Put your money where your dumbass-looking flag is, Free Traders.
This kind of thing happens to me a lot: I was getting all ready to write an entire post about immigration policy and free trade, when I found out that there’s already a whole school of thought about my position. So pretend I wrote this:
Free migration or open immigration is the position that people should be able to migrate to whatever country they choose, free of substantial barriers. Although the two are not the same issue, free immigration is similar in spirit to the concept of free trade, and both are advocated by free market economists on the grounds that economics is not a zero-sum game and that free markets are, in their opinion, the best way to create a fairer and balanced economic system, thereby increasing the overall economic benefits to all concerned parties. Many libertarians, socialists, and anarchists advocate open immigration, notwithstanding other noteworthy differences among these three political ideologies.
Arguments against free immigration are similar to arguments against free trade, for example, protectionism or what critics claim to be xenophobia. Specifically, an influx of cheap labor could easily deflate wages for workers who are already established in a particular labor market, and (at least in the short term) have a negative impact on the standard of living for the more established workers. Other critics of free immigration are concerned that it would be unfair to current homeowners if an influx of new residents greatly brought down the property values and attractiveness of living in that location, or, alternatively, increased the demand to live in the city so much that the home owner would not be able to keep up with increased taxes from higher property values. However, free market economists believe that competition is the essence of a healthy economic system, and that any short-term negative impact on individual economic actors that is caused by free immigration is more than justified by the prospects of long-term growth for the economy as a whole.
Any position which attracts both libertarians and socialists is either batshit crazy or onto something. I really don’t see how it’s possible to argue for Free Trade and against free migration - not without betraying one’s claim to being a free marketeer.
Adam Smith made the case that labor is a commodity:
But though equal quantities of labour are always of equal value to the labourer, yet to the person who employs him they appear sometimes to be of greater, and sometimes of smaller value. He purchases them sometimes with a greater, and sometimes with a smaller quantity of goods, and to him the price of labour seems to vary like that of all other things. It appears to him dear in the one case, and cheap in the oher. In reality, however, it is the goods which are cheap in the one
case, and dear in the other.In this popular sense, therefore, labour, like commodities, may be said to have a real and a nominal price. Its real price may be said to consist in the quantity of the necessaries and conveniencies of life which are given for it; its nominal price, in the quantity of money. The labourer is rich or poor, is well or ill rewarded, in proportion to the real, not to the nominal price of his labour.
The theory behind free trade is that the removal of tariffs and other barriers to trade, despite the damage to individual producers of goods, will result in a net gain for…well, shit, I’m not an Macroeconomics professor, so I’ll let Wikipedia tell it:
Imagine an orange farmer that produces 20 oranges a year. It costs him $5 to grow each orange and he sells each one for $10. His total profits are therefore $100. The world price for oranges is $4 per orange, but a $7 per orange tariff makes importing oranges uneconomical (the price for imported oranges is $11 because of the tariff).
Now imagine that the tariff is removed. First, the farmer is wiped out of business because the world price ($4) is below the farmer’s production costs ($5). His $100 profit is gone.
On the other hand, consumers are made more than $100 better off. Previously, consumers had purchased 20 oranges at $10 each, for a total of $200. After the tariff is removed, 20 oranges can be purchased for $80, but even this underestimates how much better off consumers are because consumers will buy more than 20 oranges now that oranges cost $4 instead of $10.
Now, the liberal and human in me is concerned about the farmer who is wiped out of business, but there’s another problem with this model. Consumers have to get their money from somewhere, and if local economies fall, then the only way free trade is a net gain for society is if one uses a borderless model. But we don’t have a borderless model.
By 2008, when NAFTA’s implementation is complete, nearly all barriers to trade between countries will have been eliminated. For the purposes of this discussion, which is intended to be a moral rather than an advanced economic one, let’s assume that they are nonexistent, since in most industries, they are. Except, of course, one industry: The labor market.
“We”, as in labor (one thing I should probably admit upfront is that I am, technically and at the moment, a professional, if not in spirit - but I’ve been labor most of my life), are an industry. We produce and sell labor. We sell it to consumers, for market price. Like any market, the consumers are looking to get the lowest price they can, which is determined by what people are willing to offer. And like any market, if we the sellers can’t find buyers who will buy labor for more than it costs us to produce, we are in serious trouble.
Also like any market, what labor costs us to produce varies by the costs in our local economy, for housing, food, medical care, consumables, etc. Thus, if my labor costs me $7.50 an hour, and minimum wage is $6.50 an hour, I will go out of business quite quickly; moreover, if a labor-producer in Mexico can afford to sell the same amount of labor for $1.50 an hour, under NAFTA and a free market model, there’s no reason that the employer-consumer shouldn’t buy at the lower price. Thus, Ross Perot’s giant sucking sound.
But there’s a solution. It may not be an ideal solution, but if one assumes that Free Trade isn’t going anywhere, it’s the only solution that makes sense.
Most anti-immigration voices (the ones who aren’t just flat-out racists) talk about the problems of incoming worker saturation, of low-cost labor producers underbidding local labor. And it certainly does seem as though more competition is generally bad for sellers and good for buyers. But given that Free Trade already relies on a rebound or a paradoxical effect - “sure, Mr. Farmer, your farm will fail, but the rising tide will eventually come back around to lift your boat again” - I’m not sure I see what’s wrong with embracing the paradoxical effect of free migration.
Here’s how I see it:
If we throw the US-Mexico borders wide, allowing every (non-felon) laborer to cross borders and sell their labor in the most advantageous market, the initial travel will generally be from Mexico to the US. The US labor market will swell with suppliers, driving down demand, which will drive down the price of labor (towards the minimum wage in the case of skilled labor, and relative to the cost of living in the case of industries already paying minimum wage). Meanwhile, consumers of the Mexican labor market, including some outsourced US companies, will find their labor pool start to dry up, requiring that they either pay higher labor prices (which would include working conditions) to lure labor back to Mexico, or return to the US labor market (which would in turn drive up demand, raising prices.)
Eventually, it seems to me, an equilibrium would be struck, allowing those for whom labor is their only capital to participate in the glorious Free Trade world market. Anything less than that gives lie to the philosophies Free Traders claim to adhere to. Either we’re protectionist, or we aren’t.
There are limitations to the model. For one thing, I’m not arguing that we should go so borderless as to stop enforcing labor laws; an inequality in labor laws will only drive down supply in the less-labor-friendly countries faster, leading to a faster equilibrium. Labor laws are no more anti-trade than the actions of the RIAA or MPAA.
And there would be problems at first, of course, as labor markets empty and flood, respectively. But for the life of me I can’t figure how those problems are necessarily worse than the problems facing those in the poorer countries under current Free Trade agreements; most objections to free migration rely on an American exceptionalism - things’ll get worse for Americans! - an exceptionalism which is not present in the more traditional markets. Free Trade, we’re told, is the best way to avoid treating ourselves like kings of the world; who are we to deny our poorer cousins the right to send us their shit? Who are we to deny them our jobs?
And, in fact, this would be a persuasive argument, if I thought for one minute that your average Free Trader really believed it. Instead, they’re treating labor like a commodity from their end, but not from “our” end. Corporations are, indeed, trying to get the lowest price for their labor; but they’re doing it with the most restrictive “tariffs” possible. And governments are treating those who “import” their labor illegally the same way as smugglers - in New Bedford and in Worthington before it.
If the corporations want to treat labor as a commodity, and they clearly do, then they can’t have it both ways. Trade barriers are either a useful tool, or they aren’t.
53 Responses to “Throw the Borders Wide, Or, How I Learned to Stop Worrying and Love Free Trade”
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What does this school of thought on immigratation do with the inconvenient observation that throughout history the usual response to large numbers of people just picking up to go where the grass was greener was for a war of some kind to break out? All the arguments sound worthy of closer reading but where is the history that says human nature will accomodate this academically supportable wonder?
Another aspect that would be put into play would be the value of the money being issued itself. Right now China’s Yuan is undervalued by something like %30, IIRC, which is what is making their labor markets that much more affordable to employers. Most countries wouldn’t be willing to eat that kind of a cost, so their labor costs would eventually rise due to the shifting tides of inflation and deflation.
So when will the world’s affluent realize that they can exploit the rest of us more efficiently by banding together and fighting against us? Embrace free trade, open borders, unimpeded flow of money, etc.
The Bushites, the Exxonites, the Halliburtoners, etc. want to see the world of 1984 exist for real, so why not embrace the classism and officially divide the world into the Party Members (that would be the Party of Money, not Ingsoc) and the Proles.
So, within the space of 150-years or so, we’re right back where Karl Marx was describing conditions in Victorian England and Europe. I wonder if the story will end differently this time…?
Seems like two out of three of those already exist.
By the way, in this model, anti-union activity would be correctly treated as industrial sabotage.
“By the way, in this model, anti-union activity would be correctly treated as industrial sabotage.”
As well it should be. Can’t have those proles stirring up trouble…
I’m betting that we can fully recreate the living conditions of Dickens’ England within a couple of generations if we all pull together and try real hard. (Parts of the US are almost there right now…)
As well it should be. Can’t have those proles stirring up trouble…
We may be arguing past each other, or not even arguing at all, but how is anti-union activity proles stirring up trouble?
Sorry, I looked past the “anti”.
The world I’m seeing has no power but the power of Money, which would never allow labor to compete with it for unimpeded mastery of everything - stuff and people…
After seeing how Enron and the other “energy” companies raped California, seeing the top 1% of Americans increase their ownership of country to 50% (or whatever it is), after seeing how so many companies ripped us off in Iraq with no accountability, after seeing Halliburton move its headquarters to Dubai, seeing New Orleans unwilling participate in the ultimate “urban renewal” project, Microsoft become an even bigger monopoly, etc., etc., etc., the whole thing seems so much clearer to me now.
I guess the last few years have successfully stomped out the last shreds of hope I had left…
Well, let me tip my hand even a bit more, then, so that there’s no confusion:
I’m not saying that the model I’m proposing would possibly work. In fact, there’s a good chance it wouldn’t.
I’m simply saying that WITHOUT the model I’m proposing, Free Trade is an illegitimate, imperialist, corporatist, racist policy.
You may draw your own conclusions from the above statements.
Actually, my reductionism above is incomplete. The free migration idea also proposes an on-paper solution to the tragedy in New Bedford - because tragedy it is - and so I’m not suggesting that its only utility is in theory.
I just don’t want anyone to read my post as calling Free Trade “hunky-dory if only we could take care of this pesky labor problem”; it’s a problem in search of a solution and whether that solution lies in repeal or reform is open for debate.
“I’m simply saying that WITHOUT the model I’m proposing, Free Trade is an illegitimate, imperialist, corporatist, racist policy.”
Agreed, I just can’t imagine how even with open borders the proles won’t still get screwed…
I used to imagine that there were limits to the depths of moral depravity (and I should make clear here that I’m not talking about sex, but greed, hatred, and bigotry) that would cause virtually everyone except the most sociopathic criminals from completely going over to the dark side.
I just don’t believe that anymore. We live among people (what percentage is unclear) who have no limits. Who worship money, and attainment of things, and exercise of power and dominion. Who approach their lives as if they were playing a giant game, conveniently ignoring the very real lives of the people they use as chess pieces on the board…
“But always — do not forget this, Winston — always there will be the intoxication of power, constantly increasing and constantly growing subtler. Always, at every moment, there will be the thrill of victory, the sensation of trampling on an enemy who is helpless. If you want a picture of the future, imagine a boot stamping on a human face — for ever.’” - 1984
Inside that boot will be Dick Cheney’s foot…
Even with free movement in people, “free” trade is a crock as long as countries get to game the international legal system to arbitrarily increase the price of things they produce (pharmaceuticals, movies, commonly-used currencies) and decrease the price of things produced by others (raw materials, farm products, hazardous labor). So the whole racism/xenophobia/soft-colonialism thing just makes it more of a crock.
Much free trade rhetoric for the past many years was based on the supposition that America would supply the white collar workers, Mexico the blue collar workers. The consumers in America get money from providing the white collar services to the firms that employ the blue collar Mexicans. This may be ethically objectionable, but it isn’t incoherent.
(forgot to mention that the above is precisely why the first world countries have been so gung-ho about interpolating free trade in services within trade agreements, which have historically been solely about goods. The third world countries accept the first world:third world::white collar:blue collar model, presumably, as they fight just as fiercely against addition of services to FTAs. )
Free trade is not just about having your shoes made in China and sold to you for $30. It makes people like me have to compete with guys in Bangalore with master’s degrees willing to work for $15,000 a year because their rent is $100 a month and food costs pennies.
Free trade is not just about having your shoes made in China and sold to you for $30. It makes people like me have to compete with guys in Bangalore with master’s degrees willing to work for $15,000 a year because their rent is $100 a month and food costs pennies.
Correct. Hence, this post.
I ran across the reportage on the effects on subsitance farmers in Mexico who lived on tortillas from the corn they grow and used to make spending money for the rest of their needs by selling any extra production have been driven to abandon even that meager living by the prices at which an uninhibited ADM can unload the mechanized American grain production. They had little, now they have nothing.
So Auguste, I am entirely prepared to belive “…WITHOUT the model I’m proposing, Free Trade is an illegitimate, imperialist, corporatist, racist policy.” For those farmers, even a solution that ,to armchair fair-traders like myself, is unworkable will still be worth walking north to try without the blessing of legislation.
I agree — I’m in favor of minimally regulated trade and minimally regulated immigration, with both sets of regulations having exclusively to do with the externalities associated with either.
If capital can cross the border, so should the labor.
I’m happy to see I’m not alone with this “crazy” idea.
Auguste, I keep seeing flashbacks from The Grapes of Wrath…
What if the “Joads” (from wherever) get “there” and find no jobs available? Moving is expensive, and might not even be possible for many people here in the US, let alone in another country or on another continent…
I don’t see how any of this ends any other way than massive starvation, death, slavery, etc….
Anyone who supports “free immigration” into the U.S. is either an idiot or on the other side (in war terms).
Let’s say we let 10 million more Mexican citizens into the U.S. Let’s say they want something we aren’t prepared to give them, such as voting rights. Are they just going to accept their fate, or are they going to take actions to get what they want, such as by marching in our streets or even rioting or waging war?
Every single last shred of history says the latter. Corrupt idiots, potential enemies or potential traitors say the former.
Let’s say we let 10 million more Mexican citizens into the U.S. Let’s say they want something we aren’t prepared to give them, such as voting rights.
Oh, noes! People who live in a country, contribute their labor to its economy, and pay taxes might actually want the right to vote there! Pass the smelling salts, I feel weak at the thought.
Do people who say stuff like this realize how silly they sound?
Um, the first paragrah in that comment should be a quote. I fail at HTML, I guess.
Wait, why aren’t we prepared to give them voting rights?
The theoretical argument that free trade is a net gain for society does not require free movement of labor (or capital, for that matter). The argument is that if you have two societies, and remove trade barriers, then both societies are collectively better off.
Let’s give a big hand to our friend the lone wacko, for arguing that poor immigrants can fight the United States government — oh wait, I forgot we don’t have a National Guard anymore. I keep thinking of us as the most powerful nation the world has ever seen. That may be behind the times, thanks to President Ward Churchill Bush.
As to the post, “intellectual property” laws will still limit free trade in 2008. This is why Dean Baker at the Prospect keeps saying we should call them “trade” agreements and drop the extra word.
Let’s say they want something we aren’t prepared to give them, such as voting rights.
Let’s say they want to make soccer the national sport of the US. Or make Spanish the national language. Since we’re in pull-it-out-the-ass territory courtesy of Chris ‘El Wacko’ Kelly, blogwhore extraordinaire, go hog wild.
Btw, ‘Kelly’? Isn’t that an Irish name? Was El Wacko’s great-great-grandpappy one of those accursed Micks who upset the nativists in the mid-1800s?
Every single last shred of history says the latter.
You mean Great-Grandpappy Wacko was involved in this?
TLB, that is the most pathetic attempt at an argument that I’ve ever seen. Seriously. If you don’t have anything to contribute, then shut the fuck up.
The problem with this plan is that it requires American workers to take a huge hit in terms of wages and living standards up front, as Mexican workers flood the labor pool in the U.S. Then, over time, wages and living standards would stabilize over time as American companies either returned to the States or raised wages in Mexico to retain workers.
The thing is, most blue collar Americans, when told by a white-collar professional like Auguste or Tom Friedman, that if only they’ll accept a drop to Third-World living conditions for a few years, eventually it’ll all work out, tend to say fuck that. This is why the real push for open immigration, like the push for free trade, will always come from our corporate elite, since America’s working class knows that however great open borders might work in theory, in practice it’ll just screw them over without benefiting poor Mexicans one damn bit.
I’m a fan of his, but I would like to pimp the good works of dean baker, again.
There is no free trade in the sale of pharmaceuticals, otherwise they would be dirt cheap like they are in Mexico and Canada. An I could get a version of Windows XP for the cost of a burned CD, except they get the govt to enforce their monopolies, and they call them intellectual property.
http://www.prospect.org/deanbaker/2007/03/more_drug_money_to_doctors.html#015967
http://www.prospect.org/deanbaker/2007/03/bill_gates_21st_century_neande.html#015754
Auguste said:
So I can think free migration is idiotic as long as I think Free Trade is imperialist and so forth? Okay. I do think free trade is horrible. And I think your open migration idea is horrible. I already did think free trade was a terrible idea, so it’s not like I have to stretch my mind here. I guess I’m not your target audience, Auguste: you’re (I think) trying to persuade people who’ve only heard FT gospel on the corporate media that FT is in fact a terrible idea and free migration, also a terrible idea, is the only logical consequence of FT. While I admire your moxie in tilting after one of the biggest windmills in contemporary discourse, I have to raise the idea of whether you might be turning more people off by advocating free migration well before you get to the implied punchline that FT is therefore a terrible idea. Forgive me for making assumptions, but I think most of your target audience isn’t going to read your argument with that level of sophistication.
Here’s one reason why we might not want to give 30 million Mexicans voting rights in the U.S.:
academia.org/campus_reports/2002/april_2002_2.html
In case you think he’s just a wacky academic, L.A.’s mayor is a former leader of a group with a similar ideology, as is a U.S. Rep, RaulGrijalva, and as are many other Democratic leaders.
There’s also the fact that the MexicanGovernment has a tremendous amount of PoliticalPower inside the U.S. already, and inviting more of their citizens here would give them even more.
I’m afraid that those who replied are suffering from what might be called “managed tour syndrome”. If you take a trip, your tour guide will always be there to bail you out. Those replying think the U.S. has some magical tour guide that will keep it from harm.
The similar inability to think things through is evidenced by the comment about the National Guard. There are ten or more times as many illegal aliens in the U.S. as we have military forces of any kind. And, many of those illegal aliens are clustered in urban centers. If only a small part of them became insurgents of some kind, it would be very difficult to deal with, costing a great deal of lives and money.
Similar things have happened all throughout history in various countries, but feel free to think that the current times are an exception to the past thousands of years of history.
I have long advocated for open borders. The equilibrium of supply and demand of immigrant labor will take care of itself and benefit everyone in the long run.
Wow, shit. I didn’t mean to get lumped in with Tom Friedman. Clearly a self-inventory is in order.
I’m not asking blue-collar Americans to accept a drop to Third-World living conditions; I’m saying that under the current Free Trade system, that may be the way we’re headed without any recourse. As for corporate elite - boy, that’s a lot of extrapolation from my calling myself a “professional.” My income is far less than that of a typical journeyman - if that journeyman still has a job and it hasn’t been sent abroad.
I’m not really sure where I was advocating free trade, necessarily; I frankly think it fucking sucks, especially as currently implemented. But 13 years (just since NAFTA; of course there was anti-free trade argument before) of anti-free trade action and rhetoric has led us to…DR-CAFTA and more. Hence my disclaimer of “But there’s a solution. It may not be an ideal solution, but if one assumes that Free Trade isn’t going anywhere, it’s the only solution that makes sense.”
If the title is being used as an indicator that I am a Friedman wannabe, I would just ask you to consider how much Stanley Kubrick really loved the bomb.
It isn’t perfectly comparable to NAFTA, but for the last 15 years or so a large chunk of Europe has had free movement of labor. At the beginning of this period the wealth gap between Ireland, Greece, and Portugal (on one end) and Germany, the Netherlands, and France (on the other), was rather large. It has narrowed significantly, and though there have been bumps in the road it seems to have worked pretty well. Coincidentally (?), Ireland went from being a traditional exporter of labor to being an importer during this period.
Auguste,
Ok, the Friedman crack was a little harsh, I just get pissed that it is always the American working class that is expected to be the first to sacrifice in order to remedy some injustice being perpetrated against the Third-World. Friedman and Zakaria and other free-trade cheerleaders are always compaining about how wrong it is for some $40,000 a year American to be angry over losing his job, and you come along and say that the way to make this right is for those Americans who still have jobs to put up with a flooding of the labor market and a subsequent collapse in the price of labor. It’s always the workers and never the billionaires who have to sacrifice to make things right with the Third World.
And we should do all this because, “if one assumes that free trade isn’t going anywhere, it’s the only solution that makes sense.” The problem is that free trade makes no sense. It is an insane policy that has done nothing but provide politcal cover for the systematic corporate looting of every country foolish enough to adopt it. Adding another insane policy on top of it, a policy that will result in multinational corporations moving tens of millions of desperate people all over the globe for the sake of driving down labor costs wherever and whenever they start to rise, is just further insanity.
Hey, Wacko Kelly?
Instead of blogwhoring, tell us if your immigrant ancestors were the dirty Mexicans of the late 1800s. Or is that too touchy a subject for you, if you know you’re a scion of ‘Dirty Micks’, a descendent of the victims of ‘No Irish Need Apply’, a ladder-puller par excellence?
’sfunny how the descendents of people treated as immigrant scum turn into the kneejerk nativists of a new generation. No wonder you’re a Malkinite.
On the substantive point: the Bush Gang wants a Mexican government of corporate-ocrats that deal with the country’s poor by having them cross the border. The alternative would be a left-winger who — oh noes! — hangs out with Hugo Chavez from time to time.
Dean Baker is absolutely on point, though: among the professional classes, there’s barely free movement of labor from state to state, thanks to board certification requirements. If you’re certified in New York, don’t think about working in Connecticut or New Jersey, let alone Massachusetts. Makes the union closed shop look piffling in comparison. Let’s open the borders for CEOs.
The problem is that free trade makes no sense.
It makes perfect sense, if by ’sense’ you mean ‘it coheres logically’. Unfortunately, it coheres to the premises that date back to Ricardo: that is, the poor end up on subsistence wages. Except that even Ricardo didn’t appreciate how that would mean the poor actually end up indebted up to their inner organs.
The problem is that free trade makes no sense.
Ding ding ding.
Look, the way to make things right is to give labor power at least equal to that of any other seller of a commodity. No corporatist will ever admit that, and the arguments “we’ve” used so far don’t seem to be making an impact. It’s probably quixotic to hope that taking their arguments to their logical extremes will cause any of them to wake up.
If only a small part of them became insurgents of some kind, it would be very difficult to deal with, costing a great deal of lives and money.
And what if they had access to nukes?!?!
Oh noes indeed!
Perhaps it could only be a fourth-generation sprig of the receiving end of “All right, we’ll give some land to the niggers and the chinks, but we don’t want the Irish!” (after Blazing Saddles) who could come up with such a preposterous heap of shite.
Isn’t that ultimately a futile task, though? See, the US missed out to some extent on the thinking of the early 1800s re: the commodification of labor — being a society that, unlike most in Europe, hadn’t addressed (and frankly couldn’t address) slavery. The ‘problem of labor’ as a distinct commodity in an industrial age, even as it was commodified by industrialization, was what motivated socialists and ultimately Marx and Engels.
The irony being that in the US at least, the immigration issue essentially focuses on those bits of labor that aren’t mechanised. Though perhaps it’s not an irony at all.
I’m actually 100% for a GENUINE free trade. I’m not a big fan of capitalism, but honestly, I doubt a genuine capitalism would last very long. Without governments propping up the structure of economic imperialism, I think we’d see a grass-roots mutual aid network develop really fast, and that’s what a truly free economy is made of.
I’m for Open Borders, but I’m not in the US, so it’s really more so that Sudanese Refugees have someplace to go than so Mexican labourers can find work. I think there needs to be a revolution in Mexico, not an exodus from it. (Fortunately, there’s one underway.) That said, It’s not my place or your place or the US government’s place to say who can and can’t cross an imaginary line, as far as I’m concerned. If you’re concerned about having a drop from the living standards you grew up accustomed to, well, suck it up. It’s going to happen sooner or later. The world can’t sustain the lifestyle of the average middle-class American for that much longer.
As for the WTO and NAFTA and all that crap - well, there’s a reason every time they try to have a meeting there’s a riot, isn’t there?
[…] Open Borders And Free Trade: It’s quite a debate and you can find some provocative thoughts on it HERE. […]
Sorry to come late, but I twice debated a libertarian philosopher on immigration and he’s closer to Tancredo than you. Any proposal that causes serious debates among libertarians is worth looking seriously at (I’m not one; but he got harsh criticism from ther libertarian bloggers)….
You have provided a clever way of indirectly explaining why I hate most economists, right and left - they all mouth theories which only work in idealized contsructs, where issues like racism, greed, corruption and sociopathic self-interest don’t exist, and where the real effects on humans caught “adjustments” are discounted.
The true “science” of economics is using numbers to pretend the flow of money is largely natural autonomous force, that the behavior of actual humans making conscious decisions according to their own idiosyncratic ideas of what is moral are merely side effects of “the economy.” Thus does the knowing actions to treat large groups of people like shit - be it for utopian or crass motives - are excused as just the human manifestation of the elemental force of money only a fool would ignore.
Thus whoever is getting screwed by the current theory just needs to be patience and wait out the discomfort of the period of adjustment. Sure it may wreck much of their lives or several generations, but the theory will benefit all if given time.
Economists will sneer at those suffering for being so foolish or selfish to plan their lives on a desire for financial stability, for not saving up for the possibility of an massive income drop for an indefinite period of time.
For both right and left, it doesn’t matter people are desperate to come north due to the massive income gap at home, held in place not because the money isn’t there, but because the wealthy can ruthlessly crush any attempt at redress. No this is just the state of things and it’s the fault of those on the receiving end for wanting exceptions to the circumstances created by those at the top.
This economic shell game is not just played on the right. Lefty economists (not the radical ones, but the Thomas Friedman ones) present utopian theories proclaim that if only those at risk stop selfishly worrying about themselves the elemental force of money will naturally create a more just system for all, which the wealthy will allow because it is inevitable.
Nor is there a need for theorists to address the concerns of the opposition to any economic model, or seek a safe and gradual transition between economic states. There’s no need, for example, to demand Mexico and America have the same minimum wage. That is too hard - just open the borders or close them completely and assume things can sort themselves out with out dealing with the issues on either side.
I’m a little late here, and I’m a lurker anyway, but it’s worth recalling both that the [unspoken] purpose of free trade is to free money while constraining people AND that people and money are not interchangeable.
“Free trade” depends on personal immobility–that’s what makes it cheaper. That’s why conservatives and the wealthy like it; it makes them wealthier. Restrictions on immigration are exactly what define, what create “free trade”.
It’s a mistake, I think, to debate this as if most politicians and CEOs and hereditary rich people are sitting around thinking “Wow, neoliberalism is persuasive…maybe we ought to think more about the very nature of capital and not keep it penned up at home.” They’re looking for practical strategies which will enrich them in the long term, not coming up with ideologies. Free trade “ideology” is what organizes these practices in people’s minds and in public debate.
But people aren’t the same as capital. Capital moves easily, capital translates well. Moving yourself and your family and your stuff to a new place is difficult and exhausting, even when the job at the other end is a good one. (And I’ve moved to another country for a good job.) Moving has material costs attached, plus you leave your community and often your native language. I couldn’t bear the thought of moving to, say, Belize, just in order to work as a secretary for the same money that I make now. I’d do it if I needed to do so to survive, but it would be horrible.
And it’s those same forced economic migrations that people make every day–across the desert, in a cargo hold, in the back of a van, huddled in a cheap plane seat. Those aren’t fun. They aren’t freedom. And they certainly aren’t an ideal model for a “borderless” future.
I would support open borders because open borders would probably break the system in the end, but I don’t think that open borders are the best solution to free trade. Much more open borders coupled with a really strong international commitment to labor and environmental standards, an end to stupid military adventurism…things like that would make it so that fewer people needed to move, and then it would be no problem to let the ones who did move wherever they liked.
We really need to be wary of one-stop solutions to matters of free trade, in my opinion.
Yeah, this is an issue I have given some thought to recently… Some additional thoughts:
1. The present system where we have free movement of goods, services and capital, but NOT labour, serves to further entrench inequalities, as profits are no longer spent where they are generated.
2. The present system also provides a powerful economic incentive to maximise inequality, as the level of inequality between the people who produce your goods and the people who buy them has a strong influence on your marginal profit.
3. By allowing free movement of labour, the long-term trend should be to reduce inequalites, as argued in the post.
4. The free movement of labour would also provide a strong incentive to minimise inequality, as a way of reducing the incentive for everyone in the world to move to (eg) Monaco.
But the thing is, capital will always have an edge over people when we’re talking about mobility, by its very nature. There will always be a lot of people who will keep a crappy job in their home region rather than take a marginally-better one far away.
Capital is better at being capital than people are–it’s faster, it doesn’t need food or water, it doesn’t get depressed when people die, it doesn’t need to look out the window or take a walk now and again and it lives forever. When we talk about unrestricted flows of capital and people, we’re talking as if people should try to be more like money.
It’s rhetorically exciting to talk about “unrestricted flows” and exciting international stuff and movement and change–a lot more fun than talking about policy details and regulation and planning. But really, everything gets regulated somehow–it gets regulated by physical limitations in the last instance, or by the good old invisible hand, or by backroom dealing. Better to have the regulation up front where you can see it and change it.
In fact, we talk carelessly about “free trade”–it’s really more like the “free market”, where it’s not really “free” but supported by a complex infrastructure biased toward the wealthy. We talk about “free” trade like it’s some kind of pre-modern thing, like you just load up your microchips on donkey-back and head over the mountains to the next village, but “free” trade is tied up in a network of transit, environmental, safety and economic regulations. It’s not the absence of regulation.
I’m not against more-or-less open borders–it’s really only fair to individuals to let them move if they want to when corporations can do just that. But open borders will not end the bias of law and economic policy toward the wealthy and powerful.
While we’re on this, the argument that free trade benefits countries on both sides of the exchange has always been an aggregate argument — economists acknowledge that there will be winners and losers from each act of opening borders, whether to capital, specific goods or people.
The argument in favor then continues with economists pointing out that the winners in the deal could compensate the losers for their losses and still have money left over, so that everyone would truly be better off.
Then, after the free trade agreement is in place, you’ll be surprised and shocked to hear, the winners laugh heartily at the idea that they might consider compensating the losers in reality rather than just theory. And the economists who based their arguments in favor of free trade on the ostensible expectations of compensation are nowhere to be found. It’s like the mathematician in the burning hotel, who sees the fire hose and extinguisher, mutters, “a solution exists,” and goes back to sleep.
but if we throw the borders open, then we might have to treat mexicans like humans. that won’t work. we need to be able to threaten them with deportion, keeps them in line. keeps them criminal in the minds of the public if we can keep calling them ALIENZ and ILLEGAL. keeps them working in the shadows, a slave class afraid of making waves or forming unions. why are you trying to ruin everything?
and TLB, you oughta be president. you remind me of the substance and depth that our man W flaunts. different in your thinking, but the same big heart and mind.
In terms of the interests of big business, free trade and free labor are an either/or situation.
If there is free trade, they don’t want free movement of labor, because they want to keep the concentration of labor high in the countries they are outsourcing to, in order to keep wages down there.
On the other hand, if there are tariffs that make importing goods more expensive, then free movement of labor drives down the cost of labor in the domestic labor pool.
From labor’s perspective, you want either both free trade and free labor movement, or neither.
Of course, it is pretty clear who is deciding both tariff and immigration policy these days…
Auguste, you have conspicuously failed to show that free trade makes no sense.
I’m going to stick up for the argument for free trade, since no one else will.
Free trade is not the free movement of capital. Free trade is not multinational corporations. Free trade is just trade between countries without tariffs or quotas.
This is the argument for free trade. Let’s say there is no trade between two countries. Each country makes what it needs. Now suppose the countries sign a free trade agreement. If they have nothing to trade, then nothing changes. But each country has something the other wants, then when they trade, both countries are better off. So voila, everyone’s happy!
Now I don’t think that the empirical evidence particularly indicates that whether trade is free is that important, but the existence of trade is paramount. If you are a poor country, the most reliable way to stop being a poor country is through trade. That’s how Japan did it. That’s how South Korea did it. That’s how China and India are doing it right now.
Walt, I don’t think that’s a sufficient explanation of free trade. Consider the years and years and years of hammering out trade agreements–all those meetings are about how to handle companies that have different standards about nutrition, safety, manufacturing, labor, drug legality, etc. In order to have “free trade” as we know it, either those things are “harmonized” or there’s a decision about whose laws trump whose. What if someone’s packaging chemical products in a country with low standards about contamination and safety but those chemicals are being shipped to a country with higher standards? Obviously, the distributor in High Standards Land doesn’t care, but maybe the people of High Standards Land do…what do they do when all the manufacturers of a product move to Low Standards Land? What happens when High Standards Land moves its polluting industries to Desperate Impoverished Land and Desperate Impoverished Land creates pollution which drifts back to High Standards Land? What happens when Desperate Impoverished Land creates a “free trade zone” which is basically a zone of lawlessness where corporations can violently attack union busters or fire people when they get sick, or where it’s just assumed that if a young woman wants a job she’d better expect to have sex with her employer? Those aren’t just matters of “no tariff”.
I don’t think the argument for free trade is the final word on the subject, for many of the reasons you list. But if someone is claiming to have refuted the argument for free trade, I’d like to see them, you know, actually refute the argument.