Free Trade with South Korea

[Michael Hardner]

Our technology has progressed more quickly than our ability to socialize widespread economic change, and adapt to it.

[madmax]

Explain how this statement affects trade deals in a positive/negative or neutral manner. Its an interesting quote, the discussion could go anywhere.

Here is my diversion...

Regardless, Unbalanced trade deals can override a technologically superior country or give a country unearned access to a market.

As long as people are involved the trade will never be free, fair or balanced.

The current trade deals strip Canada of its technology and reduce Canada to an export of resources nation.

There is strategic reasons for this that Global corporations and foreign countries can exploit.

Its like a throwback to pre 1867 trade.

[hitops]

If you want to look at it that way wouldn't we better off if we eliminated whatever you do?

You consistently miss the point. Nobody likes to lose their job, progress marches onward. We can't ban cars because that took work away from farmers who raised and sold horses, nor will we cut your electricity because by using it, you are oppressing the innocent folks who need jobs delivering kerosene oil to your house. Those ideas sound silly, yet you are making the identical argument in the modern context. Economically speaking, you need to make an effort to see beyond the 3-4 feet in front of your face.

Edited March 14, 2014 by hitops

[madmax]

There is a difference between changing technologies with regards to employment restructure and Trade Agreements which create employment and capital relocation.

One takes advantage of Technologies, the other takes advantage of 3rd world labour costs, environmental and health and safety costs.

One is exploitation , the other is technological advantage.

Considering my Nephew just spent 6 months training South Koreans to replace his 1000 coworkers in Ontario, their skills in CNC, Machining, Nuclear and Other Hydroproducts etc.... are to be eliminated...

The way other Canadian Companies have responded is to use Foreign Labour "Temporary" ... which is why I am surronded by more affordable Chinese Electricians...

Either way, a trade deal with a Foreign country with lower, wages, .. in the range fo $60 to $800 per month depending on the skill or trade is going to have direct impact on canadian labour rates.

This should not suprise anyone, and in some cases , the clowns cheer.

However, Until everything else in Canada balances itself, give it 50 years... we will shed both wages and jobs , while raw resources requiring LESS comparative techonology and human labour prevail.

On a Brighter note, my other relative is heading off to china to work. As that is where the work its, wages aren't high , but overall costs are also lower.

[Wilber]

You consistently miss the point. Nobody likes to lose their job, progress marches onward. We can't ban cars because that took work away from farmers who raised and sold horses, nor will we cut your electricity because by using it, you are oppressing the innocent folks who need jobs delivering kerosene oil to your house. Those ideas sound silly, yet you are making the identical argument in the modern context. Economically speaking, you need to make an effort to see beyond the 3-4 feet in front of your face.

I am not talking about losing jobs to technology or because society's needs change, that is a fact of life. I was responding to this comment made by

August.

If my neighbour decides to force his family to only eat vegetables from his own garden, should I do the same in my family? Moreover, if he decides to sell me some of his tomatoes at a good price, should I refuse his offer on the grounds that he forces his family to only eat vegetables from his own garden.

August doesn't care if other countries keep our products out by imposing tariffs, as long as we drop ours so he can buy his Hyundai for 6.5% less, regardless of the impact on the Canadian economy. He must think he has a pretty secure job if he believes he can't be affected either directly or indirectly by such policy.

And you accuse me of not being able to see more than three or four feet in front of my face.

Edited March 14, 2014 by Wilber

[madmax]

By your logic, Madmax, we could make Canada even richer if we imposed a special tariff in Canada and forced Hyundai, for example, to manufacture cars in the Yukon.

====

Economics 101 IMV? It's better to buy a cup of coffee at $1.40 than at $1.60.

Interestign logic that is..

That logic landed us TOYOTA . At that time, the Auto Pact only allowed for Cars made in Canada and the US to have special Export Import Status. In order to take advantage of that situation, Toyota made plants in both Canada and the US. Particularly during the REAGAN era, he put up HIGH TARRIFS on Japanese goods, which did two things. Japanese Motorcycles were made in California to avoid the tarrifs, and of all things, Harley Davidson arose from that ashes, as until then the Japanese had almost wiped Harley Davidson off the map.

Sir John A Macdonald brought in the Tarrifs and he built a nation, and changed it from a Resource Export, exploited territory of some 350 years and created a country on what today would be considered unsound, uneconomic measures. But it forced foreign Capital into the nation.

Today we direct Foreign Capital away to take advantage of the tarrifs.

Yes by my logic you are correct.

I stand by it.

but it would not be the Yukon, as automanufacturers locate in the regions with appropriate, resources, skills, support and labour force , something the Yukon does not currently have..

They would likely locate in Ontario , where steel is still in abundant supply and the plastics CNC industry is still technically sound.

Edited March 14, 2014 by madmax

[Wilber]

August imagines a world where computers and robots do all the work and humans just consume. In such a world the only people who would work are those who design the robots and write the software, the rest of us would just sit on our asses and enjoy unlimited consumption.

Unless the robots could design themselves and the computers could write their own software, then there would be no need for humans. Evolution at work.

[bleeding heart]

But Bonam, as Asimov and Philip K. Dick both addressed, the notion of robots "programmed to serve and obey humans" is complicated by the fact that humans are in constant conflict with one another.

A robot cannot "obey and serve humans"....only some humans, and at the expense of other humans.

[hitops]

I am not talking about losing jobs to technology or because society's needs change, that is a fact of life. I was responding to this comment made by

August.

August doesn't care if other countries keep our products out by imposing tariffs, as long as we drop ours so he can buy his Hyundai for 6.5% less, regardless of the impact on the Canadian economy. He must think he has a pretty secure job if he believes he can't be affected either directly or indirectly by such policy.

And you accuse me of not being able to see more than three or four feet in front of my face.

You see world trade as a zero-sum game, that is short sighted. You believe that by liberalizing our trade, we hurt ourselves because you don't see the economy as a fluid machine but only as monolithic parts. It's no different than people who think immigrants coming in means less jobs. It's the exact same thinking, that does not recognize the constant motion and re-organizational capacity of a free economy.

We benefit from free trade, even if other countries are protectionist. Protectionist countries lose in the end. Allowing Hyundais into Canada doesn't only mean less Fords. It means that the thousands of people who can now get their Hyundai's for $5000 (take any number you want) less, have $5000 more to travel, puts their kids in swimming, buy millions more Tim Hortons, or get extra upgrades on their Hyundai at the after-market body shop.

All regulatory regimes require enforcement. When you free up trade, you not only benefit the sectors that were previously subsidizing (being forced to pay for) whatever sector was protected, you also gain the natural advantages of capital flowing to it's more efficient point, and eliminate the cost of administering the regulatory system. It's a net gain.

The answer to auto industry fears of competition is not to protect them from real competition, it's for them to become more competitive. It's not far to make the rest of us pay more to subsidize a union that cannot compete, just as it would not be fair to make everyone pay more for food so that horsemen could still have jobs taking it to market in covered wagons. If Koreans are more competitive and make better products, they deserve the right to sell them to willing consumers and not penalized for being better.

We have conclusive proof of the effects of protecting the domestic auto makers. They have needed to be bailed out many times. The unions have repeatedly killed the domestic auto sector, not helped it. Politicians have kept it alive with everyone else's money. If the US had let those companies pay the consequences of the their union activism and fail, the big 3 would be making quality vehicles today, not the Koreans.

Edited March 15, 2014 by hitops

[Wilber]

Read my post again and August's comment again. August isn't talking about free anything. He doesn't see anything wrong with them keeping tariffs on our goods as long as we drop ours so he can buy their products for less, even though our products are being priced out of their markets because of their tariffs.

By insisting that they drop their tariffs if we are going to drop ours, that isn't protecting our domestic automakers, it is giving them a level playing field on which to compete. Do you guys hate the auto workers so much that you can't understand something so basic?

[bleeding heart]

Wilber's right. "Free trade" is not supposed to be only and solely about "buying inexpensive goods." The very underpinning of the theory demands as much of a level playing field as possible....not just so that the price of Hyundais will continue to go down in the Canadian market.

[hitops]

Read my post again and August's comment again. August isn't talking about free anything. He doesn't see anything wrong with them keeping tariffs on our goods as long as we drop ours so he can buy their products for less, even though our products are being priced out of their markets because of their tariffs.

By insisting that they drop their tariffs if we are going to drop ours, that isn't protecting our domestic automakers, it is giving them a level playing field on which to compete. Do you guys hate the auto workers so much that you can't understand something so basic?

No I did understand your point.

The point I'm making is that we should not be the business of protecting our domestic auto industry, or any other industry. That's true even if other countries protect theirs. When you lower trade barriers, you always benefit as a country, even if other nations do not lower theirs. You see it as a zero-sum game, where only Canada loses by lowering trade barriers is others do not. But it is not a zero-sum game. We also benefit, if only Canada lowers trade barriers, because things get cheaper for us.

[Wilber]

="1394998164"]No I did understand your point.The point I'm making is that we should not be the business of protecting our domestic auto industry, or any other industry. That's true even if other countries protect theirs. When you lower trade barriers, you always benefit as a country, even if other nations do not lower theirs. You see it as a zero-sum game, where only Canada loses by lowering trade barriers is others do not. But it is not a zero-sum game. We also benefit, if only Canada lowers trade barriers, because things get cheaper for us.

You don't understand anything. If you give up all your capacity to produce to others, where is your wealth going to come from in order buy these cheap goods? I suggest you look up the defintion of the word TRADE.

[Michael Hardner]

If you give up all your capacity to produce to others, where is your wealth going to come from in order buy these cheap goods? I suggest you look up the defintion of the word TRADE.

From your exports.

[Michael Hardner]

From your exports.

Wait... is hitops saying that others won't/shouldn't lower their tariffs ? That doesn't make sense.

[Wilber]

Wait... is hitops saying that others won't/shouldn't lower their tariffs ? That doesn't make sense.

I think he is saying it doesn't matter if they lower theirs as long as we lower ours and you are right, it doesn't make sense. How are we supposed to export if their tariffs keep our products out?

[Michael Hardner]

How are we supposed to export if their tariffs keep our products out?

I guess if you want to kill your own country's jobs out of spite for unions then this does make crystal clear sense.

[TimG]

When you lower trade barriers, you always benefit as a country, even if other nations do not lower theirs. You see it as a zero-sum game.

That may be true but countries are always better off if trade barriers are reciprocal. Therefore, it is very important not to give up any negotiating leverage that would get the other countries to reduce their trade barrier. If one country unilaterally drops it trade barriers then other countries have no incentive to drop theirs. For that reason along it is a bad idea to unilaterally drop trade barriers. Edited March 17, 2014 by TimG

[eyeball]

Well, you do need a big stick to go with the soft talk and what we should do is refuse to trade, at all, with any country that refuses to reciprocate.

Of course, I would have already shortened the list of potential traders we could do business with by tying trade to human rights and environmental standards...but that's just me.

[Michael Hardner]

... the list of potential traders we could do business with by tying trade to human rights and environmental standards...but that's just me.

What about the ones who wouldn't do business with us because of our records ? Since we can't even get states and provinces to agree on standards then it just seems like a recipe for isolationism.

[eyeball]

What about the ones who wouldn't do business with us because of our records ? Since we can't even get states and provinces to agree on standards then it just seems like a recipe for isolationism.

Well, you got me...it's actually a double edged recipe for cleaning up our own act too.

After all, if you're going to talk the talk...

It sucks for us that the race to the bottom is a lot easier on politicians.

[Michael Hardner]

It sucks for us that the race to the bottom is a lot easier on politicians.

Who decides what the bottom is ? At some level, people have to make trade-offs between social, environmental and economic choices whether you are North Korea or Sweden.

How about this idea - countries that are engaged in trade treaties have to elect representatives to a trade council that will lobby both countries for policy change ? Just thinking about this now.

[eyeball]

Who decides what the bottom is ?

The market apparently.

How about this idea - countries that are engaged in trade treaties have to elect representatives to a trade council that will lobby both countries for policy change ? Just thinking about this now.

Maybe, if in-camera lobbying was made a crime against humanity I probably say sure give it a whirl, otherwise I'd rather give my idea a try first.

[Michael Hardner]

The market apparently.

Right.

[dre]

Actually you dont even know if you get cheaper stuff or not unless you look at the whole picture. Countries running large trade deficits with the developing world are also amassing huge ammounts of public and private debt. So the stuff you are buying isnt really cheaper, you are just deffering part of the payment to another time, add adding interest onto the ammount.

What you are saying is like claiming buying something on a credit card makes it cheaper. Because you walk out of the store not having reached into your pocket for a single dime. One sided trade deals are the same thing... countries racking up huge debt by running trade defecits arent really getting stuff cheaper. Unless we have BALANCED trade we are really just borrowing money to buy stuff.