Comment by boelboel
10 days ago
Huawei, Foreign gambling sites were banned on dubious reasons in 2006 (in reality American companies weren't as competitive and las Vegas needed to be protected), Japanese electronic tariffs in the 80s/90s ...
US never exactly believe in full on 'free trade'.
The US believed in free trade precisely when the politically connected needed labor arbitrage, and protectionism exactly when the politically connected needed protection. The pretense of underlying ideals was never more than a political tool - political economy was always political.
It depends on whether you believe US action is overdetermined, but I think if Trump didn’t get elected we would have continued on the path of free trade. His election wasn’t predestined. He had just the right mix of features to win at the time, but if this basket of features didn’t exist it’s not hard to imagine the country going down a very different path.
If we had continued on the path of free trade without "dealing in" those displaced by free trade, the pressure would have continued to grow. It certainly could have exploded in a different direction, at a different time, with a different champion, but so long as it was repressed instead of addressed it was always destined to explode.
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George Friedman disagrees with you: he's been saying for years that US trade policy towards China had to change no matter who won the 2016 election (because an economy cannot rely on a trade partner it might go to war with, among other reasons).
When last year the Trump admin started interdicting oil shipments out of Venezuela, it left shipments heading to China intact. Then during Trump's visit to China, the two parties made a lot of progress on trade and other issues (in part because Beijing's attitude improved because the first Trump administration's restrictions on trade underlined to Beijing how dependent China is on trade with the US).
Biden wasn't a free trader at all, more alike to Trump in trade than many would like to admit.
"Kicking Away the Ladder: Development Strategy in Historical Perspective by Ha-Joon Chang"
"How did the rich countries really become rich? In this provocative study, Ha-Joon Chang examines the great pressure on developing countries from the developed world to adopt certain 'good policies' and 'good institutions', seen today as necessary for economic development. His conclusions are compelling and disturbing: that developed countries are attempting to 'kick away the ladder' with which they have climbed to the top, thereby preventing developing countries from adopting policies and institutions that they themselves have used."
https://www.amazon.com/Kicking-Away-Ladder-Development-Persp...
> Japanese electronic tariffs in the 80s
Also motorcycles. https://en.wikipedia.org/wiki/1983_motorcycle_tariff
Taking that political scenario as an example. Was the decline caused simply because Harley kept to the same working formula refusing to innovate for competition? As to the likes of Honda and Co?
Manufacturing is cheaper if you have access to resources and such. Japan may of had abundant of but in this case I don't feel it's was all about manufacturing costs.
Was it a cash cow situation, where their one formula was working but as well as where Harley were reluctant to invest in a different avenue, to innovate causing cow to dry up. And that is when they called in the government to settle? That is always the impression I seem to receive.
Excluding manufacturing costs was it because they were scared of an innovation being a failure?
The same cash cow formula can be seen with the likes of Disney Pixar and Toy Story 5, a pointless movie plot at this point where if money was invested, a new creation could be born.
A current account deficit is a capital account surplus, assets and exports compete in the balance of payments, an asset windfall kills exports by increasing the currency hurdle and embedded asset price.
What you are seeing is "the bar" for a successful manufacturing business increasing until only the most profitable are left -- things like chips, things like shell companies that exist to monetize a brand. "New growth" isn't highly profitable so it never has a chance to get started (unless a recipient of an asset windfall is willing to finance it all the way to "the bar" -- see: Elon Musk).
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The entire US auto industry is predicated on protectionism. Without it the Japanese would have wiped out GM/Ford/Chrysler in the 1980s, and now the Chinese in the 2020s-2030s.
Also, radar technology has been under export controls of various kinds by Washington continuously since WWII.
US never championed free trade if by free trade you mean "anything goes."
Really strange that rest of the world can tariff and put up barriers, but once the US does that, all free-trade warriors step out of the wood work.