Economic Benefits Of Trade Agreements - Past, Present And Future - Not At All Clear

from the hang-on-a-minute dept

As we've noted before, trade agreements are usually sold on the basis that they will bring economic benefits for large numbers of the citizens involved. But that doesn't always work out in practice, as earlier figures regarding the North American Free Trade Agreement (NAFTA) and South Korea-US free trade agreement (KORUS) indicated. New corrected 2013 year-end trade data from the US International Trade Commission shows that things aren't getting any better. Here's what's happening with NAFTA, as encapsulated (rather breathlessly) by Public Citizen (pdf):
A staggering U.S. trade deficit with Canada and Mexico after 20 years of the North American Free Trade Agreement (NAFTA)

The 2013 U.S. goods trade deficit with Mexico and Canada was $177 billion -- a nearly seven-fold increase above the pre-NAFTA level, when the United States enjoyed a small trade surplus with Mexico and a modest deficit with Canada

Even worse for U.S. workers, the non-oil NAFTA deficit has multiplied more than 13-fold, costing hundreds of thousands of U.S. jobs. Indeed, the share of the combined U.S. trade deficit with Mexico and Canada that is comprised of oil has declined since NAFTA.
Things are equally grim on the KORUS front:
A stunning decline in U.S. exports to Korea, a rise in imports from Korea, and a widening of the U.S. trade deficit under the Korea Free Trade Agreement (FTA).

20 out of 21 months since the Korea FTA took effect, U.S. goods exports to Korea have fallen below the average monthly level in the year before the deal.

U.S. average monthly exports to Korea since the FTA are 12 percent lower than the pre-FTA monthly average, while monthly imports from Korea are up 3 percent.

The monthly trade deficit with Korea has ballooned 49 percent compared to the pre-FTA level. These losses amount to tens of thousands of lost U.S. jobs
Part of the problem with future free trade agreements like TPP and TAFTA/TTIP is that (obviously) we have no historical figures; instead, we must rely on economic models to predict what the benefits might be. Embedded within models are many assumptions, and people will naturally disagree over how reasonable those are. For example, in New Zealand, the Sustainability Council has published details of its review of the model that the New Zealand government has depended upon in order to justify its enthusiasm for the TPP negotations. Here's what the Council claims to have found:
The government has repeatedly used estimates from a team of US economists to justify the Trans Pacific Partnership. This team put the economic gains for New Zealand at US$4.5 billion for 2025 (around NZ$5.5 billion) in their latest study for the Peterson Institute.

A detailed review of that study led by Dr Geoff Bertram concludes that a third of the stated benefits should not be counted at all as they are outside established economic theory. The Sustainability Council review also concludes that only a minor part of the remaining gains are justified. The total benefits likely to be available are less than a quarter of the US$4.1 billion of gains Trade Minister Tim Groser told Parliament would result for New Zealand from the TPP.

In exchange for a small gain in relative terms, New Zealand is being asked to sign away large slabs of its sovereignty. The TPP bundles the small gains from trade with a wide range of non-trade matters that will set privileges for foreign investors. These would impose serious costs in the form of limitations on a government's ability to protect the public interest.
Now, given the organization's name, it's quite likely that the Sustainability Council has an axe to grind here, but then so does the New Zealand government, which has invested a huge amount of time, money and political capital in the TPP negotiations. What that means is everyone's claims about benefits or lack of them need to be treated with caution. And that, in its turn, means that the TPP negotiators should think very hard before making real sacrifices for what may prove highly elusive gains.

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    Anonymous Coward, Feb 14th, 2014 @ 5:50pm

    the problems as far as i can see with all 'Trade Agreements' involving/instigated by the USA is, they are done to try to benefit a couple of industries that feel they are losing out for whatever reasons. the truth when examined a year or two down the line finds that there has been no change in what was happening to the particular industries that wanted the 'Deal' but trade in other areas has fallen export wise, with substantial job losses to go with it.
    basically what this means is that a couple of people from a particular uncompetitive industry, who do not want to up their game and compete in the market place, think they should have specific protection. the main problem with this attitude and expectation is that they do no better but others in the Fatherland actually get screwed. it is equally strange to me that politicians dont seem to be able to grasp this fact and keep trying to get more and more deals which give more and more of the same, ie, nothing!!

     

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    Anonymous Coward, Feb 14th, 2014 @ 6:39pm

    "What that means is everyone's claims about benefits or lack of them need to be treated with caution. And that, in its turn, means that the TPP negotiators should think very hard before making real sacrifices for what may prove highly elusive gains."

    You mean they would actually have to use their brains , I never knew corporate puppets or (drones if you prefer) had brains.

     

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    Anonymous Coward, Feb 14th, 2014 @ 6:50pm

    Wait, what?

    According to that article and the linked review, it sounds like the NZ government is relying on US-provided economists to analyze the treaty. Are they insane? That's like negotiating a contract with someone and trusting their lawyer to vet the contract.

    Regardless of whether or not the US-provided numbers are actually correct (and it sounds like they aren't), this may be the one of the stupidest things I've ever heard.

     

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    Sinan Unur (profile), Feb 14th, 2014 @ 6:51pm

    OMG, my trade deficit with Amazon.com never goes down!

    Sure, trade agreements fail to realize all possible gains from trade. But this article and all the arguments about persistent trade deficits are just as misguided as the concern about your trade deficit with Amazon.

    After all, your friendly grocery store never buys anything you make.

    http://www.youtube.com/watch?v=zk3ruapRQZk

     

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    ECA (profile), Feb 14th, 2014 @ 7:32pm

    Always wondered where

    I always wondered where theses folks get their numbers..
    PAID FOR, INFLATED/BLOATED numbers, from??

    Why cant they use BASIC Econ facts?
    The ones we learn at HOME, with out banking accounts..

    For an Economy to change, SOMETHING has to happen.
    MOSTLY WORK or more jobs..

    You cant base it on WHAT is traded TO the country...this could only happen IF' this in the country can AFFORD IT..which means more money/jobs/work..

    This goes for ALL those trade agreements the USA is trying to GET now with Pacific trade and the EU..

     

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    Anonymous Coward, Feb 14th, 2014 @ 7:47pm

    The problem with the analysis above is that it uses 'increases net exports' as the standard for what constitutes an economic benefit. It's basically just protectionist bullshit.

     

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    Anonymous Coward, Feb 14th, 2014 @ 7:51pm

    Re: OMG, my trade deficit with Amazon.com never goes down!

    Agreed, the anti-free trade slant that has taken root here recently is disappointing and misguided. Pushing for more transparency in trade negotiations is awesome. Pointing out that 'IP' exporting had no place in a free trade agreement is great. Fighting free trade itself, however, is ignorant and misguided.

     

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    Anonymous Coward, Feb 14th, 2014 @ 7:58pm

    Increasing net exports and economic benefits are not synonyms. Economic benefits from free trade are not zero sum. It's entirely possible for the economy to be better off with fewer exports and for all parties in a trade agreement to see economic benefits. This analysis reeks of protectionism.

     

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    machinehead61, Feb 14th, 2014 @ 10:02pm

    Re: OMG, my trade deficit with Amazon.com never goes down!

    Your reference to Mr. Friedman needs some examination. Friedman refers to "the damage of tariffs to consumers" as if consumers are from Mars and producers are from Venus. Here Friedman is 100% guilty of ignoring the fact that the producer is the consumer. He gives no historical statistics relating tariffs to prices in the U.S. Instead he drones on about his dogma. Have some HISTORICAL FACTS - NOT FREE TRADE DOGMA - The tariff represented a complex balance of forces. Railroads, for example, consumed vast quantities of steel. To the extent tariffs raised steel prices, they paid much more making possible the U.S steel industry's massive investment to expand capacity and switch to the Bessemer process and later to the open hearth furnace. Between 1867 and 1900 U.S. steel production increased more than 500 times from 22,000 tons to 11,400,000 tons and Bessemer steel rails, first made in the U.S that would last 18 years under heavy traffic, would come to replace the old wrought iron rail that could only endure two years under light service. Taussig says that in 1881, British steel rails sold for $31 a ton, and if Americans imported them they paid a $28/ton tariff, giving $59/ton for an imported ton of rails. American mills charged $61 a ton—and made a huge profit, which was then reinvested into increased capacity, higher quality steels and more efficient production. By 1897 the American steel rail price had dropped to $19.60 per ton compared to the British price at $21.00 - not including the $7.84 duty charge - demonstrating that the tariff had performed its purpose of giving the industry time to become competitive. Then the U.S. steel industry became an exporter of steel rail to England selling below the British price and during WW I would become the largest supplier of steel to the allies. From 1915 through 1918, the largest American steel company, U.S. Steel, alone delivered more steel each year than Germany and Austria-Hungary combined, totalling 99,700,000 tons during WW I.

     

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    Steve O'Connor (profile), Feb 14th, 2014 @ 10:13pm

    Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Comparative advantage was the creation of David Ricardo which he introduced in his book, "On the Principles of Political Economy and Taxation" published in 1817.

    Ricardo died in 1823 and so was never able to witness the devastation it brought to his own country, England.

    The first problem is very few economists have ever concerned themselves with national security. To them, the free market is their god which is to be be idolized above all others at the expense of national independence.

    "Defense of free trade theory is, I submit, the result of pure intellectual error, due to a complete misunderstanding of the theory of equilibrium in international trade - an error which it is worthwhile to extirpate if one can, because it is shared, I fancy, by a multitude of less eminent free traders. Does he (William Beveridge-London School of Economics) believe that it makes no difference to the amount of employment in this country if I decide to buy a British car instead of an American car?"

    The Collected Writings of John Maynard Keynes
    vol. 20 p. 508

    Pennsylvania steel manufacturer Joseph Wharton argued that imported steel rails from England had cost $165 in gold per ton in 1864; five years later, behind a protective tariff, a U.S. steel industry was producing all of America’s needs for $80 per ton.
    By 1880, the United States behind a protective tariff, was second only to Great Britain in its share of world manufacturing output, with the U.S. producing 14.7 % compared to Britain’s 22.9%. By 1913, the United States was producing 32% of the world’s output compared to Germany at 14.8% and a sinking, free trade Britain at 13.6%. "We lead all nations in agriculture; we lead all nations in mining; we lead all nations in manufacturing," President McKinley declared. "These are the trophies we bring after twenty-nine years of a protective tariff".

    From 1869 to 1900, the gross national product quadrupled.
    The United States ran budget surpluses every year from 1866 to 1893.
    The national debt was reduced by two-thirds; by 1900 it was less than 7% of the GNP.
    Customs duties provided 58% of all federal revenue from 1869 to 1900.
    There was no income tax - save Lincoln’s wartime tax and Cleveland’s brief 2% flat tax on the rich, which was declared unconstitutional.
    Between 1870 and 1900, commodity prices fell 58%.
    Real wages, despite a doubling of the U.S. population, rose 53 percent.
    Annual growth of the U.S. economy averaged more than 4% a year from 1870 to 1913.
    From 1870 to 1913, U.S. industrial production rose 4.7% a year, compared with 2.1% a year in free trade Britain.
    American exports grew by almost 5% a year from 1870 to 1913, while free trade Britain’s grew less than 3%.
    Protectionist America’s share of world exports rose from 7.9% in 1870 to 12.9% in 1913 - while free trade Britain’s fell from 18.9% to 13.9%.
    Between 1869 and 1910, merchandise imports fell from 8% of the GNP to 4%.
    The United States began the era with half of Britain’s production and ended it with more than double Britain’s.

    By 1885, the United States had surpassed Great Britain, then considered the world’s major industrial power, in manufacturing output. By the turn of the century, it was consuming more energy than Germany, France, Austria-Hungary, Russia, Japan, and Italy combined. Between the 1865 and 1900, American coal production rose by 800%, steel rails by 523%, railway track mileage by 567%, and wheat production by 256%.

    After Britain repealed her corn laws, she became so dependent on American grain for food that when World War I came she nearly starved from German U-boat blockade. Between 1846 and 1910 British imports of wheat grew 1,000 percent. On the eve of WW I, once self-sufficient Britain could only grow enough wheat to feed a fourth of her population.

    But economists ignore this history and other examples of the dangers of destroying national independence to serve the free market / free trade god.


    “The Allies had started the war (WW I) with twenty-one million tons of shipping, or about six million tons more than was essential to feed Britain and keep the deployed armies supplied. The shipbuilding program had not quite stayed apace with the loss rate. Now, according to Jellicoe's (Admiral and First Sea Lord) figures, the U-boats had wiped out one third of the six-million margin in two months. The March (1917) losses had been 500,000 tons; April losses would pass 800,000. Said Sims (Rear Admiral): "Looks as if the Germans are winning the war."
    "They will unless we stop those losses," replied Jellicoe.

    The American Heritage History of World War I
    1964
    p. 206

    The vast majority of economists don't care about national security. They wear free market blinders and only concern themselves with market efficiency and throw out the history that is inconvenient to their free market idolatry. Most economists are very poor historians.

     

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    Steve O'Connor (profile), Feb 14th, 2014 @ 10:20pm

    Re:

    Ireland And Free Trade

    "The only country in the world I know of that has thoroughly free trade forced upon her by compulsory process is that most distracted and unfortunate land, Ireland. Before the union her manufacturing industries were protected against England by duties on woolens, silks, cotton, yarn, and twist, and cotton manufactured goods. Her calicoes and muslins were protected by a duty almost prohibitory, and Ireland was rapidly becoming a successful manufacturing country. Her people were happy, contented, industrious, and prosperous. There was a loom in almost every house, and with it comfort came, too. Her linens were known and appreciated all over the world, and her silks were gaining a ready market.

    There were in 1800, as appears by an imperfect census then taken, over 8,000 weavers employed in Cork alone, over 5,000 manufacturing woolen goods in Dublin, 3,000 making blankets in Balbrigan, 2,000 weaving calicoes in Wicklow, 1,000 making flannels, while the numbers engaged in linen work were immense.

    This linen trade was encouraged by subsidies, but they were gradually withdrawn until all protection ceased in 1826. In 1825 more than thirteen million of dollars were expended in the purchase of coarse, unbleached, home-made webs of linen. "What a power of good, of comfort, and of happiness, those home-made webs revealed.

    England, not content with destroying Ireland's navigation, with crushing out, in the earlier days, her manufacture of woolens, greedy to manufacture for the world, determined that the rest of mankind should raise the raw materials to feed her hungry looms, as the South wanted us to feed their slaves, beguiled poor Ireland into assenting to the act of the union, under the terms of which every duty was repealed—some gradually, to be sure, but certainly. The act continued the tariff on woolens for twenty years, terminated it on calicoes and muslins in 1821, on cotton yarn and twist in 1816, withdrew all subsidies in 1826, and Ireland enjoyed the benefit of absolute free trade.

    What was the result? England held both ends of the bargain. Ireland could raise in her fertile soil the raw material. England could make it into goods cheaper than she could, but Ireland had no voice in the price to be paid for either.

    In 1840, another census was taken, and there were 500 blanket-makers in Kilkenny, 200 silk- weavers in Dublin, no carpet makers in all Ireland, no linen- weavers in Cork, 300 operatives in that city in all the manufacturing industries, where fifteen years before there were 8,000 weavers alone.

    Free trade had done its work and Ireland was starving. She is the only absolutely free trade country in the world today, the only land enjoying its rare privileges in complete fullness, and what a commentary it affords with a good climate, a fertile soil, great rivers, splendid water-power, broad, safe bays and harbors, an abundance of minerals, an industriously-inclined people, it is the most terribly vexed, troubled, suffering, distracted, impoverished, starving country in the world.

    Irishmen, loving their land earnestly and with more unbounded enthusiasm than the men of any other country, have been driven into exile by the millions. Now, I do not blindly charge all of her woes to free trade alone; land tenure has to answer for a portion, not for more than half. Give her a parliament of her own, and the first act passed would be a protective tariff, and in twenty years from now the exiled Irishman would return to the land he loves and find it peaceful, contented, and prosperous. England, for her own selfish purposes, fastened these two fearful leeches upon her, and they have been fattening on her blood."

    Senator William Pierce Frye
    Speech in the United States Senate, February 10,1882

    Note: Sir Charles Edward Trevelyan was assistant secretary to HM Treasury from 1840–1859, during both the Irish famine and the Highland Potato Famine of 1846-1857. In Ireland he was responsible for administering famine relief.


    "The influence of laissez faire on the treatment of Ireland during the famine is impossible to exaggerate. Almost without exception the high officials and politicians responsible for Ireland were fervent believers in non-interference by Government, and the behavior of the British authorities only becomes explicable when their fanatical belief in private enterprise and their suspicions of any action which might be considered Government intervention are borne in mind.

    The loss of the potato crop was therefore to be made good, without Government interference, by the operations of private enterprise and private firms, using the normal channels of commerce. The Government was not to appear in food markets as a buyer, there was to be "no disturbance of the ordinary course of trade" and "no complaints from private traders" on account of Government competition.

    The flaw in the plan was the underdeveloped state of the food and provision trade in a great part of Ireland. Large numbers of people, especially in the west and south-west, hardly purchased food at all; they grew potatoes and lived on them. Shops and organizations for importing foodstuffs and distributing them on the English model were generally found only in more prosperous districts in north-east Ulster, Dublin, some places in Eastern Ireland, and the larger towns, like Cork. Where relief would be most needed, the means by which it was to be supplied seldom existed."

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.49

     

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    Steve O'Connor (profile), Feb 14th, 2014 @ 10:23pm

    Re: Re:

    "One of the reasons why the British Government did not feel bound to send food to Skibbereen was that ample food was to be found there already. "On Saturday, notwithstanding all this distress," wrote Major Parker, the Board of Works' Relief Inspector, on December 21, "there was a market plentifully supplied with meat, bread, fish, in short everything." This extraordinary contradiction occurred all over Ireland during the famine years, and was not understood by the British Government. Trevelyan insisted that the "resources of the country should be "drawn out," failing to realize that those resources were so utterly inaccessible to the unfortunate wretches dying in the streets and by the roadsides that they might as well never have existed. The starving in such places as Skibereen perished not because there was no food but because they had no money with which to buy it."

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.159-160

    But where had the money gone?

    In true laissez faire capitalist redistribution of wealth:

    "Routh blamed the landlords. The proprietors of the Skibereen district, he told Trevelyan, "draw an annual income of 50,000 pounds." There were twelve landowners, of whom the largest was Lord Carbery, who Routh declared, drew 15,000 pounds in rent; next was Sir William Wrixon-Becher, on whose estate the town of Skibereen stood; Sir William, alleged Routh, drew 10,000 pounds, while the Reverand Stephen Townsend, a Protestant clergyman, drew 8,000 pounds. "Ought such destitution to prevail with such resources?"

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.158-159

    "However, on December 15 Mr. Nicholas Cummins, the well-known magistrate of Cork, had paid a visit to Skibbereen and the surrounding district, and had been horrified by what he saw. He appears to have written to the authorities, but without result, because on December 22 he addressed a letter to the Duke of Wellington, who was an Irishman, and also sent a copy to The Times. It was published on December 24,1846.

    “My Lord Duke,” wrote Mr. Cummins, “Without apology or preface, I presume so far to trespass on your Grace as to state to you, and by the use of your illustrious name, to present to the British public the following statement of what I have myself seen within the last three days. Having for many years been intimately connected with the western portion of the County of Cork, and possessing some small property there, I thought it right personally to investigate the truth of several lamentable accounts which had reached me, of the appalling state of misery to which that part of the country was reduced. I accordingly went on the 15th instant to Skibbereen, and to give the instance of one townland which I visited, as an example of the state of the entire coast district, I shall state simply what I saw.....

    Being aware that I should have to witness scenes of frightful hunger, I provided myself with as much bread as five men could carry, and on reaching the spot I was surprised to find the wretched hamlet apparently deserted. I entered some of the hovels to ascertain the cause, and the scenes which presented themselves were such as no tongue or pen can convey the slightest idea of. In the first, six famished and ghastly skeletons, to all appearances dead, were huddled in a corner on some filthy straw, their sole covering what seemed a ragged horsecloth, their wretched legs hanging about, naked above the knees. I approached with horror, and found by a low moaning they were alive – they were in fever, four children, a woman and what had once been a man. It is impossible to go through the detail. Suffice it to say, that in a few minutes I was surrounded by at least 200 such phantoms, such frightful specters as no words can describe, either from famine or from fever. Their demoniac yells are still ringing in my ears, and their horrible images are fixed upon my brain. My heart sickens at the recital, but I must go on.

    In another case, decency would forbid what follows, but it must be told. My clothes were nearly torn off in my endeavour to escape from the throng of pestilence around, when my neckcloth was seized from behind by a grip which compelled me to turn, I found myself grasped by a woman with an infant just born in her arms and the remains of a filthy sack across her loins – the sole covering of herself and baby. The same morning the police opened a house on the adjoining lands, which was observed shut for many days, and two frozen corpses were found, lying upon the mud floor, half devoured by rats.

    A mother, herself in a fever, was seen the same day to drag out the corpse of her child, a girl about twelve, perfectly naked, and leave it half covered with stones. In another house within 500 yards of the cavalry station at Skibbereen, the dispensary doctor found seven wretches lying unable to move, under the same cloak. One had been dead many hours, but the others were unable to move either themselves or the corpse.”

    These facts were confirmed by Government witnesses. Mr. Richard Inglis, a Commissariat, was ordered to Skibbereen on about December 17, and horrified by what he saw, he sent a statement to Mr. Hewetson, the senior Commissariat officer at Limerick, who forwarded a certified copy to Trevelyan on December 21. As Mr. Inglis arrived in Skibbereen he saw three dead bodies lying in the street, and he buried them with the help of the constabulary.

    Deaths were occurring daily; 197 persons had died in the workhouse since November 5, and nearly 100 bodies had been found dead in the lanes or in derelict cabins, half-eaten by rats. Mr. Inglis brought with him 85 pounds which he had collected privately, and started two soup kitchens. Major Parker, Relief Inspector of the Board of Works, estimated that about 200 people had died in Skibbereen during the last few weeks.

    “A woman with a dead child in her arms was begging in the street yesterday,” he wrote on December 21, “and the Guard of the Mail told me he saw a man and three dead children lying by the roadside.....nothing can exceed the deplorable state of this place.”



    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.157-158

     

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    Steve O'Connor (profile), Feb 14th, 2014 @ 10:25pm

    Re: Re: Re:

    "The Irish peasant was told to replace the potato by eating his grain, but Trevelyan once again refused to take any steps to curb the export of food from Ireland. "Do not encourage the idea of PROHIBITING exports," he wrote, on September 3, (1846) "PERFECT FREE TRADE IS THE RIGHT COURSE".

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.118


    "Routh disagreed, a rare occurrence. He considered exports to be a "serious evil" and estimated, on September 29, (1846) that by the end of the harvest, of oats alone, apart from other produce, "60,000 tons" would have left the country. Trevelyan would not be moved; according to FREE TRADE DOCTRINES the sale, by export outside Ireland, of grain and other produce which commanded a high price should provide Irish merchants with money to purchase and import low-priced foods, to replace the loss of the potato."

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.118


    “On August 7, 1846, Father Mathew, the “apostle of Temperance,” wrote in agitation to Trevelyan: he had heard rumours that “the capitalists in the corn and flour trade are endeavouring to induce government not to protect the people from famine but to leave them at their mercy,”.......

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.101


    “To people desperate with hunger the sight of food streaming out of the country was once more unbearable, and serious riots took place – more serious than any riots of the previous year (1845). At Youghal, near Cork, a small port much used for export, an outbreak took place on September 25. A large crowd of country people, described by the police as “enraged,”attempted to hold up a boat laden with export oats – the police sent for troops, and the crowd was checked, with difficulty, at Youghal bridge.........A riot, with loss of life, occurred at Dungarvan, County Waterford, on September 29. A crowd of starving unemployed entered the town, threatened merchants and shopkeepers, ordering them not to export grain, and plundered shops. The Resident Magistrate had the ringleaders arrested and put in the lock-up, upon which the crowd declared they would not go home until the prisoners were released.
    After the police had tried, in vain, to clear the streets, the 1st Royal Dragoons were called out; the crowd began to pelt them with stones and the Riot Act was read. But as stone-throwing continued the officer commanding the Dragoons, Captain Sibthorp, gave the order to fire, and twenty-six shots were fired into the crowd, which then retreated. Several men were wounded and two were left lying on the ground, dead.”

    Cecil Woodham-Smith
    The Great Hunger, 1962
    p.120

    In 1846, the potato crop was completely ruined and it was clear that the Government needed to act. Rather than provide food aid, Parliament introduced new taxes (which landowners would have to pay) to raise money for 'public works relief'. The latter was a two-pronged scheme. It created work for labourers so that they earn enough to feed their families with food other than potatoes. And it provided for workhouses to be built to house the absolutely destitute.

    The gentry were more than a little alarmed since they could see this taxation level, which they considered onerous, continuing for years. Some decided to bring a conclusion to their local problems by removing the burden altogether: by shipping their tenants to North America. They calculated that the cost of transporting each individual was considerably less than supporting that person in the workhouse for a year.

    And so the first ships were commissioned and set sail, loaded with human cargo, for British North America (Canada). Many of these vessels were overloaded. Each held an average of 300 persons, some two or three times the number that would have been allowed by a port in the USA, and some were not seaworthy.

    The ships that survived the Atlantic crossing arrived at the quarantine station of Grosse Isle, the Canadian immigration point and depot set up in the Gulf of St Lawrence (Ontario) in 1832, to contain diseased immigrants to British North America. Statistics for just one month - July 1847 - indicate the horrors that were being indured. Ten vessels arrived that month; of the 4,427 Irish immigrants that had started their journeys (all had departed from either Cork or Liverpool), 804 had died on the passage while 847 were sick on arrival.

    By the end of 1847, the awful toll could be calculated from the 200 immigrations ships that had made the crossing. Of 98,105 passengers (of whom 60,000 were Irish), 5293 died at sea, 8072 died at Grosse Isle and Quebec, 7,000 in and above Montreal. In total, then, at least 20,365 people perished (the numbers of those that died further along in their journey from illnesses contracted on the coffin ships cannot be ascertained) – one-third of each vessel's passenger list.


    Montreal's mass graves

    The quarantine station at Grosse Isle, Newfoundland, Canada, was soon overwhelmed with the numbers of sick passengers crawling or carried off the coffin ships. It couldn't treat those that were ill, let alone provide for those that were not. So those that appeared healthy remained onboard their immigration ships and were simply waved on to Montreal. Unfortunately, many had already caught typhus – the fever that ran rampant on their overcrowded and dirty vessels – and they were to become ill further upriver. Soon, it was Montreal that was overwhelmed with the dead and dying.

    Ten years after the year of the coffin ships, workers building the city's Victoria Bridge unearthed a mass grave containing the remains of about 6000 Irish immigrants. A 27-tonne granite boulder marks the spot beside the bridge's entrance where an annual ceremony remembers those who died escaping poverty and hunger.

     

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    Anonymous Coward, Feb 14th, 2014 @ 10:35pm

    Someone should write an article about the predicted economic projections of pro NAFTA economists back in the 1990's. Then compare those made-up projections with hard facts about NAFTA's real economic impact on the economy and labor markets.

    I imagine there will be stark differences between to projected and real-world figures. We can then point to this report as proof, that past history has show these voodoo economists have been way off the mark in their future economic projections.

    Which will discredit any future economic "voodoo" figures they're pulling out their asses about TPP, TAFTA/TTIP, and all these other job/wage killing "free trade" abominations.

     

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    Steve O'Connor (profile), Feb 14th, 2014 @ 10:39pm

    FREE TRADE DISASTER IN U.S. 1783-1789

    The founding fathers set a limit on personal liberty - see Wikipedia "Tariff of 1789" and "Economic Conditions Prior to Passage". If you want absolute liberty, go find a desert island and practice your anarchy. Otherwise, if you wish to be a citizen of the U.S. then put something on a higher priority than your own selfish wants - like the "GENERAL WELFARE" (U.S. Constitution preamble) of the nation. If you don't care about your nation then by all means - take the next plane to Somalia.

    James Madison in a letter to Thomas Jefferson dated March 18, 1786 described the economic depression:

    "The States are every day giving proofs that separate regulations are more likely to set them by the ears than to attain the common object. When Massachusetts set on foot a retaliation of the policy of Great Britain, Connecticut declared her ports free. New Jersey serv. New York in the same way. And Delaware, I am told, has lately followed the example, in opposition to the commercial plans of Pennsylvania. . .

    Another unhappy effect of a continuance of the present anarchy of our commerce will be a continuance of the unfavorable balance on it, which, by draining us of our metals, furnishes pretexts for the pernicious substitution of paper money, for indiligences to debtors, for postponements of taxes. In fact, most of our political evils may be traced up to our commercial ones, as most of our moral may to our political. The lessons which the mercantile interest of Europe have received from late experience will probably check their propensity to credit us beyond our resources, and so far the evil of an unfavorable balance will correct itself. But the Merchants of Great Britain, if no others, will continue to credit us, at least as far as our remittances can be strained, and that is far enough to perpetuate our difficulties, unless the luxurious propensity of our own people can be otherwise checked."

    Samuel Bryan
    "We were suffering from the restrictions of foreign nations, who had shackled our commerce, while we were unable to retaliate: and all now agreed that it would be advantageous to the union to enlarge the powers of Congress: that they should be enabled in the amplest manner to regulate commerce, and to lay and collect duties on the imports throughout the United States."

    The Address and Reasons of Dissent of the Minority of the Convention of Pennsylvania to their Constituents"
    Samuel Bryan
    December 18, 1787

    Daniel Webster in a speech delivered to the citizens of Pittsburg on July 8th, 1833, described the same situation in greater detail:

    "From the close of the War of the Revolution, there came a period of depression and distress, on the Atlantic coast, such as the people had hardly felt during the sharpest crisis of the war itself. Ship-owners, ship-builders, mechanics, artisans, all were destitute of employment, and some of them destitute of bread. British ships came freely, and British ships came plentifully ; while to American ships and American products, there was neither protection on the one side, nor the equivalent of reciprocal free trade on the other. The cheaper labor of England supplied the inhabitants of the Atlantic shores with everything. Ready-made clothes, among the rest, from the crown of the head to the soles of the feet, were for sale in every city. All these things came free from any general system of imposts. Some of the States attempted to establish their own partial systems, but they failed. Voluntary association was resorted to, but that failed also. A memorable instance of this mode of attempting protection occurred in Boston. The ship-owners, seeing that British vessels came and went freely, while their own ships were rotting at the wharves, raised a committee to address the people, recommending to them, in the strongest manner, not to buy or use any articles imported in British ships. The chairman of this committee was no less distinguished a character than the immortal John Hancock. The committee performed its duty powerfully and eloquently. It set forth strong and persuasive reasons why the people should not buy or use British goods imported in British ships. The ship-owners and merchants having thus proceeded, the mechanics of Boston took up the subject also. They answered the merchants' committee. They agreed with them cordially, that British goods, imported in British vessels, ought not to be consumed; but then they took the liberty of going a step farther, and of insisting that such goods ought not to be bought or consumed at all. “For,” said they,”Mr. Hancock, what difference does it make to us, whether hats, shoes, boots, shirts, handkerchiefs, tin-ware,brass-ware, cutlery, and every other article, come in British ships or come in your ships; since, in whatever ships they come, they take away our means of living?” Gentlemen, it is an historical truth, manifested in a thousand ways by the public proceedings and public meetings of the times, that the necessity of a general and uniform impost system, which, while it should provide revenue to pay the public debt, and foster the commerce of the country, should also encourage and sustain domestic manufactures, was the leading cause in producing the present national Constitution.”

     

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    Steve O'Connor (profile), Feb 14th, 2014 @ 10:41pm

    Re: FREE TRADE DISASTER IN U.S. 1783-1789

    On June 5th, 1789, a petition from the tradesmen and manufacturers of Boston was sent to the Congress:

    "That the great decrease of American manufactures, and almost total stagnation of American ship-building, urge us to apply to the sovereign Legislature of these States for their assistance to promote these important branches, so essential to our national wealth and prosperity. It is with regret we observe the resources of this country exhausted for foreign luxuries, our wealth expended for various articles which could be manufactured among ourselves, and our navigation subject to the most severe restrictions in many foreign ports, whereby the extensive branch of American ship-building is essentially injured, and a numerous body of citizens, who were formerly employed in its various departments, deprived of their support and dependence. . . . "


    On April 11, 1789 a petition from the tradesmen and manufacturers of Baltimore to the Congress, stated the following:

    “That since the close of the late war, and the completion of the Revolution, your petitioners have observed with serious regret, the manufacturing and trading interests of the country rapidly declining, while the wealth of the people hath been prodigally expended in the purchase of those articles from foreigners, which our citizens, if properly encouraged, were fully competent to furnish. To check this growing evil, applications were made by petitions, to some of the State legislators: these guardians of the people, in several of the States, interposed their authority: laws were made by them enacted with the view of subduing, or, at least, diminishing the rage for foreign, and of encouraging domestic manufactures, but the event hath clearly demonstrated to all ranks of men, that no effectual provision could reasonably be expected, until one uniform efficient government should pervade this wide-extended country. . .

    Your petitioners rejoice at the prospect this affords them, that America, freed from the commercial shackles which have so long bound her, will see and pursue her true interest, becoming independent in fact as well as in name; and they confidently hope, that the encouragement and protection of American manufactures will claim the earliest attention of the supreme legislature of the Nation, as it is an universally acknowledged truth, that the United States contain within their limits, resources amply sufficient to enable them to become a great manufacturing country, and only want the patronage and support of a wise energetic government. . . . ”


    Petition of mechanics and manufacturers of New York , April 18, 1789, urging that domestic trade be fostered by levying duties on certain articles of foreign manufacture.

     

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    ECA (profile), Feb 15th, 2014 @ 2:33am

    free trade??

    what FREE TRADE..

    Bush installed a 25% tax on Lumber from canada..

    SHIP our lumber to China to be made into goods, that cost 2-3 times what it would made in the USA..
    Inflate prices in the USA...
    Inflate the cost of Canada Lumber used to build homes..

    FREE trade to Corps is, "HOW can I make MORE money"..

    1 Lumber company In my state, orders wood back east, that gets SHUFFLED back and forth accross the Can. Border and TAXED 2-3 times..(on the books that is), they found a LOCAL Lumberman that cut his costs in 1/2...

    Material costs in this country are STUPIDLY HIGH..and its NOT that you are paying 1 company to DO THE WORK..you are paying, 2-4 companies..Fun part, only 1-2 HANDLE the goods, the rest is paper work and distribution..Paying for an EXTRA 100 people to handle it..

     

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  18.  
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    Anonymous Coward, Feb 15th, 2014 @ 2:51am

    Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    You do realize the phrase 'national severity' is a running joke that statists of all stripes use to extort more power for themselves, right? Would have thought the recent Snowden incident would have put that fresh in your mind yet here you are...

     

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  19.  
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    Anonymous Coward, Feb 15th, 2014 @ 2:59am

    Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Tariffs make products more expensive is 'free trade dogma?' Yet you make the same argument about us steel, that it drive prices up in the us to a significant degree. Then you sort of backpedal and claim the price was due to superior workmanship but if that were true the tariff wouldn't have been needed.

    You are flat out wrong about tariffs. Your duly handwaving nonsense about 'consumer is the producer' ignores completely that consumers is a massive group, orders of magnitude larger than producer in this or any other specific case. Tariffs and other forms of protectionism make them all worse off to enrich a tiny subset, not the group as a whole.

     

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  20.  
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    Anonymous Coward, Feb 15th, 2014 @ 3:07am

    Re: Re:

    Only a liar would claim Ireland had perfectly free trade. Then again your the sort that would post the comparison of wanting raw materials with slavery as if the two were equivalent so that's no surprise. I don't have time to waste on your likely equally dubious argument by verbosity below. Spam your anti trade copy parts shit somewhere else, it's not flying here.

     

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  21.  
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    Anonymous Coward, Feb 15th, 2014 @ 3:12am

    Re: free trade??

    Yes, sadly many beat the 'free trade' drum while really meaning they want as much protection for themselves as possible and none for anyone else. Real free trade means no protectionism period.

     

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    Sinan Unur (profile), Feb 15th, 2014 @ 5:13am

    Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Trade always happens between individuals, not nations. As for national security, isn't it better for our adversaries to waste their precious resources by selling us artificially cheap coat hangers and TV sets? That means, thanks to their "cheating", we end up having more stuff than would otherwise have been possible.

    Do you think if the DRAM tariffs of the early 80s had been successful, there would have been an Internet revolution?

    Cheap components is one of the most important things that made Linux possible (which, in turn, made cheap servers possible). The other main factors that made the Internet revolution possible are 1) IBM's PC design; and 2) Windows. Without these three pillars, there would not have been so much cheap, commodity hardware to run Linux on.

    If you do not like Friedman talking about free trade, here is me talking about it:

    http://freedomandfreesocieties.cornell.edu/past-events/2010/#unur

    I grew up in a rather protectionist, centrally-planned country. Not fun.

     

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    That One Guy (profile), Feb 15th, 2014 @ 5:35am

    Re:

    Already been covered on TD actually, and the predictions fared poorly to say the least.

    http://www.techdirt.com/articles/20131231/05580725722/nafta-20-reveals-truth-about-trade-agree ments.shtml

     

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    Richard (profile), Feb 15th, 2014 @ 5:40am

    Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Well "National Security" as used by politicians - is a rather different thing from true national security.

    Having said that I feel that most of the comment about US vs UK growth in the period in question are somewhat off beam.

    The US could afford to be protectionist because it had a large amount of empty space to expand into and a rapidly growing population during that period. Thus the usual problems of protectionism did not arise. The UK could not have performed better by being protectionist itself because it had already finished most of its population growtn and did not have scope for geographic expansion.

    The UK would have done best if it had hung on to the American colonies and been inside the US trade barrier.

    However you look at it the relative performance of the US and the UK during that period is not simply explained by differences in trade policy.

     

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    Richard (profile), Feb 15th, 2014 @ 5:48am

    Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    You are flat out wrong about tariffs. Your duly handwaving nonsense about 'consumer is the producer' ignores completely that consumers is a massive group, orders of magnitude larger than producer in this or any other specific case. Tariffs and other forms of protectionism make them all worse off to enrich a tiny subset, not the group as a whole.

    Unfortunately consumers have to get the wealth to consume from somewhere - and if competitive advantage drives all the jobs offshore then they don't have the money to buy stuff even if the price has gone down.

    The reality is that both sides of the argument are mostly trying to further the interests of elite groups at the expense of the mass of the population. The so called free traders want to be able to buy cheap goods produced outside the influence of laws to protect workers' rights and then sell them at a bigger markup than would be possible for home-produced items.

    True free trade would mean the following

    1. Free movement of labour worldwide.

    2. Uniform terms and conditions for workers worldwide.

    Without these two (and a decent amount of time for the system to stabilise) the benefits of free trade will mostly go to an elite - albeit a different elite from those who benefit from protectinism.

     

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    ECA (profile), Feb 15th, 2014 @ 5:51am

    Problems

    one of the major USA trades, is crops..

    NOw think about this.
    A company, sells products to a corp..
    The Corp sells to traders..
    Traders sell to other nations..

    WHO is getting the money?

    This is not trickle down theory..
    And the only money made, tends to STAY on the top..

    The THING about trading, is if the Purchaser, has a choice.
    When there is only 1 person/group selling to you, there is no choice.

    And the only ones making money, are the TRade/export persons.
    The Importer customers have to make money, but cant afford Over pricing.. as they have competition.

    If you saw this on the stock market, it would be EQUAL to 1 person cornering a market on MILK..and every one HAS to have it.
    this is NOT a free market.

     

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    Steve O'Connor (profile), Feb 15th, 2014 @ 6:38am

    Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    And here you are reducing ALL national security issues to nothing more than information leaks and you equate the government reaction to that information leak as the same. How ignorant are you? This ignorant:

    The reality is that the United States Trade Representative office (USTR) has been the people creating our trade agreements. These people are not elected – they have been appointed to office. U.S. Senator Ron Wyden (Dem – Oregon) described what he found when he attempted to find out what was going on:

    “As the Chairman of the Senate Finance Committee’s Subcommittee on International Trade, Customs, and Global Competitiveness, my office is responsible for conducting oversight over the USTR and trade negotiations. To do that, I asked that my staff obtain the proper security credentials to view the information that USTR keeps confidential and secret. This is material that fully describes what the USTR is seeking in the TPP talks on behalf of the American people and on behalf of Congress. More than two months after receiving the proper security credentials, my staff is still barred from viewing the details of the proposals that USTR is advancing. The majority of Congress is being kept in the dark as to the substance of the TPP negotiations, while representatives of U.S. corporations – like Halliburton, Chevron, PHRMA, Comcast, and the Motion Picture Association of America – are being consulted and made privy to details of the agreement.”

    U.S. Representative Peter DeFazio (Dem. - Oregon) found the same secrecy:

    “About 27 miles away from here, secret negotiations are ongoing. A number of us have asked to be allowed to observe the negotiations because it will have a dramatic impact on the future of the United
    States of America and our economy, but no Member of Congress has been allowed into these negotiations. This is over something called the Trans-Pacific Partnership. It's essentially NAFTA for the whole Pacific Rim. . . . We know very little about what's being negotiated because, again, the
    documents are all kept secret from Members of Congress. They have been shared, however, with 600 corporations who, at the click of a mouse, can access them through a secure site on-line. But yet no Member of Congress is allowed to see these documents, no one representing the American people.”

    There you go my free market at any cost friend - your beloved corporations are now subverting the rule of law - i.e. U.S. Constitution - and are now the powers writing our U.S. trade agreements along with the appointed USTR people. Are you happy with your corporate fascism?

     

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    Steve O'Connor (profile), Feb 15th, 2014 @ 6:58am

    Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Let me introduce you to the concept of "infant industry". England had developed its steel industry well before the U.S. had even discovered its largest iron deposits. In case you don't understand this, it takes time to develope the infrastructure and experience to create a steel industry and England was doing everything it could to make sure it did not happen in the U.S.

    Ever hear of "dumping"? I suppose in your free trade religion those complications don't exist.

    Let me introduce you to the real world when England was the expert at it:

    "When the Tariff was removed in 1846 iron rails were selling at $50; the English immediately reduced the price to $40, until our mills were closed; then they advanced the price to $60, finally to $75 a ton; between 1850 and 1854 England sold us 800,000 tons at $75; all of which we might have produced with a Tariff of $10 and kept the price down to $50, and saved $20,000,000 to American railroad owners. In 1867 steel rails sold at $166 currency, with no Tariff, we produced but 2,277 tons. In the year 1883, with a Tariff of 1 cent a pound in force for 15 years, we produced 1,500,000 tons at $40, and the importation of steel rails has decreased from 182,135 tons in 1882 to 2,395 in 1885. It is estimated that we have produced $1,800,000,000 worth of rails since we began their manufacture; this is so much added wealth to the country, which has given just that much encouragement and profit to our labor, mines, farms and other manufactures. A like increase in product and decrease in price can be shown in all departments of our iron industry."

    The Defender
    Home Production
    April 28, 1890

    "A glance at the history of prices of tin plate for twenty years past will make clear the necessity and propriety of the McKinley tariff, and, at the same time, illustrate the characteristic policy of British free trade manufacturers. "In 1873, British importers advanced the price of tin plate to $12 a box, in American markets ; and at once, American tin-plate factories commenced operations. British importers within three years reduced the price to $4.50 per box, and our mills had to shut down. When this was done British importers advanced prices to $9 and $10 per box, and under this stimulus, in 1879, American mills again started up. As soon as they were well at work, British importers again reduced the price to $4 per box ; and then made a standing offer or more properly a threat, to sell their tin plate twenty-five cents a box cheaper than the American product, no matter what the price of the latter might be. Of course, this action completely finished the American industry, and prices were at once advanced from $4 to $7 per box."

    The McKinley tariff put an end to this outrage and robbery, and this fact alone is sufficient justification for its enactment.

    It puts a duty on tin plate so high that it will probably soon transfer the most of that great industry to this country. Already many large plants are in process of erection, or have been completed, and are producing a superior tin plate, at Brooklyn, Pittsburgh, Chicago, St. Louis, and other places, and others will soon go up. The largest mines of tin in the world have lately been found in the Dakotas, California, Texas and Virginia ; so that it is morally certain that in the near future we shall be able to produce at home the full supply of tin and tin plate that we need, and which now amounts to over $30,000,000 in value annually,

    When this is accomplished it will afford a new business that will annually pay to American labor not less than $23,000,000 ; it will require from iron ore miners not less than 1,000,000 tons of iron ore more than they now produce ; from limestone quarries 300,000 tons more of limestone ; from coal mines and coke ovens 2,000,000 tons more of coal and coke ; from blast furnaces 400,000 tons more of pig iron ; from lead mines and smelting furnaces 5,500,000 pounds more of lead ; from slaughter and packing houses 13,000,000 pounds more of tallow and oil; from chemical factories 40,000,000 pounds more of sulphuric acid ; from lumber yards 12,000,000 feet more of lumber ; and will give constant work to at least 35,000 persons. Indeed, it is already (1892) in large part fulfilled."

    D. G. Harrimon
    American Tariffs From Plymouth Rock To McKinley, 1892
    p. 65-66

    And sorry to confuse your religious conviction to free markets above national security but this also applied here:

    PROTECTION FOR TIN PLATE.

    John Sherman's Plea of Justification
    Sixteen Years Ago.


    A shipping merchant from Cardiff, who is largely concerned in Welsh tin plate mills, has just completed a tour of the principal tin plate plants of Pennsylvania and the Central West. To a representative of the " Sun" he gave these impressions of the industry :

    " When l visited this country immediately after the passage of the act of July 1, 1891, which was intended to foster tin plate making. I did not believe that the United States would be able to supply its wants in tin plates in less than thirty years. On that visit I called upon President Harrison and told him that on my return to Wales it was my intention to lay the state of the conditions in America before the tin plate workers of Great Britain.

    " Among other questions. I asked the President to be good enough to tell me why so large an impost had been laid upon tin plates, as there seemed little reason for belief that capital would be attracted to a business which might be cut down by the action of a Congress hostile to high Protection. Just as I had begun to speak upon this matter Senator Sherman was announced, and to him the President referred my questions as to why the country had placed a higher impost on tin plates. He said:

    It is a long story. The gist of it is that the higher duty was placed out of consideration for the vast number of farmers who raise products for the canning industry, and for the benefit of the other interests, as products of the fisheries and from oyster beds and clam banks, that make a good part of the materials canned along our coast and by our rivers. We are dependent upon Great Britain for tin plate. In the event of a war in which that country should lose command of the seas we could not get tin plate for our canning interest.

    Our navy is insignificant. In such a war we could not protect the small tonnage of shipping under our flag. The consequence would be that for want of tin plate millions of our farmers would be forced to see products rotting on the ground. Our thousands of canneries would be closed. The vast oil industry, which exports so largely in tin cans, would be brought to a standstill, and we should lose billions of dollars—all for want of tin plate. So we passed the act which will create mills that within a few years will make us independent of foreign producers.

    " The chief manager of the largest tin plate mill in the West told me the other day that the output of tin plate from all American mills for 1906 will be not less than 12,000,000 boxes. The amount of tin plate made and consumed by interests which take the sheets without being boxed is certainly not less than the equivalent of 3,000,000 boxes. When the McKinley Tariff was passed the American output was only a few thousand boxes a year. So we see that what is without doubt the greatest degree of development in the American steel industry was brought about by a measure based upon the idea that a combination of Powers might make England unable to protect her commerce by sea."

    American Economist
    January 4, 1907
    p. 12

    Ever hear of something called WW II?

    Imagine that our nation followed your religion and subverted national security to your God - the "free market".

    You would rather have us a defenseless doormat than intrude upon your God - "Free Trade":

    Care to see that history which you never cared about and never learned?

    Too drunk on Freidman free trade Kool-Aide?

     

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    Steve O'Connor (profile), Feb 15th, 2014 @ 7:13am

    Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Sinan Unur QUOTE: [i]"Trade always happens between individuals, not nations. As for national security, isn't it better for our adversaries to waste their precious resources by selling us artificially cheap coat hangers and TV sets? That means, thanks to their "cheating", we end up having more stuff than would otherwise have been possible."[/i]

    Good God, have you never studied the relationship between defense and industy???

    Start here:

    "Indeed, it was long recognized that the six Ordnance manufacturing arsenals could produce, in time of war, only about 4 or 5 per cent of the critical requirements for weapons, ammunition, fire-control instruments, aircraft bombs, and mechanized equipment. Now that we were in the midst of a war of unprecedented magnitude, Industry would have to take over 95 to 96 per cent of the armament manufacturing program.

    Without the invaluable assistance of Industry, we of the Ordnance Department would be in the position of General Robert E. Lee when he heard that Stonewall Jackson had lost his left arm. General Lee's message was: "You have lost your left arm, but I have lost my right."

    Lt. Gen. Levin H. Campbell, Chief of Ordnance, United States Army, 1942-1946
    The Industry-Ordnance Team, 1946
    p. 5

    Any part of this you don't understand?

    Private U.S. industry that would have been killed by foreign dumping, subsidies, currency manipulation, and every other trade barrier that human creativity can invent would have crippled our ability to produce the arsenal of democracy.

    "The Robert Bosch Company of New York was created in 1906 to produce and sell magnetos, pumps, and other products of the Robert Bosch Company of Stuttgart, Germany, an old-line enterprise founded in1887. By 1930, the American company had a virtual monopoly on the U.S. Production of magnetos and fuel injection systems. Though American Bosch posed as an independent U.S. Company, in fact it had a contract with its German parent that required its permission as to what it produce, how much it produced, and to whom it sold its products. In the months leading up to U.S. entry into the world war and throughout 1942, American Bosch choked the U.S. production of diesel engines needed by the navy and others by delaying its production and delivery of essential fuel injection systems. In 1941 before the attack on Pearl Harbor, the navy desperately asked American Bosch to license its fuel injection technology to the Caterpillar Company. No answer was forthcoming. As soon as U.S. authorities understood that American Bosch was under German control; the Alien Property Custodian took over the company. The shortage was soon eliminated."

    Pat Choate
    Hot Property, The Stealing of Ideas in an Age of Globalization, 2005
    p. 132-133

    Until World War II, Swedish steel was used almost exclusively in manufacturing automotive valve spring wire. As in the case of razor blade steel, American steel circles realized that the war would compel this country to find a substitute for the Swedish steel.
    In 1940, metallurgists of the American Steel & Wire Company successfully tackled the problem. They perfected a process which produced valve spring wire of superior quality. In grueling tests, valve springs made of the wire outlasted Swedish steel by a decisive margin. The Wire Company's accomplishment was a major war contribution, for valve springs of rugged dependability were imperatively needed to keep our jeeps, trucks, tanks and planes in operation during the conflict.

    Douglas A. Fisher, Office of Assistant to Chairman, United States Steel Corporation
    Steel Serves the Nation, 1901-1951, The Fifty Year Story of United States Steel, 1951
    p. 163

    Have you ever heard of something called the submarine?

    During WW II the Germans had them:

    “Today there are few who remember the near-disaster we faced in the winter of 1943 because of the shortage of fuel oil and gasoline. It was the coldest winter in memory. Temperatures were consistently sub-zero and many fuel oil dealers were receiving as many as two hundred calls a day from customers pleading for emergency delivery.

    On January 5, 1943, I issued a public statement to underscore the magnitude of the crisis and the need for care. “Right now,” I said, “there is only one day's supply of fuel oil in dealers' supply tanks in the State of Connectitcut. Since mid-December there has never been more than three days' supply of fuel oil on hand at any one time.”

    The fuel oil and gasoline shortage was largely caused by transportation difficulties. The pipe lines to carry petroleum products from Texas and Oklahoma to the East Coast had not yet been completed and the only means of transportation was by tankers, which were an easy target for German submarines. I was told one night fourteen blazing tankers were visible from the lighthouse at Cape Hatteras.

    Our office, which had now moved to Ann Street in Hartford, was not exempt from these privations. In mid-December a headline appeared in the Hartford Times, “Penetrating Cold Penetrates OPA Office.” The article reported that some of our OPA employees had been sent home because we lacked oil to heat the office.

    Our house in Essex was built in 1939 for a large family and a heavy flow of guests, and it normally consumed a lot of fuel. However, when fuel rationing began, we shut off all the heat in two-thirds of the house and lived in the rest. Our dining room became our living room, the nearby front hall was piled high with firewood, and with an open coal fire going day and night we, like millions of other families, nursed our sharply reduced oil supply through the winter.”

    Chester Bowles
    Promises to Keep: My Public Life: 1941-1969,
    Harper & Rowe, 1971
    p. 24-25


    BIG INCH PIPELINE

    The manufacture of large diameter pipe was another research accomplishment of U.S. Steel for peacetime service to our country which turned out to be of providential aid in World War II, when there was a serious shortage of oil and gasoline on the Atlantic seaboard due to the diversion of oil tankers for military service and the submarine menace. To overcome the shortage, the Big Inch line, the world's longest pipeline, was built from Texas to the New York-Philadelphia area. National Tube Company possessed the only plant in the country capable of making 24-inch seamless steel pipe.

    During the war emergency, Big Inch transported almost 362,000,000 barrels of petroleum liquids. In the words of Harold L. Ickes, then Deputy Petroleum Administrator, “It would be difficult to overestimate the part which Big Inch has played in defeating the Axis powers. It would be equally difficult to make a precise appraisal of its contributions to the victory of the United Nations and the well-being of their citizens. With other means of transporting oil inadequate, Big Inch definitely became the facility which made it possible for us to meet the petroleum requirements of the Allied armies and thus shorten the war. It likewise prevented an oil shortage on the Atlantic seaboard.”

    Douglas A. Fisher, Office of Assistant to Chairman, United States Steel Corporation
    Steel Serves the Nation, 1901-1951, The Fifty Year Story of United States Steel, 1951
    p. 176-177

     

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  30.  
    icon
    Steve O'Connor (profile), Feb 15th, 2014 @ 7:22am

    Re: Re: Re:

    Anonymous Coward QUOTE: [i]"Only a liar would claim Ireland had perfectly free trade. Then again your the sort that would post the comparison of wanting raw materials with slavery as if the two were equivalent so that's no surprise. I don't have time to waste on your likely equally dubious argument by verbosity below. Spam your anti trade copy parts shit somewhere else, it's not flying here."[/i]

    And only a liar would pretend that "perfect free trade" has ever existed.

    And you are the sort that will ignore the mountain of evidence that contradicts your religion.

    You don't have the time because you never did the research and don't have the evidence.

    I'll share the historical facts here in spite of intolerant dogmatists such as yourself who would censor any opposing view in your supreme example of hypocrisy:

    Preach your individual freedom verbosity until I show you don't have any evidence - then you want to shut me up.

    Where do you keep your swastika, oh great purveyor of tolerance and freedom?

     

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  31.  
    icon
    Steve O'Connor (profile), Feb 15th, 2014 @ 7:42am

    Re: Re: free trade??

    Anonymous Coward QUOTE: "Yes, sadly many beat the 'free trade' drum while really meaning they want as much protection for themselves as possible and none for anyone else. Real free trade means no protectionism period."

    Real "Free Trade" is a myth that only exists in the fertile imagination of dogmatists.

    The typical conservative economist assumes that monopoly and the presumed resultant inefficiency can only occur within a protected national economy, but by some act of God revealed only to the fertile imagination of the conservative economist, can never occur under international free trade. The historical facts, which conservative economists are ignorant of, refute such an assumption.

    “By the late 1980's, Japan dominated America's television and consumer electronics markets. The logical next step was to squeeze extra profits from this dominant position.
    In 1989, New York Attorney General Robert Abrams revealed that Panasonic and Technics (both subsidiaries of Japan's Matsushita) had mounted a verticle price-fixing scheme in America. Matsushita, of course, was a founding member of the television cartel. The Panasonic/Technics scheme was hauntingly reminiscent of what the Home Electric Appliance Market Stabilization Council had pulled off in Japan in the 1950's.
    Abrams revealed that between March 1988 and August 1989 the Japanese companies had forced their American retailers – among them, Best Products, K Mart, Montgomery Ward, Circuit City – to charge fixed minimum prices for their products. Though his charge referred only to the sixteen most popular products of Panasonic and Technics – VCR's, camcorders, cordless telephones, answering machines, and stereo equipment, among other items – Abrams said that the firms had, in earlier efforts, tried to set fixed prices on all three hundred items they sold in the United States.
    Through their scheme, the firms artificially had raised their U.S. prices by 5 to 10 percent. Abrams said the price-fixing was administered “through an elaborate nationwide scheme involving scores of [Panasonic and Technics] sales executives pressuring thousands of retailers to comply with the scheme and monitoring the prices they actually charged.”
    To enforce this price-fixing effort, Panasonic directed its executives to keep all U.S. retailers of Panasonic goods in step with the firm's policies. Panasonic told its employees that “those dealers not adhering to company policy could 'create chaos in the marketplace' and would allow Panasonic to 'lose face with the entire industry.' “
    The question that lingers is whether the rest of “the entire industry,”as Panasonic called it, really did know about Matsushita's price-fixing activities. If they did not, then how could Panasonic “lose face”? More important, were other consumer electronics companies participating in similar verticle price-fixing schemes?
    When Abrams confronted Panasonic and Technics, they immediately agreed to a settlement – without actually acknowledging wrongdoing. The settlement required the companies to stop price-fixing, to repay $16 million in overcharges to nearly 700,000 customers, and to pay another $2 million to the state for settlement administration costs.
    The settlement also revealed:

    Lechmere, Inc., a retailer with stores in New York and other northeastern states, was told by Panasonic that it would “make an example of dealers charging below the 'go' price [the fixed price] and would terminate all or part of its shipments to noncomplying dealers.”

    When Luria and Sons, a Florida retailer, undercut Panasonic's fixed price on a cordless telephone, four different Panasonic representatives threatened that Panasonic would cease doing business with noncomplying retailers.

    As in Japan, this sort of price-fixing allows the manufacturer to gain an earned monopoly profit, which can then be used to subsidize dumping and other anti-competitive behavior.

    But the Japanese were able to extort monopoly profits from American consumers because America's own television industry in effect had been destroyed by two decades of illegal, anti-competitive behavior by the Japanese.”

    Pat Choate
    Agents Of Influence, 1990
    p. 102-103

    “After several years of lengthy and detailed studies and hearings concerning the problem of sharply increasing fastener imports and the impact that this has had on the U.S. fastener industry, the International Trade Commission recommended to President Carter that higher tariffs be imposed. On February 10th, President Carter rejected the ITC's recommendation, saying that fastener tariffs would be inflationary and not in the nation's best economic interest.

    But then, just a few weeks after the fastener decision, the President approved, reportedly without hesitation, a more than triple increase in tariffs on CB radio imports, from the current 6% to 21%. Apparently, President Carter believes that CB radios are more important to our nation's economic well-being than a healthy fastener industry.

    Anyone who has followed the fastener import situation with anything more than casual interest will quickly point to the hundreds of pages of well-documented evidence showing how Japanese fastener firms, over a period of years, have invaded and captured U.S. markets for standard nuts, bolts and screws. No, I am not blaming the Japanese for taking advantage of what they correctly perceive to be an enticing opportunity to enhance their own best national interests. But what does concern me is that while we remain innocent as doves extolling the virtues of free trade, we're being devoured by other industrialized nations that go after markets with a killer instinct. The facts are clear: Uncle Sam is taking a beating and coming out the loser.

    In the case of the U.S. fastener industry, imported standard fasteners already are taking about 50% of our domestic markets. As a result, close to 8,000 U.S. jobs have been lost. Industry profits have dropped sharply and a number of fastener plants have either shut their doors or sharply curtailed operations. Ironically, U.S. fastener manufacturers are the most efficient found anywhere in the world. And fastener company presidents do not oppose free trade and open markets. But they can't compete against foreign companies that work in collusion with their governments with subsidized and planned strategies for capturing our markets. George Meany says that free trade is a joke and myth. I think he's right.

    The important question that each of us, in our own way, must answer is: “Can we as a nation allow our fastener industry to erode and wither away without putting ourselves in an intolerably vulnerable position?” A Federal Preparedness Agency study already has concluded that fasteners are vital to national defense, and a continuation of our dependence upon imports will make it unlikely that we will be able to count on domestic suppliers alone in the event of a wartime emergency. But we could become vulnerable in still another way. We've already seen the devastating effects of an oil embargo and the pricing tactics of OPEC nations. Why then should we put ourselves in the same vulnerable position with respect to fasteners? The Japanese already have demonstrated how quickly fastener prices can increase when they have a market monopoly (400% increase for some fasteners during 1973-74). While President Carter is concerning himself with inflation, I hope that he will give serious consideration to this possibility.

    The outcome of the fastener import situation may, in part at least, rest in your hands. Under the provisions of the Trade Act of 1974, Congress can override a presidential decision that runs counter to ITC recommendations. A congressional vote is expected some time in July. Once again you have the opportunity to let your congressmen know how you feel about this important issue. It's up to you.

    Bob Kelly, Editorial Director
    “Let's Get Our Act Together on Trade”
    Assembly Engineering, May 1978
    p. 9

    Broadcast Engineering
    Nov 26, 2007

    EU fines Japanese manufacturers for Betacam videotape price fixing

    The European Commission has fined Sony, Fuji and Maxell nearly 75 million euros ($109.8 million) for fixing prices on Betacam SP and Digital Betacam cassettes for professional use.

    “Between 1999 and 2002, Sony, Fuji and Maxell managed to raise or otherwise control prices through a series of regular meetings and other illicit contacts,” said European Competition Commissioner Neelie Kroes.

    Sony’s fine was increased by 30 percent to just over 47 million euros after it obstructed the investigation. The fines for Fujifilm and Hitachi Maxell were reduced by 40 percent and 20 percent respectively — to 13.2 million and 14.4 million euros — after they co-operated with the investigation, Reuters reported.

    The commission began an investigation with raids on EU subsidiaries of Sony, Fuji and Maxell in May 2002. The raids found “abundant evidence of cartel activities” according to the report, although a Sony employee refused to answer questions by EU officials, and another employee shredded documents during the raid, the commission said.

    Reuters reported that Sony acknowledged its involvement only after receiving a formal charge sheet from the commission.

    The cartel covered the two most popular professional videotape formats at the time — Betacam SP and Digital Betacam. In 2001, the formats, mainly sold to broadcasters and independent television producers, had total annual sales of 115 million euros in the EU and other European countries.

    Sony, Fuji and Maxell controlled more than 85 percent of the professional videotape market. The trio “organized three successful rounds of price increases and endeavored to stabilize prices whenever an increase was not possible,” the commission said. The companies also regularly monitored the implementation of price agreements and had at least 11 meetings at which they organized the cartel.


    March 11, 2009
    by Anne Szustek

    Hitachi Will Plead Guilty in LCD Price-Fixing Case

    Hitachi has admitted to the U.S. Department of Justice that it conspired to keep prices artificially high on LCD screens intended for use with Dell desktop and laptop computers. As part of its plea agreement, the Japanese technology manufacturer is paying $31 million in fines.

    "This case should send a strong message to multinational companies operating in the United States that when it comes to enforcing the U.S. antitrust laws we mean business," Acting Assistant Attorney General said in a statement quoted by the Associated Press.

    According to the Department of Justice, Hitachi took part in meetings held in Japan, the United States and South Korea to discuss setting prices on the LCD screens in question from April 1, 2001 to March 31, 2004. "Hitachi also shared information on its sales of the LCDs sold to Dell as a way to show that it stuck to the agreed-upon prices," the IDG News Service reports.

    Hitachi is the fourth technology manufacturer to enter an agreement with the Department of Justice in connection with price fixing on LCD screens in recent months.
    Sources in this Story
    Computerworld (IDG News Service): Hitachi pleads guilty, to pay fine in LCD price-fixing probe
    AP: Hitachi to admit to fixing LCD prices
    findingDulcinea: Price-Fixing Scandal, Economic Winds Weigh on Electronics Prices
    In November, South Korea’s LG Display, Japanese technology manufacturer Sharp and Taiwanese company Chunghwa Picture Tubes pleaded guilty to fixing prices on flatscreens for use in cell phones, televisions and personal computers.

    Assistant Attorney General Thomas Barnett, who heads up the Justice Department’s antitrust division, told Bloomberg in November that LG and Chunghwa, along with other companies, met several times from 2001 to 2006 in what were called “crystal meetings” to negotiate price-setting.

    Price deflation is common as technology evolves; however the current tight market has accelerated price declines. According to statistics from the International Herald Tribune cited by findingDulcinea, the price of a 15.4-inch panel for use in a laptop computer dropped by roughly one-third from $97 to $63 over the six months leading up to the November agreement. During the same period, the cost of a 32-inch LCD screen for a television has plummeted to $223 from $321.

    The Hitachi deal pushes the total fines levied in connection with the recent LCD price-fixing cases above $600 million, with LG responsible for $400 million of that total; as such, LG is paying the second-highest fine ever levied by the Justice Department’s antitrust division. Swiss pharmaceutical titan F. Hoffman-La Roche still holds the unsavory top spot in that category, with $500 million paid in 1999 in connection with a price-fixing case on vitamins.

    Private class-action lawsuits have also been filed against the flatscreen producers, paving the way for consumer compensation.



    U.S. Department of Justice
    WEDNESDAY, JULY 25, 2001

    THREE JAPANESE EXECUTIVES INDICTED IN PRICE-FIXING CONSPIRACY
    Ibiden Co. Ltd. Agrees to Pay $3.6 Million Criminal Fine

    WASHINGTON, D.C.--Three top executives of Ibiden Co. Ltd., were indicted today by a federal grand jury for participating in an international cartel to fix the price of non-machined and semi-machined isostatic graphite, the Department of Justice announced. In addition, Ibiden, a Japanese producer of isostatic graphite, has agreed to plead guilty and to pay a $3.6 million criminal fine for its role in the same conspiracy.

    Isostatic graphite is a fine grain carbon product with great strength and resistence to heat and chemical reaction. It is commonly used to produce, among other products, electrodes for electrical discharge machinery, dies for the continuous casting of metals, and various products used in the semi-conductor industry, which require its unique properties.

    In the indictment, filed in the U.S. District Court in Philadelphia, the grand jury charged Masaru Endo, Chairman of Ibiden; Shigeo Yasuda, general manager of Ibiden's Ceramic Department; and Akira Hashimoto, general manager of International Sales in Ibiden's Ceramic Department, with conspiring with unnamed corporate and individual co-conspirators to suppress and eliminate competition by fixing the price of non-machined and semi-machined isostatic graphite sold in the United States and elsewhere from as early as July 1993 until at least February 1998. All three executives are Japanese citizens.

    At the same time, a separate charge was also filed in U.S. District Court in Philadelphia against Ibiden Co. Ltd. of Ogaki, Japan, for its participation in the isostatic graphite price-fixing conspiracy. As part of its plea agreement, which must be approved by the court, Ibiden has agreed to cooperate with the prosecution of the individual isostatic graphite defendants.

    Ibiden is the third company to be charged with participating in the isostatic graphite conspiracy, following Carbone of America Industries Corp. (CAIC) and Toyo Tanso USA Inc. Two other executives -- Michel Coniglio, CAIC's President and Chief Executive Officer, and Takeshi Takagi, an executive of Toyo Tanso USA's Japanese parent -- have also pleaded guilty to price-fixing charges. The $3.6 million fine against Ibiden, if approved by the court, would bring the total fines imposed in this investigation to more than $15 million.

    The indictment and information charge the defendants and co-conspirators with carrying out the price-fixing conspiracy by:

    participating in meetings and conversations to discuss prices and grades of non-machined and semi-machined isostatic graphite sold in the U.S. and elsewhere;

    agreeing to charge prices at certain levels and to increase and maintain those prices;

    agreeing to maintain market shares on the sale of non-machined and semi-machined

    agreeing to refrain from selling non-machined and semi-machined isostatic graphite to a co-conspirator's customer;- agreeing to eliminate discounts from the fixed price of non-machined and semi-machined isostatic graphite;

    agreeing to standardize the grades of non-machined and semi-machined isostatic graphite;

    exchanging sales and customer information for the purpose of monitoring and enforcing the terms of the agreement; and

    issuing price announcements and price quotations in accordance with the agreements reached.

    "The charges filed today further demonstrate the Division's resolve to detect and prosecute those companies and individuals involved in international cartels that harm American businesses and consumers," said Charles A. James, Assistant Attorney General in charge of the Antitrust Division.

    Ibiden and the three individuals are charged with violating Section 1 of the Sherman Act, which carries a maximum fine of $10 million for corporations and a maximum penalty of three years imprisonment and a $350,000 fine for individuals.

    The maximum fine for both corporations and individuals may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of these amounts is greater than the statutory maximum fine.

    Today's charges are the result of an ongoing investigation being conducted by the Antitrust Division's Philadelphia Field Office and the Federal Bureau of Investigation in Philadelphia.


    U.S. Department of Justice
    TUESDAY, SEPTEMBER 26, 1995

    TWO JAPANESE FAX PAPER COMPANIES AGREE TO PAY FINES TOTALING MORE
    THAN $3.5 MILLION FOR THEIR INVOLVEMENT IN A
    PRICE FIXING CONSPIRACY

    WASHINGTON, D.C. -- Two Japanese paper companies, Mitsubishi Paper Mills Ltd. and New Oji Paper Co. Ltd., have agreed to plead guilty today and have agreed to pay fines totalling more than $3.5 million for their involvement in a fax paper price fixing conspiracy, said the Department of Justice.

    Today's charges are part of the Department's ongoing antitrust investigation into international cartel practices in the $120 million a year thermal fax paper industry, which has resulted in several guilty pleas. Today's plea agreements, which must be approved by the court, will bring total fines in the investigation to more than $10 million.

    Anne K. Bingaman, Assistant Attorney General in charge of the Antitrust Division, said, "This prosecution shows that the
    Department will not tolerate price fixing by either domestic or foreign firms. Conspiracies to raise prices to American consumers will be vigorously prosecuted wherever it takes place and whoever is involved."

    In court papers filed in U.S. District Court in Boston, the Department charged that Mitsubishi Paper Mills located in Tokyo,
    Japan, and New Oji Paper Co., also of Tokyo, conspired with others to fix and raise the prices of thermal fax paper sold in
    the United States between July 1991 and early 1992.

    The Department charged that the defendants and co-conspirators, through a series of meetings and telephone communications, agreed to charge higher prices to thermal fax paper customers in the United States. The price fixing conspiracy raised prices to U.S. consumers by approximately 10 percent. Thermal fax paper is used primarily by small businesses and home fax machine owners who depend on low prices for office products.

    During the conspiracy, Mitsubishi Paper Mills Ltd. sold approximately $4.8 million of fax paper to customers in the
    United States. It has agreed to pay a $1.8 million criminal fine.

    New Oji Paper Co. Ltd. was formed in October 1993 when Oji Paper Co. Ltd. merged with Kanzaki Paper Manufacturing Co. Ltd. During the conspiracy, Kanzaki Paper Manufacturing and Oji Paper Co. sold approximately $40 million and $8 million, respectively, of fax paper to customers in the United States. It has agreed to pay a $1.75 million fine.

    In July 1994, Kanzaki Specialty Papers, of Ware, Massachusetts, its former president, Kazuhiko Watanabe, Mitsubishi International Corporation, of New York, and Mitsubishi Corporation, of Tokyo, Japan, pleaded guilty to similar charges and paid fines totalling approximately $6.5 million. Elof Hansson Paper & Board Inc., a New York based importer of thermal fax paper, pleaded guilty to similar price fixing charges earlier this year.

    Bingaman stated that the charges arose from a grand jury investigation conducted by the Antitrust Division's Litigation II
    in Washington, D.C., and was assisted by the Federal Bureau of Investigation's office in Boston. The investigation is continuing and has been conducted jointly with Canadian Antitrust authorities. Both firms also agreed to cooperate in the Department's ongoing investigation.


    “By the late 1980's, Japan dominated America's television and consumer electronics markets. The logical next step was to squeeze extra profits from this dominant position.
    In 1989, New York Attorney General Robert Abrams revealed that Panasonic and Technics (both subsidiaries of Japan's Matsushita) had mounted a verticle price-fixing scheme in America. Matsushita, of course, was a founding member of the television cartel. The Panasonic/Technics scheme was hauntingly reminiscent of what the Home Electric Appliance Market Stabilization Council had pulled off in Japan in the 1950's.
    Abrams revealed that between March 1988 and August 1989 the Japanese companies had forced their American retailers – among them, Best Products, K Mart, Montgomery Ward, Circuit City – to charge fixed minimum prices for their products. Though his charge referred only to the sixteen most popular products of Panasonic and Technics – VCR's, camcorders, cordless telephones, answering machines, and stereo equipment, among other items – Abrams said that the firms had, in earlier efforts, tried to set fixed prices on all three hundred items they sold in the United States.
    Through their scheme, the firms artificially had raised their U.S. prices by 5 to 10 percent. Abrams said the price-fixing was administered “through an elaborate nationwide scheme involving scores of [Panasonic and Technics] sales executives pressuring thousands of retailers to comply with the scheme and monitoring the prices they actually charged.”
    To enforce this price-fixing effort, Panasonic directed its executives to keep all U.S. retailers of Panasonic goods in step with the firm's policies. Panasonic told its employees that “those dealers not adhering to company policy could 'create chaos in the marketplace' and would allow Panasonic to 'lose face with the entire industry.' “
    The question that lingers is whether the rest of “the entire industry,”as Panasonic called it, really did know about Matsushita's price-fixing activities. If they did not, then how could Panasonic “lose face”? More important, were other consumer electronics companies participating in similar verticle price-fixing schemes?
    When Abrams confronted Panasonic and Technics, they immediately agreed to a settlement – without actually acknowledging wrongdoing. The settlement required the companies to stop price-fixing, to repay $16 million in overcharges to nearly 700,000 customers, and to pay another $2 million to the state for settlement administration costs.
    The settlement also revealed:

    Lechmere, Inc., a retailer with stores in New York and other northeastern states, was told by Panasonic that it would “make an example of dealers charging below the 'go' price [the fixed price] and would terminate all or part of its shipments to noncomplying dealers.”

    When Luria and Sons, a Florida retailer, undercut Panasonic's fixed price on a cordless telephone, four different Panasonic representatives threatened that Panasonic would cease doing business with noncomplying retailers.

    As in Japan, this sort of price-fixing allows the manufacturer to gain an earned monopoly profit, which can then be used to subsidize dumping and other anti-competitive behavior.

    But the Japanese were able to extort monopoly profits from American consumers because America's own television industry in effect had been destroyed by two decades of illegal, anti-competitive behavior by the Japanese.”

    Pat Choate
    Agents Of Influence, 1990
    p. 102-103

     

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  32.  
    icon
    ECA (profile), Feb 15th, 2014 @ 8:34am

    For those that dont get it..

    In the USA we have had 1 mAJOR INDUSTRY that we WANT to keep.

    GUNS.
    To keep them going and not shut down, we SELL guns to other nations.
    WE ant sell enough GUNS to all the people in this nation to keep the business going.
    Do you think we sell them at HIGH prices in other nations??
    NOPE.

    HOW about the price in the USA??

     

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  33.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 12:56pm

    Re: Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    No one reduced all national security issues to information leaks. What was actually pointed out is that 'national security' is an excuse deployed by largely the same people in both cases and for the same reasons: to prey on petty nationalism to increase or protect their own power.

    You will get no argument from me that the USTR is acting in the best interests of anyone but incumbent businesses. That you think someone who is really pro-free trade would side with them or hold them up as a champion is demonstrative of your own ignorance of what free trade actually is and your lack of authority to speak on the subject.

     

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  34.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 12:59pm

    Re: Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Just to spell it out more clearly corporate fascism isn't a free market. Not sure why you would think it is other than that you've been convinced by the propaganda that claims such. Why anyone would be stupid enough to think that centralizing authority would make it harder for corporate interests to subvert is beyond me. In reality the only difference between me and you is that I've realized the only way to end it is to curtail the centralization of authority in a strong central government and you haven't.

     

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  35.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 1:05pm

    Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Yes, I would readily agree that there are many interests that would wrap themselves in the cloak of being 'free trade' while actually fighting to remove trade barriers for only their own goods and no one else's. I would also readily agree that that's not actually free trade. However I would have to disagree that there's any significant difference in the groups of 'elite' you reference. The revolving door between government and incumbent business is oft lamented here and it ensures the two groups are by in large the same.

     

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  36.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 1:12pm

    Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    It's easy to make a case by cherry picking a specific success from history and pretending it makes a general argument it is, however, fallacious reasoning. You've attributed a level of foresight and guaranteed results that is in reality completely absent government interventions. Protectionism of 'infant industries' can just as easily create economic leeches scumming the lowest hanging fruit from foreign industries and reproducing it at home behind the protectionist barrier, stagnating the domestic production by shielding it from competition.

     

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  37.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 1:17pm

    Re: Re: Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    More nationalist hand wringing, how typical.

     

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  38.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 1:20pm

    Re: Re: Re: Re:

    No one argued perfectly free trade ever existed but you when you showed up here posting copypasta about how Ireland suffered under "thoroughly free trade." So who's the liar again?

    Here you are preaching how sacrosanct the state is that 'national security' must trump the welfare of the people and you want to accuse me of a religion? The fucking nerve.

    Telling you your argument doesn't hold any water and your wasting your time here is 'censorship' and makes me a nazi? Pathetic.

     

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  39.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 1:25pm

    Re: Re:

    Top comment nailed that one so squarely on the head I'm surprised anyone would bring it up as an example.

     

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  40.  
    identicon
    Anonymous Coward, Feb 15th, 2014 @ 1:32pm

    Re: Re: Re: free trade??

    If there's never been real free trade then it follows the historic facts refute the argument that government intervention always works out best for everyone involved. Pick an argument and stop contradicting yourself. And who here argued that monopoly can only occur in a protected national industry? You sure beat the shit out of that straw man you set up though, he didn't stand a chance!

     

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  41.  
    icon
    Niall (profile), Feb 15th, 2014 @ 4:02pm

    Re: Re: Re: Re: Re:

    Copypasta maybe, but it is educational and unfortunately accurate in its historic detail - a horrific blot on Britain's copybook. These people were treated as badly as slaves - if not worse - because of remote, uncaring control from London. It would take them another 70 years to win their freedom and probably greatly drove later Troubles. Small surprise there are so many 'Irish' in New York, Glasgow or Liverpool still.

     

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  42.  
    icon
    Steve O'Connor (profile), Feb 16th, 2014 @ 6:38am

    Anonymous Coward QUOTE: "No one argued perfectly free trade ever existed but you when you showed up here posting copypasta about how Ireland suffered under "thoroughly free trade." So who's the liar again?"

    In case you can't read, the statement was written by a:

    Senator William Pierce Frye
    Speech in the United States Senate, February 10,1882

    And I suspect in your temper tantrum you missed this also:

    "Now, I do not blindly charge all of her woes to free trade alone; land tenure has to answer for a portion, not for more than half."

    Also from that same statement.

    Anonymous Coward QUOTE: "Here you are preaching how sacrosanct the state is that 'national security' must trump the welfare of the people and you want to accuse me of a religion? The fucking nerve."

    YOU, NOT ME, YOU are the one who stated "Spam your anti trade copy parts shit somewhere else, it's not flying here."

    You can spam anything you want my intolerant hypocrite. Unlike you it poses no threat to me, just an opportunity to post HISTORICAL FACTS - NOT FACT-DEVOID DOGMA LIKE YOU.

    Do you understand the difference?

    HISTORICAL FACTS

    FACT-DEVOID DOGMA

     

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  43.  
    icon
    Steve O'Connor (profile), Feb 16th, 2014 @ 6:45am

    Anonymous Coward QUOTE: "Here you are preaching how sacrosanct the state is that 'national security' must trump the welfare of the people and you want to accuse me of a religion?"

    Allow me to introduce you to a document that you have NO COMPREHENSION OF:

    "We the People of the United States, in Order to form a more perfect Union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America."

    Ever hear of it?

    It's called the U.S. CONSTITUTION

    Ever hear of this man?

    GEORGE WASHINGTON, in his first annual message, speaking of the nation as " a free people," said :

    "Their safety and interest require that they promote such manufactures as tend to render them independent of others for essentials, particularly military supplies."

    DID YOU READ THAT???

    . . . particularly military supplies."

    What you are guilty of -

    "An economy is not a country. A nation's economic system should reinforce the bonds of national unity, but the nation is of a higher order than any imaginary construct of an economist. A nation is organic, alive; it has a beating heart. The people of a nation are a moral community who must share values higher than economic interest, or their nation will not endure. As scholar Christian Kopff asks, "What doth it profit a man if he gain the whole world, and suffer the loss of his country?"

    What is wrong with the Global Economy is what is wrong with our politics; it is rooted in the myth of Economic Man. It elevates economics above all else. But man does not live by bread alone. In a true nation many things are placed on a higher altar than maximum efficiency or a maximum variety of consumer goods. Once, conservatives understood that.”

    Pat Buchanan
    The Great Betrayal: How American Sovereignty And Social Justice Are Being Sacrificed To The Gods Of The Global Economy, 1998
    p.287-288

    A Humane Economy

    Neither the national economy nor the free market is an end in itself. They are means to an end. A national economy is not some wild roaring river that must be allowed to find any course it will, to be admired for its raw power and beauty. It is to be tamed for the benefit of the nation. The same holds true for the market. While an unfettered free market is the most efficient mechanism to distribute the goods of a nation, there are higher values than efficiency. To worship the market is a form of idolatry no less than worshiping the state. The market should be made to work for man, not the other way around.

    "What is the market? It is the law of the jungle, the law of nature. And what is civilization? It is the struggle against nature."

    So declared France's Prime Minister Edouard Balladur at the close of the GATT negotiations of 1993; he is right."

    Pat Buchanan
    The Great Betrayal: How American Sovereignty And Social Justice Are Being Sacrificed To The Gods Of The Global Economy, 1998
    p.287-288

    This is you in SPADES.

     

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  44.  
    identicon
    Anonymous Coward, Feb 16th, 2014 @ 11:02am

    Wow!
    Wall-O-Text on a rampage.

     

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  45.  
    icon
    mdpopescu (profile), Feb 17th, 2014 @ 6:56am

    Re: Re: Re: Re: Re: Re:

    The whole point of the AC was that "control from London" is the opposite of free trade.

     

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  46.  
    identicon
    Pragmatic, Feb 17th, 2014 @ 9:33am

    Re: Re: OMG, my trade deficit with Amazon.com never goes down!

    Nobody is fighting FTAs themselves, just the lack of transparency around them and the investor-state relations clauses that have caused so much grief. Remember how Chevron told Ecuador to change its laws to accommodate their pollution?

    The fact that FTAs have been screwing the American farmers and other producers are down to the fact that they're often competing against subsidized competitors, etc. It's like being obliged to race against athletes that take steroids. These things are rushed through so that people who mostly make their money on the stock exchange can make a killing. It's got nothing to do with benefiting the country.

    If you're that much in favor of FTAs, tell me some of the established benefits of the ones we actually have in place - for us. I think they're a great thing when done so that countries are trading with each other, not screwing each other over. There is a difference, you know.

     

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  47.  
    identicon
    Pragmatic, Feb 17th, 2014 @ 9:38am

    Re:

    Steve O'Connor is trying to prove his point of view with verifiable facts. The AC is not, hence the walls of text. I'm getting a real education here!

     

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  48.  
    icon
    Steve O'Connor (profile), Feb 17th, 2014 @ 2:33pm

    Re: Mdpopescu and Irish Free Trade

    "The whole point of the AC was that "control from London" is the opposite of free trade."

    Ireland and England formed a union in 1800 and Ireland had representation in parliament proportional to its population which left it in the minority (democracry = two wolves and a lamb voting on what to eat for dinner). That parliament removed all of Ireland's tariffs really is irrelevant because how the trade barriers were removed has no effect on the outcome. The result was Ireland's trade no longer had barriers (no tariffs) - FREE TRADE.

    England's parliament was warned that vast unemployment and hunger were present in Ireland by its own government commission in 1837 - a full 10 years before the horror of the potato famine took place. The trade policy enforced through parliament had devastated the Irish industry and forced millions of Irish to attempt subsistence farming to survive, selling grain to pay landlords for rent and raising potatoes to live on.

    Being Irish and having my first relative coming to the U.S. in 1850 from Ireland I have spent some time reading about what were the conditions and how those conditions came about in that time period to result in one of the greatest emigrations from a European nation in modern history.

    I have an original copy of the 1837 Final Report of that commission and parliament essentially ignored their responsibility in creating the massive unemployment to begin with through their free trade policy imposed upon Ireland. England itself had its own economic problems - unemployment, hunger and labor uprisings and England hoped to relieve its own unemployment by forcing Ireland through free trade into a colonial trading position of exporting raw materials and importing higher value finished goods from England. England had done the same thing to India and Turkey with the wealth going to England and increased poverty in those nations. They attempted to do it to America but we chose revolution.


    "If, therefore, workhouses were determined upon for Ireland as an actual means of relief, they must be established for the purpose of setting vast numbers of unemployed persons to work within them, and of so providing for such persons and their families. Now, according to the third Table annexed, we cannot estimate the number of persons in Ireland out of work and in distress during thirty weeks of the year at less than 585,000, nor the number of persons dependent upon them at less than 1,800,000, making in the whole 2,385,000.

    This, therefore, is about the number for which it would be necessary to provide accomodation in workhouses, if all who require relief were there to be relieved; and we consider it morally, indeed physically, impossible so to provide for such a multitude, or even to attempt it with safety.

    The expense of erecting and fitting up the necessary buildings would come to about £4,000,000 and allowing for the maintenance of each person 2 1/2d. only a-day, that being the expence at the Mendicity Establishment of Dublin, and at other similar establishments in Ireland, the cost of supporting the whole 2,3385,000 for thirty weeks annually would be something more than £5,000,000 a-year; whereas the gross rental of Ireland (exclusive of towns) is estimated at less than £10,000,000 a-year; the net income of the landlords, at less than £6,000,000; and the public revenue is only about £4,000,000."

    Abstract of the Final Report of the Commissioners of Irish Poor Inquiry; Second Edition
    London; F.C. Westley, 162, Piccadilly, 1837
    p. 8

     

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  49.  
    icon
    Steve O'Connor (profile), Feb 17th, 2014 @ 2:54pm

    Re: Re: Mdpopescu and Irish Free Trade

    The death toll from the Irish famine is estimated to be at least 1,000,000 - ONE MILLION DEAD - the worst famine in European history. The exact number will never be known for the exact population was unknown.

    A census taken in 1841 revealed a population of slightly over 8 million. A census immediately after the famine in 1851 counted 6,552,385, a drop of almost 1.5 million in 10 years.

    In 1841, the population of the 26 counties which would later form the Republic of Ireland was over 6.5 million people. The Great Famine and the emigration it caused had a dramatic effect, so that by 1871 the 26-county population had dropped by over a third to four million, and by 1926 had reduced further to three million.

     

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  50.  
    icon
    Steve O'Connor (profile), Feb 17th, 2014 @ 3:03pm

    Re: Re: Pragmatic

    Pragmatic QUOTE: "Steve O'Connor is trying to prove his point of view with verifiable facts. The AC is not, hence the walls of text. I'm getting a real education here!"

    The first reference to this I found in a text printed back in the late 1800's that gave both sides to the free trade debate. It included Senator William Pierce Frye's
    Speech in the United States Senate, February 10,1882. That was the first time I had seen any reference to free trade in Ireland. Since then I have found one other pamphlet from the mid-1800's that confirmed the devastation to the Irish textile industry after the union of 1800. It is very hard to find.

    You are very welcome for presenting it here and this is why I share historical facts - they are the record - not the dogma.

     

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  51.  
    icon
    Steve O'Connor (profile), Feb 17th, 2014 @ 3:24pm

    Re: Re: Mdpopescu and Irish Free Trade

    After the Act of Union 1800, sometimes referred to as the Act of Union 1801, the unreformed House of Commons was composed of 658 members, of whom 513 represented England and Wales.

    From 1 January 1801, Ireland had been represented in the House of Commons by 100 members. Each of the thirty-two counties returned two MPs as did the Boroughs of Dublin City, County Dublin and Cork City, County Cork. Thirty-one other Boroughs and Dublin University sent one MP to Westminster.

    The 1832 legislation slightly changed some boundaries of Borough constituencies. More significantly it conferred a second seat on the Boroughs of Belfast, County Antrim; Galway Borough, County Galway; Limerick City, County Limerick and Waterford, County Waterford as well as Dublin University. The total number of seats in Ireland was therefore increased to 105.

     

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