Twenty Fallacies

[August1991]

Eighth Point: Profit is a bad word

Profit is simply a trick to determine whether an activity creates or destroys "value" in society. By linking this trick to greed, we've created a phenomenal generator of net value. Health care is a service as any other.

If prices don't reflect all values, then what values do prices ignore and why? This a separate and legitimate question but the solution is not to set other goals than profit; the solution is to incorporate ignored values into prices. How much would you pay to do that?

Businesses are not obsessed with the bottom-line in the next three months at the expense of long term thinking. People consider the resale value of a new car and of a house. IOW, share prices today reflect not only immediate profitability but also future profitability. How else to explain google's share price?

Corollary: Health care is not a commodity. (Yes, it is.)

Our health care system should be run with an aim to provide a fully functional, decent system, with an eye on the economics of the whole situation. However, the goal is to provide health care, not turn a profit, operate on a budget dreamed up by a slick business man, etc...

Dear Thelonious,

1. True, there are people who negotiate a good deal. IMV, no deal is bad. The purpose of Life is all about making deals. (Think: DNA is all about replication.)

2. Meek. My fear here is that a meek person walks away from a good deal.

3. Maximized profits and oppression..

... there is no scale that excludes it, or indicates when it occurs. That is, there is no 'moral redline' on the 'profit tachometer' to show when it crosses the line.

To me, 'profit' is just a measure of 'good deal for you, good deal for me'. To co-operate, we must help each other. The word 'profit' is just a way to state that measurably, our co-operation is good for both of us.

[August1991]

Ninth Point: Modern Governments are deprived of resources

Corollary: Governments can no longer print money.

There is good reason to believe that the exceptional economic growth between 1950 and 1970 came about because of exceptional monetary expansion. It was a trick to make us sacrifice leisure in favour of material goods, and to sacrifice current consumption in favour of future consumption. Such a trick comes at the cost of future timidity or skepticism or simple confusion. It took the 1980s and part of the 1990s to cure us of this confusion. One consequence was that elected politicians in western countries lost control of the money supply and faced a budget crunch, having only taxes or borrowings to pay for their purchases. Since 1980, the leitmotiv of politicians has been: "We have no money."

Links

Various Canadian governments combined now take more as a percentage and more in real terms of what the Canadian economy has to offer than at anytime in Canadian history.

Yet many people have the perception that governments are having trouble and that they could somehow do more before.

Cite

I think, if we are to fix our health care system, we have to reverse much of the damage that Paul Martin did to it while he was finance minister (and Prime Minister...) The Conservatives said that Martin didn't cut enough from health care, so I guess we have to look to the left if we are going to rescue our health care and turn it into the system it was intended to be ....

Link

[August1991]

Tenth Point: It is because individuals are different that it is wrong to generalize

We live in a world of co-ordinated collective effort and as individuals, we can see this effort. (The US, a group, is a collective force in the world).

But this collective force is very confusing. Confusing? Well, it is obvious that a group of people does not behave as an individual. (The US bombs countries but the US also sends disaster relief.)

So some foreigners fall back on the contemporary truism "each individual is different" when dealing with groups, and group behaviour. (There are good and bad Americans.)

Some other foreigners insist on seeing US collective behaviour as consistent, individual behaviour. (The US disaster relief is for America's own benefit.)

Other foreigners insist on seeing US group behaviour as if it were consistent, individual behaviour also, but view it positively. (The US bombing is for everyone's long term good.)

----

True, a group does not behave like an individual but this is not because individuals are different. And we can generalize about groups, but not the way we generalize about an individual.

Similar confusion exists in genetic theory. A gene is designed to be selfish and seek replication; a species is the collective result of individual gene behaviour.

The trouble is most people can't comphrend complicated concepts like that. If you say tha race X is on average smarter than race Y then 80% of the people will conclude that every individual from race X is smarter than every individual than race Y. It is true that bigots will say that anyways, however, there is a big difference between having those stats discussed by a few people on the fringe and having it opennly discussed by mainstream politicians and commentators.

Link

I'm sorry if my reasoning seems difficult to follow.

The analogy of an Olympic hockey game with a biased referee is dramatic but fundamentally false.

So, let me return to the ice cream. If I drive to Westmount and hand out free ice cream to kids, am I foolish? Living in Westmount, are you foolish to prevent your kids from getting any? This analogy is weak because it is so absurd. But it is fundamentally correct.

I think the absurdity arises because we confuse government (group) behaviour and the way individuals behave.

[August1991]

Eleventh Point: Free Trade means a race to the bottom

If you discover a new and faster way to drive to work, how does that hurt anyone else in the world?

If the Chinese discover better ways to use their resources, how does that hurt anyone else in the world?

Corollary: Canadian workers cannot compete with Chinese/Indian workers

Corollary: Corporations (capitalists) love watching workers compete themselves into poverty.

----

Links

Auguste1991 says:

But I'm still waiting for an intelligent Leftist to make some proposals. Instead, I just hear the old 1960s refrains ("profits are bad", "corporations are bad") of Noam Chomsky et al. Ugh.

I wouldn't call myself a leftist, but others might.

Corporations helped build (N) American into what it is today, and even leftists have to acknowledge what they have done to improve millions of lives.

But how do we decide who owes what to whom ? Are we indebted more to the corporations or they to us ?

I propose better modes of discussion and clear, good-quality information from moderate representatives of both sides of the political divide to help guide us into the future.

We need this becasue we've now stumbled into something called a Global economy which might be the road to an unprecedented global cooperation and wealth. Or perhaps not.

The working people of North America have been judged as being overpaid. So they're asked to accept outsourcing, layoffs, reduced benefits and so forth. And they have done.

But when will the system balance itself out ? Can we trust the current modes of information to tell us that the pendulum has swung enough the other way ?

If it's truly a race to the bottom as some have suggested, then the only signal we will have that it has gone too far will be violence and upheaval.

If the problem is that CEOs are making hundreds of times the wages of the lowest employee, that's not really a situation that will spark wide outrage. People have even accepted lower wages and benefits while the richest do better.

What will cause a problem is loss of homes, hunger and disease happening amidst pockets of increasing wealth and affluence.

The media systems we have now cannot tell us whether things are getting better or worse. The internet may be a thousand points of light, but without any prevailing authority.

If we as a society can't agree on answers to simple questions such as "who are we ?" "what are we doing ?" "what do we want to achieve ?" then we shouldn't be surprised at our lack of direction.

Yaro, you fail to realize that the Sun does exactly that. It exports to us light and heat and we pay nothing in return. That's a good deal for us and makes us richer. (Don't you agree, Yaro?)

Do you belie that China exports to us without wanting anything in return? This is the most asinine statement I have ever seen (and I mean that quite literally). Trade is just that an exchange of goods.

<{POST_SNAPBACK}>

At great expense, we could employ many, many people to produce light and heat artificially. The Sun however produces and sends light and heat to us for free. Yaro, do you mean that the Sun drives down wages and causes unemployment? Because that is the exact same argument you are making with respect to China and India.

Yaro, I think you are mistaken because you are focussing entirely on what we must give in the transaction and not on what we receive.

BTW, there are good arguments against free trade but they take an entirely different approach from the one you have chosen.

Yaro, if you are going to argue that trading with China and India is bad for our economy because the Chinese and Indians can produce goods much more cheaply than we can, you'll have to explain why sunlight - which is free after all - is bad for our economy too.

Are you actively misinterpreting me? The Chinese and Indians produce goods more cheaply, not more efficiently this doesn't just make us poorer in the long run it makes everyone poorer by the margin of efficiency lost. In this case it is the efficiency lost due to logistical considerations which are increasingly significant.

<{POST_SNAPBACK}>

I have read your response several times and for the life of me, it is pure gibberish. "...logistical considerations..."? "...produce goods more cheaply, not more efficiently... " WTF?

I have no idea whether the Sun is efficient or not, and I have no idea what logistical considerations are involved in delivering sunlight to us. I do know that it would be much more costly for us to produce artificial light and heat than to accept this good deal the Sun offers us.

Union Wants Autos to be Issue in Election

"The way to solve the problems of the auto industry today is to stop the imports from killing us or get the opportunity to export to those nations that won't let us sell our products today," Hargrove told CAW leaders on Friday.

Maybe better build cars would help sell CAW built cars.

These words are used differently by different people. To the Left, it seems to me, globalization implies genetically modified food, destruction of the environment, US domination and corporations taking over the world. Only a Democratic State can protect ordinary people against this onslaught.

Is it necessary to ensure the State is not controlled by Corporations? How?

What is the difference between Free Trade and Globalization?

Is there such a thing as 'Collective Rights' which should dominate over 'Individual Rights'? When?

At some point, protectionism and unionism will come back - maybe at the point where a bus driver makes more than an chartered accountant.

Actually, this is the biggest problem facing Canada as high paid export oriented service industries face competition from low cost economies. In most cases, these low cost countries can hire skilled people for a lot less than in Canada because they don't have to pay their bus drivers and other low skilled service industry people huge salaries. As time goes on - high paying low skilled jobs in the public sector will be put under pressure as Canadians realize that showering a select few with riches costs everyone else.

BTW - I realize driving a bus safely requires some skill - however, it is a skill that can be taught in a few months as opposed to years. I picked bus drivers because that is the example that Micheal used.

Globalization and free trade have increased incomes in the developing countries.

<{POST_SNAPBACK}>

Of course it has, and quite predictably. Many of these countries serve as sources of cheap labour for large-scale manufacturing and many other businesses. The labour costs, although seeming very low by our standards, is still a boon to many/most of these countries and their inhabitants, effectively providing a living for people who may otherwise have little or no income at all.

Additionally, a lot of these countries have previously un-exploited resources.

Globalization effectively spreads the wealth around.

But there is a downside, which we already are feeling here in Canada and the USA.

Outsourcing of jobs has been a hot issue for quite some time now, and will likely continue to be for a while yet. As long as a major corporation can get labour provided overseas for a fraction of what they pay employees here, outsourcing will continue to be a problem here at home.

Globalization, in this regard, is a two-edged sword.

[Toro]

Free trade is a race to the top.

That's a very good point about collective behavior. The madness of crowds often leads to irrational behavior.

[August1991]

Twelfth Point: SUVs are bad because they consume too much gasoline

This point really has two points: congestion and pollution.

First, SUVs are truly bad because they take up road space, forcing other drivers to wait until a space on the expressway becomes available. If SUV drivers need the road space so badly, they should pay the other drivers for making them wait.

Second, SUVs are bad because they can pollute freely the air. In a sense, SUV drivers get to use the environment but they don't have to pay for its use. Western countries abolished human slavery in the 19th century. We should now abolish environmental slavery.

Using US$, the cost of running a car

Buy a new car, $25,000, depreciated over 10 years, recovery value $2,000 = $2,300 a year

Insurance = $700 a year

Fill up once a week @ $30 = $1500 a year

Maintenance = $500

Total = $5,000 a year to run a car.

Canada's economy, like every other nation's economy on planet earth, is geared towards growth.

With more people and more production of goods, where will this leave the planet's fragile ecosystems?

When does the growth stop? When is enough enough?

Who is looking at the big picture?

http://dymaxionworld.blogspot.com/2006/05/...ithout-end.html

Apparently, it takes more energy to extract oil from tar sands in Alberta than is contained in the oil that is produced, as much as 3x more. To get the oil out of the tar sands, they are using natural gas to cook it. But the energy of the oil that is produced is less than the energy of the natural gas that is used to produce it.

At a time when everybody is worried about our finite supplies of fossil fuels running out, why they are wasting energy to extract oil from the tar sands?

I guess it is economic to develop the tar sands as long as the price of energy in natural gas (in $/BTU) is cheaper than that in oil, but as natural gas supplies in N. America deplete (they are already half gone), it will eventually not be economic to produce oil from the tar sands (unless they switch to coal to cook the oil out of the sands).

I guess for the petroleum industry, it's all about the money.

[Riverwind]

Twelfth Point: Cars are bad because they consume too much gasoline

Oil is amazing material that can be turning into everything from plastics to airline fuel. It is a huge waste to burn up oil for ground transportation or heating when other alternatives exist. That does not even get into the arguments related to global warming and pollution.

Cars are not the evil here. Cars are a useful tool. The problem is the price of gas has been too cheap and, as a result, people have been encouraged to pruchase wasteful vechicles and alternative technologies have not been able to compete. Higher oil prices should rectify this problem, however, it is unfortunate that people have to be pushed by the market since the market can be a quite brutal instrument.

[August1991]

Second Point: Cont'd

No one really knows what democracy is but some define it as "everyone gets one vote". Well, broad-based suffrage is relatively new. Voter turn out is declining. I'm not surprised. It seems to me that people vote for political parties the same way they choose movie stars and hockey teams. It obviously makes no overall difference how one person votes but it makes the game or movie more interesting to watch if the person chooses sides.

The reason I used my profession before to explain it, and the reason I knew that the person that rebuked it didn't know what they are talking about, is that in the industry in which I work there is such a shortage of personnel that people float all kinds of promises in front of us and tell us all kinds of things to get us to change jobs. These promises are almost never kept. As a result, every time people promise us something we are naturally on guard and skeptical and unbelieving until we see what is promised materialize. Because we as a vocation have been so scarred we tend to look at things with a level of cynicism.

The promises made to us by government are no different. I've watched politics for about 10 years now and seen at best 10% of the promises made to us kept just the same as all the things I have been promised in my job. So I look at government though the same lens and have no doubt that most people that work in the industry I do view just it the same.

[theloniusfleabag]

Dear August1991,

Eleventh Point: Free Trade means a race to the bottom

I am getting the impression you are making this up as you go along....

[August1991]

Thirteenth Fallacy: Governments can do no good

Governments can do so much good and to understand what good they can do requires an understanding of what makes government a distinctive institution. Like marriage, government is coercive.

I think what I am saying is that I am waiting for Leftists that understand modern economics, why markets are good, who reject typical socialist solutions to society's problem and then pointedly explain to the neo-cons why Governments alone can do Good. Believe me, the arguments are there.

Ah. So you are saying the state can do good by refraining from stealing from people? Wow. Given all the people I haven't stolen from, I must be like Mother Theresa by now. My place in heaven is assured.

You should know that all that a government has to offer is violence and coersion, and ultimately, all that a government can do is to kill you. I am just wondering what virtue you feel is so great that it is worth stealing, imprisoning and killing for?

Thingi Iceland, Celtic Ireland, pre-Alfred Anglo-Saxon England, Holy Experiment Pennsylvania and even modern Somalia are all examples of libertarian or anarchist nations.

And these sterling examples show that the transaction costs of conducting all deals without any State are sometimes greater than the deadweight cost imposed by State sanctioned transactions. Once transaction costs (the costs of enforcing a contract, knowing what you're really signing) are taken into account, the State with all its flaws sometimes offers a better method to do the deal. (The same argument explains corporations, clubs, families and clans.)

Sparhawk, I think my main point is that a person should not have to pay to obtain "normal" wireless access to the Internet in an urban area. Why? Because once the network is installed, it costs society nothing to provide that person with access. If a person faces a charge to obtain Internet access, they may choose not to use the Internet and society will be worse off. I was making a similar argument concerning culture, ideas, the CBC and broadcasting in another thread. We have too little art and artistry and too much pollution and environmental damage. This happens because our governments fail us.

Socialists want our governments to do everything and Libertarians want our governments to do nothing.

[August1991]

Fourteenth Point: Chance is a Black & White Issue

More people have died from Jamacan gang violance than from Muslim terrorism in the country. More people have died from Sikh terroism (Air India bombing) than from Muslim terrorism.

That may be true but as usual, one must consider the potential gravity of a danger, the chance of the danger occurring and the cost of deterring the danger.

Crossing at a redlight may potentially kill you, but the chance is slight and the cost of being careful is small. Having your car stolen would mean losing several thousand dollars but the chance of it happening is rather high and the cost of insurance is rather low.

Clearly, fanatical Muslim terrorism poses a potentially great cost to society and the chance of it occurring is deemed high enough to warrant extra measures.

Do they really believe that an offender is going to pause and say 'wait a minute now...under the Liberal plan I was going to get a mandatory 4 year sentence, but that mean old Stockwell Day is going to give me five. I'm putting this weapon right in the trash'

Violent criminals don't care about the potential punishment before they offend. Their eyes are on the prize.

It's an absolute joke, but typical of backward thinking CPC dogma.

There are two key aspects to a penalty as a deterrent: the size of the penalty and the chance it will be imposed. There is little doubt that few people would commit a crime if there was a policeman standing beside them at the time. There is probably a trade-off between these two aspects, between the severity of sentence and chance of getting caught.

IOW, other than the insane or perhaps suicidal, criminals are as "rational" as anyone else, although they might judge the chance of getting caught differently from the rest of us.

So, IMV, increasing the degree of the penalty (longer prison sentences) is the dumb way to compensate for police catching fewer criminals.

The person who killed that young girl in Toronto at Christmas time last year is still at large and the Toronto police seem no more likely to catch the culprit. Worse, the culprit is likely bragging about this crime and impunity, and the Toronto police don't even know about the bragging.

Doubling or tripling a prison sentence for a gun crime will have no deterrent effect if the penalty is never imposed, because the criminal is never caught.

In a sense, this is a failure of government, and a serious one at that. Someone, obviously known to others, killed a person in broad daylight in a major city and the police can't find the culprit. Will longer prison sentences prevent such crimes in the future?

Criminal law is not about justice; it's about setting incentives.

I've never agreed with fate determining sentences in criminal matters. I think an Ecstacy dealer who sells to kids is equally negligent, whether they live or die. Just as an attempted murderer is equally negligent. I don't see why a person who tries to kill someone should get a lesser sentence because they were incompetent.

I am very sympathetic to the idea of helping people who have been unfortunate in life. You are right to say that life is often a question of luck (and I disagree with Geoffrey that life is merely a question of choices).

Nowhere is this more obvious than in the case of children. We don't choose our parents. Purely by chance, some children in Canada are born into families with self-centred, alcoholic parents. As a society, we must protect and help these children.

[August1991]

Fifteenth Point: Kyoto is about protecting the environment

Look, peak oil ain't here and never will be. Worrying about running out of oil is like worrying about running out of land. (There not making any more! Oh no!)

Global warming is an entirely different issue and there is every reason to be concerned.

In very simple terms, oil is not a problem because somebody owns most of it. The environment is a problem because nobody owns it. When something appears to be free, then in general eventually, you'll have a problem. And that's exactly what global warming is.

Link

[August1991]

Sixteenth Point: Canada is progressive country

Is Canada a progressive country? I think rather that Canada is a civilized country. We share our natural largesse in a civilized fashion. But we are certainly not progressive. In general, we share our wealth practically.

The Public Works Transfer Thread ver 1.0.

Public Works Transfer Thread ver 2005

[August1991]

Nineteenth Fallacy: Markets are from Mars, Government is from Venus

There is the false idea that capitalistic markets encourage violent, competitive behaviour while democratic government seeks non-confrontational, co-operative solutions. Dead wrong. Road rage is proof.

Corollary: Markets need to be regulated

Yet we all know instinctively that the collective can benefit best from co-operation.

Unfortunately, an individual member can gain more by being competitive and cheating.

Hundreds of thousands of years ago, Conrad Black was the man-ape that pretended to help in the kill and then got up in the middle of the night to take more than his share. A scab.

Markets are designed to be competitive not co-operative. If they were not competitive they could not function and competition is diametrically opposite co-operation.

California is in the midst of an enormous stupidity crisis. Californians have been sitting in the dark because ... they didn't turn the lights on.

P. J. O'Rourke

[August1991]

Twentieth Fallacy: Farmers and Students are Good

At issue is that students are young, and farmers own land. Their rent is naturally restricted.

Link

This is an ag issue so im gonna bite and bite hard. I cannot see how anyone could be in favor of an attempt to put our dairy farmers out of business, and whats worse they are foreigners, I say support us for the things we need and if we absolutely can't produce ourselves than import. For those complaining about high milk prices, go after the grocery stores and processers for artificially exaggerating the price to line their CEO's pockets, don't pick on the little guy from Quebec trying to make a living. Harper should cave in, he should stand up for our little guys.

I mention all this because I happen to think that when the government gets involved in providing a service for "free", many people obviously want to use the service and then complicated rules must be created to decide who can or cannot get to use this "free" service. Too often, the squeeky wheel gets the grease. The organized parent with contacts or telephone skills ensures their child gets a place.

At the same time, I sense that many women in Quebec - whether mothers or daycare workers - prefer the current system despite all its flaws. Working mothers, whether single or potentially single, know that in general they pay less tax than the $28 subsidy they receive. Women easily overcome the inconvenience of waiting lists by making phone calls to other women to find out where to put their child.

Perhaps most surprisingly, women - whether mothers or employees of the CPE - feel better that the system has the stamp of approval of the State. It provides a measure of security. Employees feel their job is more secure and mothers feel their children are in safer, "official" hands. I wonder whether the State is replacing the role of a good husband.

[August1991]

Seventeenth Fallacy: Wars and Disasters are Good for the Economy and Corporations

Having said all of this, there are a number of distinct advantages in becoming a partner in continental defense. For one, we could stipulate that we share in the productive efforts of providing infrastructure on Canadian soil. By this I mean providing the military hardware for the bases of operations.

Jerry, you state one of the most ignorant ideas I have ever seen - and it is also frighteningly common.

The efforts to provide defence are a cost to society. A country is richer when fewer people are involved in policing and defence. If a country doesn't need police or soldiers, then those people can do something else useful with their time. Canada benefits because we rely on Americans for our defence. Canadians can do something else useful instead of being soldiers.

Wars (and hurricanes) are not good for a country's economy. Wars and hurricanes destroy. They kill. They make people waste their time preparing for the destruction, trying to avoid it or fixing the destruction afterwards.

Foreign wars are not good for domestic economies or corporations. If Canada made cruise missiles and dropped them in the Atlantic Ocean, would this make Canada rich?

This simple ignorance, and lack of common sense, frightens me sometimes.

To follow up that idea, if the Canadian government pursued a policy of giving money to corporations to make cruise missiles and then dropped the missiles in the Atlantic Ocean, would Canada become a rich country? In the long run, would the corporations be successful?

If you believe that, then African governments should start hiring African corporations to make cruise missiles - they'll be rich.

Common sense says that making something and then dropping it in the ocean is a waste of time and energy. The US military is a burden, not a benefit.

But what about shareholders of US corporations who make cruise missiles? It may be a waste of time for America to make cruise missiles, but the shareholders benefit. That's like students and farmers. If that's the game, there are easier ways to get government subsidies than making cruise missiles and dropping them in the ocean.

The simple fact is that the US military is strong because many Americans are willing to pay for a strong military. Canadians have perhaps wisely chosen to spend our money elsewhere. These are choices countries make.

But I disagree that military spending is good for a country, or even good for corporations in the long run. Making something and then exploding it hardly strikes me as a plausible get-rich-quick scheme.

[Guest eureka]

Free Trade may not mean a race to the bottom. I suppose that we don't really know what it will bring until we try it.

[August1991]

Free Trade may not mean a race to the bottom. I suppose that we don't really know what it will bring until we try it.

<{POST_SNAPBACK}>

Well, some deals involve few negotiating hassles and other deals are terribly complicated to put together. So, the idea of "free trade" is one of degree. I think the basic principle is that governments should not make it more difficult for people to do deals.

In international affairs, free trade means that governments should treat foreigners as they do Canadians. IOW, Canadians should be able to trade with foreigners as easily as they can trade with other Canadians.

This is obviously not the case now but we are closer to this ideal than we were, say, 25 years ago.

----

The comparison of new technology and opening to trade is the best way to understand what is at stake. Your comment, eureka, is like saying "Nano-technology may be good but we won't really know until we try it." Well, we can make exceptionally small microchips now and this technology is very good.

[Guest eureka]

My point is a wider one, August. It is that so-called Free Trade is only Frre, and then only relatively, between equals.

The reality is not the poorest countries have not embraced Globalisation but that we will not let them. And inequality is growing not reducing. It is growing both within countries and between the rich and the poorer countries.

I heard someone recently in a debate who has apparently written a book on Trade, saying that s/he was surprised when researching to discover that the greatest inequality was found in the USA.

[August1991]

I heard someone recently in a debate who has apparently written a book on Trade, saying that s/he was surprised when researching to discover that the greatest inequality was found in the USA.

Probably Maude Barlow.

This is the ultimate argument of the Left against free trade. Free trade makes the poor poorer and the rich, richer.

You could probably make the same argument about new technology, too. At first, new technology is a risky choice - some gain greatly but others lose. Then, as the technology spreads, the old ways of doing things change. Some people's valuable talents become almost worthless. (Imagine you had a valuable skill in breaking horses in 1900, just prior to the arrival of automobiles. Or you were a fast typist in 1979, just prior to the arrival of PCs.)

The evidence in the long term however is that new technology does not create a great divide between rich and poor. If anything, with time, new technology gives a chance to even things out. What creates a divide between rich and poor is impediments to new technology, and to trade.

The Left (people like Maude Barlow) really must learn this point. The Right is deserving of criticism. But an argument based on "fair trade" or "free trade for corporations" is simply wrong. It's 1960s Marxist nonsense. The Left will go nowhere with such arguments.

[Riverwind]

You could probably make the same argument about new technology, too.  At first, new technology is a risky choice - some gain greatly but others lose.

This is really the crux of any argument about trade: someone always loses even if the 'aggregate' wealth of society increases. It is hard to be sanguine about free trade when the winners are faceless masses overseas and the losers are your friends and neighbors. In that sense free trade goes against a basic human instinct to put the interests of the people you know ahead of the interests of the people you don't know.

The fact that protectionist sentiments come from people all across the political spectrum re-enforces my point. Free trade is not a left-right conflict: it is a head-heart conflict.

I would go so far to say that everyone is a protectionist at heart and free traders are only people who believe that they can reap the benefits and ensure that faceless others will pay the costs. There are a lots software people that were hard core right wing free trader types in the 1990s who are no longer certain about the virtues of free trade now that they realize that their jobs are threatened.

August, you yourself have a protectionist streak when it comes to immigration. Restrictions on the movement of labour are trade barriers like any other. Restricting movement of labour means that resources are not used as efficiently as possible since artifical scarcities are created by national boundaries. Yet, you have argued that the social benefits of restricting immigration outweigh the harms caused by restricting trade. Most opponents of free trade are making the same argument when it comes to trade in goods and capital.

Ultimately, I think free trade not an absolute goal but a delicate balancing act similar to what the BoC has to do with interest rates. There are no easy answers and every decision has costs that must be weighed against the benefits.

[August1991]

This is really the crux of any argument about trade: someone always loses even if the 'aggregate' wealth of society increases. It is hard to be sanguine about free trade when the winners are faceless masses overseas and the losers are your friends and neighbors.

Now that's a bizarre twist on zero-sum thinking. "Free trade benefits foreigners at our expense." Your notion is completely false.

Free trade is an overall gain for us.

If someone offered you a satellite cell phone service offering unlimited world-wide calls at $5 per month, would you accept it? Would the service likely mean that many, many people would lose their jobs in traditional telephone companies? Would this be reason to forbid the introduction of such a service in Canada?

There is no question that if Canada had such a cell phone service, it would be a good thing for Canada. Overall.

IOW, trade is not a choice between faceless foreigners and those near and dear. Trade is a choice between being better off and being worse off. To refuse to trade is akin to refusing a new technology on the grounds that you want to remain poor and you want your neighbour to do an obsolete job.

I will agree that if (or rather when) we get such a cell phone service, there will be many traditional phone engineers who will have to find new work. But the gain to Canadian phone users will outweigh the loss to these Canadian phone engineers.

This scenario is identical to foreign trade.

[Riverwind]

Free trade is an overall gain for us.

Free trade will benefit some people. However many others will suffer and end up being must worse off. Most free trade advocates acknowledge this and suggest that the government provide 'retraining' and retirement bridging programs for displaced workers. In most cases, the workers affected never recover what they had before they lost their livelyhood to 'free trade'. The bigger worry is there will eventually be no jobs left to train for other than providng health care and financial services to wealthy boomer retirees.

That said, free trade advocates say the needs of the many outweigh the needs of the few and that we should not worry about the people that are unlucky enough to be on the losing end of the free trade bargin - your cell phone service example makes this argument.

My point is not that we should not stop trade: in many ways I agree that trade makes us all more wealthy. However, I do not buy the arguement that an unfettered free market is always good for Canadians.

But you have not addressed the contradiction in your argument: restrictions on immigration are restrictions on trade. If free trade in goods and capital makes us all more wealthier then free trade in labour should make us wealthier too. Finding people to pick up my trash for $1/hour is going make me as wealthy as a $5 cell phone service. The fact that someone earning $1/hour would be living a pretty miserable life is, according to you logic, not relevant because we would be better off.

[August1991]

My point is a wider one, August. It is that so-called Free Trade is only Frre, and then only relatively, between equals.

eureka, you view trade like a sports match - yet that is not what it is at all. Trade is co-operation, two people helping each other. Their relative size is irrelevant, as children's stories often show.

Free trade will benefit some people. However many others will suffer and end up being must worse off.

New technology will benefit some people. However many others will suffer and end up being much worse off.

Is that what you meant Sparhawk?

My point is not that we should not stop trade: in many ways I agree that trade makes us all more wealthy. However, I do not buy the arguement that an unfettered free market is always good for Canadians.

In what circumstances would you advocate fettering Canadians access to new technology? If the rest of the world can buy a 20GB flash card now, should Canadians wait 6 months longer? Should we pay a special "new technology tax"?

But you have not addressed the contradiction in your argument: restrictions on immigration are restrictions on trade. If free trade in goods and capital makes us all more wealthier then free trade in labour should make us wealthier too. Finding people to pick up my trash for $1/hour is going make me as wealthy as a $5 cell phone service. The fact that someone earning $1/hour would be living a pretty miserable life is, according to you logic, not relevant because we would be better off.

Immigration is a more complex issue - given the Canada we live in. (I'm a pragmatist in most questions.)

I take the radical view that most people don't like to move from where they were born. (crazymf, another poster here, comes to mind as an example.) If people do move, it is usually because they seek a better deal elsewhere - if not for themselves, for their kids.

With free trade in cell phones, why move to Canada to manufacture cell phones at $1/hour? You can stay wherever you are already, make them, and ship them to Canada instead. Cell phones can be manufactured abroad and shipped to Canada.

Immigration is often a way to overcome barriers to trade.

I suspect I have avoided your question since cell phones are somehow different from collecting trash. Well, how would a trash collector earning $1/hour be able to pay rent in any Canadian city? For that reason alone, and until we find a technological fix, trash collection is likely to be an expensive proposition.

[theloniusfleabag]

Dear August1991,

eureka, you view trade like a sports match - yet that is not what it is at all. Trade is co-operation, two people helping each other.

Two people helping each other is 'communism' (anathema to 'free enterprise'), two people competing against each other for all each other has is 'free enterprise'. I realize that this is taking things to extremes, but I am not sure where you get your notions from.