BW echoes my previous thinking on free trade:
I think NAFTA and its cousins are not really free trade. They’re increased regulation. Getting the government OUT of the market generally leads to prosperity. Creating new bureaucracies to make sure everyone plays fair isn’t free trade – it’s more like socialism. Free trade really is a good idea.
By free trade, I don’t mean the government has NO role in the deal. I think, for example, that the constitutional method of taxation (excise taxes, import duties) is the best way to fund the government – as long as they don’t play games with it like taxing textiles 20% and everything else 2%. That’s not exactly leaving the market alone. But when the government keeps its hands propertly tied, the people are free to trade as they wish. If all governments play that way, everyone wins. My two cents.
Yes, this is the conventional theory, and one to which I have subscribed for many years. However, the reality does not seem to match the theory, for example, what if a nation has no genuine competitive advantage over another? Should it then elect to lose out to the world? Is that wise? And on a global scale, what nation can hold a competitive advantage over every other nation in the world?
As I pointed out in my article today, the very concept of free trade is becoming increasingly meaningless, as the nations wane in terms of sovereignty and the multinational corporations and supranational organizations wax in power.