Monday, January 9, 2012

Letter to Mr. Romney & His Record and His Rhetoric

Open letter to Mitt Romney:

Dear Mr. Romney,

You're about to catch some serious heat from your [hypocritical/supposed capitalist] opponents, right and left, on your exploits at Bain Capital. You're, they'd have voters believe, the heartless corporate raider. Ads featuring folks who've lost their jobs when Bain (you) swept in and swept away their employers will flood the airways in the weeks ahead. You sir have been handed a most golden of opportunities.

For not only will you do the obvious---cheer those companies Bain nursed to huge profits and new jobs---I suspect you'll spin to your advantage the notion that a "raider" might penetrate Washington and expose/purge inefficiencies so glaring a freshman business major could unearth...

Martin L. Mazorra

To the reader: This would not be my endorsement of Mr. Romney, I have some fundamental concerns (with regard to *trade, for one) that I've expressed heretofore. This would be however my encouraging of any aspiring, or sitting, politician who'll get to the long-overdue housecleaning so desperately needed in Washington. Not that my endorsement/encouragement matters in the least...

*As bright as Mr. Romney is, I can only conclude that his egregiously ignorant position with regard to trade with China (for example), is politics at its worst --- i.e., he has to know better, which, assuming he does, makes him no better than his opponents. I.e., while his record at Bain Capital is a legitimate (and, leveraged properly, a political) plus, his rhetoric with regard to trade, while he clearly views it as a political plus, is without question a legitimate minus.

This is Economics 101: To the extent we pay less for a Chinese-made product than our demand price (the max we'd pay), we enjoy consumer surplus. To the extent our exporters sell goods to China at a price above their supply price, they enjoy producer surplus. Apparently therefore, our consumer (2/3rds of our economy) enjoys a substantially greater benefit from trade than does the Chinese consumer.

The protectionist politician (he who'd impose tarrifs, etc.) pretends to represent the consumer... Oh but make no mistake my friend, he does not. He represents only his constituent producer(s), at the direct expense of the consumer at large.

Click below for my down and dirty free trade illustration:

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