McCain Versus Obama on Free Trade: McCain = McCan’t and Obama = OhMama

This is a continuing series on the Primary Issues of the Presidential Election 2008. | Read Round One: McCain Versus Obama on the issue of Health care. | Round Two: Their take on the Iraq War. | Round Three: Obama Versus McCain on Free Trade. | Part One of Round Four on Natural Resources and Fossil Fuels, here. | In Part Two, we think the Democrats, Republicans And We All Are Misguided. | Part Three: McCain’s Position. Hypocrites Need Not Apply!! | Part Four: Obama Will Save The World, But the US will Go Broke in the Process | Round five: Is the US the Melting Pot or the Stagnation Pot? The candidate’s position on Immigration | Round Six: On the Issue of Abortion | Round Seven: McCain Versus Obama on Social Security: Obama Needs a Fundraiser, McCain Missing in Action | Part one of Round Eight: McCain Versus Obama on National Security, Obama’s Position | Part two of Round Eight: McCain Versus Obama on National Security, McCain’s Position

You have heard this famous cliché many times, we are sure. “There is no such thing as a free lunch”. There is even an acronym for it! TANSTAAFL. Go figure. For an explanation of how the cliché was derived, read the reference link. It is quite fascinating, well, at least interesting, well worth a click anyway.

Our politicians banter about the term “free trade”, but what it means is not exactly clear. Similar to the “free lunch”, it is practically a cliché. Our personal definition would be trade of merchandise between nations without taxes, duties or fees. So, if an item costs $5.00 to purchase from a company in Mexico, you don’t pay $30 because the US government wants $25 in tariffs, you actually pay $5.00!!  This combined with free and equal access, so it is as easy to find and buy our goods there as it is to find and purchase theirs here.

This really does not exist for the individual. We have relatives and friends all over the globe and most nations examine every package sent, even those declared as gifts, and charge fees and duties to the recipients. This is even with our so-called allies. Recently we sent a video collection to a friend in Canada. Its value was $100. They taxed our friend $30 even though it was marked clearly as a gift. 30% is hardly free.

Similarly, when we arrive home from travel to a foreign destination, our bags are searched to see if we have anything to “declare”. If we do, we pay taxes and duties on it. “Free trade” is a pipe dream for the individual.

On a larger scale, free trade provides merchandise from foreign countries at a significantly cheaper price than if tariffs and fees were charged. The questions become, why is it cheaper and what does it really cost us to deliver those cheap goods to our shores?

So called “free trade” has proven to be a double edged sword (what another cliché?). It clearly cuts both ways. It is not always tit for tat.  or even Steven. But we digress.

Fact is, nothing is “free” in “free trade” except the word free, and the lie behind that word has cost America plenty. What America has gained with respect to “free trade” is primarily a lower inflation rate. Just ask Uncle Alan Greenspan. We are able to import vastly cheaper products than we could manufacture in the US, so products are indeed cheaper. Check that $10 shirt in the closet and your $39.99 shoes and see where they are made. We are willing to bet it isn’t in the US.

Most of our cars are manufactured in Mexico, Canada, Korea, Germany and Japan. Most bicycles, clothing, shoes, etc. (and we stress the etc.) are manufactured in China and throughout Asia. The other edge of the sword is that it is no longer profitable to make anything in America, so jobs are lost, but more importantly, the national trade deficit rises as we purchase vastly more than we sell. Perhaps, as our wonderful politicians state, you actually could train people for new jobs, but that would only make them buy more foreign products increasing the deficit even more. Great idea.

The biggest consideration of a huge trade deficit is a weak dollar. The dollar has collapsed versus other currencies since we instituted supposed “free trade” with many other nations. Now, think for a minute. If this were fair, why are their currencies soaring with respect to ours? Because the only thing we have to trade is our dollar!! We don’t make anything else, so all we can do is print money to buy it all!

It is apparent that the gain in lowering the rate of inflation does not compensate those that lost their jobs as a result, and it certainly does not justify our huge trade deficit. If “free trade” were equal trade, the huge trade deficit would not be there! But we do at least have EBAY for those that lost their jobs as a result.

NAFTA, the North American Free Trade Agreement, was drafted for free trade among North American Nations. We cannot possibly cover all the facets and criticisms of this agreement, but it is also covered here. It has caused much of a stir over the years, and whether it was beneficial or not depends on your perspective, but we believe it the least of our problems.

We do not believe in “free trade”. We believe in fair trade. And we do not believe in fairness only for special interests, but for America as a whole. Certainly some businesses benefit strongly from marketing cheap goods in the US Market or exporting their labor to foreign nations, but who pays for that, and just as importantly, who gets paid for endorsing it (lobbyists, government officials)?

Here is an article that clearly defines how badly we are doing on the trade front. We agree completely with the Democratic position here. “In July, the politically sensitive deficit with China increased 16.1 percent to $24.9 billion, the second highest gap on record.

Critics contend the administration has not done enough to combat unfair Chinese trade practices. U.S. manufacturers say the Chinese keep the yuan undervalued by as much as 40 percent against the American dollar. That makes Chinese goods cheaper for American consumers while making U.S. products more expensive in China.”

On an international basis, we must be more restrictive with nations that cheat the United States. China, for example, while they provide cheap products, steals daily from Americans. They destroy American companies with illegally exported products and they cheat wherever it favors them. They market fake companies on our stock markets and steal from our investors by falsifying reporting information with the assistance of the NASDAQ and NYSE. And when one of these companies goes under, and the Chinese criminals make off with the money, no one prosecutes them; the Chinese government lines their pockets and Americans surrender another portion of their retirement portfolios.

Nations that cheat and steal from the United States should not be offered free trade even if it means cheaper products. Those cheaper products ruin US companies, destroy jobs and line the pockets of criminals. It is not that we think fair trade is not an objective we should seek with all nations, but we think our government has severely failed us in protecting us from economic theft by nations such as China that even cheat with 12 year old girls in Olympic Gymnastics. China does not deserve free access to our markets, and US citizens do not deserve to be abused by a government drooling over the evident opportunities for their special interests.

All that said, and now that we have made our opinions on “free trade” and trade in general as clear as we can without a complete dissertation on every possible trade agreement, let’s allow the candidates to have a say. After all, it isn’t we that are running for President.

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