.’
That may well be true – Tim is certainly very much the reason I visit TRUK.
‘Were it not for TW reposting the dribbling ramblings of this remarkably idiotic idiot, he would have sunk, like Corbyn did, from what was already an iceberg type position, rising only briefly when he mentioned to socialists the existence of the Magic Money Tree.’
I am not sure that is true – look at the prevailing intellectual climate. Idiocies like an FTT, CBCR, Peoples QE – these are all being discussed in intellectual circles now and while the Laft in the UK looks a bit buggered currently at a Parliamentary level, it still holds complete sway across the education system and in the bureacracy, at local government level at least. While Murphy is not clever enough to have created these ideas, his advocacy of them has been key in getting them into the intellectual mainstream.
‘Personally, I don’t get as much fun as I used to from the Ragging series. It’s now a bit like kicking an offensive retarded cripple.’ which ordinarily would be unconscionable but in his case, he needs to be continually kicked, often and hard, until such time as he is disappeared from the intellectual scene.
@ Dave
“few” includes the 3 billion people living in China, India, Bangladesh, Pakistan and “IndoChina” (South-east Asia excluding Myanmar). But probably no-one in Downham Market (he won’t know anyone in Ely yet).
Dear Mr Worstall
From the perspective of the average champagne socialist, neoliberal capitalism is a danger because the world is rapidly running out of poor people whom said socialists can wring their hands over and pen anguished articles for their publication of choice.
In RitchieWorld™ only tax can save the poor.
DP
Most of Murphy’s variegated stances on economics can be be understood as a cri de coeur at the beastliness of the world in making him move to a smaller house. Set against that cosmic injustice, a few million kids in Africa not dying of diphtheria is small potatoes.
@Dave
The benefits of trade have overwhelmingly gone to the poor in rich countries too. Basically all the cheap tat made in China is what keeps prices low in Walmart. The issue is that much of the costs of free trade (and technology) have been born by some of the poor.
John77>
So you admit it’s not being shared evenly, you neoliberal pigdog!
“the largest decline in absolute poverty in the history of our species”
Aye, but it hasn’t benefited any of the people who pay Murphy (or at least no more than it has anyone else), so it’s a bad thing.
Sorry, I hadn’t realised that BiCR had said much the same, and said it better.
You might find Hans Rosling interesting. For example:
http://www.ted.com/talks/hans_rosling_reveals_new_insights_on_poverty#t-16174
DP largely has it.
But I’d go further: the Left needs there to be an underclass of poorly educated, materially-wanting plebs for them to patronise the living shit out of.
Prime example: back near where I came from originally, the Left sent Viscount Stansgate Anthony Neil Wedgwood Benn to condescend on the ignorant dopes.
Hence even when the poor are no longer poor, such as in the UK, they have to convince the dopey buggers that their life is shit, all evidence to the contrary.
Last, we should not forget the tax angle: someone has to make good the loss of tax revenues that trade deals involve and that is rarely, if ever, business. So ordinary people pay.
Ah, Ritchie and the concept of Tax Incidence… Never the twain shall meet.
This is my favorite:
The loss to capital has a third dimension: under modern trade deals the right to profit is being enshrined in agreements so that the ability of governments to intervene in markets is being restricted by a corporate right to compensation if they do, with that right being upheld by secretive courts.
Evidently the governments negotiating the trade deals are doing so in a manner that ensures said governments will surrender their power to govern… or something.
Right.
That is actually quite mind-boggling, that a self-styled economics expert would forget about incidence.
Especially since he wrote a whole rant slagging off the CBI over it:
“CBI tax misinformation – employers do not meet the cost of employer’s national insurance contributiuons”
“And the one thing that all economists are sure of is that the incidence of employer’s national insurance is on labour”
Is it harsh of me to laugh at this, since it is in the bloody title of all places?:
“contributiuons”
Murphy is full of shit.
But a point remains. People in the US for example are saying that in terms of spending power US wages have been stagnant since the 70s. My Dad could run a house, a car and a wife and two kids in the 60s and have a slowly but steadily increasing standard of living on one average office workers wage. That true today? When the state is trying to “help” couples onto the house ladder–with often both working?
How many are living in credit–cards/loans etc. There were fuck-all loan ads on tv in the 60’s –as far as I remember.
“Get the Strength of the Insurance Companies around You” is the ad I remember best from those times but no shit such as 118118 loonies offering loans. You’d be better off with a loan from The Goodies.
I’m not denying the benefits to the former 3rd world. Good on them. But lets not get carried away with how prosperous we are. A lot of fancy dan tastes may have developed in the West and there is lots more electronic junk to buy now. But taxes, inflation, regulation and state meddling/bungling are surely eating the innards out of civil society.
The cause is statsim and socialism not “neo-liberalism” whatever the fuck that is supposed to mean. Freedom fosters prosperity. Tyranny begats poverty and we have growing tyranny.
Ritchie’s greatest moment is about to happen. He has just told Christian in Hastings that of course he can trade with Toronto as well as Athens, but there’ll be a tariff on it and “so?”.
The stupid fucker’s mind is so far out there now he sees Greece enjoying favourable trading terms compared with Canada as the natural state of affairs instead of an international anomaly. He’s not alone though; how did we get here?
On the principle of “Who gains?” I think we must consider the possibility that Spud is a fiction, invented by Worstall to amuse us all. Accordingly I suggest we nominate the aforesaid above-mentioned Worstall for the Nobel Prize in Literature. Has there been a finer comic character than Spud since Jeeves and Wooster? Or, at least, M. Hulot?
“There were fuck-all loan ads on tv in the 60’s –as far as I remember.” But people bought their tellys on HP.
Come to think of it there have been zillions of funnier characters than Spud: most of Dad’s Army for a start.
“But people bought their tellys on HP.”
Most people rented given the unreliability and regular need for valve changes and need for retuning. A school friend from the ’60s earned a tidy living servicing rental TVs well in to the early ’80s when reliability killed his trade.
“Ironically, I think Tim is keeping Ritchie alive.”
Even a year ago I never had much interest in what Murphy said, even as an example of a leftist idiot. These days I have no interest whatsoever.
BiND
” when reliability killed his trade.”
See!!!!!! Trade kills jobs!!!!
35 years ago I lived in a house with no central heating and had to dig through the snow to get to the coal shed. Today I live in a house with central heating and if I wish I could sit around in my chuddies all day. Where have I lost out?
Nautical Nick,
He’s always interesting and insightful, and what an end to the presentation.
A tapeworm like Murphy actually likes poverty. The nihilism and sheer evil of this man needs underlining.
Nostalgia corner:
Mr Ecks: “Get the Strength of the Insurance Companies around You” Yes – it ended with the family being encircled in a castle tower. Leaving aside TV ads, Lloyds, NatWest and Midland launched the Access Card in competition with Barclaycard with a massive mailshot issuing cards to their customers many of whom cut the cards up as the work of the devil.
Dearieme, BiND: yes TV rentals via D.E.R.
And, yes, Murphy is becoming a bit betamax but he’s still got a place in my heart as a lichen-encrusted reconstituted stone garden gnome. We’ll all miss im when he’s gone.
I hate going to his site to read his posts, they’re so boringly written and such drivel that I feel my life ebbing away. Anyway, I just gave up a few more seconds of my life to check this assertion:
“The problem was, as has now been realised, that even if tariff free trade did deliver growth (and that was open to question in some cases) it was also apparent that the benefits were not equally shared. Data in the disparities of income growth in society over the last thirty or more years are now well known: most benefits have gone to a few. This leaves obvious questions for many on the benefits of growth.”
And yet again we find a data and citation free post so have to draw the conclusion that he’s making it up.
Its a pretty fair assumption with everything he has written that he has made it up.
He’s a very interesting psychology study using his public posts and written works.
Intereresting that Trump is saying similar things. Richie will have an aneurysm when he finds out.
It fits in with this bizarre take on the Wallonia veto and Brexit: http://www.euractiv.com/section/trade-society/opinion/wallonia-the-real-reasons-to-postpone-ceta/
“Did the Brexit vote or recent votes in some Eastern European countries not send a sufficiently clear message? Its citizens do not want a purely economic and financial Europe at the expense of its rich cultural diversity delivered to the commercial practices of unregulated globalisation and the legislative sovereignty of international arbitration courts.
They wish instead for a Europe that states, through the expression of a real democratic freedom, the richness of its differences and values.”
Actually, this Brexit voter voted to have the EU sod off, and let’s get cracking on free trade, free of that self-absorbed, set of institutions. Certainly the Euro did deliver a Europe that’s not purely economic and financial, since it’s been a disaster for both. Be seeing you!
Should make the Brexit negotiations fun.
“Right, we’ll have free trade thanks.”
“Don’t you want a rich cultural diversity …”
“No thanks, just free trade”
“We can offer expression of a real democratic freedom [Shulz, quiet down there at the back] …”
“No, really, I’m sure that’s lovely but we’ll still just take the trade, thanks.”
“But won’t you at least consider the richness of differences and values?”
“No. Just put the trade in the bag, and we’ll be off”