Tuesday, November 18, 2008

One of the Times I Don't Entirely Agree with Mr. Buchanan

Mr. Buchanan favors--for understandable reasons--approving some loans for the U.S. auto industry. I don't, for the simple reason that I don't think that any loaned amount will be enough until the underlying problems are addressed. Mr. Buchanan addresses one of them here:
...the most magnificent industry, the auto industry that was the pride of America and envy of the world, we surrender to predator-traders from Asia and Europe, lest we violate the tenets of some 19th-century ideological scribblers that the old Republicans considered the apogee of British stupidity.

Nancy Pelosi is talking about tying loans to a restructuring of the industry. But Congress is not competent to do that.

What needs to be restructured is the U.S. tax-and-trade regime.

Dump globalism. Instruct Japan, Canada, Korea, Germany and China that if they wish to sell cars here, they will assemble them here and produce the parts here. And we shall have the same free access to and same share of their auto market as they have of ours.

To accomplish this, use the same import quotas and tariffs Ronald Reagan used to save the steel industry and Harley-Davidson.

Reciprocal trade. Even Democrats like FDR used to practice it.
The more I learn about this subject, the more I am constantly gobsmacked by people who don't quite seem to get it. They are continually harping about how other nations will "retaliate" without quite understanding that they have already attacked, so to speak. Our nation-competitors--that is what they are--already rig their home playing fields against us. It's not a question of "retaliation," it's a question of self-defense. In far too many instances, we've unilaterally disarmed in the trade wars. As Phyllis Schlafly said in her column:
(McCain) repeatedly reminded voters that he is the "biggest free-trader" they'll ever meet, a line that may resonate with a few libertarian think tanks but is a poke in the eye to blue-collar guys whose jobs have gone overseas to Chinese working for 30 cents an hour.

McCain could have called for a level playing field for international trade, such as by changing the discriminatory trade agreements that allow foreign countries to replace their tariffs with a value added tax of a comparable percentage, or by repudiating the World Trade Organization, which has ruled against the United States in 40 out of 47 cases. But he didn't.

McCain did a lot of railing against earmarks (not a big issue with the voters), but he didn't criticize the political action committee contributions and high-paid lobbyists who promote policies that advantage the multinationals at the expense of manufacturing jobs and small business.
Personally, I think the Fair Tax is the best solution to our trade problems. Instituting that might be the best solution to the auto industry's woes. But if I can't get that, I'll settle for the judicious use of some tariffs.

The other big issue that needs to be addressed is government interference on the side of big labor, resulting in wildly unsustainable labor contracts for the Big Three. In a market where government was not acting on big labor's behalf, labor costs would look a lot more like they do in the South, and the Big Three would be a lot more competitive.

We've got to address those issues first. And I haven't even mentioned that the Constitution doesn't, not anywhere I can find, anyway, give the Federal government the authority to loan money to private businesses.

So, yeah, I disagree with Mr. Buchanan on this one. It does occasionally happen.

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