The Longer Term View of Free Trade: "War?"

What will Free Trade Bring Us?

A Discussion of Futures….

A penny for your thoughts!

Listening to all of the pundits espousing their agendas in the media, one begins to wonder “What does all this mean?” And the answers are not too clear for any number of reasons. Among them, very little value is placed on honesty and candor in today’s political world.

For this writer, among the most serious of the issues facing us is something we hear little about and that is intentional. Why discuss something that is going the way you want it to go? The trouble is that this is the short term view. It is highly likely from this perspective that the subject of Free Trade-- like the Taoist balance of yin and yang --contains the seeds of its contrapunctual opposite, which in this case is destruction.

The case for this argument are predicated on linkages that only seem to emerge after the decision to proceed with free trade are made. And they are subtle and mostly indisputable according to every argument I have heard..

For example, if we support free trade, then we are helping to build up the economies of third world nations. Let’s use as our defining example, China.

Until recently, China was considered a backwards nation with a very low GNP and prospects not exceedingly bright.

But China reinvented itself. Part of that was due to the improved economic climate for its goods. And that was connected to the concept of Free Trade advocated by this country. Then, 85% of China was agricultural, requiring a vast enterprise for it to feed itself. Today, China reflects a manufacturing culture with 121 cities of over a million population. Today, whole cities may be committed to manufacturing the world’s volume of socks, hats, gloves, etc. .

Why focus on China? Here’s why: It’s population of 1.3 billion people; and it’s growing and expanding economy which puts us into direct conflict for limited resources.

With a population of several hundred million people in a fledgling middle class and soaring expectations and the money to pay for what they want, China’s rising demands are being met on a global scale. For example, if the Chinese people want more fowl in their diet, the market will accommodate that demand.

But how? That’s the part that we seem to take for granted.

An increasing population of fowl require soybeans for feed.. China is incapable of growing the volume of soybeans on its existing land so it subcontracts with places like Brazil.

Brazil’s undeveloped land is the Rain Forest. As a result, Brazilian growers burn down the rain forest to accommodate agricultural purposes and more rain forest that produces most of the oxygen in the world is lost. Eventually, the land loses its ability to support agricultural products and it is lost forever. To compensate for this loss, the burning process goes on again.

If you think about it, you can begin to see a cause and effect relationship between increasing the population of fowl to feed China’s growing tastes, but also a downside that punishes the world so that the richer Chinese can indulge themselves. Clearly, there is a direct correlation between China’s growing economy and loss of rain forest. This puts China’s demand for growing resources into perspective. Now, if you multiply what’s happening to China to the rising middle class in places like Taiwan and India, you begin to see the dimensions of the world-wide problem that is linked to Free Trade and a growing world-wide economy.

China now competes with the US in the pursuit of oil. Now, they are writing agreements for the development of the kind of oil-rich shale that doesn’t interest America, however, as both we and China recognize that we need the same kind of resources, we can expect the competition to intensify.

But what is of perhaps greater concern, is that with the increasing use of resources and the growing demand, we will run out of resources and then what?

So what had started out as our preoccupation with free trade has morphed into growing into competition for fewer and fewer resources with the attendant global warming, reduced sunlight and the destruction of oxygen generating mechanisms that have stood us well up until now.

The irony is clear: Capitalism is all about now! It does not take into consideration the future. The idea of Free Trade seemed like a great way to enhance the wealth of the “have’s;” but before we jumped in with both feet, we did not subject the idea to discussion or analysis and now we are discovering the dark side of free trade. . What it has done is to create an environment where there are new “haves” who are competing for a limited amount of resources.

As of now, nobody seems to be doing anything about it. In fact, few have seemed to put this all together into a coherent argument much less a discussion that will allow us to deal
Intelligently with the problem.

Will free trade’s logical end be War?

At this point, viewing the limited abilities on both sides of the issue, that possibility does not seem out of the question. Yet, it is unlikely that this issue will even come up in the elections of 2008 unless there is some triggering reason such as oil at $5.00 a gallon!....
In the meantime, we hope beyond hope that a sophisticated leader who understands micro and macro economic considerations who is also an environmentalist and concerned about the future of the world will emerge to help us find a way to deviate from the current path and find a better way.

Les Aaron
The Hubmaster