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Friday, April 15, 2016

Mailvox: "one of the most substantive debates I've heard"

MC rather enjoyed the free trade debate:
This was fantastic.  Clearly one of the most substantive debates I've heard.  Both of you made your points well and it really gave the audience the ability to truly focus on the subject matter and the pertinent points of each argument.  I was impressed with Dr. Miller as he did not seem like your typical Academic, but really a guy that is interested in honest discussion (although naive).  Would love to hear more of these.

I am of the opinion that Free trade works well in theory, in a perfect world with honest players, but such a world does not exist this side of heaven.  I believe due to the fallen nature of man, protecting the nation-state is much more important than the benefits of open free trade, because of the eventual destruction of the culture and national identity.  I think the founders understood this much better than us, which is why they advocated tariffs and an American First mindset.

Great debate, I was very impressed, this is really good stuff.  More Please!
I'm glad everyone enjoyed it so much. I intend to keep doing this sort of thing and more at Brainstorm, and the more people that support Brainstorm by joining or simply showing up for the free events, the more high-quality guests like Dr. Miller and Dr. Hallpike will be interested in participating.

Speaking of the debate, some of you will recall that I felt the purely logical aspect of my critique of free trade could be improved and further refined. In that regard, a syllogism occurred to me that I believe  succeeds in succinctly and conclusively refuting Dr. Miller's corruption argument for free trade.
  1. Dr. Mill argues that free trade is beneficial because it reduces corruption by removing power from the hands of elected politicians and transferring it to the board members and executives of multinational corporations, who are presumed to be less corruptible than politicians by virtue of being answerable to the Invisible Hand of the free market.
  2. But it is the board members and executives of multinational corporations who are the primary actors responsible for corrupting the politicians.
  3. And the causal factor of the process of corruption is, obviously, more intrinsically corrupt than the various parties being corrupted by it.
  4. Therefore, Dr. Miller is incorrect, the hypothetical ability of the Invisible Hand to rein in the corruption of the corporate interests is insufficient, and free trade will tend to increase corruption by transferring power from state politicians to multinational corporate interests.
  5. Therefore, free trade is not beneficial.

Labels: ,

167 Comments:

Anonymous Luke01 April 15, 2016 4:53 AM  

An enjoyable gentlemen's debate.

Regarding (3), why must the causal actor be more corrupt than the receiver? Could it not just be an additive process, regardless of which actor is inherently more corrupt? Otherwise would this not suggest a maximum level of total corruption?

Anonymous That Would Be Telling April 15, 2016 5:28 AM  

Regarding 2: "But it is the board members and executives of multinational corporations who are the primary actors responsible for corrupting the politicians."

I have to question if that's true when we're talking about "unlimited" governments. Compare their power to the multitudes of lobbies/special interests like the AARP, public sector unions, etc.

Along those lines, our old experiences with "the moneyed interests" like J.P. Morgan, or industrialists like Andrew Carnegie don't hold, different times, a qualitatively different ruling class.

On the other hand, the Crédit Mobilier of America scandal sounds awfully familiar ... but you might say it was "the only game in town", at least of that scope, back then.

I am glad to see a focus on this, for it is to me a key issue in the free trade, from an insight I read in the paleocon journal Chronicles: "limited government" or not, the stakes are sufficiently high it seems impossible to avoid corruption, and as I've noted before, one of the major causes of the US Civil War, and as I recall some previous conflicts of the sort, was "economic warfare" between regions. That exact thing is less likely nowadays with the way most of our economic activity is or can be dispersed, but...

Blogger Derek Kite April 15, 2016 5:28 AM  

1 Corruption is common and a human failing, as are many human flaws. There are systems that keep a lid on the failings, others accentuate than.

If the easiest way to succeed is to buy a politician than that is what will characterize the economy. If you want to enter that market you have to play that game. It will corrupt people who otherwise wouldn't be corrupt.

Blogger VD April 15, 2016 5:33 AM  

Regarding (3), why must the causal actor be more corrupt than the receiver

Because if the receiver would not have been corrupt without the causal actor, whereas the causal actor is intrinsically corrupt, the receiver is, by definition, less corrupt.

Blogger clk April 15, 2016 5:38 AM  

So when does the conversation on free trade evolve into one of free markets and deregulation... and where does those intellecullty lead... back to a large governemnt, central controlled economies... it seems danger exists at both ends but perhaps not to the same extent. Human nature as it is, flawed, self centered, perhaps inherently sinful, will always be an unstable base to build any sustained civilization one.... has scifi plot written all over it...

Blogger Derek Kite April 15, 2016 5:39 AM  

Point one has been the attraction to free trade for me, not so much corruption but the competitive pressure will force moribund economies to sharpen up.

But that doesn't end up being the determinant factor. If due to currency differentials you are being undersold at prices that are below your costs, then it isn't competitive pressure to improve, it is simply going out of business.

But to fix that requires some supranational body determining relative values, which ends up in reality being subject to some extraordinarily powerful unaccountable thieves. Or where central banks have economic power from their ability to devalue the currency.

Blogger James Dixon April 15, 2016 5:57 AM  

I don't think point 2 is true, Vox. It seems more likely to me that the actions of multinational corporations merely reveal the corruption that is already in place.

Blogger Shimshon April 15, 2016 5:57 AM  

This explains the dogmatic free trade position pretty. The existence of civilization, particularly Western Civilization, has become axiom, with no justification for it.

Blogger Rantor April 15, 2016 6:19 AM  

@Derek, no supranational body needed. Each nation should decide who to trade with, what to trade, and what the tariff should be. Then link your tariff to the exchange rate at the time of the agreement. If they devalue their currency, the tariff should automatically adjust upward.

You can grant a peer free trading privileges so long as currencies trade within a narrow band.

Blogger Markku April 15, 2016 6:54 AM  

Always remember, folks, that "anti-free-trade" does not mean "I want to give this particular government that we now have, unlimited freedom to impose tariffs and taxes, and any other barriers, to foreign countries."

It just means "some other position than never, under any circumstances, imposing or threatening to impose tariffs".

Anonymous VFM #6306 April 15, 2016 7:06 AM  

That is the same thing, James Dixon. It is not the state of corruption but the act of corruption that is caused by the corp.

In other words, a corrupt politician with no bribe to take is no different in a trade situation than an honest politician. The hair you split is irrelevant to the syllogism.

Blogger VD April 15, 2016 7:12 AM  

I don't think point 2 is true, Vox. It seems more likely to me that the actions of multinational corporations merely reveal the corruption that is already in place.

That makes absolutely no sense. Corruption is not some sort of magic aether that exists devoid of human action. Either the politician or the multinational executive is corrupt, or both of them are corrupt.

Now, ask yourself this: who corrupts whom? Does the Goldman Sachs executive corrupt the congressman or vice-versa? Who owns whom?

Anonymous Toastrider April 15, 2016 7:16 AM  

The trick, I think, would be to break the chain in point two -- to limit or even eliminate the capacity of government to be influenced with money. The less power government has to screw around with the markets, the less motivation people and corporations will have to throw cash at them.

Blogger VD April 15, 2016 7:18 AM  

The less power government has to screw around with the markets, the less motivation people and corporations will have to throw cash at them.

Recall that corporations are creations of government.

Blogger FSL April 15, 2016 7:20 AM  

In favor of the spirit of Dr Miller's argument, though perhaps not his terms, I would say that the central question is one of *responsibility* rather than *corruption*. People are generally going to do whatever they can get away with, and our system of checks and balances and the Federalist Papers assume this.

Therefore, it is better to say that politicians are not held *responsible* as board members are, because their investors, the people are stupider than the investors of the board, and if the politician says "Bush did it" almost a decade after Bush's tenure, or "democracy conquers all", well, a non-insignificant portion of their base is going to buy it.

Not so for a boardmember who does not produce productivity. The investors are smart enough to hold them accountable. Citizens are generally not.

...So would run the improved argument anyway.

Blogger Michael Maier April 15, 2016 7:21 AM  

I don't buy it, Vox.

Imagine an honest businessman, totally above board. Starts doing business in Mexico. Sees bribery is the matter of course.

Or a farmer, never had a corrupt thought in his life. Has an EPA official show up to discuss "wetland / zoning issues" that could wipe out his farm, been in the family for 200 years ... then he mentions money problems...

I mean, come on. I know businessmen aren't angels, but how many of them GO INTO business because of graft vs politicians?

Blogger BCM April 15, 2016 7:22 AM  

Free trade also exposes a nations politicians to a larger number of corporations and corp executives. Therefore free trade multiplies the potential sources of corruption. If there is a market for corruption, additional entrants are demand and what does additional demand do to the "price" of corruption? It drives up the bidding price for a politician.

Blogger Michael Maier April 15, 2016 7:23 AM  

It's like Booker T. said: "Lawd, de cotton am so grassy, de work am so hard, and the sun am so hot dat I b'lieve dis darky am called to preach!"

Blogger Michael Maier April 15, 2016 7:24 AM  

Well, I guess unless you're a banker, then they probably teach theft and graft as an undergrad class.

Anonymous VFM #6306 April 15, 2016 7:27 AM  

There goes my epilepsy again. Feels like I'm gonna shake my head till kingdom come.

For the sake of my health, please read your own posts to see if it answers your own objection before hitting "publish."

Anonymous Lennier April 15, 2016 7:49 AM  

So Mozilla's SJW garbage team goes full mad now: they are threatening the Pale Moon guys now:

https://forum.palemoon.org/viewtopic.php?f=17&p=83218&sid=31ea014780e5bfa175c0e74a34f6eed9#p83218

SJW's unleashed, Spread the word!

Blogger Durandel Almiras April 15, 2016 7:55 AM  

The syllogism will at the very least open the discussion to whether the free hand eliminates corruption or not, thus questioning the axiom. Which is good, since history will quickly show that corporations will seek their own interests even if said interests are directly opposed to the interests of their native nations.

Corporations, if they have no or low incentive to defend and protect a nation, will choose to plunder a nation as a incentive for profit does not care how profit is obtained, be it through honest business practices, graft, or damagin policies that destroy cultures and nations.

This has to be hammered into the libertarian minded side of the economics profession. they need to be forced to say that they don't care about nations and culture. Once they admit it, it's then time to move and crush them on their idea that destruction of nations is a non-factor.

Anonymous Bowman April 15, 2016 7:56 AM  

2. & 3. are not correct.

Gov. tendency to regulate everything to death makes it inevitable that regulations & business clashes.
And when clash happens, every side does with its means. Business with resources, and government with power.

Business giving resources to gov. officials is a logical consequence of gov. power grab on everything.

Free trade removes power from gov., so it decreases corruption.

Blogger VD April 15, 2016 8:00 AM  

Imagine an honest businessman, totally above board. Starts doing business in Mexico. Sees bribery is the matter of course.

It's remarkable how many free trade arguments begin with the word "imagine". This should tell you something about the quality of the logic involved.

Now ask yourself how many innocent, honest businessmen are executive-class members of the multinational corporate elite.

Blogger VD April 15, 2016 8:04 AM  

2. & 3. are not correct.

You are absolutely and utterly wrong. Politicians don't corrupt businessmen. Businessmen corrupt politicians. What do you think causes the notorious "growth" that takes place when Mr. Smith goes to Washington?

Anonymous That Would Be Telling April 15, 2016 8:08 AM  

@12 VD:

Now, ask yourself this: who corrupts whom? Does the Goldman Sachs executive corrupt the congressman or vice-versa? Who owns whom?

I thought I was pretty well educated on the subject of corrupt US politicians before I read Extortion: How Politicians Extract Your Money, Buy Votes, and Line Their Own Pockets. Now, you're having all but literally "rubbed" shoulders with Trump at a convention, it probably has little to teach you, but I for one was a bit surprised by, for example, learning about leadership PACs, which allow Congressmen to pocket and spend for any purposes they want the donated money (seriously, and it's all "100% legal").

So I accept that it's hardly one way, national level politicians are entirely capable of extorting companies. Stepping back a bit, who can break either? Maybe not at the GS level, but one or two below?

Blogger Markku April 15, 2016 8:10 AM  

imagine all the people
living for free trade

Blogger Steve Moss April 15, 2016 8:12 AM  

Because if the receiver would not have been corrupt without the causal actor, whereas the causal actor is intrinsically corrupt, the receiver is, by definition, less corrupt.

So one who solicits a prostitute is more corrupt that the prostitute?

I view corrupt politicians and multi-nationals as being in a mutual symbiotic relationship, in that one cannot survive without the other.

Anonymous Athor Pel April 15, 2016 8:16 AM  

"23. Anonymous Bowman April 15, 2016 7:56 AM
2. & 3. are not correct.

Gov. tendency to regulate everything to death makes it inevitable that regulations & business clashes.
..."


You're seeing the effect as the cause. The regulations on business are always sponsored by business either directly or indirectly through proxies. The regulations are not created for their stated purpose, they are anti-competitive mechanisms to keep new businesses out of the market.

The Government doesn't do things by itself. Government is a tool. People use the tool how they will. People are people first and government bureaucrat or businessman second and everybody has a patron.

Anonymous That Would Be Telling April 15, 2016 8:17 AM  

@25 VD:

2. & 3. are not correct.

You are absolutely and utterly wrong. Politicians don't corrupt businessmen.


Really?!??!!!

I think it's a tall order for you to convince us that politicians have no tendencies or instincts to ever tell a businessman (or industry, see coal in the US right now), "Nice company you have here, it would be a shame if anything happened to it."

None of these classes of people are angels.

Blogger Salt April 15, 2016 8:18 AM  

VD wrote:Politicians don't corrupt businessmen.

Not directly, no. But there is a symbiosis between the corruptible.

"Does the Goldman Sachs executive corrupt the congressman or vice-versa? Who owns whom?"

Good question. One of them had their hand out first. Ultimately I really don't care because the two of them made a devils bargain.

Blogger seeingsights April 15, 2016 8:24 AM  

Free trade benefits Castalia House.
Castalia House is a Finland based publisher. It sells science fiction and fantasy books in the US, and other countries. In return, Castalia House gets money.

Suppose the US imposed a steep tariff on foreign published science fiction and fantasy books. US consumers, then would turn away from the more expensive Castalia House books, and buy home grown alternatives, such as books by John Scalzi.

Blogger dc.sunsets April 15, 2016 8:31 AM  

I find it hilarious that people posit simultaneously that men are demons and men are angels.

The entire purpose of political government is to have a territorial monopoly on ultimate decision-making. Monopoly is the operative word. Monopolies can only be maintained by violence or the threat thereof, and the state's monopoly rests on popular consent. Hoppe and la Boetie are logically irrefutable on this.

The problem is that people in a social environment largely demand this monopoly. If one doesn't exist, they quickly act to institute one. Original Sin and all that.

So we end up arguing about who should rule and how should they be chosen, basing each argument on mutually incompatible premises at every turn.

In the end it is all about who wins and who loses. In the ancient world this was determined periodically by war. In the modern era it is determined by public relations.

Blogger dc.sunsets April 15, 2016 8:34 AM  

Dr. Miller's premise is that conditions of selection for corporate board members and executives is more benign and/or less corrupt than those for politicians.

The very notion of separating these two, especially after Kelo, is ludicrous. It is as though Dr. Miller has never encountered Public Choice Theory or the notion of regulatory capture.

Blogger Markku April 15, 2016 8:39 AM  

Free trade benefits Castalia House.
Castalia House is a Finland based publisher. It sells science fiction and fantasy books in the US, and other countries. In return, Castalia House gets money.

Suppose the US imposed a steep tariff on foreign published science fiction and fantasy books. US consumers, then would turn away from the more expensive Castalia House books, and buy home grown alternatives, such as books by John Scalzi.


As I already said, opposing free trade doesn't mean slapping tariffs indiscriminately on everything. For one, Finland is one of the (if not THE) most obedient countries in the world in living up to the contracts we have made, and we have made a specific, one-on-one contract with USA where we agree to tax US companies that sell in Finland exactly the same as they tax Finnish companies selling in USA.

This is exactly, down to a T, the anti-free-trade model. If we got uppity, they could revoke the deal in a heartbeat. And if we play ball, they keep things as they were.

Blogger dc.sunsets April 15, 2016 8:42 AM  

It is openly acknowledged that industry representatives author most legislation affecting them today. For all practical purposes, in the economic sphere corporations already write the laws; hell, who actually funds the FDA, for instance? Hint: the checks to the U.S. Treasury have Pfizer, Johnson & Johnson, Striker, Abbott, etc. right on them.

It's all Public Relations. Corporations are not run by idiots. Each major firm commits vast resources to "prepping the public" for every one of the corporation's important business plan actions.

Want to reduce the headcount costs? Institute a campaign to "educate" the public that there is a vast shortage of qualified American STEM grads and that H1-B visas are required. Phone your "captured" senators and reps, and provide them with speeches and press releases your own firm authored to reinforce this narrative, and remind them that if they don't vote your way, you'll fund their next opponent in the coming election.

All this is so obvious that only small children can't see it.

Anonymous VFM #6306 April 15, 2016 8:43 AM  

1. There is nothing wrong with the syllogism.

2. Most People Are Idiots

3. Therefore imagine benevolent corporations are taken advantage of by corrupt politicians.

Blogger VD April 15, 2016 8:47 AM  

I think it's a tall order for you to convince us that politicians have no tendencies or instincts to ever tell a businessman (or industry, see coal in the US right now), "Nice company you have here, it would be a shame if anything happened to it."

I think that's a remarkably inept attempt at a rebuttal, which I can only hope is disingenuous rather than stupid. Now, do you want to rethink through your attempt to put totally unnecessary words in my mouth, or is it necessary for me to hold your hand and walk you through it?

So one who solicits a prostitute is more corrupt that the prostitute?

You don't understand the analogy. The pimp is more corrupt than the prostitute. In most cases, the pimp literally corrupts the prostitute.

Who do you think put the politicians in their positions? Where do you think the large quantities of money required to get them elected in the first place came from?

Blogger VD April 15, 2016 8:49 AM  

So I accept that it's hardly one way, national level politicians are entirely capable of extorting companies.

How many national politicians are self-financing? I am not arguing that politicians are corrupt. I am observing that if you don't acknowledge that multinational corporations and the executive class that run them are an order of magnitude more corrupt, you are either innocent or dishonest.

Blogger dc.sunsets April 15, 2016 8:52 AM  

Basically, between your #1 and #2 are the following premises:
A. Corporations are buying politicians.
B. Bought politicians simply become a resource for executives of multinationals.
C. In the absence of nationalism, executives of multinational corporations are increasingly subject to narrow, naked self-interest, thus becoming more willing to use the monopoly coercive apparatus of the political system to concentrate benefits in their own hands and spread the diffuse costs, no matter how toxic, over everyone else.

My point: free trade is but one symptom of an increasingly destructive system, which is itself a product of inadequate nationalism (AKA social cohesion.)

Whereas a nationalistic corporation might poison the living hell out of the Wogs in Whocaresistan, a corporation run by people without nationalism will poison the living hell out of everyone to turn a buck.

Yeah, that's a hell of a step up....

I suggest that this is also the seed of central banks enabling this largest-in-history credit bubble. Financialization is now a mutual suicide pact, but the players at the top have used it to concentrate unimaginable wealth while sowing the seeds of the largest bust in history.

Blogger Ahazuerus April 15, 2016 8:53 AM  

I'd question the strength of proposition number 2, that corporate officers are the primary corrupting factor. I would say it is power which holds this position, and yes, the rise of corporate power has been followed by a rise in corporate corruption. Nonetheless, as Lord Acton had it, power corrupts.

But in fact I think Lord Acton was wrong in that his formulation is overly simplistic. There is correlation as he noted, but it is no causation. Power does not corrupt, it merely reveals what was previously concealed by impotence.

There is no inherent virtue in the powerless. Power simply allows people to act out our inherently corrupt natures, and most of us will not resist that impulse.

@33:

Public relations is the continuation of war by other means.

Many people know of the words of Jesus when he called the devil a liar and a murderer from the beginning. Few stop to consider that he murdered Adam and Eve by lying to them.

People who lie to you are trying to control you. They know that if they told you the truth you would act differently. So they try to direct your actions by feeding you wrong information. They try to control you. Hence Jesus also said; "... and you shall know the truth, and the truth shall set you free."

"Public relations" as a term was invented to put a new face on an old whore; propaganda. It is the propaganda term for propaganda. Propaganda is an art of war.

Public relations is the continuation of war by other means.

Anonymous HoosierHillbilly April 15, 2016 8:54 AM  

Around here, the syllogism looks fine. If this was being presented to an audience that hasn't considered the depth of international corruption, a weak form of your argument might be in order. Might also help calm down some of the complaints already upthread.

"2. The board members and executives of multinational corporations, in response to the shareholders’ desire to increase the corporations’ competitive advantage, have a strong driving force to become the primary actors responsible for corrupting the politicians."

A weaker argument, I understand. But it moves to set up the uninitiated to the reasonable: "yes, I see how a corporation might want to become a corrupting force to increase its profits." We can get to the strong version you have posted when their eyes are opened a bit more.

Anonymous Jay Will April 15, 2016 8:56 AM  

What matters is unchecked power. Media, politicians, multi nationals are all on the same page with self-enriching globalisation. They due to owning all the levers of power are able to bulldoze through what they want. Its less important who, and to what extent they are corrupt, it is that the corrupted do have too much power.

Then the question becomes are borderless free market ideas more or less likely to lead to higher concentrations of power. It doesn't necessarily matter what form the concentration of power takes it is simply that it is too powerful and has no adversary strong enough to challenge it. It appears that borderless free market multi nationals are creating the greatest concentration of power in human history. They will mess it up guaranteed.

We all need to be taken down a peg or too on occasion. We get ahead of ourselves. When those around us are comparatively too weak to do the pegging down we are more likely to abuse our dominance because that is our nature. This is why I am avoidant in my head the secret king can have no challengers which I means I must isolate myself. In my head I am all powerful and control its whole universe. The current powerful are also isolated in their private jets, gated communities, echo chamber politics. So the question becomes how do you burst this bubble open. Bring the vampire out into the light to singe its fragile ego.

Anonymous That Would Be Telling April 15, 2016 9:01 AM  

@39 VD:

So I accept that it's hardly one way, national level politicians are entirely capable of extorting companies.

How many national politicians are self-financing? I am not arguing that politicians are corrupt. I am observing that if you don't acknowledge that multinational corporations and the executive class that run them are an order of magnitude more corrupt, you are either innocent or dishonest.


Well, at least that's a less contemptuous reply to my previous posting (and I really don't want to continue going down that path of contempt). Score me as "innocent".

I'll grant about the same order of magnitude: on general principles we'd expect that at minimum from the systematic destruction of moral values in the population, and that's what I senses from my limited observations of both.

An order of magnitude? "[citation needed]", or more seriously, what would you point me at to convince myself of your thesis?

Blogger James Dixon April 15, 2016 9:01 AM  

>
> That is the same thing, James Dixon. It is not the state of corruption but the act of corruption that is caused by the corp.

OK, that is a valid point. But in that case corruption isn't really the right word to use. I'm not sure what might be a better one though.

> Either the politician or the multinational executive is corrupt, or both of them are corrupt.

Both are already corrupt.

> ...who corrupts whom? Does the Goldman Sachs executive corrupt the congressman or vice-versa? Who owns whom?

Since both are already corrupt, neither corrupts the other. Each is taking advantage of the existing corruption in their own way. IMO, you're arguing that a symptom is a cause.

Now, if I take the first quote above as your position (that you are arguing the act of operating corruptly rather than the state of being corrupt), then my argument is null and void, and I apologize for wasting your time.

> Free trade removes power from gov., so it decreases corruption.

Right. Because a multi-thousand page document regulating trade removes power from the government.

Blogger Ahazuerus April 15, 2016 9:07 AM  

@42

The problem as I see it is that a lot more corporate officers are spending a lot more money trying to bribe politicians in D.C. than in Lima.

The difference is a function of power. Power not only reveals corruption, it attracts it.

As our governments have accumulated more power over us, they have become more corrupt. So too, as our corporates have become more powerful they have also become more corrupt.

It's tempting to ascribe the primary corrupting influence to the corporates, but they formally lack the power of our governments. And who licenses and regulates them? Our governments. In practical terms our corporates are agents of our governments, designed and operated to provide a fig leaf of plausible deniability while funneling cash to those sitting in the seats of power.

Who is it that sets the rules of political lobbying? Who is that commands the machinery of death and destruction we laughingly call defence departments?

The most brutal truth is that the answer to all these questions is the same; our corporates ARE our governments, and vice versa. The same class of arseholes runs both and the revolving door is real and revealing. Focus on one or the other, in the face of the reality of their cosy duopoly, is as mistaken as a focus on either Republicans or Democrats.

But in the end, even if proposition 2 only says that there's no distinction in corruption or corruptibility between our government officers and corporate officers (they're all just people, after all), the syllogism remains equally strong in its conclusion.

Blogger Salt April 15, 2016 9:08 AM  

VD wrote:multinational corporations and the executive class that run them are an order of magnitude more corrupt

The chicken is always larger than the egg.

Blogger VD April 15, 2016 9:12 AM  

Well, at least that's a less contemptuous reply to my previous posting (and I really don't want to continue going down that path of contempt). Score me as "innocent".

There wasn't room for anything but contempt. You clearly failed to understand that I am not arguing for the non-corruption of politicians, nor is that even remotely necessary for my syllogism to hold. All that is necessary for the syllogism to be correct is for the collective corruption of the various multinational corporate interests to be at least as bad as the collective corruption of the political class in the country considering free trade.

Are the Chinese corporations more or less corrupt than US politicians? Are the big international banks more or less corrupt? Unless you can demonstrate that the global multinationals are less corrupt than American politicians, the Corruption argument for free trade fails.

Since both are already corrupt, neither corrupts the other. Each is taking advantage of the existing corruption in their own way. IMO, you're arguing that a symptom is a cause.

People are not born on the take. I have some personal experience of how the political grooming system works. The party elite selects those who are deemed susceptible to corruption and those young men and women are then corrupted by the financial interests behind the party. Some larval politicians embrace the corruption, others are gradually seduced by it. But they are not the instigators.

Blogger James Dixon April 15, 2016 9:13 AM  

> But in fact I think Lord Acton was wrong in that his formulation is overly simplistic. There is correlation as he noted, but it is no causation. Power does not corrupt, it merely reveals what was previously concealed by impotence.

More importantly, power attracts the corrupt, who would use the power for their own ends. Thus, a powerful government attracts the corrupt to run for office and attracts the corrupt corporations who attempt to (often successfully) subvert it to their own benefit.

> I am observing that if you don't acknowledge that multinational corporations and the executive class that run them are an order of magnitude more corrupt, you are either innocent or dishonest.

I have to agree with That Would Be Telling that an order of magnitude seems too high. I would accept double, and be willing to consider even triple. Which I guess also makes me innocent. Your experience in these circles dwarfs mine however, so I would encourage others to reasonably value your opinion over mine.

Blogger pyrrhus April 15, 2016 9:17 AM  

Free trade is inconsistent with the existence of the western welfare State, since any benefits from the trade itself are eaten up by the financial and social costs of increased unemployment and underemployment in the countries with higher labor costs. The same is true of importing labor from 3d world countries.....When you throw in the rapidly increasing level of automation, amplified by the Fed's ZIRP policies, there is absolutely no benefit to outsourcing manufacturing or any other labor intensive production.

Anonymous kfg April 15, 2016 9:17 AM  

@VD: "Recall that corporations are creations of government."

This plus over 9000!

Virtually every argument I have had over these issues has come down to the other party not understanding this point and I have to walk them, in baby steps, toward understanding and accepting it.

It's bad enough when the other party is a socialist, but I (or at least I used to) expect libertarians to have some basic grasp of that fairly basic and (should be) obvious point.

Blogger James Dixon April 15, 2016 9:21 AM  

> Unless you can demonstrate that the global multinationals are less corrupt than American politicians, the Corruption argument for free trade fails.

OK. That's another point in favor of your position over mine. I had failed to notice that you limited your argument specifically to "the board members and executives of multinational corporations" and took it as a more generic argument on corporate corruption.

On the basis of that limitation, I'm willing to concede the point. There's little doubt that the corruption of multinational corporations exceeds the corruption of at least US politicians. I can't argue the case for politicians of other countries either way.

Blogger James Dixon April 15, 2016 9:25 AM  

Actually, failed to absorb would be more accurate than failed to notice. Sometimes things take a while to sink in.

Anonymous That Would Be Telling April 15, 2016 9:26 AM  

@49 James Dixon:

I have to agree with That Would Be Telling that an order of magnitude seems too high. I would accept double, and be willing to consider even triple. Which I guess also makes me innocent. Your experience in these circles dwarfs mine however, so I would encourage others to reasonably value your opinion over mine.

His personal experiences are colored in such a way that his ability to be objective on the subject is automatically suspect (and let's not go into more detail). For the sake of the discussion, can we retreat to "of the same order of magnitude", which in @48 VD claims is sufficient for the syllogism to be correct?

Blogger Nate April 15, 2016 9:29 AM  

1-5 certain demolish that one aspect of his position but the primary argument he makes is the fact that free trade makes everyone richer. Now... the problem here is he is making the typcial new atheist mistake. Free Trade is works because Trade is good. Well Trade and Free Trade are not the same thing. Its like saying Communism is good because communities are nice to live in.

The angles he left open are 1) corruption (which you addressed) 2) bait and switch of Free Trade vs Trade and 3) national independence and self-reliance

Anonymous kfg April 15, 2016 9:30 AM  

No having the proper account to do so, I cannot comment at Alpha Game, but I do not believe the subject is entirely OT here, so:

"In a great paradox these three forces are in superficial opposition to each other but in combination support the weight of western civilization."

I prefer to use the metaphor of a guyed mast, rather than pillars. It is because there are three guys mutually opposing each other that the mast stands. There is no apparent paradox.

Blogger James Dixon April 15, 2016 9:32 AM  

> His personal experiences are colored in such a way that his ability to be objective on the subject is automatically suspect

So is for everyone, but experience is the only reliable guide we have in such matters. Documentation of corruption is difficult by definition, and fails to convey either the full nature or magnitude of it.

> People are not born on the take

On the take, no. But we are all born fallen. There but for the grace of God...

Anonymous kfg April 15, 2016 9:37 AM  

@48 VD: "People are not born on the take."

I understand what you are saying and do not disagree, however: I would like to see you convince your mother of that.

Blogger dc.sunsets April 15, 2016 9:37 AM  

Am I missing something? The question seems to be, under what conditions are those who pull the strings more likely to "do right?"

Let's posit that people are always self-interested. Self-interest can be grubbing for money, but it can also be grubbing for status, grubbing for virtue (signaling), grubbing for peer-respect, etc.

In a world without borders, without national or tribal identity, all the incentives most here appreciate (statesmanship, wise-stewardship, etc.) are absent. What are left are grubbing for money (power, bigger private aircraft, a bigger yacht, more and larger mansions, etc.) and grubbing for recognition within whatever social fad exists (today it's Blank Slate/Magic Dirt anti-racism with a side of Gaia-worshiping Environmentalism.)

The primary ethic in our Consumer Culture is being the visibly larger consumer (while genuflecting at the main altar of anti-racism and the secondary church of Gaia.)

Of course this produces corruption. Of course this produces widespread rationalization for approving toxic drugs, toxic farming practices, totalitarian Two Minutes Hates for Wrongthink, etc.

These same perverse incentives apply to corporate executives and politicians. The clear presence of political de-nationalism (where politicians put the welfare of OUTSIDERS ahead of the welfare of their own supposed constituents) is prima facie evidence that the concentrated benefits of Universalist People (those without loyalty to tribe or nation) are steering the ship.

People without loyalty are sociopaths. We are thus now ruled by them.

Blogger dc.sunsets April 15, 2016 9:41 AM  

Open borders and free trade are thus dogma in the Universalist, no-nation, no loyalty cult.

When everyone is "special," no one is special. That this serves to entrench those at the very top in both wealth and "public virtue" is a feature, not a bug.

Blogger Edward April 15, 2016 9:53 AM  

It's all 'corrupt' because of differing goals and perspectives. CEOs want high saleries and bonuses, they don't care about the impact that their products and employment practices have on the local economies unless it causes a backlash that has to be managed with public relations.
Right wing governments want full employment, even at low wages. Law and order etc. or at least they claim to.
Left wing governments want high living standards, education, healthcare, sexual freedom, arts and crafts, social safety nets, or at least claim to.
Capitalists want high returns on investments, regardless of the investment products, be that consumer oriented businesses or meta-financial services.
Individual people may act in one or more of these roles simultaneously and mostly likely will change priorities several times over the lifespan.
When you are under 25 you want left wing policies in place around you, when you are 25-55 you want right wing policies around you, and when you are 55+ you care more about the capitalist tier because of your pension fund and investments.
Each age group keeps advocating for its own interests, creating new policies and programs, with the end result being that closed economies become progressively more complex and consumer oriented.
Big international businesses now have a very good handle on population demographics in different economies, so they can play to the biases of the different tiers.
High revenue reports in USA = high stock price = profit for stock based compensation. Low corperate tax in USA due to playing all the loopholes = profit.
High priced consumer goods sold to nominally wealthy people in different demographics = profit. Low wage manufacturing labour in a poorer but growing economy = profit. Low wage marketing/advertising/support/public relations labour in a richer but shrinking service-oriented economy = profit.
Numbers that don't add up within individual economies, budget deficits etc? Oh well, sucks to be you, but we're an internationally recognised brand so we can just relocate our component parts into different economies as they develop or collapse.
Who ultimately wins? Well who owns all the debt built up by the different economies? Who owns the rights to all the big name brands? Who has been playing this game for millennia so they know exactly what makes people tick?
You can't beat the system as a whole, you can just learn the rules and play the game, and teach your kids so they get a leg up.
The numbers will never add up, but so long as they are just numbers in computers and not advancing armies, why worry?

If you represent a big business free trade agreements are great. If you just want to live in a nice country that isn't being trashed buy internationalist oligarchs, well it all sucks.
Who owns all the politicians of either orientation in virtually all the economies? The international oligarchs and bankers.
The situation seems to be pretty much sewn up, so arguing about it isn't going to make much difference.

Anonymous VFM #9617 April 15, 2016 9:55 AM  

I would just like to note that the argument from Dr. Miller is also naive in the sense that it treats "elected politicians" and "board members and executives of multinational corporations" as two separate and distinct entities, as opposed to the fungible goods that they are.

Revolving door of government everyone? Or do we double-down on Pollyannaism and imagine that those politicians who get well-remunerated posts on the boards of multinational corporations such as Apple (Al Gore), Chevron (Chuck Hagel), GE (Sam Nunn), Ford (Dick Gephardt, John Huntsman), JP Morgan (William Gray), Pfizer (William Gray, again), Dell (William Gray, busy guy, never heard of him before, but after 12 years in Congress and serving as Budget Committe Chair I guess you get to Make Friends and Influence People), Prudential (my newest best buddy William Gray, can I borrow $20?, Gaston Caperton), and we could go on, and on.

And this doesn't even count all those Goldman VP's that get nominated to serve on the various Reserve Banks and their equivalents in national banks, etc., of other countries. Nominated, typically, by politicians. I'm sure that when they serve in their capacities as "public servants" they completely forget about the interests of their former (and usually future cause many go back to one of the tentacles the Squid afterwards), are pure as the driven snow in serving the interests of the public, just like the self-same politicians who appointed them.

Would positing that count as tripling down, or is it quadrupling down because you are doubling down on doubling down?

Anonymous VFM #9617 April 15, 2016 10:02 AM  

Argghh, got caught up in my list of names so I didn't complete my thought:

imagine that those politicians who get well-remunerated posts on the boards (list of names) were completely impartial and disinterested in all the affairs of these corporations and their dealings with the .gov and its agencies, and further that after joining the boards of these companies they serve because of their ability to contribute to the running of the company as opposed to their political connections.

Anonymous mature-Craig April 15, 2016 10:04 AM  

not sure if anyone already brought this up
but I believe that free-Trade relies upon the US Army enforcing justice on the globe thwarting all forms of tyranny

so other parties should be very grateful to US and if US wants to give itself a little favor with tariffs, that is their right since it is their sacrifice making free trade possible in the first place and other countries should respect that and not have any problem with that at all

Blogger dc.sunsets April 15, 2016 10:05 AM  

@62 It gets worse. I'd bet that the adult offspring of major politicians and highly-placed bureaucrats land "corner office, high pay" positions for which they don't even need to show up, quite frequently.

When a $1 billion in cash goes missing in the Iraqi Occupation and it's less than a rounding error, and no part of the US government has been able to pass a standard accounting audit for a lifetime, just the "change in the couch cushions" in the Beltway intersection of Congress, Executive Branch and K-Street is more than the combined wealth of every person who has ever visited this blog.

Think about that.

Blogger VD April 15, 2016 10:05 AM  

For the sake of the discussion, can we retreat to "of the same order of magnitude", which in @48 VD claims is sufficient for the syllogism to be correct?

I'm not retreating at all. I repeat: it is either stupid, ignorant, or dishonest to believe that politicians are NECESSARILY more corrupt than multinational corporate interests. Politicians don't even read the laws that corporate interests write for them; in many cases, politicians are little more than rubber stamps for the corporate interests that make them.

I'm not concerned about anyone else's ability to accept observable reality. My objective is to point out that Miller's contention is logically fallacious and thereby disproven.

Anonymous kfg April 15, 2016 10:08 AM  

" . . .free-Trade relies upon the US Army . . ."

Local free trade existed before the US Army. You are making a variable of the model dependent on being taken up by a particular constant.

Rephrase in the general case.

Blogger praetorian April 15, 2016 10:08 AM  

Do any of the Ilk have suggestions on nationalist economic analysis?

Fredrich List seems to be the main guy mentioned when I look into it.

List's fundamental doctrine was that a nation's true wealth is the full and many-sided development of its productive power, rather than its current exchange values. For example, its economic education should be more important than immediate production of value, and it might be right that one generation should sacrifice its gain and enjoyment to secure the strength and skill of the future.

Mmmmm, low time preferences and intergenerational solidarity...

Blogger James Dixon April 15, 2016 10:13 AM  

> I'm not retreating at all. I repeat: it is either stupid, ignorant, or dishonest to believe that politicians are NECESSARILY more corrupt than multinational corporate interests

Vox, to your average person who has no contact with these people, it's all one large cesspool and the relative level of corruption for each party is impossible to distinguish.

Anonymous VFM #6306 April 15, 2016 10:13 AM  

This syllogism highlights what Dr. Miller referred to as the simple difference in values.

If Dr. Miller can't refute this syllogism, then he must adapt his values to the new conclusion.

It will then be clear that the difference never was in values. The values are the same: both debaters value a trade that restricts the most corrupt.

Only one of them has identified exactly how successful the invisible hand is at doing that.

Anonymous kfg April 15, 2016 10:13 AM  

" . . .it might be right that one generation should sacrifice its gain and enjoyment to secure the strength and skill of the future."

It is the case that this is how dynasties are formed, and that they fall when this ceases.

See the common observation that the wealth of families often cycles through three generations; the first generation that founds the dynasty, the second that fosters it and the third that pisses it all away.

Anonymous mature-Craig April 15, 2016 10:16 AM  

global free trade weakens America.

lower wages and less jobs for American citizens
less revenue for the American government

its bad for the American private sector and its bad for the American public sector

Anonymous VFM #6306 April 15, 2016 10:17 AM  

That is irrelevant, James Dixon. The average person thinks the Invisible Hand is a sex toy, too.

This is about the truth, not how retarded average people are.

Anonymous mature-Craig April 15, 2016 10:18 AM  

Free Trade seems to me to be entirely consistent with the globalist UN visions that I have come to see as bad in every way

Anonymous mature-Craig April 15, 2016 10:19 AM  

meant to say -global free trade- in 74

Anonymous VFM #9617 April 15, 2016 10:21 AM  

dc,

Going into the benefits that accrue to family members (whether in public or private sector) would be another exhaustive endeavour. It's good to be a Reid in Nevada, for example. Or a Biden as far away as the Ukraine.

Anonymous kfg April 15, 2016 10:22 AM  

"Global Free Trade seems to me to be entirely consistent with the globalist UN visions that I have come to see as bad in every way"

Now all you are left to do is draw the arrow of causality.

Blogger VD April 15, 2016 10:26 AM  

Vox, to your average person who has no contact with these people, it's all one large cesspool and the relative level of corruption for each party is impossible to distinguish.

That may well be. I could not possibly care less what the average ignorant person thinks. I am interested in the truth. Anyhow, one doesn't require any contact whatsoever with either the corporate or the political class to observe the way in which they interact.

Blogger James Dixon April 15, 2016 10:28 AM  

> This is about the truth, not how retarded average people are.

Normally when you make a public argument, you want people to be able to understand and follow it. Pointing out that the average person probably can't do so isn't out of place. Now, Vox is somewhat of a special case in that regard, but...

Blogger tz April 15, 2016 10:29 AM  

@51 or as I put it:
Corpseorations are undead monsters animated by Dr. Frankenstate and have only the rights their creator wishes to endow them. They are both slaves and masters of their creator - masters because their creator would fall without their services. The cotton does not pick itself, and for the plantation to continue...

But there is another point. Boeing announced thousands of layoffs now the ex-im bank is revived. Corporations NEVER want actualmfree trade. I can't even write a non-approved iPhone app. I can't buy insurance across state lines, nor drugs from Mexico or Canada.

Corrupt corporations will never allow free trade, so the Professor's argument is backward. Free trade can't cause itself. Politicians must want it (not the crony managed trade with the Orwellian term).

My post on the earlier thread bears repeating - we used to have open borders and free trade between the US and Canada - Ontario and Michigan were closer than Michigan with many other states. High trust, compatible laws. NAFTA shattered that by addimg low-trust Mexico. The nice card game now has regular cheaters so no one plays.

Eliminate the corruption, and our borders can be opened again to our peers and cousins.

It is like a law that every home party must be open to all, so you can't just invite people you know, if the biker gang hears about it, they will attend. Or the refugees.

You can only begin to think about free trade under a rule of law and a specie monetary system (e.g. gold and/or silver). Don't imagine them, work toward them. These are necessary but not sufficient conditions.

Blogger VD April 15, 2016 10:30 AM  

Normally when you make a public argument, you want people to be able to understand and follow it.

The argument that the average person will be able to understand and follow is that Dr. Miller has a PHD! In Economics! From THE UNIVERSITY OF CHICAGO, which has a NUMBER ONE economics department. Therefore, free trade is beneficial, because less corruption.

So, we're not concerning ourselves with that level of analysis.

Anonymous kfg April 15, 2016 10:31 AM  

" . . . one doesn't require any contact whatsoever with either the corporate or the political class to observe the way in which they interact."

The average person is ignorant because they refuse to observe, and if forced to observe refuse to deduce.

But then these people are useful idiots at best and as you note not relevant to the theoretical model.

Blogger James Dixon April 15, 2016 10:34 AM  

> I could not possibly care less what the average ignorant person thinks. I am interested in the truth.

That was a given. It was merely a comment about the effectiveness of your argument, not the veracity thereof.

> Anyhow, one doesn't require any contact whatsoever with either the corporate or the political class to observe the way in which they interact.

Observation is contact, even if of a limited type.

Blogger tz April 15, 2016 10:36 AM  

Let me summarize - when you have low corruption and high trust, you can have (true) free trade. Free trade is the effect, not the cause.

Blogger Ahazuerus April 15, 2016 10:42 AM  

@84, tz

There's a lot of people get that relation all mixed up.

OpenID paworldandtimes April 15, 2016 10:42 AM  

transferring it to the board members and executives of multinational corporations, who are presumed to be less corruptible than politicians by virtue of being answerable to the Invisible Hand of the free market.

The main problem with the market as arbiter of social affairs I'd that it shows a preference, over time, for quantity over quality in terms of its customers' demands and in fulfilling those demands, it seeks to level societies to their lowest common denominator.

In that process, the market not only obliterates high culture, it also eradicates traditional culture of lesser societies.

It accomplishes this through its tendency toward monopoly formation. Under a total-market rule, we all become the perfect corn syrup swilling, Miley Cyrus twerking, stabbing-each-other-over-sneakers global consumers. Funny how latter-decade Communism of Eastern Europe had kept much of that culture-leveling tendency of the market in check, whatever the system's many other faults.

PA

Anonymous kfg April 15, 2016 10:42 AM  

@80: "You can only begin to think about free trade under a rule of law and a specie monetary system . . ."

And thus a libertarian society will tend to construct a system of contracts that recapitulates the function of government.

Because those functions are necessary to maintain a society.

Blogger James Dixon April 15, 2016 10:51 AM  

> Under a total-market rule, we all become the perfect corn syrup swilling, Miley Cyrus twerking, stabbing-each-other-over-sneakers global consumers.

Don't mistake mass market consumerism for the entirety of the market.

Anonymous polyhedron April 15, 2016 10:57 AM  

Vox, would you clarify your assertion that free movement of goods necessarily entails free movement of labor? Dr. Miller admitted there would be "some intermingling", but, as I understood him, he believes that goods and labor can be treated separately in matters of theory and policy.

Blogger dc.sunsets April 15, 2016 10:58 AM  

This argument is why monarchy was better than (social or representative) democracy...or any democracy.

Per Hoppe, rulers (whether elected politicians or string-pulling corporate executives) in a democracy behave like caretakers/renters. Their incentive is to make hay while the sun shines, leveraging their position from the stand point of it being temporary, strip-mining value today without concern for tomorrow.

A ruler who sees the whole of his society as a single property holding (including its people, land, capital, etc.) behaves if sane like an owner because that is the incentive structure involved.

Only an entity that directly benefits from the combined, total value of a society has any hope of being able to discriminate between open or limited trade in any niche, and only an entity that can be deposed and beheaded will respect the total value experienced by citizens in that society.

Nationalistic rulers appear more apt to consider the total capital value, long run wealth and well-being of citizens. Today's nadir in nationalism (and devotion to heterogeneity) is part and parcel of the absence of statesmanship in power.

We're ruled by sociopaths, elected by sociopaths who are brainwashed by sociopaths in the most scientifically ordered (and evil) system ever. H.L. Mencken was right, we deserve to get it good and hard.

Blogger VD April 15, 2016 11:08 AM  

Vox, would you clarify your assertion that free movement of goods necessarily entails free movement of labor? Dr. Miller admitted there would be "some intermingling", but, as I understood him, he believes that goods and labor can be treated separately in matters of theory and policy.

Read the quotes from Mises, Friedman, and North in yesterday's post.

Anonymous polyhedron April 15, 2016 11:08 AM  

Oh, I just noticed your Notes post. Scratch that.

Anonymous mature-Craig April 15, 2016 11:21 AM  

The main problem with the market as arbiter of social affairs I'd that it shows a preference, over time, for quantity over quality in terms of its customers' demands and in fulfilling those demands, it seeks to level societies to their lowest common denominator.

interesting

Blogger Alec Rawls April 15, 2016 11:34 AM  

Vox on free trade

Nice syllogism by Vox. IF the trade agreement includes discretionary processes then yes, the multinational companies that are supposed to be controlled by the agreement will instead be able to co-opt it. Happens all the time.

But not all trade agreements are subject to this co-option. It is possible to have an agreement with no discretionary component, just a blanket prohibition on barriers to trade together with a simple pre-specified tit for tat enforcement mechanism. Vested interests will certainly try to block such an agreement from ever coming to pass, but if it does come to pass it will eliminate most opportunities for corruption.

How a country will fare under such an agreement depends on how well structured it is to win the international competition for viability in various markets. The current viability-killer for the United States is our massive system of social welfare, especially the large entitlements that get loaded directly onto employers through employer mandates (Obamacare, unemployment insurance, workers compensation insurance, family leave in CA now, etcetera).

Get rid of the welfare state and America's massive overregulation of everything and the United States would dominate every industry. We would be the big winner of the free trade world, which would also make the rest of the world better off, with lots of technological progress and stuff getting less expensive all the time.

As a matter of political economics a real free trade agreement, by exposing us to competition, would push us to reduce employer mandates and the welfare state and over-regulation, so the political dynamics are not bad either. On the other hand our welfare state isn't about to disappear and our present ability to compete is not looking good.

Thus in current circumstances free trade is a mixed bag, with big American winners and big American losers. For it to be win-win for all Americans we'll have to get rid of the welfare state.

Anonymous mature-Craig April 15, 2016 11:48 AM  

re: 94

so it seems to me that the democratic party is the destructive force doing all the damage you mention. which is why I identified them as public enemy number one a long time ago

Blogger VD April 15, 2016 11:54 AM  

But not all trade agreements are subject to this co-option. It is possible to have an agreement with no discretionary component, just a blanket prohibition on barriers to trade together with a simple pre-specified tit for tat enforcement mechanism. Vested interests will certainly try to block such an agreement from ever coming to pass, but if it does come to pass it will eliminate most opportunities for corruption.

No. You're wrong. This is not a variant of the "No True Free Trade" argument.

Blogger Snidely Whiplash April 15, 2016 11:55 AM  

I would say that neither party instigates the corruption. Rather, the entire system is weighted, managed and operated to maximize corruption on both sides. As a small corp, the surest, easiest and almost only way to become a large corp is through corruption of regulators, politicians, the media, unions, bankers. You do not move into Multi-national Megacorp status without even more cynical blatant corruption than seems humanly possible. You do not rise to the top of a Megacorp without manipulating every factor in your environment to that end, without becoming a corrupt bastard.

On the other hand, politicans are selected at every level for their malleability and corruption. Contrary to "Mr Smith", an honest man almost never makes it to Washington. When he does, he is seduced or destroyed. Only the most venal and pliable are allowed into chairmanships, given plum speaking engagements, allowed into leadership. Any who do not play the corruption game are quickly neutralized and removed.

Is Ted Cruz using his marriage to Heidi to accrue political power, or is Heidi using her marriage to a very successful politician to accrue corporate power? It's not exclusive.

Carly Fiorina was shockingly corrupt in her management of HP. Unfortunately for the stockholders and employees, she was also incompetent. So having finally been driven out, and unlikely to get into a position of Corporate power again, she naturally went into politics, where competence is not an issue.

And what happens to politicians who have lost their posts? Why they go into the corporate world, where they are used to taint and corrupt their former fellows.

I guess my point is that "corporations" and "politicians" are not two separate categories, merely two faces to the same counterfeit coin.

Blogger Snidely Whiplash April 15, 2016 12:02 PM  

Alec Rawls wrote:ut not all trade agreements are subject to this co-option. It is possible to have an agreement with no discretionary component, just a blanket prohibition on barriers to trade together with a simple pre-specified tit for tat enforcement mechanism. Vested interests will certainly try to block such an agreement from ever coming to pass, but if it does come to pass it will eliminate most opportunities for corruption.

Oh how cute! An optimist!

Your proposal assumes there's an honest broker, right in the middle of the process.

Someone will have to declare that the barrier to trade exists, that it was erected by the other party, and that it is causing actual harm. That person will be a politician, no matter how you structure the mechanism. Many very large, very rich, very powerful people and organizations will have a vested interest in the outcome of that decision making process. Some will want such certified when it is in fact not true. Some will want it not certified when it is in fact true. Some subset of those will be willing to pay to get what they want.

Blogger rcocean April 15, 2016 12:06 PM  

The idea that we need to transfer power from Trump to Bill Gates, Zuckerberg, George Soros, and Adleman, has to labeled as some kind of crazy.

Blogger S1AL April 15, 2016 12:11 PM  

I'm going to try a different approach to rebutting #3 - the historical record of the treatment of corruption in international dealings.

1. For most of U.S. international history, bribes paid to foreign governments out their officials were legal and actually considered a legitimate business cost.

2. A large number of U.S. companies with no domestic corruption record paid such bribes in order to do business.

3. In such cases, the corrupting agent is government.

4. In most such cases, the development of free trade reduced or even eliminated this corruption.

5. Therefore free trade is beneficial.

Since both of these assertions cannot be correct, there is an error. I believe it's in the assumption that there is a single corrupting agent, but other arguments could be made.

Blogger rcocean April 15, 2016 12:13 PM  

"It's remarkable how many free trade arguments begin with the word "imagine"."

And its amazing how many average people fall for it.

Anonymous Jack Amok April 15, 2016 12:13 PM  

it is the board members and executives of multinational corporations who are the primary actors responsible for corrupting the politicians

Though I agree that multinationals are exacerbating government corruption, I don't quite agree with how the argument is laid out here. I believe politicians are inherently more corrupt than the average businessman - they have chosen after all to make their salary running a con-game. Politicians choose their profession to get away from the power of the Invisible Hand.

But the execs of multinationals are hardly the average businessman. At some point, when a company has become big enough, individuals can avoid market accountability for their actions by moving around within the company (or industry). They escape the Invisible Hand too. At that point, the partner with politicians. Neither is corrupting the other, they are both corrupt to begin with and merely seeking each other out as partners in an even bigger con. "Recall that corporations are creations of government" is part of this.

Small and mid-sized businesses, subject to the Invisible Hand, are less corrupt than big multinational. Free Trade favors the big companies (easily provable, even just looking at "Free Trade" within the US before NAFTA).

I believe the proper penultimate point is "free trade will tend to increase corruption by transferring power from smaller companies who are subject to the Invisible Hand to multinational corporate interests which use their influence with government to escape the Invisible Hand."

There's perhaps another point in there about Free Trade favoring remote governments over local ones (and here Vox's excellent point about politicians having to live among the people they represent matters - local politicians have to do this more so than distant imperials). It's the remote government overseeing the Free Trade Area that prospers at the expense of the local governments.


Anonymous Jack Amok April 15, 2016 12:19 PM  

Or maybe the right approach is to hammer home the point that a multinational corporation is much closer in behavior to an autocratic government than it is to the smaller businesses constraint by the Invisible Hand of the market.

It's size, not form, that matters.

Blogger Elder Son April 15, 2016 12:20 PM  

And, we want to thank our innovative national security techno police state partners for helping keep America safe!

I know that this isn't the direction you are going, but there are just so many ways that corporations corrupt Mr. and Mrs. Washington.

Corporations, like bankers, and politicians, understand one thing. Money. And power. Money has no motherland.

You think all those Bilderbergers meet up to talk about how much they luvvv you? You are just a tool. An amoeba, to be used, or discarded.

The NWO is a corporatocracy. A global currency and global corporatocracy makes perfect sense. Now get back in your pens, we'll call you when we need you.

"Mischief springs from the power which the monied interest derives from a paper currency which they are able to control, and from the multitude of corporations with exclusive privileges, which are employed for their benefit."

Blogger BrianE April 15, 2016 12:21 PM  

In general, free trade produces more wealth in a country than restricted trade. A question is who is the benficiary of that wealth.
I don't remember if the influence of currency valuations was discussed but that is a driver of decisions whether a product is competitive in foreign markets.
My company relies on exports and with a weak dollar our products are very competitive in European markets. As the euro has weakened it has affected our ability to export. Solution. Shift more production to manufacturing facilities in the EU.

Anonymous mature-Craig April 15, 2016 12:21 PM  

re 95

I got overly charged up reading 94 and in 95 I think I may have been a little too hard on democrats,

Blogger tz April 15, 2016 12:24 PM  

@94 there is no magic enforcement fairy. Corrupt governments can choose enforcement or not. The Chinese political prisoner can't sue Wal-Mart.

@87 - assuming high trust, and then contracts will be custom and handshakes and experimental for most things. If people trust and cooperate naturally, no government is needed, if they can't or won't, no government can substitute for it.

Blogger tz April 15, 2016 12:26 PM  

Corpseorations are responsible to their stockholders, so when cheating, theft, or killing (pollution, safety) will boost the stock price this quarter, their duty is to do such. Laws might limit evildoing, but not any invisible hand.

Anonymous mature-Craig April 15, 2016 12:32 PM  

If people trust and cooperate naturally, no government is needed, if they can't or won't, no government can substitute for it.

I would say tyrannical govts can rise up and create environments where people are coerced into doing things they don't want to

Blogger Steve Moss April 15, 2016 12:34 PM  

I suppose the old restatement of the Golden Rule would support Vox's argument- "He that has the gold, makes the rules".

I still have to consider the balance of it, including who is more 'corrupt'.

Anonymous kfg April 15, 2016 12:35 PM  

@97: See @14

@103: "It's size, not form, that matters."

Power tends to corrupt.

Also, although I came by the observation independently in my youth, I was not the first to observe that the large corporation is structured in a way analogous to feudalism.

It certainly fit Japan to a T.

Anonymous mature-Craig April 15, 2016 12:40 PM  

re 109

and so like you said no govt can substitute for it

Anonymous peppermint April 15, 2016 12:44 PM  

This is the argument Ted Cruz makes when he says Donald Trump is the establishment and donated to Hillary Clinton.

Anonymous kfg April 15, 2016 12:46 PM  

@105: "My company relies on exports and with a weak dollar our products are very competitive in European markets."

Europe took action to weaken the dollar because, back in the day, American products were competitive in European markets on the basis of quality, despite their cost in Europe.

Blogger praetorian April 15, 2016 12:52 PM  

Get rid of the welfare state and America's massive overregulation of everything and the United States would dominate every industry.

That is fantasy. America has a tragically incompetent welfare system (really, systems, since they are typically a mix of Fed and State) and far freer corporate environment when compared with, say, Germany, which is doing a much better job of preserving its manufacturing base.

I certainly agree that the US can stand welfare and regulation reform, but to assert that afterwards we would dominate a freely traded world is silly. China is willing to shit up massive chunks of its country and employ workers in absurdly awful working conditions in order to knock out widgets. No amount of American enthusiasm or competence can compete with that, nor should it. Fuck them: if they want to produce their goods in that manner, let *them* buy them.

It's size, not form, that matters.

That's stretching it a bit, but the point holds. Efficiencies of scale in both production and socio-political clout lead to large multinationals held by abstracted ownership in the form of common stock. These multinationals, almost by definition, lose their pre-rational moral commitment to the nation in which they were founded and become quite happy to sell off and/or sacrifice public goods (moral infrastructure, social trust, solidarity, productive capacity and so on) for a sliver of additional short term monetary profit.

Trading across moral gradients, particularly for finished goods, is always going to be dicey, and should be considered on a case-by-case basis.

Surely there is a Rothbard of nationalism. Who is he?

Blogger James Dixon April 15, 2016 1:03 PM  

> Surely there is a Rothbard of nationalism. Who is he?

I'd have to say your posting on his blog.

Anonymous mntngt April 15, 2016 1:07 PM  

@VD

Regarding 2 & 3, your analysis is fundamentally flawed, scripture is very clear that the one taking the bribe is at greater fault

Yes the business types are the cause or initiators but that is to be totally expected in the grand scheme of things. It is the mandate or job of government to enforce the level playing field ie equal weights and measures.

A righteous person in authority must never request or receive a bribe if offered......however at the same time a righteous person when dealing with corrupt officials should not hesitate to offer a bribe if that is what it take to bring about righteousness

The onnis is always on the those recieving the bribe.

Blogger justaguy April 15, 2016 1:10 PM  

As I understand VD’s corruption argument:

1. free trade creates multinationals and larger companies due to networking and specializing effects. So large companies and more multi-nationals exist with free trade.

2. these larger companies and multi-nationals are more corrupt because they have more power, more ability to ignore free market and more ability to corrupt?

3. So more corruption from free trade

If cause of corruption is misuse of government power that restricts free trade/free choice/liberty through regulation, tariff, etc., then isn’t the issue with government, not the entity that benefits from the misuse of government power? Isn't the issue the size of government power in a free trade world?

Items 2 and 3 are just assumptions and not necessarily true. Is the total corruption more with fewer large companies than with many small companies?
a. Larger companies and multis have more cash and market share so more ability to conduct corrupt practices-?maybe but adding up all the corrupt smaller ones to a corrupt large one—is there evidence that this is more corrupting?

b. Why is multi-national more corrupt than national leader corruption/coopting national politician? Easier to corrupt one set of politicians than many.

c. Crusader countries with broad anti-corruption laws like US can inhibit multi-nationals in many countries, not just one country.

d. Reputation can impact the larger companies more, so issues with corruption cut both ways

e. Professional boards and managers with more at stake (large salaries and bonuses) than can be gained from petty corruption so they want to inhibit corruption—although buying regulation and legislators is seen as legitimate.

There is quite a bit of data on anti-trust and other corrupt practices. Cultural effects are large but I don’t know about studies showing size. Does data confirm the assumption that larger equals more corrupt?

Blogger RobertT April 15, 2016 1:13 PM  

Agreed. Pretty stupid naive argument. I hope the overall debate went better than this.

Blogger Snidely Whiplash April 15, 2016 1:18 PM  

justaguy wrote:As I understand VD’s corruption argument:
You don't understand Vox' argument

Blogger RobertT April 15, 2016 1:20 PM  

Corporate CEOs may not literally be a part of government, but they all play for the same team, with the same motives. Which are neither corporate success or good government.

Anonymous Jack Amok April 15, 2016 1:21 PM  

Efficiencies of scale in both production and socio-political clout lead to large multinationals held by abstracted ownership...

That's not quite what I meant. Size becomes an insulator from feedback. It pushes the feedback loop beyond the event horizon of an individual's job, either in time or space. It becomes too difficult to hold someone accountable for the bad results of their decisions because by the time the results are known, the person responsible has either moved on, or been obscured by time or distance.

Anonymous Jack Amok April 15, 2016 1:26 PM  

If cause of corruption is misuse of government power that restricts free trade/free choice/liberty through regulation, tariff, etc., then isn’t the issue with government, not the entity that benefits from the misuse of government power?

If you arrest the meth dealer, the meth addict will find another dealer. If you arrest the meth addict, the meth dealer will find another addict.

You need to get rid of both if you don't want meth-heads stealing stuff in your neighborhood.

Blogger RobertT April 15, 2016 1:27 PM  

Many commenters trying to define circumstances in which free trade would be possible & good. Gives us an idea of how brainwashed people are. They just can't give up on such an "obvious" good, like mother, God & free-trade. I don't think those circumstances exist.

Blogger RobertT April 15, 2016 1:27 PM  

Many commenters trying to define circumstances in which free trade would be possible & good. Gives us an idea of how brainwashed people are. They just can't give up on such an "obvious" good, like mother, God & free-trade. I don't think those circumstances exist.

Anonymous Illisara April 15, 2016 1:37 PM  

Spread the news... Let's send that harassing SJW's from Mozilla which are sucking Google's balls as they want to wish to be like Chrome the proper message! They have no right to harass and attack the Pale Moon project.

https://twitter.com/ygjb/status/720720678475812865

https://twitter.com/ygjb/status/720746330616758272

Blogger praetorian April 15, 2016 1:40 PM  

That's not quite what I meant. Size becomes an insulator from feedback.

Yes, completely agree. Comments are tough for stuff like this.

What I'm saying (agreeing w/ and amplifying your point) is that the market and society often naturally produces larger and larger organizations, leading to the problems you are describing (Taleb: no skin in the game). As people become economic abstractions, "worker", "boss", "shareholder" etc. rather than "fellow countryman" the temptation to sell off or sacrifice common/public goods becomes overwhelming.

So the market must be restrained at some level, even though we all can agree that, at certain scales, it is by far the most efficient mechanism for generating wealth.

Anyway, I'm not saying anything you don't know.

Anonymous mature-Craig April 15, 2016 1:47 PM  

commenters trying to define circumstances in which free trade would be possible & good

I believe that the case has successfully been made that global free trade is something that weakens America

Anonymous mature-Craig April 15, 2016 2:02 PM  

1.Dr. Mill argues that free trade is beneficial because it reduces corruption by removing power from the hands of elected politicians and transferring it to the board members and executives of multinational corporations, who are presumed to be less corruptible than politicians by virtue of being answerable to the Invisible Hand of the free market

2.But it is the board members and executives of multinational corporations who are the primary actors responsible for corrupting the politicians.

I like that, also at least politicians can be held accountable at some level, in global free trade the villains are invisible and unaccountable,

Blogger Marcio Goncalves April 15, 2016 2:24 PM  

But it is the board members and executives of multinational corporations who are the primary actors responsible for corrupting the politicians.

Not really. If you follow corruption scandals in BRIC countries or in Latin America in general, you will realize that it's the politicians and the public servants that usually start the corruption.

Basically, if you don't pay them, your company won't be able to either work legally (because of licenses, authorizations, etc...), to get finance (in BRIC countries and Latin America is really hard to get finance for a business, so most people have to go to the government banks) or to be able to participate in biddings for government contracts.

In this type of situation, free trade has been proved to be an AMAZING tool against corruption.

Anonymous kfg April 15, 2016 2:33 PM  

"In this type of situation, free trade has been proved to be an AMAZING tool against corruption."

You mean like that promulgated by the United Fruit Company?

Blogger tz April 15, 2016 2:43 PM  

@109 coercion can force people to act, not to trust or naturally cooperate. It often paid for slaves to act as stupid as possible to avoid being forced.

Blogger Marcio Goncalves April 15, 2016 2:53 PM  

You mean like that promulgated by the United Fruit Company?

Your best example against free trade is a company famous for crony capitalism in the late 19th century and early 20th century? C'mon, you can do better than that.

And if you really believe the United Fruit Company got its monopolies only through bribery and that the politicians of Central America are only victims, you're absurdly naive and don't have a clue about how things work here in Latin America.

I could give you a list of cases in my country (Brazil) where even a modicum of free trade (i.e. opening a little bit the import restrictions or lowering import tariffs) either stopped or diminished corruption.

But what would be the point? You already made up your mind, considering that your regurgitating 70's marxists talking points...

Blogger praetorian April 15, 2016 3:06 PM  

I could give you a list of cases in my country (Brazil) where even a modicum of free trade (i.e. opening a little bit the import restrictions or lowering import tariffs) either stopped or diminished corruption.

But what would be the point? You already made up your mind, considering that your regurgitating 70's marxists talking points...


Remember, Marx praised international free trade.

Marxists were occasionally right about what was wrong, but always wrong about what was right.

Blogger Matamoros April 15, 2016 3:17 PM  

In the meantime: The secret US army study that targets Moscow

http://www.politico.eu/article/the-secret-us-army-study-that-targets-moscow/

Anonymous kfg April 15, 2016 3:18 PM  

"Your best example against free trade is a company famous for crony capitalism in the late 19th century and early 20th century?"

It's the most obvious example to the widest group of people. It stands only as an icon. The history of business interests taking an active part in corrupting Latin American political life goes back to the beginning. Simon Bolivar was known to complain bitterly over it. If he had had sufficient money to outbid business he might well have been able to achieve his dream of a South American republic by simply buying it.

To ignore the past history that brought your nation to where it is now is a greater error than the one you accuse me of.

" . . .your regurgitating 70's marxists talking points..."

I predate the 70's by a reasonable margin and have been a life long, anti-Marxist, entrepreneurial capitalist. I leveraged the proceeds of a paper route into owning the means of production.

And any kid who spent his money on a pair of Air Jordans could have bought a basic set of mechanics tools instead.

But didn't.

I still own most of the very tools I bought when I was 13 and they still provide me with income when needed.

Sometimes without taking the step of obtaining the required permits. Sometimes operating across the trade blockade of the Iron Curtain.

The free trade of the street corner that you are talking about is not the free trade between nations that VD is talking about. The idea that he might be advocating Marxist trade restrictions is absurd.

Anonymous rubberducky April 15, 2016 3:24 PM  

Free Trade is a sham. This book chronicles the experience of my hometown, Martinsville, VA, and surrounding areas in the era of free trade:

http://www.amazon.com/Factory-Man-Furniture-Offshoring-American/dp/031623141X/ref=sr_1_1?s=books&ie=UTF8&qid=1460747995&sr=1-1&keywords=the+factory+man

Tom Hanks has picked up on it, and is making it into a movie.

It is a sordid tale, and quite shocking, what happened.

Free trade killed my town, killed it dead. This story chronicles only one aspect of it, the furniture one. We were also a major textile producer and a chemical producer. All gone. This crap happened across the board.

Free trade is deadly and a fool's bargain.

Anonymous mature-Craig April 15, 2016 3:25 PM  

I still own most of the very tools I bought when I was 13
I think that's really cool

Anonymous mature-Craig April 15, 2016 3:29 PM  

another thing that swirls around like a whirlwind in the back of my mind in this discussion is the role of America on PLanet Earth.

when one of the parties involved in a free trade discussion is America I think everything changes and you are dealing with a very special case (maybe I am blind and ignorant)
and its maybe important that America ALWAYS have the UPPER HAND in any negotiation because that is just the way God wants it, and one way to strengthen that hand is tariffs, one way to lose that upper hand is global free trade

Blogger VFM #7634 April 15, 2016 3:57 PM  

Peripherally connected (free trade and Trump): someone in the media is trying to urge the GOPe not to fall for Trump's Xanatos Gambit:

http://www.cbsnews.com/news/why-the-gop-cant-take-the-nomination-from-trump/

Prediction: the GOPe cucks act like the SJWs in the Hugos and go through with shutting Trump out of the nomination anyway, especially if he doesn't win the first ballot.

Blogger SciVo April 15, 2016 4:03 PM  

5. Therefore, free trade is inimical.

Blogger Marcio Goncalves April 15, 2016 7:12 PM  

The free trade of the street corner that you are talking about is not the free trade between nations that VD is talking about. The idea that he might be advocating Marxist trade restrictions is absurd.

1) I'm not talking about "street corner free trade", I'm talking about free trade between nations. This type of free trade has empirically proven to be a good medicine against government corruption in Latin America. So VD's logic in this post is a little bit off.

2) I never said that VD is advocating for marxist restrictions. I said that YOU are using marxist talking points, quoting one of the laziest examples against free trade someone could use, the United Fruit Company.

I agree with VD that we should analyse Free Trade in terms of late 20th century and 21th century, not just in terms of 18th century. So we should use more current examples.

And in the case of Brazil, Argentina, Uruguay, Paraguay, etc... Free Trade (when it was allowed to exist) has been proven to be beneficial economically and a deterrent to corruption.

I'm not a open borders advocate. I believe in controlled immigration with an assimilation policy (mandatory English, etc...).

But what VD seems to be defending lately won't work. It will transform USA in Brazil - and I assure you that you don't want this to your country.

Brazil is exactly like VD wants the USA to be: free trade between Brazilian states but almost no-Free Trade between Brazil an other nations.

The result is crony capitalism, ridiculous high cost of living and endemic corruption.

Blogger Michael Maier April 15, 2016 7:19 PM  

I suppose I was thinking very small-scale, not multi-nationals.

But I suppose if there wasn't graft to be had, folks wouldn't go into politics in small towns to get graft either.

Blogger VD April 15, 2016 7:30 PM  

But what VD seems to be defending lately won't work. It will transform USA in Brazil - and I assure you that you don't want this to your country. Brazil is exactly like VD wants the USA to be: free trade between Brazilian states but almost no-Free Trade between Brazil an other nations.

Brazil is like Brazil because it is full of Brazilians, not because of its trade policies. You have endemic corruption because you have a low-trust, short time preferences population. Trading with other countries would probably make Brazil less corrupt... and it would make some of those other countries more corrupt.

Blogger Aeoli Pera April 15, 2016 8:02 PM  

"I support free trade with country X" = "I want to be on a level playing field with country X"

No comment on the debate yet, have only listened to it once and it was pretty high-level.

Blogger Aeoli Pera April 15, 2016 8:03 PM  

I.e. It makes sense that Bill Gates would want to play on a the same field as Brazilian techno-elites.

Anonymous mature-Craig April 15, 2016 8:04 PM  

re Marcio

I don't see how free trade would lead to less corruption, and your arguments are without substance and very ex-nihilo in my view, and your comment about Marxism leads me to believe you are intentionally trying to confuse the discussion.


Anonymous mature-Craig April 15, 2016 8:12 PM  

some thinking out loud thought experiment re 147

what might indirectly lead to less corruption in the case you are referring is that the eyes of the world and the police force of the US military and the MORAL AUTHORITY and the HONOR that the honorable US military would bring to the environment would cause the countries engaging in free trade to be on their best behavior knowing that they are being watched, and that would create less corrupton,

but it seems to me that would only be temporary until corrupt individuals who now have more cover and less accountability figure out a way around that.

Blogger Snidely Whiplash April 15, 2016 8:23 PM  

VD wrote:It's remarkable how many free trade arguments begin with the word "imagine". This should tell you something about the quality of the logic involved.

Virtually all the arguments for Libertarianism start that way.

A thought experiment is the opposite of an experiment. Aristotle and Marx both conducted lots of thought experiments.

Anonymous mature-Craig April 15, 2016 8:41 PM  

and another thing that occurs to me in this discussion, other countries really ought to -kiss America's ass- more , so to speak given the sacrifices that the US military makes being a police force to the entire world

Blogger VFM #7634 April 15, 2016 9:07 PM  

Brazil is exactly like VD wants the USA to be: free trade between Brazilian states but almost no-Free Trade between Brazil an other nations.

The result is crony capitalism, ridiculous high cost of living and endemic corruption.


@142
Last I checked, Brazil was in Mercosur.

Anonymous kfg April 15, 2016 9:09 PM  

The United Fruit Company is the sort of trader that made the US rich, albeit at the expense of Latin America.

The type of trade it has now is driving it closer and closer to being Brazil. In fact, a number of consumer items I have in my possession were made in Brazil, when they used to be made in my own area, which is now an economic wasteland.

Blogger tz April 15, 2016 10:27 PM  

@144 Ding ding ding! - Exactly.
Brazil is the way it is because of Brazilians, or at least those in charge who create a low-trust environment.

This wasn't covered strongly in the debate.

Brazil can through legislation create a high-trust environment (if they eject the low-trust legislators).

Swiss are very high trust, hence "swiss banks"..

But it isn't symmetrical or averaging. A 20% trust trading "freely" with an 80% trust results in 30-40% trust, not 50%. Trust is recessive, cheating is dominant.

That is why there will be LESS trade under a "free trade" regime where low-trust nations are allowed to enter. I can assume Canadians aren't trying to cheat and will ameliorate mistakes. Mexicans will laugh. So I will do LESS trade when it is open to liars, thieves, and cheaters.

Blogger tz April 15, 2016 10:33 PM  

United Fruit Company was the prototype.
Have you asked yourself why so many Banana Republicans?
Venn diagram would show large overlap with cuckservatives

Blogger Marcio Goncalves April 15, 2016 10:33 PM  

Brazil is like Brazil because it is full of Brazilians, not because of its trade policies. You have endemic corruption because you have a low-trust, short time preferences population. Trading with other countries would probably make Brazil less corrupt... and it would make some of those other countries more corrupt.

I won't disagree with you here. I lived enough years in the USA to know the difference between a low-trust society like Brazil and a high trust society like the USA.

But I also lived enough time in Northern California (San Francisco to be exact) to realize that the USA is becoming more and more like Brazil in terms of crony capitalism.
Less free-trade would accelerate this.

Anyway, I think you're anti-free trade arguments are the best I've heard so far, my problem was specific about this sentence here:

But it is the board members and executives of multinational corporations who are the primary actors responsible for corrupting the politicians.

Well, that's not really the case in most cases in BRIC countries. It's usually a situation where politicians and high government servants are the primary actors of corruption.

In Brazil, China, Russia, etc... it's basically "pay us (put your number here)% or you won't be able to work legally here".

Blogger tz April 15, 2016 10:42 PM  

One difference between Brazil and the USA is the 2nd amendment.
somewhere between the 2nd and 5th escalation of the BLM, "the only good Fed is a Ded Fed" will be adopted. And depending on the locale, the number of good snipers might not be on the Fed's side. Add to that the brittle infrastructure.

(Anyone who wants anarcholibertarianism that has a spare nuke, check out the American Redoubt or read "Molon Labe" by Boston T Party).

Blogger Marcio Goncalves April 15, 2016 11:05 PM  

I don't see how free trade would lead to less corruption, and your arguments are without substance and very ex-nihilo in my view, and your comment about Marxism leads me to believe you are intentionally trying to confuse the discussion.

Ok, let me elaborate my point then. What do you think it's easier for a big corporation to do:

1) To compete with companies and products around the world, trying to convince part of a 200.000.000 population to buy its products. Or...

2) To pay some politicians and make them enact some protectionists tariffs and laws that will make your company products the only alternative to this same population?

Of course option 2 is much easier and cheaper. That's what happens in BRIC countries ALL THE TIME. And that's what you'll have in the USA if you go this way.

That's how protectionism leads to more corruption.

Of course that does not invalidate what VD said about a low-trust society.

A more corrupt and closed USA will probably functions better than a corrupt and closed Brazil - just like England functions better than Portugal - but it will still be much worst than it is now.

Anonymous A Paradigm Is More Than Twenty Cents April 15, 2016 11:13 PM  

tz
Brazil is the way it is because of Brazilians, or at least those in charge who create a low-trust environment.


So clearly we should import lots and lots of Brazilians into the US and let them run entire industries in some regions, because what could possibly go wrong?

Anonymous A Paradigm Is More Than Twenty Cents April 15, 2016 11:25 PM  

Marcio Goncalves
Not really. If you follow corruption scandals in BRIC countries or in Latin America in general, you will realize that it's the politicians and the public servants that usually start the corruption.

The dead hand of the Spanish Empire still rests heavily in Latin America. Spanish functionaries, especially in the colonial regions, were not regularly paid. As the Empire grew weaker often they were not paid at all. The custom grew to charge a small fee for services, such as a clerk recording a deed, that went into the individual pocket.

The word in Mexican Spanish is "mordida", the "small bite", and it has been institutionalized across the former Spanish empire for centuries. To have a public office is to receive certain payments, que no? Not a bribe! A bribe would be a more under the table payment for something special. This is a routine payment for doing a job.

Contrast that with the Anglo-Saxon tradition that is best summed up: "A public office is a public trust". This mindset would have been very clearly laid out in high-trust areas such as the Nordic - cultural areas of the US like, oh, Minnesota. Someone caught taking a bribe, no matter how small, would lose reputation and might well go to jail.

These two world views are now playing out in parts of California, where the Progressive-era system of government that gave some degrees of freedom to localities is increasingly being run by people whose culture includes the word "mordida" as a regular feature of business.

Perhaps this is one of the influences in Vox's mindset; he has an unconscious premise that government functionaries are honest until someone corrupts them, because that's how it was (or how it was supposed to be) where he grew up.

Culture matters. Culture is what we get when a large enough group of people with similar genotypes live together.

Migration / colonization is cultural imperialism.

Anonymous kfg April 15, 2016 11:27 PM  

" . . .pay some politicians and make them enact some protectionists tariffs . . .That's what happens in BRIC countries ALL THE TIME."

So:business is the instigator.

I think that's where I came in to this movie.

Anonymous A Paradigm Is More Than Twenty Cents April 15, 2016 11:36 PM  

So:business is the instigator.

Except when it's not, of course.

Anonymous kfg April 15, 2016 11:46 PM  

"The dead hand of the Spanish Empire still rests heavily in Latin America."

S'truth.

Blogger Eric Slate April 16, 2016 12:06 AM  

Government sets the rules by which corporate officials play. A government may select for its own corruption by rewarding companies congrats based on campaign contributions. We know this happens. Politicians have incentive to do this for campaign funds. Once a company is incentivised, the others follow suit to compete.

Anonymous Jack Amok April 16, 2016 12:41 AM  

But I also lived enough time in Northern California (San Francisco to be exact) to realize that the USA is becoming more and more like Brazil in terms of crony capitalism.

Absolutely. It's a combination of things - adding 60 million immigrants - most from a low-trust society being one big thing. Trading with low-trust societies is another big one. Let's just consider "traditional" Americans - the folks you experienced as a high trust society.

Not all of them are high trust. Every society has a range of people. An economy that rewards the ones willing to sell out their neighbors to the Chinese will, over time, end up lower trust because the lowest trust people will gain power.

Less free-trade would accelerate this.

As the above indicates, I disagree.

Anonymous mature craig April 16, 2016 12:59 AM  

Looking at it from the point of view of USA free trade is definitely bad. . Perhaps from the point of view of a" low trust country" it might have a positive effect but I have to think about that further

Anonymous mature-Craig April 16, 2016 8:45 AM  

re 147: For some reason I was thinking Free trade is consistent with Marxism, but I thinking about it further, I see how Protectionism might be more consistent with Marxism, so I apologize for my 147 comment.


there are a lot of factors and variables going on in this discussion

Blogger hooligan April 16, 2016 10:19 AM  

There was a time when corporations sought tariffs as protection for their domestic market because they could not otherwise compete with industries in Third World shitholes or corrupt Second World backwaters where operating costs were much lower than here because of the state of society. The cleverest of the CEOs, however, realized that it would be much more profitable to buy successive governments here to remove those tariffs and allow virtually unrestricted access to the domestic market...as long as they could move to some shithole or backwater and BE the beneficiary of those low operating costs.
Of course, they were not so clever as to keep in mind that cutting the income level of such a large portion of the workforce would eventually negatively affect the very market they desire.

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