Globalization, Free Trade and Economic Freedom

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Code for "let business run the world: the heck with the populace." The anti-liberal dominance of plutocratic property and business over popular sovereignty. Historically, we could extend these concepts to include buying, owning, and selling slaves. The arguments made then were the same. Used by propagandists to trump other freedoms. Also known as economic liberty.

Because capital is more mobile than labor, this advantages capitalists over workers.

Note also that globalization does NOT imply free trade or economic freedom. It simply means exchange between nations, at whatever rate with or without regulation. Frequently, globalization is credited with raising incomes of the world's poor, but not because of free trade or economic freedom (consider China, for example.)


Libertarian Indexes Of Freedom (8 links)
Over the years, many libertarian think-tanks and other Koch-funded organizations have created indexes of freedom that invariably represent the interests of large multinational corporations and the rich while ignoring the interests of ordinary people. This is obviously opposed to democratic ideas of political freedom. The entries in this index are evidence, not criticism.
101 Boosterism [More...]
"The point is that just because Econ 101 makes a smart, counterintuitive point doesn’t make that point of central importance, here or elsewhere. People should know what’s in the textbook; above all, they should buy my book! But never imagine that it’s the be-all and end-all of what matters."
Economic Freedom (propaganda) (3 links)
Economic freedom is a code phrase for the dominance of property over popular sovereignty (democracy.) Libertarian ideas of economic freedom are like freedom to sail your yacht where ever you like, even if your wake swamps other boats. Great if you have a yacht! But not valuable to everybody, and sometimes harmful. See: Globalization, Free Trade and Economic Freedom.
The Davos Lie (4 links)
A term coined by Larry Summers. The old idea that since free trade increases overall benefits, the winners could compensate the losers with some of the gains to create a Pareto improvement where everybody wins. But the real world fact is that this compensation does not occur, increasing poverty and inequality dramatically.
Investor-State Dispute Settlement (2 links)
A part of trade agreements that creates private kangaroo courts for corporations to sue governments. Part of the libertarian/neoliberal agenda to privatize power by giving corporations the whip hand over democratically elected governments.
Famines (2 links)
Libertarians blame governments for famines, but Amartya Sen attributes famines to declines in ability to obtain food, which can be due to governments or to natural causes or to market peculiarities. Democratic governments have always been able to respond to these declines and prevent or alleviate famines. Capitalism and globalization has been behind famines in many nations.
A parable of one-way free trade [More...]
The benefits of international trade can be subverted by strategic interventions by governments. An "always free trade" policy leaves us vulnerable to the strategies of other nations.
A Protectionist Moment? [More...]
Skip past the comments about Bernie Sanders to the important part, where Paul Krugman points out that "much of the elite defense of globalization is basically dishonest".
Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism (book, online)
Exposes revisionist myths of free trade and development of nations. Free trade tends to harm developing nations, and is generally not adopted unless it is forcefully imposed by other nations or a dominant position in markets is established.
China Isn’t the Only Reason to Question Free Trade [More...]
"If nudging companies to export can raise productivity, the U.S. has work to do. The country’s domestic market is so big that lots of companies don’t bother to compete globally..."
Economics: Science, Craft, or Snake Oil? [More...]
Dani Rodrik laments that while economics has innumerable models, it has very few tools for deciding which model is appropriate. He also points out that simple answers, such as support of free trade, rely on long lists of preconditions which are seldom met.
Free-Trade Blinders [More...]
Dani Rodrik presents thought experiments to a class on globalization. He shows that justice issues play an important role in our judgements of what sorts of redistribution from free markets should be considered fair.
Freedom in the World [More...]
A respectable, non-libertarian index of freedom, and a good alternative to libertarian, neoliberal and corporatist indexes. Produced by Freedom House. Based on 10 political rights questions and 15 civil liberties questions.
Mises on the Ricardian Law of Association: The Flaws of Praxeology [More...]
The alleged economic advantages of free trade claimed by Misesian praxeology and by Ricardo are simply false, because of the false hidden premises in the argument.
On the Wrong Side of Globalization [More...]
Trade agreements like the Trans-Pacific Partnership would make our problems worse. "Huge multinational corporations complain that inconsistent regulations make business costly. But most of the regulations, even if they are imperfect, are there for a reason: to protect workers, consumers, the economy and the environment."
Protectionism and US Economic History [More...]
"The case for selected protectionism and also “infant industry protectionism” is a strong one. First, all the theoretical arguments in favour of complete free trade fail [....]"
Reading Hamilton From the Left [More...]
An excellent overview of how Alexander Hamilton's Federalist, dirigiste vision of state-supported capitalism was the basis for the growth of American capitalism. As opposed to Jefferson's large, patrimonial, slave-owning, agrarian elites who exported primary commodities and imported finished manufactured goods from Europe.
Rescuing Economics from Neoliberalism [More...]
A refreshing antidote to neoliberal ideology, stuffed with more excellent writing and economic ideas than are easily appreciated. "The fatal flaw of neoliberalism is that it does not even get the economics right. It must be rejected on its own terms for the simple reason that it is bad economics."
The American Social Contract: A Promise to Fulfill [More...]
A history of the US social contract from the 18th century to the 21st. Details five elements of economic opportunity comprising the social contract: economic liberty, economic access, economic adequacy, economic ability and economic security.
The case against free trade – Part 1 [More...]
Why progressives should prefer "Fair Trade" to "Free Trade". Free trade is a theory that is loaded with unrealistic assumptions and does not predict what actually takes place in real-world markets.
The case against free trade – Part 2 [More...]
"There is no such thing as the ‘free market’. It is an obfuscation used by elites to distort the public debate and create the impression that state regulations, consumer and worker protections and the like are costly distortions which undermine our welfare. What they really mean when they talk of the ‘free market’ is that these protections reduce their capacity to extract larger proportions of national income..."
The case against free trade – Part 3 [More...]
"These so-called ‘free trade’ agreements are nothing more than a further destruction of the democratic freedoms that the advanced nations have enjoyed and cripple the respective states’ abilities to oversee independent policy structures that are designed to advance the well-being of the population."
The case against free trade – Part 4 [More...]
"There is never a case that a corporation should have institutional structures available that allow it to use ‘commercial’ arguments to subvert national legal positions... A progressive policy framework has to allow all workers access to work even if it explicitly destroys jobs as part of an overall strategy to redress matters of concern (whether to advance labour, environmental or broader issues) and allow the poorest members in each nation opportunities for upward mobility."
The Case for Protecting Infant Industries [More...]
"Shielding young companies helped the U.S. economy flourish once. It wouldn’t hurt to revisit the idea."
The endless struggle for ownership of “economic freedom” [More...]
"But just because the right-wing has strangely captured the phrase in the last few decades, that does not mean it should be conceded over to them. The idea that extreme laissez-faire capitalism can be described as economic freedom is a very new one historically, and one for which there are very convincing reasons to reject."
The Failure of Libertarianism: Why Economic Freedom Alone Cannot Deliver a Better Future [More...]
"If libertarians are correct in claiming that they understand how best to organize a modern society, how is it that not a single country in the world in the early 21st century is organized along libertarian lines?"
The Man Who Made Us See That Trade Isn't Always Free [More...]
"David Autor upended the assumption that everyone benefits when countries swap goods without restrictions."
The question libertarians just can’t answer [More...]
If your approach is so great, why hasn’t any country anywhere in the world ever tried it? Some political philosophies pass this test, such as Nordic social democracy. Laughably, they try to substitute claims of economic freedom instead.
The Questionable Record of Neoliberalism [More...]
"I’ll take a brief look at [...] the US & UK, Chile, Hong Kong & Singapore, and Scandinavia. I believe that in none of these instances do we get a clear example of neoliberal policies succeeding economically."
The TransPacific Partnership And "Free Trade" [More...]
A short, clear, graphic-novel introduction to the how the wealthy collect the benefits of Free Trade and the rest of us bear the costs. It includes the loss of national sovreignty through trade agreements that force deregulation.
Too Late to Compensate Free Trade’s Losers [More...]
"Gone are the confident assertions that globalization benefits everyone: we must, the elites now concede, accept that globalization produces both winners and losers. But the correct response is not to halt or reverse globalization; it is to ensure that the losers are compensated."
U.S. Companies Were Hurt by Trade With China Too [More...]
Free Trade with China, often assumed to be beneficial, as been shown to leave deep and lasting scars on huge swathes of the American workforce, increase political polarization, and decrease U.S. corporate innovation.
What Color Tie Do You Vote For? [More...]
The relationship between "freedom" and "economic freedom" is not as simple as Milton Friedman would have it.


Globalization’s cheerleaders do considerable damage to their cause by framing the issue as a stark choice between existing trade arrangements and the persistence of global poverty[...] In fact, the most phenomenal export-oriented growth experiences to date -- Japan, South Korea, Taiwan, and China -- all occurred when import tariffs in the US and Europe were at moderate levels, and higher than where they are today[...] Progressives should not buy into a false and counter-productive narrative that sets the interests of the global poor against the interests of rich countries’ lower and middle classes. With sufficient institutional imagination, the global trade regime can be reformed to the benefit of both.
Dani Rodrik, "A Progressive Logic of Trade"
But it’s also true that much of the elite defense of globalization is basically dishonest: false claims of inevitability, scare tactics (protectionism causes depressions!), vastly exaggerated claims for the benefits of trade liberalization and the costs of protection, hand-waving away the large distributional effects that are what standard models actually predict[...]Furthermore, as Mark Kleiman sagely observes, the conventional case for trade liberalization relies on the assertion that the government could redistribute income to ensure that everyone wins — but we now have an ideology utterly opposed to such redistribution in full control of one party[....]
Paul Krugman, "A Protectionist Moment?"
One cannot overstate the childishness of the ideas that feed and stir the masses. Real ideas must as a rule be simplified to the level of a child's understanding if they are to arouse the masses to historic actions. A childish illusion, fixed in the minds of all children born in a certain decade and hammered home for four years, can easily reappear as a deadly serious political ideology twenty years later.
Sebastian Haffner, "Defying Hitler: A Memoir", pg. 17.
Now let the reporter go undercover as a student in the professor’s advanced graduate seminar on international trade theory. Let him pose the same question: Is free trade good? I doubt that the answer will come as quickly and be as succinct this time around. In fact, the professor is likely to be stymied by the question. “What do you mean by ‘good?’” he will ask. “And good for whom?” The professor would then launch into a long and tortured exegesis that will ultimately culminate in a heavily hedged statement: “So if the long list of conditions I have just described are satisfied, and assuming we can tax the beneficiaries to compensate the losers, freer trade has the potential to increase everyone’s well-being.” If he were in an expansive mood, the professor might add that the effect of free trade on an economy’s growth rate is not clear, either, and depends on an altogether different set of requirements.
Dani Rodrik , "Economics: Science, Craft, or Snake Oil?"
Freedom for the wolves has often meant death to the sheep.
Isaiah Berlin, "Four Essays on Liberty" p.xlv.
As it happens, I was reading a book about my second-favourite period of UK history over the weekend. It’s amusing to note how many of the arguments of the kind “raising labour standards will close down the factories and send the poor into horrible scavenging”, are nearly word-for-word copies of similar arguments made in the 1830s against the child labour laws passed in England. They were wrong then …
Daniel Davies, "Globollocks, v2.0"
The key to understanding this, and to understanding Libertarianism itself, is to realize that their concept of individual freedom is the "whopper" of "right to have the State back up business". That's a wild definition of freedom.
Seth Finkelstein, "Libertarianism Makes You Stupid"
The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.
Joan Robinson, in Marx, Marshall And Keynes
The invisible hand of the market makes a very good pickpocket.
Mike Huben
[...] a huge part of the problem is the Jeffersonian notion that “the government that governs best is the one that governs least.” While that is true as regards individual liberty, it is absolutely dangerous to think that way as regards the economy.
Christian Parenti, "Reading Hamilton From the Left"
The basic competitive-markets model dating back to Adam Smith has been modified over time by the inclusion, in rough historical order, of monopoly, externalities, scale economies, incomplete and asymmetric information, irrational behavior, and many other real world features.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
Chile's neoliberal experiment eventually produced the worst economic crisis in all of Latin America.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
Neoliberalism and its customary remedies -- always more markets, always less government -- are in fact a perversion of mainstream economics. Good economists know that the correct answer to any question in economics is: it depends.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
The fatal flaw of neoliberalism is that it does not even get the economics right. It must be rejected on its own terms for the simple reason that it is bad economics.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
Critics often point out that this emphasis on economics debases and sacrifices other important values such as equality, social inclusion, democratic deliberation, and justice. Those political and social objectives obviously matter enormously, and in some contexts they matter the most. They cannot always, or even often, be achieved by means of technocratic economic policies; politics must play a central role.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
A journalist calls an economics professor for his view on whether free trade is a good idea. The professor responds enthusiastically in the affirmative. The journalist then goes undercover as a student in the professor's advanced graduate seminar on international trade. He poses the same question: Is free trade good? This time the professor is stymied. "What do you mean by 'good?'" he responds. "And good for whom?" The professor then launches into an extensive exegesis that will ultimately culminate in a heavily hedged statement: "So if the long list of conditions I have just described are satisfied, and assuming we can tax the beneficiaries to compensate the losers, freer trade has the potential to increase everyone's well being." If he is in an expansive mood, the professor might add that the effect of free trade on an economy's long-term growth rate is not clear either and would depend on an altogether different set of requirements.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
There is nothing wrong with markets, private entrepreneurship, or incentives -- when deployed appropriately. Their creative use lies behind the most significant economic achievements of our time. As we heap scorn on neoliberalism, we risk throwing out some of neoliberalism's useful ideas. The real trouble is that mainstream economics shades too easily into ideology, constraining the choices that we appear to have and providing cookie-cutter solutions.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
Lacking any really-existing libertarian countries to which they can point, the free-market right is reduced to ranking countries according to “economic freedom.”
Michael Lind, "The Failure of Libertarianism: Why Economic Freedom Alone Cannot Deliver a Better Future"
If socialism is discredited by the failure of communist regimes in the real world, why isn’t libertarianism discredited by the absence of any libertarian regimes in the real world? Communism was tried and failed. Libertarianism has never even been tried on the scale of a modern nation-state, even a small one, anywhere in the world.
Michael Lind, "The Failure of Libertarianism: Why Economic Freedom Alone Cannot Deliver a Better Future"
We should wonder about this impulse of economists like Friedman and Hayek to theorize and write about the meaning of freedom and liberty. Why should economists be taken as the moral authority on what freedom and liberty mean? Are they our new priests? Indeed, Friedman is tipping his hand to a secret about economics as a discipline: economic policies are not value-neutral science.
Howard I. Schwartz, "What Color Tie Do You Vote For?"
Now that we have dug beneath the rhetoric we know that Friedman is really saying that “You are against freedom if you disagree with my theory of government and markets.” Such a claim certainly sounds suspicious for someone who is supposedly defending a diversity of values in the market place. Surely freedom should involve precisely the question of debating what the boundaries between government and markets should be. And surely that very boundary between government and market should be subject to debate and discussion?
Howard I. Schwartz, "What Color Tie Do You Vote For?"
We would say in contrast to Friedman that “Underlying most arguments for a free market is a mistaken assumption that free markets and freedom are one and the same thing.” They are not. The degree of the market’s freedom is always a question within a free society. But there are many gradations of free markets and there can be multiple ways to draw the line between government and the market and all of them can comfortably sit under the rubric of a free society.
Howard I. Schwartz, "What Color Tie Do You Vote For?"