Trade agreements...

[jjj]

The last five years I lived in Chile. There fruits & veggies used to be of high quality at affordable prices. Then the government signed up trade agreements and the best produces went out of the country, leaving locals to feast on rejects at higher prices...
Politicians and rich growers call it 'progress', because it benefits them, not the larger community.
Now I understand why people protest at all G7 meetings, for it only  serves the rich getting richer and visa versa. It's all of that proverbial New World Order. It's the ambition of a powerful, sordid elite to control our world with one string only!

[Swatopluk]

The "socialist" countries did the same. The GDR for example exported decent beer and used all the available hop for that. For domestic consumption they used ox bile instead (no joke).

[Alpaca]

Irony of free trade and globalization: Since the poorer countries are suffering, you'd expect the rich ones to benefit. Wrong! Americans, for instance, from individual workers to entire businesses, are being driven out of work because they can't compete with the cheap goods being imported from places like, say, Chile.

...blame immigration!

[Aggie]

Hey 'Paca....  did you meet our new emoticon 'Little Irony' yet? 

[Alpaca]

That is amazing. I had seen him around, but I hadn't grasped his name.

[Kiyoodle the Gambrinous]

Politicians and rich growers call it 'progress', because it benefits them, not the larger community.
Now I understand why people protest at all G7 meetings, for it only  serves the rich getting richer and visa versa. It's all of that proverbial New World Order. It's the ambition of a powerful, sordid elite to control our world with one string only!

You're just looking at one side of the problem. You forget the benefits of globalization and capitalism. As far as I'm concerned, those may be evil at the first view, but benefits are there. Thanks to it, you are able to buy cheap sneakers for example.

The G7 has its purpose and it is actually trying to figure something out about the improvements for third-world countries. What people must understand is that the results won't come in a few months, it will take years for third world countries to come out of the position they are in now. People only see short-term results and do not consider the long-term.

Of course, it all has its flaws. Nothing is perfect. All those countries in the G7 (or rather G8 now) have also their own interest to take in regard, there's nothing wrong with that. They don't want their countries to lose their "riches", that isn't a crime.

Concerning your claims about the rich getting richer; yes it is true. The rich people are getting richer. But we all benefit from that as well... You should read Adam Smith's "Wealth of Nations", particularly the part about the "invisible hand", it's quite interesting, maybe it will show you a little different idea:

    But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavors as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labors to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.

(IV.ii.6-9, page 456 of the 1776 Glasgow Edition of Smith's works; vol. IV, ch. 2, p. 477 of 1776 U. of Chicago Edition.)

This statement can be interpreted very simply: if each consumer is allowed to choose freely what to buy and where to buy and each producer is allowed to choose freely what to sell and how (or where) to produce it, the market will settle on a product distribution and prices that are beneficial for every individual member of the community, and so the community as an entity. Greed will drive all the actors of the trade to beneficial behaviour. It's also very nice put in wikipedia:

It also works as a balancing mechanism. For example, the inhabitants of a poor country will be willing to work very cheaply. Capitalists can make great profits by building factories in poor countries. But since they increase the demand for labor, they will increase its price. And since the new producers will also become consumers, local businesses will have to hire more people in order to provide for them the things that they want to consume. As this process continues, the labor prices will eventually rise to the point at which there is no advantage for the foreign countries doing business in the formerly poor country. Overall, this mechanism will cause the local economy to function on its own.

[Sibling Zono (anon1mat0)]

The last five years I lived in Chile. There fruits & veggies used to be of high quality at affordable prices. Then the government signed up trade agreements and the best produces went out of the country, leaving locals to feast on rejects at higher prices...

As a consumer it -proverbially- sucks, but the question in my head goes more to this: are more farmers employed because of the new trade agreements, and are they being payed better, the same or worse than before?

I certainly couldn't care less about rich guys making more money, but I do care about regular folks having a job, a place, etc, etc.

To me the whole demonization of free trade is just a smoke screen rather than criticize the way of it and who profits from it. Globalization is -in my eyes- unavoidable unless we suddenly fall into the stone age and all forms of communication and transport fall apart. Better look if trade is done fairy (rarely  ) and if it is benefiting the society at large or just the top 5%, or -most likely- in which percentage is benefiting everyone.

It also works as a balancing mechanism. For example, the inhabitants of a poor country will be willing to work very cheaply. Capitalists can make great profits by building factories in poor countries. But since they increase the demand for labor, they will increase its price. And since the new producers will also become consumers, local businesses will have to hire more people in order to provide for them the things that they want to consume. As this process continues, the labor prices will eventually rise to the point at which there is no advantage for the foreign countries doing business in the formerly poor country. Overall, this mechanism will cause the local economy to function on its own.

Now, the other side of the coin (as expressed above) has some truths to it but it usually ignores the time frame in which those balancing changes take place and the immediate consequences to the people involved. To the ones on top there are fewer consequences than for those in the bottom that depend on the industries affected. Also it is very 'convenient' that a lot is advocated in favor of free trade* but free movement is not considered in the equation (which should be advocated more forcefully by the laissez faire crowd but is rarely heard).

*Free trade isn't usually so, most agreements have protectionist clauses that usually benefit the stronger partner. As a point of reference a trade agreement was signed by GWB and Colombia's president Uribe. The treaty is far more damaging for Colombia than for the US but the Dems are blocking it on principle.

[Aggie]

*Free trade isn't usually so, most agreements have protectionist clauses that usually benefit the stronger partner. As a point of reference a trade agreement was signed by GWB and Colombia's president Uribe. The treaty is far more damaging for Colombia than for the US but the Dems are blocking it on principle.

I am stuck in the *&^$ flatlands due to the fall-through of 'free trade' wrt the softwood industry.  It's going against the agreements, but there's little power to enforce compliance.

[jjj]

 The rich people are getting richer. But we all benefit from that as well... 
True. What bothers me is the selfishness of capitalists. They virtually strive on the incentive to engage themselves only if they can exploit the miserable living conditions of the poor. Why are they not contented with less for themselves and offering the poor a chance to make it at the same time? This would be true progress or 'commonwealth' for a change.
Lately sprung up a few of those altruistic entrepreneurs. I heard of a Bangladesh banker lending money at law interest rates. In some instances the boss of a business allowed his workers to part own the business and so, benefit from gains/ suffer the losses.
Another example from Chile is VTR (USA's communication giant for all South America). Instead of offering Chileans a better deal than local TV-cable, telephone & internet companies, they merely adapted to horribly greedy, local conditions. Almost daily I received calls from carriers offering 'lower' rates, such as almost $ 2/pm to Australia. Next time
I tell them: thanks, I'm fine with 15cents/pm Skype calls. Until now, I told the young lady on the phone: 'Un momentito, por favor, tengo algun al la puerta. Es mi polola! , Senorita, le digo la verda que prefiero ser con ella en cama que con Ud.al telefono'... ('Hold on please, there's someone at the door. It's my girl friend and sorry... to prefer to be with her in bed than with you on the phone!')
Want more witty fun? The same tictac/ tactic I apply with pious canvassers. Once, I opened the door and was confronted with the question: 'Do you know why there are so many bad people in the world?' and I answered: It's, because now even the clergy indulges in pedophilia! God save our children! Thanks God I'm an agnostic!  (That fixed her!)

[Sibling Zono (anon1mat0)]

I told the young lady on the phone: 'Un momentito, por favor, tengo algun al la puerta. Es mi polola! , Senorita, le digo la verda que prefiero ser con ella en cama que con Ud.al telefono'... ('Hold on please, there's someone at the door. It's my girl friend and sorry... to prefer to be with her in bed than with you on the phone!')

On a more serious note, what you describe is nonsensical capitalism (as opposed to the -practically extinct- common sense variety). If capitalism had real long term goals they would care about their customers, not rob, extort, cheat, lie, poison, etc their own source of income, and despite all that, they cry for deregulation!

[Scriblerus the Philosophe]

As a recipient of a bit of what is apparently Chile's finest, (raspberries, mostly. We grow everything else locally, pretty much) let me tell you it does not ship well. Moldy raspberries are NOT appetizing. They may well do better to keep fruits that ship poorly at home.

Zono: Capitalism is supposed to have real long term goals, but the stupid way it is being practiced is the problem.

[Sibling Chatty]

The rich are getting richer and "we all" benefit from that??

Speak for yourselves.

Down here where the disabled, the elderly, the folks at the bottom of the food chain live...no we don't.

Prices go up, but low end wages don't. Disability doesn't. And the NAFTA crap has cost so many jobs in the US that the Very Poor are the fastest growing demographic in former manufacturing states.

Those Wal-Mart 22 hour a week jobs are just what former factory/assembly line workers need!! You can certainly feed a family on that!! You just can't shelter them, clothe them or provide them medical care, school supplies or even a cheap pair of shoes on it.

And don't even get me started on "disability Social Security" in the US.

But hey, as long as the top 3% of the world's people control the top 50% of the world's money, 'those poor people' will do just fine.

[Sibling Zono (anon1mat0)]

Zono: Capitalism is supposed to have real long term goals, but the stupid way it is being practiced is the problem.

You tell me! Now I notice the generalization in my post, my point is that capitalism as it is practiced nowadays lacks common sense, and is mostly devoid of long term goals (apart from total domination and/or a practical monopoly).

My main gripe with capitalism as is understood now, is that there is a disconnect between ethical behavior and the goals of many businesses. The point of a for profit endeavor is, well, to profit, and while I don't think that making money is necessarily evil, there seems to be a very large (and very dark) 'gray' area in which a company can auto-justify immoral behaviors on the basis of profits.

One of the things that makes us human is our ability to take advantage of the circumstances (very useful for survival) and without a moral compass the result is a general 'unpleasantness' that goes from a few bucks stolen in a transaction to poverty, hunger and/or death in huge sectors the population.

Given that, I don't believe that deregulation can help. The day that all businesses prove that they can behave ethically without the fear of immediate punishment I'll reconsider that position.

[Aggie]

One of the problems I see with capitalism as it's practiced in the west is that it's often a matter of straight business tactics - there's no connection between product and management.  There seems to be a view that capitalism involves a person or closely-involved persons starting up a business and working to develop a better mousetrap, so to speak.  This isn't a 'family business' system any more, and hasn't been for decades, maybe even a century.  Heck, even in the East the mega-conglomerates (chaebol are what I have in mind here) are to some degree family-based and plausibly maintain some personal pride in their products (not that they aren't just as politically corrupt and dirty as any other mega-corps). 

I'm more and more convinced that American-style capitalism creates the problems it does to a large part simply because ethical considerations have no currency amongst the top players.  With limited emotional investment in products, working conditions, the state of the world's poor, it's just a numbers game to those at the top, and I'm convinced that competitive pressure and status/power is a larger driver than simple monetary gain.  IOW, they are not seeing the moral consequences because they are barely even seeing the business... just buy/sell opportunities and systematic methods of showing profits (am reading A Random Walk Down Wall Street at the moment, and the earlier bits of the book provides some background history on the many, many ways business has screwed over investors - for hundreds of years; if capitalism is willing to do this to it's true believers and supporters, there's NO hope for the rest of the world).

The goal of any publicly-traded business is to show constantly increasing growth rates (exponential growth), which is fundamentally flat-out impossible to sustain. Flat profits are anathema to capitalism - let me repeat that, although I'm sure everyone knows this already - a publicly-traded business that made the same amount of money this year as it did last year is considered to be 'failing' at its job and will probably suffer a hit to stock prices and investor confidence. 

All economists and business students should be bloody beat over the head with an ecology text book to learn 'em on what this type of growth does to any (eco)system. There's small wonder that our environment is in trouble.

[beagle]

Seems to me there are several different strands here, with a tendency to push the blame for human failings on to the economic model.
Yes capitalism is flawed, but the greed etc that's been identified is also a failure (more spectacularly so) in the other systems that have been tried from time to time, and the other systems generally fail to deliver the goods (literally).

Yes, free trade will move production to the cheapest places. All the time the Industrial Revolution made sure those places were Europe and the USA we were fine with that; now it's India and China we've gone off the idea.  The EU and USA use trade agreements to deliberately limit the rate at which global wealth distribution to the poorest can occur. None too successfully judging by the size of China's foreign exchange reserves.

I reckon the ecological point is very valid. Capitalism is so good at supplying what we want rather than just what we need that there is a big ecological hit, and a constant drive to persuade people they need more to be happy.
However we're talking major slump and huge unemployment if we strip down to essentials any time soon.

On the original post about exporting the best products there's nothing new to that. After World War II in Britain all the best produced stuff was exported to generate income to cover the war debt. My parents' generation could only buy chipped cups, flimsy furniture or seconds clothes for quite a long period after the end of the war. The point is that provided the country in question has reasonably sound government it is only a temporary phase until the place is elevated into the first world of ecological over-consumers.