The debate starts with the proposition “Buy American, hire American polices will backfire,” and then solicits arguments for and against. Not only is the proposition worded in a pro-free trade manner, the supporters of the proposition have a much easier job. While those who oppose the proposition have to argue the positive claim that “Buy American” polices are definitively good, the argument for “backfire” can just be a grab bag of random assertions about things that might possibly go wrong. Any argument that poses careful weighing of evidence versus Fear, Uncertainty and Doubt is doomed, and the latter is the currency of conservatism.
This debate was an exemplar. The pro-trade faction pulled out wild claims one after another and threw them at the wall to see what stuck. It will depress trade and therefore the whole economy; it will waste money; other countries will retaliate; it will encourage bad practices that will lead to some other lack of competitiveness. The most academic proponent of the motion simply said that the international system was super-complex and that lots of non-linear and unpredictable things could go wrong. Booga booga! I believe his Ph.D. was in FUD.
The fog of so much nonsense left the opponents reeling. Time and again they had to make difficult and nuanced rebuttals to the unsourced claims from the other side, so that in the end they had little time to forward their actual case.
Right-wing memes have also permeated public thinking so deeply that’s it’s sometimes hard to see where our own beliefs have become perverted. One such moment for me was when an audience member asked, in essence: what’s the moral case for spending more for American products if it only rewards laziness? If this question resonates with you at all, congratulations! You’re a latent Libertarian. Libertarians believe that the cost of goods is entirely a function of the personal intensity of their creators. Lazy workers like those in France and Detroit make expensive union products, while industrious workers like those in China and Peru make cheap entrepreneurial products.
And yet the reality is – like the right-wing smarty-pants argued – somewhat more complex. Costs can vary by orders of magnitude from country to country. Labor costs dominate the textile industry and compensation for American workers is 6 times that of their Mexican compadres. Is this because Mexicans are 6 times more motivated? Are Americans 600% more lazy? Of course not. A factor of 6 is also impossible to transcend with a clever application of technology. Any automation that affords an American worker 6-fold productivity can be quickly replicated south of the border. Even if the knockoff is only half as good as the American original, the Latin American plant is till 3 times cheaper because Mexicans need lower wages.
The current difference in standard of living between first and third world countries is free money to those who can exploit it. Free trade advocates are arbitrageurs, just milking a natural wealth pump. They don’t have to do anything except create (or invest in) the same goods in cheaper countries and they make a bundle. The fact that it impoverishes you and me and wrecks our social ecosystem means nothing to them. There’s your “moral argument”.
You want another? Let’s stipulate that American goods are more expensive than imported equivalents. The big issue is equivalence – with American-made goods you know that they were made in accordance with federal health and safety laws, and that they comport with accepted legal standards of quality and non-toxicity. Or if they don’t there’s easy recourse. With imported goods that’s not so clear, since such disputes often are resolved by shadowy bodies accountable even less than our elected officials. But let’s stipulate all that. You have a choice of product A made in America and imported product B, both of equal quality, both non-toxic, and made with equal respect for the rights of workers.
If A and B cost the same it’s clear you should pick A – the American product. Financially the argument is very simple. Money paid to an American firm becomes corporate profits and personal income. Both are taxed. Taxes go into the general fund which benefits everyone, including you. Every dollar that you pay to an American firm instead of a foreign or multinational firm benefits you personally. What more libertarian argument could be made?
The moral argument is also clear. If I spend my dollars on my neighbor, then they have money to buy local products, to buy materials for their kid’s education, to make their lives better and our neighborhood better. If I’m no worse off, I’d rather pay someone I know. If I spend those same dollars on imported products then I enrich the importer and perhaps send a fraction of that money to someone in a distant country. Meanwhile my neighbor, who makes the same product at the same price, suffers. Morality is parochial. We must support our neighbors if we can. Even if you want to send money to third-world farmers, buying their products is the least effective way to do it.
Once you accept the fact that, all things being equal, buying American is the self-interested and moral choice: the question becomes what is that worth? Would you still buy American if it was 1% more expensive? How about 5%? How about 10%? Ultimately in economics a choice must become quantitative. If you continue to profess that “Buy American” is a vanity that hurts competition then you demonstrate a blindness of both economic self interest and morality that can only be attributed to mental poisoning by right-wing ideas. My hope is only that you will think harder about the way you are being forced to think before you decide.
On the other hand, I wish this debate was available in any form.
- jack*
Comments