Intro to Free Trade & Free Markets Part 1

America is going bankrupt…not technically, but functionally, which is just as bad. (See here, here, here, and here.) And one of the causes is Free Trade, or what passes for Free Trade…what is actually Faux Free Trade.

(Want to read more? Try this, this, and this.)

So, there it is…Free Trade, one of the hottest topics going around. (Well, it was until the race turned into Hillary's attacks on Trump's "misogyny" while deflecting her problem with her email.)

OK, no…it   died rather quickly. I guarantee you it died because the elites wanted it to die. They are the ones who profit the most from this fake or Faux Free Trade… Read about Corporatism vs Capitalism in The Matrix Exposed.

Free Trade is an article of faith in our business class, and anyone who tries to touch their version of free trade is some kind of demonic populist bent on destroying American business and international trade as well. (Great example with Trump as target.)

Free Trade, even (unbelievably!) the terrible Faux Free version we have, has been incorrectly assumed to be some kind of panacea for the world's economic problems, and it's also incorrectly assumed that what we have going now with nations such as Japan, South Korea, and especially China, is "free trade".  We will get to that.

Beyond that, the "free traders" believe that the founder of modern economic theory, Adam Smith, was a "free trader". The Authentic Adam Smith says differently….(page 7)…

"A close reading of The Wealth of Nations and other good evidence
shows that Adam Smith was no doctrinaire free trader. 

 He approves certain monopolies and restraints on trade, export subsidies and restrictions, sumptuary laws, penal taxation, limits on the rate of interest and the issue of bank notes, compulsory qualifications for craftsmen, the pressing of merchant sailors and discrimination against Roman Catholics. 

 He was expert at exploiting the system of nepotism then dominant in the administrations of Britain, India and North America. 

He believed that government should be involved not only in educating but in entertaining the public. The words laisser faire or laissez faire appear nowhere in his work. Though he deplored British commercial policy in Ireland, the Americas and India, he thought the solution was
not independence for those countries, but federation with the mother country."

What I'm going to do in these blogs is try to give some basic but thorough economic lessons to people who might feel that these concepts are too challenging and abstract for them. I wish to make it possible for you to counter those arguments and have a sense of what you want as a citizen with a stake in the future of our country.

I maintain that what many of us have intuitively felt…that so-called "free trade" is neither "free" nor "fair"… have had it right all along. (Has the US turned against Free Trade?)

Further, the only reason these concepts are too challenging and too abstract is because the experts prefer it that way. You can study various societies and you will find even in primitive tribes that there is an elite in the tribe that has control of, let's say, medicine or the healing arts.

Even under these extremely primitive conditions, anthropologists have noted that the medicine men construct an arcane vocabulary and set of concepts to keep their knowledge essentially to the in-group.

So, when you go on-line and you look up these concepts, as I've done recently, you'll come away confused and befuddled.

Worse, the experts get things very, very wrong.

Remember the crash in 2008? Peter Schiff was laughed at on the Neil Cavuto show on Fox Business because he said that the stock market was going to crash. He was not alone in this prediction, and some people made hundreds of millions of dollars going against the conventional wisdom concerning the mortgage industry and United States.

In 1989 everyone saw Japan as about to rise to be the number one economic power in the world. They had all of the top 10 banks in the world. Within one year the Japanese economy crashed, and it has never really recovered. Four of the banks died. No Japanese bank remained among the top 10.

Yet, when I studied it, I was teaching ESL in Milan Italy. Discussing it with bankers and others, anyone could see there was no big mystery behind the collapse. The bubbles were easily predicted and you could account for everything that happened. (We will get to that in re Export-driven Econ Model.)

What you can't account for is the fact that everybody missed the analysis, the obvious prediction, the signs of danger, and let it go on until everything burst.

So not only do they keep this information and knowledge to themselves, they misuse it to make a ton of money, (often- too often- even way too often), at the expense of not only the American people but of the foundations of our society and nation-state.

Part 2