World poverty is falling. Bernie Sanders would reverse that

I love it when Bernie Sanders calls for the USA to be more like social democratic Europe. Unfortunately, that’s not all he is campaigning for.

On his campaign web page, he says:

If corporate America wants us to buy their products they need to manufacture those products in this country, not in China or other low-wage countries.

That statement is very dangerous.

Over the last fifty years, there has been a dramatic fall in world poverty. Not just in China, but across the developing world. This has transformed the lives of hundreds of millions. Have a look at the following chart from https://ourworldindata.org. There is still far too much absolute poverty, but the downward trend is extremely good news.

World-Poverty-Since-1820-full

Click on the graph to see the full size version.

This trend is under threat from protectionism.

There is a debate to be had about environmental standards and exploitation in the developing world, but that’s not what Sanders’ website says. It argues that jobs should go to Americans, rather than poor people in the developing world.

There’s now little chance of Sanders becoming president, but he will campaign until the democratic convention. If he continues to argue for protectionism, he’ll strengthen the hand of others, like Donald Trump who are arguing the same thing.

Of course, protectionism won’t work. It’ll cost many more US jobs than it saves.

But it’s also deeply immoral. Many of Sanders supporters are very idealistic. If they agree that we should let the poor work their way out of poverty, they should pressure Sanders to change his stance of protectionism.

Before we Brits get too smug, we in the UK often make the same kind of mistake.

In politics, it isn’t easy to make the right choices. Let’s commit ourselves to facing up to hard realities, so that the good we do is not outweighed by the unintended harm.

(This is a shorter version of an article published in Middle Vision)

 

* George Kendall is the acting chair of the Social Democrat Group. He writes in a personal capacity.

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55 Comments

  • That’s a gross mis-interpretation of Senator Sander’s position, it’s taken out of context and should be withdrawn. It’s a straight lift from that friend of Wall Street Hillary Clinton.

    Here’s what the Borgen Foundation think “The Borgen Project is an incredible nonprofit organization that is addressing poverty and hunger and working towards ending them.”
    – The Huffington Post

    BORGEN FOUNDATION REPORT ON BERNIE SANDERS 10 FEBRUARY, 2016.

    10 FEB 2016 Bernie Sanders record on Global Poverty

    Bernie Sanders, one of the leading democratic candidates in the 2016 Democratic Party primary race, has been praised for his stance on promoting equality. Over the course of his congressional career, he has been an ally for the millions of impoverished around the globe.

    In speeches, Sanders has claimed that investing in global poverty has several positive outcomes, such as lessening the instances of terrorism abroad. He has claimed that with a sound foreign aid policy, living conditions abroad are less likely to produce conflict.

    Sanders has an impressive track record on global poverty to back up these claims. In 2000, he voted in the Senate to allocate $156 million from the military’s large budget to the International Monetary Fund. This was in support of the Millennium Development Goals.

    In 2008, he also supported funding to combat AIDS, malaria and tuberculosis. The bill he supported authorized $48 billion to various countries to combat the further spreading of these diseases.

    Sanders has also demonstrated his support for combating global poverty in his statements about global warming. He has described how international conflict is produced when populations become desperate as a result of climate-related hazards, including lack of access to water and food.

    Sanders has been vocal about eliminating income inequality and domestic poverty. He has shared his aspirations for putting an end to systemic forces diminishing the middle class, claiming that a more equitable economy can be created through fair taxing of corporations and banks. “America now has more wealth and income inequality than any major developed country on earth,” he said.

    The presidential hopeful is devoted to redistributing America’s wealth and alleviating the 22 percent of American children living in poverty. His focus on domestic poverty and inequality is a promising indication of his future foreign aid and global poverty commitments.

  • Eddie Sammon 9th May '16 - 1:58pm

    Sanders’ vision is probably for aid to solve world-poverty and trade not so much. However the big problem in my eyes with Bernie Sanders is he engages in hate speech and is misleading the public. I have two editorials that also match my opinion:

    https://www.washingtonpost.com/opinions/bernie-sanderss-fiction-filled-campaign/2016/01/27/cd1b2866-c478-11e5-9693-933a4d31bcc8_story.html

    https://www.washingtonpost.com/opinions/banks-vs-regulators/2016/04/17/f78109c4-0337-11e6-9203-7b8670959b88_story.html

    “Preposterous, and a smear, to suggest that every bank’s “business model” is “fraud”

  • I don’t wish to get into a defence of Bernie Sanders, but I do want to point out that having minimum wages are liberal and social democratic. In classical economics wages can fall and often did, increasing poverty. With globalisation companies can base their production in any country and economics will drive them to base these in countries with low real wages. This can put downward pressure on wages in other countries to stop this governments need to set minimum wages. I have never heard minimum wages called protection before!

    Therefore “We must increase the minimum wage not only in the United States, but in Haiti and throughout the world” makes perfect sense but only if each country sets its own minimum wage and there is not a one fit all for everyone in the world.

    As liberals and social democrats we should recognise the natural imbalance in power between employers and employees and take measures to address it, such as having minimum wages in the UK and separate ones in every country in the world set according to their own circumstances and what they consider to be an acceptable standard of living.

  • Tony Dawson 9th May '16 - 3:28pm

    Come ON George.

    The only thing which is going to elect Hilary Clinton is that she is not Donald Trump.

  • charlotte scot 9th May '16 - 4:19pm

    If protectionist refers to keeping people employed in our own country, I’m all for it. It is not up to us to raise the standard of living throughout the world. We have 47,000,000 people in the USA living in poverty. 50% poverty for youths in poor neighborhoods. I find that embarrassing and tragic. The only ones who really benefit from low wages in other countries are the corporations, not the people. I am all for helping poor people in other countries but giving them jobs at slave wages is not the answer, nor is driving American workers to the poor house to eye vote CEO’s salaries.

  • George – Would Sanders’ ‘buy America’ policy reverse the trend in world poverty as you suggest? Are the gains all (or largely) down to free trade?

    Whatever the theory, the US voter’s experience of it is awful and its awfulness is statistically well supported. e.g:

    http://www.alternet.org/15-million-american-families-live-2-day-these-authors-spent-years-finding-out-why

    That’s why, from left and right, Sanders and Trump have made BIG gains stressing the trade issue. The establishment – warns the sky will fall but for many ordinary Americans it already did.

    As for the theory, it’s not so simple as many believe. Except for (a) resource states (e.g. Saudi Arabia) and (b) entrepot city states (e.g. Hong Kong), I know of no example – including the UK incidentally – that got rich through free trade. All used very unfree trade to build up their industrial base. It helps if the ‘free trade’ is highly asymmetrical.

    That was case with the UK in the 1840s around the time the old Liberal Party was formed. In the Opium Wars Britain’s greater military power vs. China enabled us to force them to allow our drug pushers in. I really think liberals shouldn’t boast of their free trade history.

    The boot is now on the other foot because our business establishment has discovered that they can (in the shortish run of a decade or two) cut costs and increase profits by outsourcing while it helps China et al to have an almost unlimited source of demand. But this doesn’t work for us because, once the credit runs out, we are bankrupt. It doesn’t work too well for China because instead of building a sustainable domestic economy they have become over-dependent on exports. Chinese workers are reduced to production units, useful and important only until the party ends.

    For the business establishment here however it works very well. What they are doing amounts to ‘regulatory arbitrage’, allowing them over a period of years to asset strip the economy for private profit.

    In a different context the great liberal economist Keynes pointed out that, in certain circumstances, there can be a general failure of demand in the economy and argue that when that happens government should deficit spend until normal conditions are re-established. In other words demand is crucial for the economy to stay healthy. How do you square that with allowing demand that goes way beyond fair exchange to be sucked out of the economy? (Hint: you can’t).

  • Eddie Sammon – You accuse Sanders of “hate speech and misleading the public”.

    I don’t read the campaign web page George links to like that at all – rather a level headed fact-based assessment of the desperate situation the US is in.

    Don’t forget the Washington Post it is very much the voice of the establishment that both Sanders and Trump seek to overthrow. So hardly an impartial witness!

    For instance the first of your links rubbishes Sanders’ “Medicare-for-all” health plan accusing him of not saying how it could be funded. The WP notes that “Getting rid of corporate advertising and overhead would only yield so much” which is narrowly true but unimportant and diverts attention from the real point that the US manages to spend nearly double what other advanced countries spend as a share of GDP yet leaves many (IIRC getting on for 40 million) without cover and many more with illusory cover where the insurers would rat out on the deal on some pretext in the event of a large claim.

    The bottom line is that if Sanders could close just half the gap to European averages (never mind the best) health costs would be massively slashed, universal coverage would be established as is the norm in all other developed countries and it would STILL leave a huge savings dividend. But don’t expect to hear that from the WP.

    The losers would be a group of powerful insurers and others whose business model is uncomfortably akin to extortion. Of course not all are like that but the point is NONE should be and the country would be better off if that were so.

  • Stevan Rose 9th May '16 - 10:47pm

    “I think we all would agree that protectionism is a hindrance to world prosperity”

    It doesn’t seem so, there are differences of opinion.

    Prosperity shouldn’t be measured in dollars alone and industrialisation and urbanisation are the cause of major social upheaval in China and elsewhere. Free trade encourages a perspective dominated by GDP where quality of life is surely more important – see the Happy Planet Index, HPI. Fair trade not free trade.

  • David Allen 9th May '16 - 11:27pm

    George,

    Clearly you’re right to argue that many emerging countries have gained economic benefits from being able to sell into Western markets. However, most of these countries would never have developed marketable products in the first place if they hadn’t initially adopted protectionist policies in respect of their home markets, and thereby built up competitive industries. As Gordon says, that’s what we did ourselves, back in the Victorian era and our Industrial Revolution. It’s what China did in the more recent past. It’s what a nation needs to do in order to get off the mark.

    Furthermore, if “free trade” means gross imbalances in trade, whereby a rich Western country buys all its manufactures cheap from China using the money it has built up from past glories or is making now from dubious “financial services”, and thus runs a major trading deficit – then its consequnces are harmful. China may have gained from free trade, but now China must wean itself off over-production – if it can – before the imbalances cause a crash. China should stop relying so heavily on Western customers who can’t be trusted to stick around, and should produce more to meet its own internal needs. If a degree of protectionism from Bernie Sanders were to mean a shift back from producing all the West’s toys in China to producing some of them in America, it would make both the US and Chinese economies better balanced and more stable.

  • Lorenzo Cherin 10th May '16 - 1:23am

    George as ever, motive here , no different ,concern for people.And very many responses similarly .

    I am going to be my usual radical centre and mainstream centre left oriented self and say the truth lies in the very middle between Georges response to Sanders , and Sanders himself.

    George is right on trade.Free trade lifts people out of poverty.Workers and consumers. The latter is forgotten , often.We get cheaper goods .In the USA, even more than here , as consumer expectations are more inclined to be used to it, in a very insecure and competitive country, with worse welfare and longer hours of work, many working in two jobs.They have a greater sense of consumer demand , remember , Ralph Nader was for years , a consumer champion , not just on safety , but value for money.

    It goes without saying , as Mark and Eddie etc so well put it , that the worker and small business person also benefit , from free trade, in poor countries,as the products get sold , otherwise , no income !!!

    Sanders is not knowledgeable or effective ,on things outside his comfort area, of “bashing.”But , and there is a big but here.Far from the need being individual countries having their own minimum wage , ALL countries need to be raised up , in the developing world especially.The free trade we advocate is fair trade.We support workers rights , encourage partnership approaches , all Liberals and social democrats should.But while the small , individual textile manufacturer may , with a family specialist business , benefit from globalisation as we support it , very often the sweatshop conditions , or horrendous hours , and lack of unionisation, are no Liberalism or social democracy.Not in the hands of some businesses .

    Sanders may be many things , some I do not like .Yet completely dim is not one of them.He is saying that people everywhere are people .They must have dignity .Or economics is exploitation.

  • Mr. Kendall, you omitted the first sentence in the text. “Reversing trade policies like NAFTA, CAFTA, and PNTR with China that have driven down wages and caused the loss of millions of jobs.” Hillary Clinton takes a similar position. See “On the Issues”: [http://www.ontheissues.org/celeb/Hillary_Clinton_Free_Trade.htm] It is not clear to what degree either candidate would be protectionist, but it is certainly speculative to take one sentence from Sanders’ website and decide he would shut down free trade. Surely that is not the only thing he has ever said about trade.

    It seems that Sanders would accept free trade provided environmental and labour standards existed. Note that Sanders did not demand an American level of wages for Haiti, and even Hillary Clinton backed a minimum wage. Nor would she challenge minimal standards. One could argue for example that sex tourism directed at children benefits third world economies, yet few mainstream politicians would defend it.

  • There’s a protectionism you’ve missed George. Investors also indulge in protectionism. But, their form of protectionism seeks profit at the expense of having to pay any wages [minimum or otherwise] at all.
    An investor considering closing a factory, in Vietnam or elsewhere, is not motivated by some desire towards benevolence or public service. If an investor can see the profit motive in closing down 5,000 jobs in the East, by opening a better run AI iteration of that enterprise in Britain or the US, by running it with 300 operatives on minimum wage, ..They will go for that.
    With the kind of yearly improvements in AI and automation generally, the politics of chasing a minimum wage for all, is not just protectionism, it is as futile as a dog chasing its own tail, because every new iteration of an enterprise, will naturally seek to use less people and thus less wage overhead, even at minimum rates of pay?.

  • Jayne Mansfield 10th May '16 - 12:34pm

    @ Steven Rose,
    I agree with you that extreme poverty should be a multidimensional concept. We need to take into account access to clean water, education, access to health care etc.

    In my view, the way the World Bank has defined absolute poverty needs to be challenged.

  • Are we talking at cross purposes? To some extent perhaps.

    Prof Dani Roderik describes a trilemma; it says that democracy, national sovereignty and global economic integration are mutually incompatible. You can combine any two but never all three, simultaneously and in full. He makes a compelling case.

    As he points out the post WW2 Bretton Woods regime delivered the first two compromising with limited global economic integration which in practice worked rather well until it became a victim of its own success.

    I would add that it’s not clear that total economic integration would have added much. A little perhaps but at a high price to democracy or sovereignty, the perils of which path the Eurozone is now discovering. Also, as a pragmatic observation, it simply doesn’t deliver economically for most people and it very clearly throws democracy under the bus – see Greece et al.

    http://rodrik.typepad.com/dani_rodriks_weblog/2007/06/the-inescapable.html

    In practice, international trade is invariably governed by immense amounts of rule-making – even the allegedly ultra-free trade TPP & TTIP run to many thousands of pages of legalese. So really it’s managed trade – but for whose benefit? They say about poker that if you don’t know who is the patsy at the table that’s because it’s you. The same applies here; you can be VERY sure someone is benefitting disproportionately – but who?

    History suggests that in each age it’s the dominant power (actually the dominant group in that power) that defines ‘free’ and that they do so in a very self-serving way. In Victorian Britain that was the new industrial and trading elite – hence the Opium Wars. Currently it’s US and allied financial elites that call the shots. Trickle down is not important to their thinking except as PR; really it’s about creating a form of neo-colonialism, extracting wealth via trade rather than occupying countries (although that happens as well).

  • I am still not convinced at all. Free trade encourages behaviours in developing countries that benefit global corporates whilst generating GDP stats that give the appearance of increased prosperity as we in the West might recognise it. It encourages cash crops over food production. Industrialisation that results in urbanisation and actually creates unemployment and loss of social and cultural cohesion. It leads to slums and rubbish dumps and insanitary conditions. Many improvements such as schools, clinics, wells, are funded by aid and charities not by corporate taxes. You can point to rapid GDP growth but is the sweatshop worker really better off than the subsistence farmer? Only in a spreadsheet. Free trade also gives market access to GM seed producers to control food production. There is fair trade and good ethical trade that should be free trade. There is unfair trade and unethical sweatshop and dumping and corporate profiteering trade which tariffs should punish.

  • The job of an American President is to govern for the American People, not the rest of the world. Aside from anything else the rest of the world does not get to vote in America. And I assure that Americans will vote for what best suites themselves as a Americans.
    The problem with internationalist and globalist philosophies is that they are obsessed with economics and interconnectedness. but tend to ignore the reality that governments are decided nationally on national issues. Whenever anyone votes anywhere in the world they are mostly voting for themselves in context of the society they live in. There is no great global interconnectedness of peoples because people and cultures are not interchangeable.

  • Lorenzo Cherin 11th May '16 - 3:36am

    Three cheers George !!!

  • Dude, there you go again.
    I’m absolutely sure people are concerned , but also pretty certain that they do not actually vote accordingly. It’s like in the Blair Years. Most people were really concerned about our dodgy involvement in military actions. Millions protested. Millions more sat home being appalled by the pointless waste of lives. Tony Blair was elected twice more by most of the same people decrying those military interventions. Why? Because the economy seemed good and they were more worried about what a Conservative government might do to them than what a New Labour government were doing to the people of Iraq. It was an economic crisis that effected the national economy and closed local businesses that undid New Labour, Not moral doubts or being concerned about the Middle East.
    As for the economic argument. Capitalism isn’t moral. It moves production to save money. Any good that has been or is done is simply an accidental by-product of trying to keep production cost lower to increase profits. If the same companies found that it was cheaper to produce stuff on Planet Zog they would move their production to Planet Zog. But, more likely, is that when it becomes cheaper to produce goods with less and less people, all those jobs will disappear irrespective of the impact on any local population or its economy. This stuff is nothing to do with interconnectedness except maybe the interconnectedness of bank accounts and share prices.

  • Jayne Mansfield 11th May '16 - 6:42am

    @ Steven Rose,

    What you say strikes a chord based on personal experience.

    You might be interested in the Christian Aid briefing paper, ‘The economics of Failure’, and also, ‘Trade: who pays the price’.

    It is not surprising that Liberal Democrats are wedded to the orthodoxy of free trade, but if you wish to read work by a heterodox economist, I recommend the work of Ha -Joon Chang.

  • George’
    I do think we’re sort of at cross purposes, but that’s more or less what I’m saying. Having said that if I was an American Democrat and I was offered a choice between Clinton and someone like Sanders I’d probably vote Bernie Sanders. You seem to expect factory workers and the low paid in the US or in the West generally to just accept more job insecurity because allegedly “free” trade benefits poorer nations, but why should they and why would should anyone expect them to just suck it up and keep voting for business as usual. Ghandi, by the way imposed big tariffs on British cloth to protect the livelihoods of a less competitive workforce. The end result was that it became cheaper to produce cloth and clothing in India than in Factories in Britain. Free trade didn’t create the situation it simply exploited it. China doesn’t practice free trade either, it simply benefits from a Western addiction to it. Export dominance and not free trade are the keys to manufacturing success. Free trade is simply a mechanism that allows things to go to the lowest bidder.

    My attitude to populism is that ultimately it is part of democracy because the electorate, the populace if you will , decides.

  • David Allen 11th May '16 - 1:36pm

    “As to whether these free trade agreements are free trade or managed trade, that’s just a matter of semantics. Whatever.”

    No, it sure isn’t. The expression “free trade” sounds much like “freedom” or “liberty”, a principle which is self-evidently noble and good. Whereas once we recognise the validity of the term “managed trade”, we can see that there is nothing inherently superior about one particular way of managing trade. Should we “manage trade” to maximise the benefits to the most powerful countries and/or companies? Or, should we manage trade to protect the interests of a particular group, class or nation?

    There are no simple answers. Those who claim that there are simple answers are being dishonest.

  • The other point is that if you look at the current crop of free trade agreements they are protectionist pacts amongst Western economies. They’re not about free trade or freedom of movement. They are about freedom of movement for Europeans and,free or rather controlled, trade for the established Western economies. It’s really not about helping poorer nations at all. So to me it really comes down to the nation state v a still protectionist larger grouping of states. At which point, I think it’s probably better to protect the more direct democratic accountability of the nation state and national interests above those of a less accountable conglomerate.

  • David Allen 11th May '16 - 5:44pm

    George,

    You quote an article which Paul Krugman wrote almost 20 years ago, when he could declare that:

    “The benefits of export-led economic growth to the mass of people in the newly industrializing economies are not a matter of conjecture.”

    but also:

    “The advantages of established First World industries are still formidable. The only reason developing countries have been able to compete with those industries is their ability to offer employers cheap labor.”

    I don’t think he would be able to make that latter point in 2016.

    Back in 1997, globalisation worked to redress an imbalance between the rich, dominant West and the poor “developing countries” like China, who at that time were struggling to catch up. Here in 2016, the mass unemployed of Southern Europe and the US rust belt would laugh hoarsely at the idea that they are still the dominant rich, while the Chinese are the starving underdogs.

    They will vote for the Sanderses and the Trumps, who are not blind to what is happening to the “forgotten” American poor. They will vote against those patrician politicians who simply ignore their predicament. Sadly, that could include Hillary.

  • George,
    I never said we should care about protecting American wages or jobs. I implied it was odd to think Americans shouldn’t. As for the rest of it ? Well, things like TTIP and the EU ARE Western Protectionism, they’re just pan national business practice protectionism rather than nation state protectionism.

    There is nothing unique to the West about protectionism. Even most poor countries don’t really want free trade. They just want to sell the wealthier nations stuff which is an entirely different thing.

  • George

    “Do you really think all these improvements can be explained by an increase in aid and charities?”

    No, I would expect improvements as part of development without free trade. I’m suggesting that the bulk, maybe all and more in some cases, of benefits from free trade with developing countries go to (a) global corporates, (b) local elites, (c) middle class consumers in the West who get their clothes etc. cheaper. Aid and charity fill the gap and there is not enough to go around. But fair trade can make an enormous difference to all parties. Investment choices too – some countries have squandered their limited resources, others have invested in technology and education, creating a broader middle class and domestic demand. Intelligent governance is so important. Protectionism that defends inefficient poor quality domestic production is bad news but so is free trade that destroys efficient high quality domestic production purely on labour costs – often deliberately so. As with most of life there is no simple answer but balances and fine judgements.

  • “Of course, Sanders and Trump are populist politicians, in the sense of being more interested in saying what people want to hear, than saying what is deliverable and will give the outcomes they claim.”

    No “of course” at all. Sanders and Trump are two politicians who aren’t beholden to the interests of big business and big finance – in Sanders’ case on principle, in Trump’s case because (as he brags, and makes it a selling point) he’s rich enough not to need their money. Because Sanders and Trump aren’t under the thumbs of corporate interest, they can manage to listen to ordinary Americans, and seek to give them what they ask for.

    Hillary Clinton, and the Bushes / Rubios / Kasiches, depend on corporate money to run expensive campaigns. Ergo, their policies are (to varying but considerable extents) shaped to suit corporate interests. The fact that these policies might, as an unintentional byproduct, also (sometimes) help people in poorer countries is largely irrelevant to them. Except that it enables corporate apologists to dredge up a bogus “socially concern” argument in favour of managing trade to suit the big boys.

  • George,
    fair enough.
    Stevan Rose,
    My argument would be that very little of the benefit of Free trade really goes to consumers because the retail prices tag does not correspond with the cost of production. It’s really only about cheap labour to maximise profit and where the prices are low it’s often about killing the competition. I also dispute the idea that protectionism is necessarily bad when it protects inefficient local production. Western farming methods are far more efficient than food production in the emerging economies which is why those economies, as well as some established economies, put high tariffs on staple foods stuffs like rice. The point to me is that there is more to society than economics and capitalism is not a philosophy as such. If you actually look at examples from history the two most prominent features of emerging economies are protectionism at home and disregard for patent and copyright laws. This is true of America, which until fairly late in the 19th Century had a strong domestic economy but as an exporter barely registered, It’s also true of Japan amongst others in the mid to late 20th century and China amongst others now. In short free trade actually only really benefits emerging nations when it’s essentially a one way street. This is my problem with UKIP who seem to think pulling out of the EU will mean Britain will be a hive of unrestricted trade when the reality is that if nations were going to open their markets to us it would already have happened! To me the main advantage pulling out of the EU is that it will make domestic politics more important than global concerns.

  • Jayne Mansfield 12th May '16 - 12:12pm

    @ George Kendall,
    Perhaps the idea that you might be in some way right wing ( I don’t believe hat you are from what I have read of your contributions on here) is that you select a comment by Bernie Sanders and declare him as a danger to developing countries. You might cut developing countries some slack, but the EU in its’ free trade’ agreements does not, and I am not just talking of infant industries.

    I would look at the information from Oxfam, Doctors without Borders, Oxfam and other charities on the consequences of what the EU proposed regarding India’s generic Medecin industry. An industry that has saved millions of lives, and enabled HIV programmes in poor countries that cannot afford the products produced by big pharma.

    TRIPS plus increasingly high levels of intellectual property Property rules have been used by the USA to deny poor people medicines in developing countries like Jordon , threatening public health programmes by making them increasingly unaffordable a long time before Bernie Sanders came on the scene… and yet you wonder why idealistic people might vote for him. What is the alternative?

  • George.
    You’ve just confirmed everything I thought about globalist ideas and what’s happened to what passes for progressive politics why they are increasingly unpopular amongst ordinary voters. Basically it’s a suck it up and accept your lot message to the domestic electorate because after all there are people worse of elsewhere variation on we know best and I’m all right jack. Then you wonder why people who do not have job security, are not really rich, struggle with there bills and are probably going to be broke in their old age are attracted to the populism you are so scared of.

  • I agree with Glenn (all comments).

    George – I suspect you’re (a) creating a fake bogeyman of ‘protectionism’, 1930s style and (b) assuming it’s a zero sum game. Well, the world has moved on from the 1930s and it’s not zero sum.

    The worst protectionism today – or rather its modern equivalent – is to be found sailing under the false flag of ‘fee trade’. It seeks to stop developing countries protecting their infant industries until they are globally competitive and to extend intellectual property rights. The beneficiaries are of course corporations not people. Yet, as Glenn says above, these are the key to development as history clearly shows time and again. I think most people take it as read (I certainly do) that most, probably all, developing countries have something they can export whether it’s minerals or cheap labour in the form of garments and suchlike labour-intensive goods. I don’t think that a big problem for many high wage countries who should be moving to higher skill products.

    What is a problem is when multinationals export high-end jobs not to supply overseas markets but to beat down workers back home while also earning slightly greater margins by reason of the cheap labour- or so they think. (Actually, in the long term it looks like the extra profit is tiny and they tend lose the ability to innovate because in manufacturing that’s closely tied to keeping design and shop floor close.) This is financialised trade, not bona fide trade. It’s possible only by building up debts to unsustainable levels. All that is what I object to.

    As for developing countries they must develop industries and products primarily to supply their home market because that’s a proven route and also because the import capacity of the richer world simply isn’t great enough to satisfy their ambitions. Or, to put it another way, what you advocate isn’t a sustainable model as China is currently discovering.

    Nor is it sustainable for us. Productivity is falling which guarantees the next generation will be poorer if the trend continues. And that in turn means pensions won’t/can’t be honoured.

    So, what we have is a process which over time asset strips our economy firm by firm. Directors pocket bonuses based on unsustainable short-run profits and workers are immiserated.

  • Bill le Breton 12th May '16 - 7:29pm

    Gordon is right.

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    Charis, I am often highly critical of the 'National Party' so let me for once leap to their defence. They have, in the last 2...
  • User AvatarPeter Hirst 13th Aug - 5:30pm
    If people really want to come to our country with all its faults, we should embrace them with open arms. Seeing a boat load shout...
  • User AvatarJohn Probert 13th Aug - 5:24pm
    @ Anthony Watts: Very well said and not a moment too soon either, Mr Watts!