--- Peter D'Souza <[EMAIL PROTECTED]> wrote:
>
> When you talk about "not having a problem" with a certain business
> model, or another one being "acceptable", you're essentially trying to
> create an equation which says that if one country gains jobs by trade or
> outsourcing, then the other country must necessarily lose. This pattern
> of thought left economies such as India very stunted for decades. The
> only ways by which a country to prosper are to establish rule of law,
> provide good education and allow free trade (in that order).
Your comments are not without merit. However, I am inclined to believe that you
look
only at the positives of globalization by looking at the larger picture, without
looking at the immediate impact. That is what, I believe, most economists do as
well.
Yes, in the long run, and perhaps in an ideal world, free trade will have many,
many
benefits. But that is still a theory, since there is no "free trade" anywhere
in the
world, and we have not reached the year 2050 (?). What we have today is a
pseudo-free trade where some industries are protected and some are not.
Today, Chinese textile imports in the US are reduced by a quota. The same
exists for
shrimp from Thailand or Catfish from Vietnam. At the same time, farmers in the
US/EU
are heavily subsidised allowing them to undersell rice/wheat etc.
Here I am not arguing the merits or demerits of quotas or subsidies, but merely
pointing out their existence in the US and all countries in the world. So when
we
talk abot free trade today, we must talk about its benefits with a caveat.
Now let us say all countries eliminated quotas and subsidies overnight. Don't
you
think that entire industries in almost every country will be destroyed by
China? Let
us forget the US here and just think about the impact it will have in Cambodia
or
Bangladesh or Pakistan, where textiles form the basis of their export. These
industries will vanish overnight in those countries and their already sickened
economies will die.
We see that today happening on a limited scale with textiles, plastics etc.
There is
a cost. Not to the businesses for sure, but to the workers.
Now I come to my last main point. If free trade is to be successful, then
perhaps we
should also allow free transfer of labor. That does not happen and perhaps will
never happen.
-Tariq
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