Cartels and Tariffs Go Together
Back in 1994, Lew Rockwell wrote an excellent article exposing the World Trade Organization. He made it clear that this agency, like NAFTA, is part of an international conspiracy to control people's actions.
Where's the trick? That's the first question to ask about any international trade deal these days. What appears to be a step in the right direction -- towards greater liberty in trade across borders -- turns out to be a leap into world statism.That was true of Nafta, with its labor regulations, environmental restrictions, trade-diverting rules of origin, foreign aid, investment guarantees, and supranational bureaucracies. The agreement placed a legal imprimatur on the worst aspects of the mixed economy, as one might expect from the Clinton administration. And the recent Gatt negotiations are Nafta cubed.
Gatt's "Uruguay Round," if approved by Congress, will create a menacing new supranational institution, the World Trade Organization. The WTO, which international statists have worked for since at least the Wilson administration, will entangle the entire world in a Keynesian thicket of regulation, enact international fiscal planning, and link trade with wealth redistribution.
The multinational corporations aligned with big government will benefit from all of this, but medium and small businesses, not to speak of American liberty and sovereignty, will suffer.
So it's big government, big regulation, big cartels. There is no escape.
Americans put up with a gigantic system of Federal regulation. The Federal Register cranks out 70,000 pages a year, three-columns of fine print. All of it is in restraint of trade. It is cumulative. There is no escape.
States do the same, but on a smaller scale. So do counties. So do cities.
Everywhere we turn, there is someone with a badge and a gun telling us, "you and he are not allowed to make a deal." The only way we get one guy off our backs is to say, "You have no jurisdiction here. This other guy does." The other guy has a larger gun.
The hierarchy of governments means a hierarchy of laws against free trade.
The Federal hierarchy messes with us the most. The WTO, NAFTA, etc. don't have guys with guns at our front door. They operate with threats against the Federal government. These threats are not very powerful. The Federal government has the guns.
If the United Nations Organization had the weapons, and national governments were disarmed, then the New World Order would be the #1 threat to our liberty. But it will never get this, I hope.
In the conflict of guys with badges and guns to interfere with me, I prefer the local guy. I can move away from him if I must.
This country used to be run by local guys. In the South, that was bad for slaves and great for plantation owners. The yeomen liked the arrangement, because they could look down on slaves and think, "There's someone worse off than I am." The planters owned the Pareto-normal 80% of the wealth. They scared off the yeomen, who had the votes. "Destroy us, and the slaves will get loose." The political system worked well for the planters until 1861, when the hot-heads in South Carolina seceded, and the rest of the South joined them out of deluded loyalty.
The slaves wanted Federal sovereignty. They got it. They lost it in 1877: the end of Reconstruction. They got it back around 1964: the Civil Rights Act. By that time, the South's new hierarchy was in place. It was not tied to cotton. It was tied to commerce. The dreaded Yankees had conquered the South where it mattered most: in the public schools' textbooks and the economy.
The public schools are state-run. They constitute the #1 threat to liberty. If it were my choice to kill the public schools or the Federal bureaucracy, I'd choose the public schools. Yet most Americans love them.
As I said, we get our choice of men with badges and guns. We get our choice of cartels. But we always have both.
There is no free trade. There is only managed trade. The question is: Who manages it? Mostly, the federal government.
To the extent that you can get off the Federal government's radar, you will prosper. That's why I like the Web. The states don't collect income taxes on Web sales. The Feds don't yet impose a VAT. So far, so good.
Low tariffs are always good. There are no exceptions. Why? Because low taxes are always good. A tariff is a tax.
The hucksters for industries that are facing stiff foreign competition never call a tariff what it is: a sales tax on imported goods. They also never tell you that every tariff imposes an invisible export tax. If foreigners can't earn dollars by selling to Americans, American exporters cannot earn foreign currency by selling to foreigners. A tariff is a double tax. It taxes domestic consumers (higher prices, money to the Feds), and it taxes domestic exporters (reduced sales).
If you ever read a pro-tariff book that calls a tariff a sales tax, and also openly admits that tariffs work the other way -- restricting exports -- you will have found the only known case of an honest defense of tariffs.
The hustlers for the non-competitive domestic industries are trying to sell you a bill of goods on behalf of the domestic cartel of producers.
What we need is this: a concerted effort to get domestic regulation reduced (impossible politically) and also get NAFTA and WTO regulations off our backs. We need lower tariffs and reduced regulation. But there is no political constituency for this. Everyone wants protection from some group of competitors. Everyone is willing to surrender to restraints on trade to save his income.
Free trade means trade unhampered by guys with badges and guns. There is no constituency for this.
So, I prefer local guys. Get the Feds off my back. Let the Feds get the WTO off my back. I'll deal with the local regulators.
Bring it back home!
This is why the breakdown of the Federal government will be positive. The NWO boys think they will pick up the pieces. They won't. The pieces will stay scattered.
Find a piece to dig in now, in expectation of the political break-up due to the economic breakdown.