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In the Media

article imageOp-Ed: Arthur Jones doesn't understand economics

article:320814:10::0
By Alexander Baron
Mar 8, 2012 in Politics
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Republican Congressional hopeful Arthur Jones has been courting controversy by making seemingly outrageous statements about the Second World War and the Israel lobby. But how do his economic policies shape up?
In his 1995 book DREAMS FROM MY FATHER: A Story Of Race And Inheritance, the future President of the United States writes: “Black politicians...discovered what white politicians had known for a very long time: that race-baiting could make up for a host of limitations. Younger leaders, eager to make a name for themselves, upped the ante, peddling conspiracy theories all over town - the Koreans were funding the Klan, Jewish doctors were injecting black babies with the AIDS virus. It was a shortcut to fame, if not always fortune; like sex or violence on TV, black rage always found a ready market.”
He concludes: “Nobody I spoke with in the neighborhood seemed to take such talk very seriously.”
The boys over at PressTV love Arthur Jones and have been lapping up his pronouncements; that is hardly surprising as he is bad news for the hawks and warmongers, but if a politician, even an aspiring one, wants to be taken seriously, he needs more up his sleeve than rhetoric about issues he can't influence. Especially during times of austerity, it's the economy, stupid. What does Mr Jones believe the US should do in this department?
Here it is, straight from the horse's mouth: “America's working people can't fairly compete to produce products made by foreign workers who are paid as little as 50¢ a day as they are in places like China and other third world nations. I started fighting against free trade treaties in 1984. I was right then and I'm right now that free trade agreements are destroying the ability of this country to manufacture almost anything anymore.”
This is a popular argument, especially with local businessmen and trade unions. As Professor Quigley points out in his magnum opus, the widely quoted Tragedy & Hope: “...the picture which Marx had drawn of more and more numerous workers reduced to lower and lower standards of living by fewer and fewer exploitative capitalists proved to be completely erroneous in the more advanced industrial countries in the twentieth century. Instead, what occurred could be pictured as a cooperative effort by unionized workers and monopolized industry to exploit unorganized consumers by raising prices higher and higher to provide both higher wages and higher profits...”
Most people find it difficult to think of trades unions and big business collaborating, but both seek to maximise their earnings/profits, and the best way to do this is to exclude more efficient competitors. It is tue that Americans can't compete against poorly paid foreign workers, so perhaps they should concentrate on doing things they are good at, like developing the technologies of tomorrow, Silicon Valley, and so on?
The protectionist argument advanced by Mr Jones would mean the erection of trade barriers and tariffs. A tariff is a tax, pure and simple; most politicians of all shades claim they would like to reduce taxes, even those who favour government spending advocate taxing ordinary people as little as possible. Mr Jones is clearly ignorant of the theory of trade; rather than expound on this at length, the reader might care to read the classic satire The Petition of the Candlemakers.
If you think that is an extreme example, consider the following: in the UK, in April 2010, the price of a standard letter first class stamp rose from 39p to 41p, and a second class stamp from 30p to 32p. The cost of posting letters has increased steadily over the past few years and the volume sent has dropped, but it is not rising prices that have cause the drop in volume, rather it is the drop in volume that has led to the rise in prices. The reason for this drop in stamp sales and rise in prices is in front of you. If you are old enough to remember the world without the Internet, can you remember how many letters you sent every day?
How many e-mails do you send a day now? Chances are you are walking around with a telephone in your pocket. Perhaps you use Skype. Would Arthur Jones ban the Internet in order to protect the jobs of American postal workers? Like subsidising companies that are too big to fail, protectionism may have great appeal to workers in particular industries, and to the people who run these industries, but it comes with a hefty price tag.
It is true that the American economy is in big trouble, but protectionism is not the answer. If Americans are free to buy cheaper goods from more efficient foreign companies, they will have more money in their pockets to spend on other things, and perhaps to invest. Mr Jones does not understand this, which is one reason Americans should not vote for him, whatever his opinion of the Israel lobby.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
article:320814:10::0
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