NetNews Usenet Archive 1992 #31/NN_1992_31.iso/spool/sci/econ/9514

Internet Message Format | 1992-12-23 | 3.2 KB

Path: sparky!uunet!olivea!gossip.pyramid.com!pyramid!pyrnova.mis.pyramid.com!pcollac
From: [e-mail] (Paul Collacchi)
Newsgroups: sci.econ
Subject: Re: Dumping
Message-ID: <[e-mail]>
Date: 23 Dec 92 18:27:58 GMT
References: <[e-mail]> <[e-mail]> <[e-mail]> <[e-mail]>
Sender: [e-mail]
Reply-To: [e-mail] (Paul Collacchi)
Distribution: usa
Organization: Pyramid Technologies, Mt. View, California.
Lines: 57

In article <[e-mail]> you write:
|> In article <[e-mail]> [e-mail] (Glen Raphael)
writes:
|>
|> > We don't need the US to compete in every market, we just need
|> > *somebody* to compete.
|>
|>    We *do* need the US to compete if we want jobs, prosperity,
|>    and social stability in the US.    You guys are still looking
|>    at all these things like they're single-variable problems!
|>
|>
|> ---peter

I think his point was a more narrow one than you are making.  Everyone
agrees that the US needs to be competitive to insure prosperity.  Glen
was simply pointing out that "competitive equilibrium" discourages
dumping as a strategy, and that in a strong world market, the US
doesn't necessarily need to be a part of every competitive equilibrium.

It's a good point, I think, and one which pro-protectionist types too
frequently miss.  For example,  there is much concern over this EC
consortium to make airplanes.  Everyone in the US is worried, you know.
They're afraid that gov't intervention in Europe will put the US
manufacturers out of business.

They may be right, but if they do, it won't be such a bad thing.
Why?  Because we know that gov't intervention is no more efficient than
private capital.  If it's any less efficient at all -- and it probably
will be -- then the entire EC economy becomes weakened by that
inefficiency.

We ought not respond by by becoming more inefficient ourselves.  Such is
the subtle contradition of protectionism!

Instead, we should take it on the chin, and,  know that the capital freed
up from US airline manufacturers will eventually pursue some other endeavor
*AND* with maximal efficiency.  In that sense, our *whole economy* will
continue to exhibit monotone non-decreasing levels of capital efficiency.

Now the "jobs" problem.  Let me give you the bad news.  The purpose of
Capital is to maximize return -- not necessarily to create jobs.  In fact,
Capital will seek to reduce labor costs (jobs) whenever possible.  It's not
in capital's best interest to create jobs.  It's merely Capital's rhetoric.

Get this:  what's good for Capital and "competitiveness" is not
necessarily what's good for America, for exactly the reasons you've
pointed out; namely
that Capital competitiveness may produce a concentration of resources which
is antagonistic to "the general welfare."

Therefore, we may choose to give up competitiveness in the name of creating
jobs.  And we can invite Jim to explain to us how his wunderzystem will
produce prosperity for *all* and not just "some" or "most", including those,
who out of freedom choose not to turn themselves into competitive machines.

Paul Collacchi