Bush Urges Support for Free Trade Principles. Need I say more?

http://www.reuters.com/article/politicsNews/idUSTRE49O2DH20081026

The following excerpt is taken from the end of this linked Reuters article:

Bush warned against taking a protectionist turn in response to the current financial turbulence, saying free markets and free trade were fundamental to long-term economic growth.

“These policies have shown themselves time and time again to be the surest path to creating jobs, increasing commerce, and fostering progress,” Bush said. “And this moment of global economic uncertainty would be precisely the wrong time to reject such proven methods for creating prosperity and hope.”

Yeah, right.  The world is just awash in prosperity and hope right now, isn’t it?  Can there be any greater indictment of our free trade policies than the fact that Bush clings to them so desperately?  It’s like a drowning man crying out, “Water!  Water!” instead of shouting, “Help!”

There can be no doubt that our free trade policies have created jobs, increased commerce and fostered progress around the world – all at the expense of the United States.  Of course!  Pumping $700 billion into the rest of the world, year-in and year-out, will do wonders for the economies of nations like China, Japan, Korea and Germany.  But all it did for us is drive us into bankruptcy.  

Trade is a wonderful thing.  Really!  But the word “trade” implies some mutually beneficial exchange.  By definition, to be mutually beneficial, it has to be balanced.  It’s simply impossible for either side to sustain a large deficit indefinitely without eventually destroying their economy, and there’s nothing beneficial about that.  While trade is a wonderful thing, misguided trade policies like unfettered “free” trade skew the process and offer a slow but steady path to economic ruin.  

It’s time for a return to sensible trade policies that maximize the benefit of trade for the U.S. while maintaining a balance.

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4 Responses to Bush Urges Support for Free Trade Principles. Need I say more?

  1. Pete,

    It is my studied opinion that the U.S. has reached maturity in our economy. If I am correct, we will never raise our real (inflation adjusted) GDP above $14 Trillion.

    For a nation whose economic underpinnings were designed around infinite exponential growth…this is not good news.

    Therefore, retrieving our $700 Billion deficit and moving it back to CRITICAL American jobs has never been more important.

    I also believe that our monetary system has reached the limits to growth. By virtue of compounding interest, our monetary system grows exponentially, requiring ever greater amounts of money to be put into circulation. I believe that the exponential function is reaching the mathematical impasse that will require a total restructuring of our faith backed fiat currency.

    These are truly historic times when Universal physical law will trump mortal mans best efforts to forestall the same.

  2. Pete Murphy says:

    I agree, Mike. As painful as it is to watch the market drop, it is going to be fascinating to watch what happens as our leaders and economists grapple with the problem. Will they try to put Humpty Dumpty back together again or will they seize this unprecedented opportunity to remake our economy in a sustainable way?

  3. Pete,

    I fear that it is the Humpty Dumpty approach as we listen to the ideas of a world currency and control model. There was a time that such talk was only suggested by those seen as radical zealots, today it is the subject of main stream financial news broadcasts. Go figure.

    Crazy old Ron Paul is becoming more sane every day.

  4. Pete Murphy says:

    The Humpty Dumpty approach is the one they’re pursuing, for sure, but I’m hopeful that the whole thing will collapse and take an “every man for himself” approach. I’m starting to see signs of lots of finger-pointing, primarily at the U.S. I don’t see the U.S. agreeing to some new world economy that is based on some currency other than the dollar, and everyone else is blaming the dollar for the world’s problems.

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