Thursday, January 9, 2014

Nothing's more pernicious than protectionism...

Ask yourself:

If you were a U.S. producer of some essential good, how would you feel if---due to an export ban---you couldn't market your product to would-be customers willing to pay you the market price?

If you, U.S. citizen, were in need of a job, how would you feel about a ban on an essential good that, if lifted, would inspire the U.S. producers of that good to expand aggressively---putting you, and thousands of others, to work in the process?

How would you, U.S. citizen, feel if your local producers of an essential good, with the capacity to produce it in such great quantity so as to not only supply you, but folks abroad as well---due to an export ban---didn't? Essentially forcing producers to keep supply low enough to keep the price (that you pay) high enough to remain profitable.

How would you, U.S. consumer of goods produced abroad, feel if---due to an export ban---the producers of goods from abroad were denied access to the global supply of some essential input, forcing their cost of production higher and, therefore, the price you pay for the desired good higher than it otherwise would have been?

If you were a U.S. exporter of anything, how would you feel if---due to an export ban---your customers abroad lacked access to the global supply of some essential good, resulting in higher prices for that good (and, therefore, less spendable income) for them, and less business for you?

And lastly:

If you were a non-U.S. consumer/producer, how would you feel about a trading partner who has control over the production of some essential commodity that you are in need of---and that you are eager to pay the market price for---and that "partner", out of some unfounded fear and/or to benefit some select group of political supporters, refuses to sell it to you? Would that strain your business relationship? Might you, in retaliation, play the same sort of game should you find yourself with a surplus of something that that "partner" may need in the future?

Folks, these are a few of the questions that might arise when we look beneath the surface of the export ban on crude oil that will be debated in the weeks and months, maybe years, to come. I assure you, any arguments for justifying the continuance of the 40 year-old ban, while they'll be cloaked in concerns for the U.S. consumer, will be made on behalf of politically-connected special interests. Of all the political blunderings that serve to hamstring our economy, not to mention---and most importantly---our liberty, I can't think of any more pernicious than protectionism.


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