Free Trade




Ron Paul is a proponent of free trade and rejects protectionism, advocating “conducting open trade, travel, communication, and diplomacy with other nations.” He opposes many free trade agreements (FTAs), like the North American Free Trade Agreement (NAFTA), stating that “free-trade agreements are really managed trade” and serve special interests and big business, not citizens.

He voted against the Central American Free Trade Agreement (CAFTA), holding that it increased the size of government, eroded U.S. sovereignty, and was unconstitutional. He has also voted against the Australia–U.S. FTA, the U.S.–Singapore FTA, and the U.S.–Chile FTA, and voted to withdraw from the WTO. He believes that “fast track” powers, given by Congress to the President to devise and negotiate FTAs on the country’s behalf, are unconstitutional, and that Congress, rather than the executive branch, should construct FTAs.

Buy American, Unless… (February 12, 2001)
Members of Congress often encourage us to “buy American” during their speeches on the House floor. Some members regularly place a “buy American” clause in various trade-related bills, seeking to protect domestic jobs by encouraging the purchase of American goods. Ironically, however, many of these same legislators vote to prohibit American companies from gaining access to new markets overseas. They do so by supporting our senseless embargo policies, which simply help our foreign trading competitors at the expense of American companies.

Of course most politicians claim that they support free trade. Intuitively, most Americans understand that access to foreign markets provides significant benefits to US citizens and American-based corporations. However, we continue to pursue a policy of denying or restricting domestic companies from selling to Cuba, Iraq, Iran, China, and other countries. This inconsistency is especially evident when we consider “export financing,” which really is foreign aid designed to help other countries buy American goods. Most Washington politicians support the practice of export financing, arguing that access to foreign markets benefits American companies, and not just foreign consumers. However, the opposite argument is made with regard to our embargo policies. Suddenly, increased trade with countries some want to label as unworthy only benefits sinister foreign consumers, and not domestic producers. This nonsensical position is maintained by many in government who favor government-managed trade which benefits certain chosen special interests.

Conflicting and inconsistent views on trade policy result largely from a lack of understanding of basic economic principles. Free trade is not a zero-sum game where some countries benefit and others inevitably suffer. On the contrary, true free trade by definition benefits both parties. Free trade is the process of free people engaging in market activity without government interference such as tariffs or managed-trade agreements. In a true free market, individuals and companies do business voluntarily, which means they believe they will be better off as a result of a transaction. Tariffs, taxes, and duties upset the balance, because governments add costs to the calculation which make doing business less attractive. Similarly, so-called managed trade agreements like WTO favor certain business interests and trading nations over others, which reduces the mutual benefit inherent in true free trade.

Free Trade With All, Entangling Alliances With None (September 21, 2001)
Free trade with all and entangling alliances with none has always been the best policy in dealing with other countries on the world stage. This is the policy of friendship, freedom and non-interventionism and yet people wrongly attack this philosophy as isolationist. Nothing could be further from the truth. Isolationism is putting up protectionist trade barriers, starting trade wars imposing provocative sanctions and one day finding out we have no one left to buy our products. Isolationism is arming both sides of a conflict, only to discover that you’ve made two enemies instead of keeping two friends. Isolationism is trying to police the world but creating more resentment than gratitude. Isolationism is not understanding economics, or other cultures, but clumsily intervening anyway and creating major disasters out of minor problems.

Free trade makes sense (June 7, 1999)
[…] if someone says they are for “free trade,” one must look carefully what they really mean, for the classic (and common sense) definition does not apply.

All to often in Washington, free trade is used when one really means “subsidized trade,” or, tax dollars being funneled to foreign governments to buy American products. Similarly, the phrase can mean to use tax dollars to bail-out American firms for risky overseas ventures, or managed trade by the World Trade Organization to serve powerful special interests.

On the other hand, those of us who oppose using the taxes of American citizens to prop-up foreign governments or American corporations are derisively called “isolationists.” There are indeed some people who are isolationists. They call themselves “fair traders,” though. Exactly what this means is open to debate. All too often it involves letting the government determine what is and is not “fair” in the private trading between individuals who live in different countries.

Sadly, these definitions all hinge on the assumption that there are essentially only two options: tax dollars being used to subsidize corporations/foreign governments, or no trade whatsoever without the rubber stamp of government bureaucrats and special interest groups.

The bottom-line of both options, of course, is higher taxes for Americans. Higher taxes to finance the subsidies, or higher taxes on incoming products (and make no mistake, a tariff is a tax, paid by the American consumer).

There is another way. Free trade and free markets are, without a doubt, the best guarantor of peace. But this requires something all too few in Washington want: less government intervention.

It is indisputable that individuals know better how to provide for their families than government. It is also indisputable that a company is better equipped to know what its market will tolerate than a bureaucrat in Washington. In this way, a person is able to determine what goods best meet their individual needs, weighing numerous factors in their decision. But when government intervenes, it no longer becomes possible for an individual to provide for their family and business in the most expedient fashion. This is the antithesis of liberty.

The World Trade Organization (March 20, 2000)
The economic argument for free trade should be no more complex than the moral argument. Tariffs are taxes that penalize those who buy foreign goods. If taxes are low on imported goods, consumers benefit by being able to buy at the best price, thus saving money to buy additional goods and raise their standard of living. The competition stimulates domestic efforts and hopefully serves as an incentive to get onerous taxes and regulations reduced.

If one truly believes in free trade, one never argues a need for reciprocity or bureaucratic management of trade. If free trade is truly beneficial, as so many claim, unilateral free trade is an end in itself and requires neither treaties nor international management by politicians and bureaucrats. A country should promote free trade in its own self-interest — never for the benefit of someone else.

Those not completely convinced of the benefits of free trade acknowledge a “cost” of lower tariffs for which they demand compensation and fair management. Thus, we have the creation of the WTO. By endorsing the concept of managed world trade through the World Trade Organization, proponents acknowledge that they actually believe in order for free trade to be an economic positive, it requires compensation or a “deal.”



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6,740 Comments:

  1. I would vote for Ron Paul. But unless someone brings up the true problem of free trade with 3rd world countries, and tells it like it is.. Free trade isn't free trade when the country your trading with gets all the jobs. Not everyone can work in high tech or service industries. Free trade is a lie unless your standard of living is the same. watch this movie with Charlie Rose talking with Sir James Goldsmith. A self made Billionaire in 1994 that forecasts what is happening to us now.

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    • I would vote for Ron Paul. But unless someone brings up the true problem of free trade with 3rd world countries, and tells it like it is.. Free trade isn't free trade when the country your trading with gets all the jobs. Not everyone can work in high tech or service industries. Free trade is a lie unless your standard of living is the same. watch this movie with Charlie Rose talking with Sir James Goldsmith. A self made Billionaire in 1994 that forecasts what is happening to us now.

      http://video.google.com/videoplay?docid=5064665078176641728#

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      • The thing that is scary about this video is that the "clueless" naive advisor is now on Obama's team of advisors which would explain the expansion of additional free trade agreements lately. They are doing exactly opposite what needs to be done to create jobs while making it easier for companies to find additional pools of cheap labor. How long can this mentality go on before the politicians GET IT! I sure hope Ron Paul sides with Sir James Goldsmith on this. He's nailed it on the head with his observations.  Ms. Tyson needs to find a new line of work, I hear China is hiring. People want to refer to tariffs in a negative sense due to history but this country has NEVER been in this situation before so history has no bearing. China and India are killing US manufacturers every day. We can not compete. If we automate the processes we don't need employees so thus either way we have more unemployed unless the American worker wants to make what they are paid in India. $100/month. FREE TRADE IS NOT FREE! It's only plausible given the equality of both trading partners. You don't hear of problems caused with Canada.

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    • I wrote a peace back in DEC 2010 trying back then to somewhat explain the free trade.
      Basically all I can say today if the people want free trade, as long as you are ready to pay more taxes minimum of 2%.
      That 2% comes from tariffs, this is what free trade will do away with.

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  2. "Free Trade" today is insanity and completely one sided; that is against the United States! The trade imbalance with Red China is currently one billion dollars per day, and rising! Red China does not buy our goods, they do not want our goods, they are buying our technology and land! If tariffs are bad, why are they so successful against the United States? Too many citizens have lost their jobs and livelihoods because of these free trade agreements. Wake up America!

    The United States should only trade with foreign countries when it is advantageous for the American citizen to do so!

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    • @John_Galt I Agree, how is free trade beneficial to America when we cant even compete with counties like china? Tariff's are a tax, but a tax to make it so we can compete. Meaning that we can make some of the same products and sell them at the same price. Its not an issue of cheaper items make it so more Americans can buy these things. It's an issue of jobs. Without Tariff's Many companies just cannot make it in America, That means less jobs. We don't have to Tariff everything, Just non-essential items that we can make in America and create jobs. The Argument form both the left and the right is that we would not want these jobs. Take away food stamps and I bet a lot of people would want these jobs.So tell me, What makes more jobs? A factory in your town or someone that imports and sells foreign goods?

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      • @MatthewOStroben@John_Galt I agree too.

        Funny how a protective trade policy works for China isn't it?

        It would work here too. Reagan implemented a tariff on Japanese motorcycles to protect Harley-Davidson in 1984.

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  3. Ron Paul could more than likely go along way when it comes to fixing this mess we are in. I see that we will more than likely have more bank bailouts. Will people elect Ron Paul? I would truly hope so but my guess is they will not. How will all this play out? First we will elect status quo and when that happens our economy will go straight down the drain. Our currency will more than likely loose it's status as the world reserve currency and since that is all we produce any more, printing money, then kiss us good by. Our socialist state will then come un-glued. People will riot in the streets, building will be burned. You will have to sit with a rifle and guard what you have, that is if you have anything.

    Finally after it is all over and bank accounts have been cleaned out, complete towns burned to the ground,homes have been lost and 401k's destroyed and just after we have boiled our dog on the kitchen stove, then people will wake up and be ready for Ron Paul and true change. Only problem is Ron Paul will probably be gone by then. I am afraid we are about to let the best chance we ever had slip through our fingers. Some of us can see something coming from afar and will do something to avoid the pain, like elect Ron Paul, but sorry to say most of us have to feel the pain first.

    We keep thinking that if we just go with the status quo everything will work out. That will not work this time around. The fat lady is about to sing. We are spending over $100,000 every second in this country. No sane person can see a good out come with that. Just remember if we do no elect Ron Paul we are going to feel the pain and that is guaranteed.

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  4. I'm still dismayed to see how so many people don't get it, or perhaps when I raise this topic I do not use the proper words?

    If tarifs were a cure to anything, the adoption of the Smooth-Hawley tariffs in the spring of 1930 by Hoover (when the unemployment was 9%) would have "cure" the economic crisis, but it just worsened it.

    I agree that the permanent trade imbalance is a problem, but Ron Paul is suggesting new ways to cope with this issues, some solutions that most republicans and no democrats want to consider.

    -Balancing the budget deficit: The Chinese can do 2 things with their dollars, they can purchase US goods and they can purchase US bond treasuries. What do you thing they will do if one of the two windows is closed?

    -Stop funding the IMF and several other organizations since they are just using the money to help other countries to compete with the US. And here China cannot retaliate

    -Sound currency: If the Fed stop to print US dollars, a trade imbalance would mean a scarcity of US dollars in the US, which means deflation in both salaries and prices (for US made products) and higher prices for foreign products. It's a self regulating mechanism because the US products would become cheaper abroad and China would send back the dollars in the USA this way.

    Now what happens if the US put a tariff of 100 $billion on Chinese goods?

    Let say that 5,000,000 Chinese workers lose their jobs. Does it mean that US companies will replace them? Perhaps in 10%, 20% of the cases, but in most cases they will not get the loans from banks to purchase material and expand if the situation is volatile and many people around lose their job ( see the Chinese retaliations). In many cases products from Malaysia, Pakistan, Bengladesh will replace the Chinese goods and it is very complex to manage and adjust tarifs for 100 countries.

    So lets say that 500,000 Americans find a job with this insteadf of 5,000,000.

    The Chinese retaliate with tarifs too, 100 $billion. 5,000,000 Americans lose their job, but the Chinese can easilly find similar products in Canada,Australia,Russia.

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  5. Don't you think free trade like this would lower the average pay of our production workers here in the United States as American companies try to compete with companies of other countries who have lower standards of living and pay their workers less? Eventually it may balance out, but I believe that the average American production worker would be severely crippled economically in the short and long run.
    I like many of Ron Paul's policies, but this one scares me. How can American companies compete with foreign companies who pay their workers so much less? I think it would erode a big part of the middle class. Also, what's to stop American production companies from taking all of their production jobs and moving them overseas where they can cut costs by paying workers less? American workers are more than ever having to take pay cuts to keep their jobs in the United States. If free trade were allowed, what are all of the production workers going to do?
    Will the American companies really lower the cost of their products even though it cost them less to make by shipping jobs overseas? Or just rake in more profits by selling their products to the people who never worked in production?
    Are there any extensive objective studies on these free market policies or is it all just theory? If there are studies, please post a link.

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    • Those are all good points.
      Paul's foreign policy position is more national, but trade is more global oriented.
      Wonder why that is? I don't see a problem with having a national patriotic fair trade policy. After all, Ron Paul voted against NAFTA.

      The typical Republican is detached from the middle class and it's workers.
      That's part of the problem for the party that will surface at some point in elections if the middle class realizes that they have vote for their own interests first and the GOP does not have the same interests. If not, the financial sector will be the only focus and the middle class along with it's jobs will be long gone.
      I'm voting for whoever has the best plans for American jobs. No middle class = a continuation of the Second Republican Great Depression. Those of us Americans that work for a living can't afford much more of that!!!!

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    • Um. Here's some examples.
      http://www.heritage.org/index/Country/Switzerland
      (note the zero percent tariff, besides like agriculture)
      http://ec.europa.eu/trade/creating-opportunities/bilateral-relations/countries/switzerland/
      http://www.ehow.com/facts_6935129_switzerland-trade-agreement.html

      BTW they have like, less than 4% unemployment.

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      • To Ron C:
        Canada is another example. It hasn't permanent, chronic trade deficits like the US.
        For the year 2008: +45 $billion (trade surplus), or 2.86% of the GDP.
        For the year 2010, -9 $billion ( trade deficit), about 0.57% of the gdp.
        A comparison with the USA:
        - 500 $billion in 2010, so a trade deficit representing 3.5% of the gdp.
        But regarding the US, the trade balance is always negative, in 2008 it was -700 $billion or -4.9% of the GDP.
        As far as I know Canuckstan doesn't rely on child labour

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      • The countries that are doing well have been dumping their goods in the United States, so called free trade is and has been one sided.

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  6. I'm beginning to think a lot of you hear didn't actually read what is written above. His ideas make senes.

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  7. @ Jerry: You, ironically, have no understanding of the red herring fallacy. A red herring fallacy is when you change the subject of an argument. In fact, it is impossible to have a red herring in a single phrase. Ron Paul was just simplifying jargon to make it more understandable to the average voter. A good example of a red herring fallacy would be to initiate an argument with a premise that a person is being dishonest and then changing the subject of your argument to how important tariffs are and how important it is to buy domestic. Thanks :)

    On another topic, I think that what you don't understand is that free trade is essential to capitalism. I won't go into a lecture on economics, I'll just assume you are familiar. Free trade is essential to capitalism because without it the 'invisible hand', is not controlled by the consumers or the people, but rather the government.

    If company A makes a better, cheaper product than company B why should you support company B when what needs to happen is they adapt their business model or go away? What, I have to support an inferior product at a higher price because it was made by someone in the same country, by some union worker who spends an inordinate amount of time hiding tools from other workers rather than creating a product? No, that would be ridiculous.

    Here is a specific example of how tariffs hurt consumers. Mercedes Benz, clearly a superior car: more rivets, great steering, suspension, transmission, engine, and on and on. So superior that it is worth it to many people to pay exorbitant amounts for them. But, in Europe they are reasonably cheap and quite popular and, btw, they have free trade throughout the continent.

    There are many other benefits to free trade, but I'm not even going to bother reiterating what Ron Paul already put on this page because he hit the nail on the head. Mutually beneficial key words. If you don't believe him just ask an anthropologist...

    @ Robbie: Have you ever been to China? They kind of don't have homeless people, did you know that? Have you witnessed low standards of living in China and, if so, are they any worse than the United States? Or are you just parroting the mainstream?

    @James: There was actually quite a debate at the time. Remember founding fathers is plural. The founding fathers were certainly not in agreement on a great many things. But, they were really good at something that politicians cannot even fathom now--compromise. Anyway, Alexander Hamilton was an imperialist, wrong on the economy then and wrong now. I'd say that our strong economy at the time may have benefitted from a massive slavery institution, but that's a completely different topic. I would really love to see something closer to a Jacksonian republic. Have you heard of Andrew Jackson? He wanted a federal government that was inconsequential in the daily lives of its citizens. When Hamilton argued that a strong, prominent, centralized government was necessary for defense against foreign powers, Jackson responded that when you give the people liberty at the level he was talking about, and that liberty is threatened, they are damn well going to fight to keep it and win.

    So to put it into relations with today's politicians, Hamilton would be Bush and Obama combined and Jefferson would be Ron Paul. In fact, Ron Paul has essentially adopted Jefferson's platform. And, honestly, I just can't see mercantilism working today.

    In this upcoming election you will probably face a pretty inconsequential choice between two candidates that are from either the red business party or the blue business party. Or we could realize that there is a candidate in the running that is different and actually wants to do what is best for the majority of Americans, the consumers, the employees (or the 1/6 that are former employees), or "the people".

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    • * Jackson not Jefferson... typo

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    • To Ron C on his comment to Robbie. I work for a global company that has sites in China. Pay for a chemical engineer is less than 60% of what a chemical operator makes in the US. They have no health insurance. A few years ago, we took up money to help an engineer with leukemia unable to afford medical care. Is that what we want here? It seems people are becoming disposable.

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    • Your right. "if company A makes a better, cheaper product than company B why should you support company B when what needs to happen is they adapt their business model or go away? What, I have to support an inferior product at a higher price because it was made by someone in the same country, by some union worker who spends an inordinate amount of time hiding tools from other workers rather than creating a product? No, that would be ridiculous."

      Tell me, how are we going to compete with 4 billion people that are willing to work basically for food. You don't get it. We need Jobs. Not everyone can do service work or high tech work. Do you think, just because someoen isn't as intelligent as you that they don't deserve to have as good as standard of living as you. That's off subject. Free trade only works for the countries benefit when the cost of living is the same. If you can save 20% of production cost why would you build or hire anyone in America?

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  8. "tariffs are simply taxes on foreign made goods" -This is a red herring.

    Cheap foreign-made products are drug. Just like cocaine or heroin effectively make us feel 'good' in the short-term, there are very real long-term consequences. We like that we saved 300 on our new tv, but then we wonder why some of our relatives are slowly falling into worse jobs, being forced into smaller homes and trailer parks. The two are connected. I will proudly purchase fewer things at higher prices, if my brother doesn't have to work nights for half of what he made (and deserved) 10 years ago. But it's hard to do when the drug is still on main street. Harbor Freight, Wal-Mart, they're all there...dangling their wares and hoping we'll come back to put another nail in our neighbors' economic coffins.

    Tariffs aren't taxes, they're the antidote to the drug of foreign discounts. They exist as a net to keep our dollars in the USA. While I'm not confident (nor are you) in the government getting those dollars, it's much better than what currently happens. Currently *all* our dollars go straight to Beijing. Then, the Chinese purchase US Treasuries, and now commercial real estate in our cities. China doesn't need to go to war with us, they've cleverly found a way to BUY us instead without ever firing a shot.

    A clever regime has an advantage over a modern Democracy. They can put such a plan together without having to discuss it openly. Meanwhile, they can invest in our media and ensure our political parties battle each other to the extent that America can't produce any laws to defend itself. Currently we could have God, Ghandi and Einstein working in the oval office, and the minority party wouldn't let them pass a law.

    We're in big trouble as a nation. NAFTA etc is the problem, I'll agree with Mr Paul on that. But his only suggestion is to lubricate the very machine that sends our nation's wealth to Beijing. What motivates a person to tell their countrymen that this is ok?

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    • You said:
      "Currently *all* our dollars go straight to Beijing. Then, the Chinese purchase US Treasuries, and now commercial real estate in our cities. China doesn’t need to go to war with us, they’ve cleverly found a way to BUY us instead without ever firing a shot."
      They have 3 $trillion of US "assets", treasury bonds but also Freedie Mac Fannie Mae bonds, this is junk! That's the way they boost artificially the value of the dollar to make their products more competitive. But they don't *win* from it, because the sole way for the US to pay them back is with depreciated dollars. It's like if they were just working for free half of the time. In the end half of their manufactures will have to shut down and dozens of millions of their workers will need to find another way to survive. The US is guilty when it leaves a window wide open with those monstruous budget deficits, the Chinese are short-sighted and greedy when they want to have it both ways.

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  9. Yeah but the only reason Chinese goods are so cheap is because they are not paying their slaves a living wage. Why do you think the standards of living in China are so poor? It is basically criminal what the Chinese get away with. Not to mention they devalue their currency against the USD to keep their exports high. The system we have now is most DEFINITELY NOT FREE TRADE!

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  10. I have to disagree with your stance on free trade and I wish you would take another look at it with a little more reason and big picture approach. This may be the one reason why I can't vote for you and it is a shame because I would love to see you be president!

    You speak so highly of our founding fathers. You believe so deeply in the constitution and original intent. Why then don't you go back to our founding fathers economic and foreign trade policies.

    I think we need to look closely at the policies put in place by Alexander Hamilton. A man so important to our economy that we put him on the $10 bill. It was these policies put in place by our founding fathers that built the worlds strongest economy. We must go back and end free trade.

    Free trade allows corporations to go overseas and build cars, make jeans, make toys, make everything. Ship it over here with no penalties for taking American jobs away. And then sell it for Record Profits! All because labor is cheaper overseas. We must have protected tariffs that protect American jobs and protect American wages! So we tax the incoming goods to make the cost to produce equal or higher to the cost to produce in America! This will bring jobs back to this country! High paying life long good jobs!

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  11. Perhaps a "non-protectionist tariff" is a flat tarriff on everything say 10% - instead of the product dependent tarriff we have now which is 6% on somethings - 3% on others, 25% on others - which has been set by Congress to protect certain industries and their prices. I'm having a bit of a problem with this free trade thing - I cannot tell by the labeling who stands for what. So if NAFTA was the removal of all tarriffs between the US, Canada and Mexico for all goods moving in or out of those countries has caused businesses to move to Mexico where the labor is cheap, and losing jobs here in America, How is it that removing traffis and creating free and "fair" trade relationships going to improve the jobs of this country? Sure, it reduces the prices to consumers, however, it increases unemployment - therefore less spendable income of the population. Or we can have some "protection" with tarriffs on some imports or all imports and the prices of goods will go up and entreprenurs will get into the production of those goods and services and create jobs because they can produce those goods at cost lower than the import price and make a profit? So the choice is low prices or jobs? Surely there's some middle ground somewhere! Beside that, with smaller government, who's going to monitor this free and fair trade stuff? Buisnesses? If it doesn't put money to the bottom line - they will not do it? I guess that's where I have a problem with Ron Paul's entire prospective - that the market will sort everything out. Well, I do not trust that buisnesses are that open with their product problems. Do you think Ford would have recall the Pinto in the 1970's had they not been required to by the government? How many folks were killed before the public got the information that the gas tank "may" explode in a rear end collision? Ford went to court and sworn an oath to tell the truth and still denied any design flaw! And if you have some consumer protections in my state, can I avoid those just by going to another state which does not have the same protections? It looks to me that we should be careful of what we ask for - you just might get it along with a whole bunch of unintended side effects. I believe that a big part of government is public saftey - I want to know that my drinking water is safe, and that plane flying over my home is going to remain on its path because its been inspected, and that its really tuna in that can of tuna. I don't have the resources to sue companies or individuals who cut corners to make a profit and results in the death or maiming of folks. I don't trust the market to do the right thing - I trust that they will try to make a profit all any cost - and some will see lawsuits as just another cost of buisness. Like BP oil - after the death of 13 workers, may look into the safety measures for its employees but may not. - May look into better spill prevention - but may not. After all will it add to the bottom line? Why bother, who's going to make them do the right thing? Their customers are still there! I guess the market worked! Unfortunately, the government for what ever reason just gave them a pass as well as the entire industry. The government has "gotten out of the way" by issuing more drilling permits in the Gulf since the spill than the Bush adminstration did in his last term. Amazing! I guess under Ron Paul , there would be no permitting process at all. So when Paul become President and there is a spill in the Gulf - Texas, Louisanna, Mississippi, Alabama and Florida - you're on your own to enforce what ever laws you have on your books with respect to your beaches. Hope its in your budget! Good luck!

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    • The market wouldn't sort everything? What happens if the USD is based on gold? Americans buy more from Mexico/Canada/China than what those people buy from Americans. Gold is flowing out from the US. Those people don't buy anything from Americans, and the USA government hasn't a budget deficit, so it doesn't need to borrow gold from foreigners. How could the Americans continue to purchase foreign goods indefinitelly if gold is not flowing back?

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  12. Free Trade not Fed sht, can we just trade in obama for ron paul ? like a refund lol.

    Go Ron Paul :-)

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  13. Just as in your position on Healthcare "charitable benefit provided by doctors who feel a personal responsibility for their fellow citizens", you have left the poor and repressed of the world out to dry.

    The WORLD must insist on human rights and pollution controls and any country that violates those should not be allowed access to the rest of humanity because they are not acting like a part of humanity.

    If you reward these countries with access to markets, you relegate these people to a life of poverty and abuse forever

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    • I see two problems with this approach...

      1) Who has the authority to police/enforce this policy?

      2) When we are the country responsible for violated human rights, do we isolate ourselves? For how long?

      You see, that's the problem. We cannot claim human rights issues and then kill babies half way around the world....it's a double standard that cannot be reconciled. So, by your proposed solution, we'd be completely isolated from the world for the past *looks at watch* 80 years and counting....

      What could be more isolationist that that?

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  14. I applaud you Ron, for having a forum to discuss issues on your web site that appears to be free and open, rather than just allowing “rah rah” props.

    I’ve often heard in your interviews “But we have no money for it!” True enough, but is money the real point? Or are PEOPLE the point? What comes FIRST, the money or the people?

    If the people are to come first -- and things happen that cause people to need help that the market – and often over-extended charities – will not be able to help – does not that money need to come from SOMEWHERE?

    It has to come from taxes… yes, that dirty word. Taxes. I’m not naïve enough to expect Monsanto, Exxon/Mobil, or even CARE, to help everyone who’s doing their best and “falls through the cracks.”

    But I AM more than happy to pay a percentage of the money I earn above what I need to live comfortably so there is a public means to help such people (and maybe someday myself or a friend or family member) survive such a crisis. And I think corporations should do so, too… at least out of money made by doing wrong by people (see below). Again, this is consistent with the idea of PEOPLE coming first – ahead of dollars or “even” gold.

    This is not to encourage free-loading and dependency on government… there are things to be done that able people can do to earn their aid, so everybody wins. In other words, turn the welfare system into a temp agency, child care network, and public enterprise that fills in some of the cracks that private enterprise does not.

    We don’t need tariffs to discourage trade, but we can ENCOURAGE businesses to hire Americans and pay them a good wage by having them write off wages paid to American workers up to a comfortable living (say 40K per year for a 40 hour work week) straight off their tax bill. Encourage businesses to invest in improvements that enable them to operate more cleanly by taking it straight off the tax bill. Enact massive credits for personal income that is invested in US businesses or in other ways that actually stimulate the economy. In other words, have taxes based on BEHAVIOR to a greater degree.

    This will create American jobs, and spur production that will create REAL wealth better than any amount of gold could ever do. And eventually enough jobs that we may not even NEED the public aspect of it.

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  15. Maybe the American people should have sit ins to block the ports and not allow imports, that should get alot of people back to work, the Politicians are not going to do it and we can't compete at $2 per day, it's time for the Citizens to get ready to do something about this BS.

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  16. There is no free trade, any more than there is a free lunch. Trade is expensive, because there's always some scumbag skimming off the top, which is why the private sector will always be LESS efficient than the public sector, contrary to conartistive propaganda.

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  17. I'm seeing many posts from people who say that the solution to the trade imbalance would be tariffs on import merchandises. However many of those people would be outraged to see that their homemade American products cost 50% more than Chinese products. If the Chinese goods are so present it’s because the consumers prefer them in general – for the price -. I’m living in Canada and when I buy something I prefer to buy Japanese or Western made stuff, not by nationalism but because I was disappointed by the Chinese quality often. So a little question for those who say that the USA should restore protectionism… how many of you are currently buying American stuff when you can, even if it is more expensive?
    My impression is that this big trade imbalance is caused by the policy of all those central banks; but especially the budget deficit of the US government. Under a gold standard there is never a durable trade imbalance provided that the USA hasn’t a budget deficit as well. In such a case the banks raise their interest rates to prevent gold from quitting the country and a deflation occurs, so American products become more competitive. It is only possible to maintain an artificial trade imbalance (until the whole system collapse) if the USA borrow gold from China to offset the trade imbalance, so if the US government has permanent budget deficits. You have some similitude with the actual system and the fact that China and Japan purchase treasuries, but in the end their “assets” will be worthless and whole factories will be shut down, malinvestments.

    The enormous expansion of the money supply in the West (due to low interest rates from the central banks) was masked by those imported products, so the CPI didn’t increase accordingly but when the foreign products stop to flow in, expect a strong inflation. Again I'm saying that there was no way under a gold standard and the absance of a budget deficit to see such a monstruous distorsion.

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    • Just a clarification regarding what I said on the gold standard:
      The parallel is that even without the gold standard, the US dollar could have act as gold under certain conditions, if the Fed hadn’t created too much money out of thin air. In such a case a trade imbalance means that US dollars would flow out of the country without flowing back, so the resulting scarcity of USD in the United States leads to deflation, both in prices and salaries. Real wages are stable or even grow ( if you look at the history of the USA in the early twentieth century), nominal wages fall but local products are cheaper as well while foreign products stay expensive, American products become cheaper abroad. So ultimately USD are flowing back. Overprinting money prevent the self-adjustment provided by such a mechanism, the US budget deficit didn’t help neither because foreign countries recycled their USD in the economy in the wrong way (treasuries), there was simply no scarcity of the US dollars in America regardless of the trade imbalance.

      Many companies have shipped their production abroad but they assume that the current Ponzi scheme can last forever. It is based on the illusion created by currency manipulations.
      In a system based on a sound currency and no permanent budget deficits you have some real, physical advantages with free trade.
      Americans consumers can buy oil from Alberta, cheap hydroelectricity from Quebec, cheap timber products from Ontario/British Colombia and some manufactured products without paying the extra tariffs, Canadians can purchase cheap and fresh fruits during the winter, cheaper chicken and beef (no need to heat the barns/henhouses during the winter in the US) as well a some manufactured products where American companies have developped an expertise.

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    • Truth Is Self-Evident

      Ron Paul is not advocating protectionism.

      Please stop LYING about this!

      Ron Paul opposes FTA's that are far from free trade, rather these FTA's are corporate managed trade that establishes winners and loser. Ron Paul also opposes FTA's that violate the Constitution, Article One, Section 8.

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      • Well, before posting such an accusation and shooting yourself in the foot, why not reading carefully? I NEVER claimed that he was advocating protectionism, I said:
        "I’m seeing many posts from people from people who say that the solution to the trade imbalance would be tariffs on import merchandises"
        Where do you see the name "Ron Paul" here?

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  18. Everybody seems to be asking how we can compete with with cheaper labor. The real question is, WHY should we compete with cheaper labor? It's CHEAP. It means cheaper goods. The only way for us to compete with that is to make it more expensive via tariffs and embargoes, and that does not help. It might help producers, but not everyone else. It may make more jobs, but it also makes goods more expensive so the labor is worth less. It also impedes the economy as a whole from developing the way it would without those barriers. The key idea in free trade is specialization, that everyone does what it is best at. This applies to countries as well as individuals. If other countries can provide cheap manufacturing, then let them. We do not have to manufacture the things that other countries can do better in order to grow. In fact, the only way we can grow and get out of our current economic situation is by doing what we can do better and more efficiently than other countries. The only way that will happen is if the government does not interfere with trade or the economy.

    The next logical question is, what are we good at? This is a very good question, and the answer is simply that I do know. I do not have all the answers. No one does. That is the entire basis for limited government. If someone really did have all the answers, then fine, let him run everything. But no one does. The problem is, the government ignores this very simple truths and tries to pick the winners and losers in our economy, both for the present and the future, as if they knew best, which they really don't. This is an exceedingly dangerous policy, and could insure the total stagnation of economy, because we will be stuck in industries in which we have no business. All I can say for sure is that everybody always has at least one area of competitive advantage, in which they can profitably specialize.

    Some of the practices involved in lowering labor costs are morally objectionable, of course, and I do not condone them or support them in any way. However, to say that their practices require intervention from our government is to say that I need the government to tell me what is morally acceptable and what is not. This is something that I cannot accept. The solution to this problem is a little something called personal choice. YOU make the decision not to buy things from countries and companies whose practices you find objectionable. No one else can make that decision for you. The government already has trade barriers with Chine, yet boatloads of Chinese goods make their way into our markets constantly. We cannot rely on government to do things for, to make the choices that we should be making for ourselves as citizens of the free world. It falls to the individual, as it should, to make moral decisions as well as economic ones.

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    • Truth Is Self-Evident

      Good point, John.

      Everyone should ask themselves, why Communist Russia was unacceptable to trade with, as is Communist Cuba still today, but Communist China is no problem.

      Please don't give a load of bull about China being capitalists, there is no private property in China, no political parties allowed but the Communist Party, and when anyone goes to the streets to complain, you get another Tienamen Square incident where the Red Army crushes their own citizens with tanks. We are at war with Lybia, Yemen, and others for attacking their citizens like this!

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    • We can compete with cheaper labor by enacting tax credits that make it cheaper to hire here.

      People will, for the most part, buy what is cheapest, provided they don't see enough difference in quality to justify paying more.

      A totally free market without direction will lead us to "competitive" wages, which is basically what enough people find just barely preferable to begging or stealing. That's the reality of it.

      The government need not provide everything, but it can certainly DIRECT. We need it to direct for the benefit of the American people, not those who pay off its representatives, as we have now.

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      • Here's the issue with tax credits: the money has to come from somewhere. It may *seem* like a free lunch, but it isn't. The government isn't going to cut its spending because of this tax credit, so it acts as another expense - one that must be paid for by taxes somewhere else. So those tax credits (on your solar panels, or on employment/whatever) are really just government subsidies for failing industries.As to what America and Americans are good at: we are good at service, we are good at ideas, and we are good at entertainment, to name three things. We produce movies, business executives, ideas, medical procedures, perscription drugs, sports, services, food, etc. And all these things are *real* jobs that create value. You wouldn't pay for them if they were worthless, and even though they often aren't tangible (like movies and sports), they are still valuable. They improve your quality of life, and therefore have utility. to say that we *need* manufacturing jobs to be competitive (what competition is it again? I never got that), or to have a good economy, is just asinine.

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  19. Right to work laws make Union practices to call strikes unfeasible. Since employers naturally have an advantage over employees, this is unjust. To gain competitiveness with other countries the minimum wage needs to be lowered, either nominally or through inflation. The only revenue source allowed in the Constitution is tariffs. Oil companies should be charged for the cost of wars fought on their behalf. That will raise gas prices and people will use less gas. Theft is an indicator that resource allocation is not working. I pity anyone wanting to try and solve all these problems. A radical change in the White House against growing government interference as a rule is what we need, nott supporting this program or that. Ron Paul for President!!!

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  20. Free trade only works if everyone plays by the same rules, meaning that they pay the same wages to their employees and have the same environmental controls on their factories. China doesn't play by these rules, they pay their workers 1/50th of what a US worker would earn doing the same job, and China is a polluted mess, they have so many people that the Chinese government doesn't care if they die from cancer caused by all the toxins in their air and water. So to make things equal, a tariff needs to be imposed on all Chinese goods, equal to the difference in wages and pollution control costs. This should not apply to just China, but trade with any foreign nation.

    By putting these tariffs into place, it will encourage companies to bring manufacturing back to the United States, thus creating jobs.

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    Highly rated. What do you think? Thumb up 14 Thumb down 4

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