Defence and the Free Market

[JimC]

Tariffs are clearly a form of government interference in the free operation of markets, and not one designed to control fraud etc. (the usual Sethian exceptions...). Whether they have benefits or drawbacks in any given situation is another question...

[Seth]

Tariffs are clearly a form of government interference in the free operation of markets, and not one designed to control fraud etc. (the usual Sethian exceptions...). Whether they have benefits or drawbacks in any given situation is another question...

Actually, tariffs can be designed to control fraud if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

A free market in one nation is not truly a free market so long as foreign governments can conspire to damage or control that market without sanction.

[JimC]

Seth wrote:

if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

[Svartalf]

Remember when Indian cloth destroyed the British woollen industry...

[Seth]

Seth wrote:

if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

No, not really. The essence of a free market is that government(s) keep their thumbs off of the scales of private contractual commercial transactions. Yes, cheap labor is a draw for producers and that's not a free market problem, it's a feature. But when the government of the cheap-labor nation is in control of the costs of labor and manipulates its own economic policies and laws to enslave citizens into "cheap labor" as China does routinely and even owns the "means of production", which is also the case in China where the Chinese military runs factories and profits from them while using slave labor to produce goods, or where China interferes with free market economics to dump cheap steel on the international markets by using government force and money to permit the below-cost dumping that's not an inevitable consequence, it's an initiation of force and fraud by that government and destroys the "free" part of "free market."

[JimC]

I'm not a fan of the oppressive Chinese government, but their effects on the world economy do not have to be a Marxist conspiracy, but merely the playing out of global economic forces...

[Scot Dutchy]

Remember when Indian cloth destroyed the British woollen industry...

Cotton industry.

[Seth]

I'm not a fan of the oppressive Chinese government, but their effects on the world economy do not have to be a Marxist conspiracy, but merely the playing out of global economic forces...

Except that their effect on the world economy, among other things IS a Marxist conspiracy, or had the fact that China is a Communist country run by Communists somehow escaped you? Whatever you think is "playing out of global economic forces" with respect to China is actually part of a very carefully-planned long term Communist agenda of enriching and empowering China at the expense of other nations so that it will eventually be in the economic and military position to once again physically export Communism outside of China through military force.

Those who do not understand the inherent danger of doing business with, enriching and becoming economically and politically entangled with Communist China are the very definition of Marxist useful idiots.

Why the FUCK do you think Communist China is building artificial islands on reefs in the South China Sea and installing military bases, weapons and equipment on them? Why the FUCK do you think that they are building a much, much larger navy? Why the FUCK do you think they are developing long-range hyper-speed ship-killing missiles and submarines? Why the FUCK do you think their military is expanding and modernizing at an unprecedented rate?

Wake the FUCK up!

[JimC]

Yes, yes, I know, they're not the marxist messiah, they're just very naughty boys...

[Forty Two]

Seth wrote:

if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

However, if in country X, the minimum wage is 1 cent an hour minimum wage, and they have little to no liability for workplace injuries, unemployment, etc. and have very little occupational safety and health regulation, whereas country Y has nearly 800 times the minimum wage, coupled with high expenses for required workers compensation, unemployment compensation, health benefits, and occupational safety and health regulations/costs, then there are two entirely different "markets," not one combined market. So, you don't have "a" free market. You have two different markets.

The entire foundation of free market theory is removed when you're referring to two markets operating mostly independent of each other, with goods being exchanged "between" markets, not "within" a market.

A free market presupposes that there is VOLUNTARY exchange of goods and services at "market prices" (where supply and demand can actually operate). One of the basic principles of a free market economy is "equal treatment under the law." So, where you have one market treated one way, and another market burdened significantly more, together they don't make a free market, because the principle of equal treatment has been destroyed.

[Forty Two]

I'm not a fan of the oppressive Chinese government, but their effects on the world economy do not have to be a Marxist conspiracy, but merely the playing out of global economic forces...

Sure, but that doesn't mean it's a free market, or that the dumping of Chinese goods on the US market is somehow a consequence of the free market.

[pErvinalia]

Seth wrote:

if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

However, if in country X, the minimum wage is 1 cent an hour minimum wage, and they have little to no liability for workplace injuries, unemployment, etc. and have very little occupational safety and health regulation, whereas country Y has nearly 800 times the minimum wage, coupled with high expenses for required workers compensation, unemployment compensation, health benefits, and occupational safety and health regulations/costs, then there are two entirely different "markets," not one combined market. So, you don't have "a" free market. You have two different markets.

That's the idea behind 'comparative advantage'. That's a cornerstone of liberal market theory.

And they are they same market while ever they buyers are meeting sellers. It's nonsensical to claim say China and the US don't operate in a market.

[Forty Two]

Seth wrote:

if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

However, if in country X, the minimum wage is 1 cent an hour minimum wage, and they have little to no liability for workplace injuries, unemployment, etc. and have very little occupational safety and health regulation, whereas country Y has nearly 800 times the minimum wage, coupled with high expenses for required workers compensation, unemployment compensation, health benefits, and occupational safety and health regulations/costs, then there are two entirely different "markets," not one combined market. So, you don't have "a" free market. You have two different markets.

That's the idea behind 'comparative advantage'. That's a cornerstone of liberal market theory.

Do they not teach economics anymore at university? It's only a cornerstone within a market. Comparative advantage based on a lack of equal treatment under the law has nothing to do with market theory, certainly not liberal market theory.

And they are they same market while ever they buyers are meeting sellers. It's nonsensical to claim say China and the US don't operate in a market.

They don't operated under the same, or even similar, regulatory system.

You really are stretching this to make a nonsensical point. Dumping goods on another market is not the free market in action. Dumping goods -- the practice of selling goods to FOREIGN markets at artificially low prices -- is not a cornerstone of the free market. The very idea is absurd.

As Hayek wrote -- "the laws under which government can use coercion are equal for all responsible adult members of that society... " is one of the basic underpinnings of a free market. So, where one market has more onerous and expensive laws and regulations than another, the competition between entities in one market with entities in the other is not a free market. He also wrote of "...the familiar requirements of generality, equality, and certainty of the law is really the crux of the matter, the decisive point on which it depends whether the Rule of Law prevails or not." Lecture III. The Safeguards of Individual Liberty - 19. Fundamental Rights and the Protected Private Sphere. This is basic stuff.

The whole idea of antidumping and countervailing duties is to offset inequalities between or among foreign markets.

[pErvinalia]

Seth wrote:

if you consider government-sponsored support of foreign goods intended to destroy a domestic market and create political turmoil in the target nation to be an initiation of force or fraud by the foreign government, which I most certainly do when it comes to Communist countries like China.

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

However, if in country X, the minimum wage is 1 cent an hour minimum wage, and they have little to no liability for workplace injuries, unemployment, etc. and have very little occupational safety and health regulation, whereas country Y has nearly 800 times the minimum wage, coupled with high expenses for required workers compensation, unemployment compensation, health benefits, and occupational safety and health regulations/costs, then there are two entirely different "markets," not one combined market. So, you don't have "a" free market. You have two different markets.

That's the idea behind 'comparative advantage'. That's a cornerstone of liberal market theory.

Do they not teach economics anymore at university? It's only a cornerstone within a market. Comparative advantage based on a lack of equal treatment under the law has nothing to do with market theory, certainly not liberal market theory.

Comparative advantage works BECAUSE of different regulatory environments (among other things).

And they are they same market while ever they buyers are meeting sellers. It's nonsensical to claim say China and the US don't operate in a market.

They don't operated under the same, or even similar, regulatory system.

Nice goal post shift. They don't need to operate under the same regulatory system. While ever there is voluntary trade, there is by definition a market.

You really are stretching this to make a nonsensical point. Dumping goods on another market is not the free market in action. Dumping goods -- the practice of selling goods to FOREIGN markets at artificially low prices -- is not a cornerstone of the free market. The very idea is absurd.

It's free as long as there is no coercion. No one is forcing anyone in the US to buy those "dumped" goods. Dumping is a good example of how free markets don't really work. The same with the need for anti-trust laws in relation to monopolies.

In any case, I didn't say it was a free market. You claimed it wasn't a market at all. I was debunking that point. Regarding free global trade, once again, the more tariffs that exist, the less free a market is BY DEFINITION.

As Hayek wrote -- "the laws under which government can use coercion are equal for all responsible adult members of that society... " is one of the basic underpinnings of a free market. So, where one market has more onerous and expensive laws and regulations than another, the competition between entities in one market with entities in the other is not a free market. He also wrote of "...the familiar requirements of generality, equality, and certainty of the law is really the crux of the matter, the decisive point on which it depends whether the Rule of Law prevails or not." Lecture III. The Safeguards of Individual Liberty - 19. Fundamental Rights and the Protected Private Sphere. This is basic stuff.

There's no coercion going on. And I'm not really sure why you are going on about dumping so much. It's not like the US just has to accept anything that China flogs in the market. Wiki - "The Department of Commerce has regularly found that products have been sold at less than fair value in U.S. markets. If the domestic industry is able to establish that it is being injured by the dumping, then antidumping duties are imposed on goods imported from the dumpers' country at a percentage rate calculated to counteract the dumping margin." - https://en.wikipedia.org/wiki/Dumping_(pricing_policy)

[Forty Two]

Or simply an inevitable consequence of the supply and demand aspect of cheap labour in one country and expensive labour in another...

However, if in country X, the minimum wage is 1 cent an hour minimum wage, and they have little to no liability for workplace injuries, unemployment, etc. and have very little occupational safety and health regulation, whereas country Y has nearly 800 times the minimum wage, coupled with high expenses for required workers compensation, unemployment compensation, health benefits, and occupational safety and health regulations/costs, then there are two entirely different "markets," not one combined market. So, you don't have "a" free market. You have two different markets.[/quote]

That's the idea behind 'comparative advantage'. That's a cornerstone of liberal market theory.

Do they not teach economics anymore at university? It's only a cornerstone within a market. Comparative advantage based on a lack of equal treatment under the law has nothing to do with market theory, certainly not liberal market theory. [/quote]

Comparative advantage works BECAUSE of different regulatory environments (among other things).

Not as an underpinning of liberal free market theory, buddy. Different regulatory environments means two markets are being treated differently, or that there is unequal treatment under the law within a market -- in either circumstance, that is an unfree market, not a free market.

And they are they same market while ever they buyers are meeting sellers. It's nonsensical to claim say China and the US don't operate in a market.

They don't operated under the same, or even similar, regulatory system.

Nice goal post shift. They don't need to operate under the same regulatory system. While ever there is voluntary trade, there is by definition a market.

But, not by definition a free one. You can have a market in a planned economy -- it's not a free market. To have a free market, you need relative equal treatment under the law. You can't have a system where the government says we'll burden X paper maker more than Y paper maker -- and you can't have two governments burdening their papermakers significantly differently -- that's a market (or multiple foreign markets) -- but, it/they ain't free.

You really are stretching this to make a nonsensical point. Dumping goods on another market is not the free market in action. Dumping goods -- the practice of selling goods to FOREIGN markets at artificially low prices -- is not a cornerstone of the free market. The very idea is absurd.

It's free as long as there is no coercion. No one is forcing anyone in the US to buy those "dumped" goods. Dumping is a good example of how free markets don't really work. The same with the need for anti-trust laws in relation to monopolies.

Dumping is a good example of how unfree markets don't really work. There has to be antitrust laws for there to be a free market. I mean - the absurdities in your argument here belie your ignorance of the subject matter. The whole idea of free markets is that there are not coercive monopolies distorting the market forces. FFS.

In any case, I didn't say it was a free market. You claimed it wasn't a market at all. I was debunking that point. Regarding free global trade, once again, the more tariffs that exist, the less free a market is BY DEFINITION.

Not sure where I said it wasn't a market at all - what I've been communicating here is that it is not a free market.

You're wrong on the tariffs issue -- more tariffs MAY indicate a less-free market. However, where a tariff is imposed as a countervailing measure to anticompetitive behavior or to unfair practices or grossly distorted regulatory schemes, then it's not "less free." The answer is "it depends."

As Hayek wrote -- "the laws under which government can use coercion are equal for all responsible adult members of that society... " is one of the basic underpinnings of a free market. So, where one market has more onerous and expensive laws and regulations than another, the competition between entities in one market with entities in the other is not a free market. He also wrote of "...the familiar requirements of generality, equality, and certainty of the law is really the crux of the matter, the decisive point on which it depends whether the Rule of Law prevails or not." Lecture III. The Safeguards of Individual Liberty - 19. Fundamental Rights and the Protected Private Sphere. This is basic stuff.

There's no coercion going on.

Ah, say, Ah say, Ah say, boy. What in the hell is the matter with you? No coercion? Regulatory schemes imposed by law are coercive.

And I'm not really sure why you are going on about dumping so much. It's not like the US just has to accept anything that China flogs in the market. Wiki - "The Department of Commerce has regularly found that products have been sold at less than fair value in U.S. markets. If the domestic industry is able to establish that it is being injured by the dumping, then antidumping duties are imposed on goods imported from the dumpers' country at a percentage rate calculated to counteract the dumping margin." - https://en.wikipedia.org/wiki/Dumping_(pricing_policy)

Exactly. That's what antidumping duties are for. To counteract anticompetitive behavior on the part of a foreign market. That's what I'm talking about. It doesn't mean it's not a free market. The Chinese behavior in engaging in the dumping is anti-free market, because of the unequal treatment between Chinese manufacturers and American manufactures. The countervailing duties remedy the issue in the unfree market. If the market were free, then the reason for the antidumping duties would not exist.