Thursday, January 02, 2014

Indian Economic Liberalization Winners & Losers (Another Straw Man Courtesy of Mr. LB)

...trade liberalization... tends to benefit elites more and thus to increase income inequality ~ The WTO and the OECD (excerpt from a 2009 study, as quoted in the article Winners And Losers: The Human Costs of "Free" Trade by Peter Costantini, Huff Post World 12/14/2009).

The country of India is proof that Libertarian economics is the shiznit, or so says a Libertarian blogger in a recent commentary...

Libertarian Blogger: Back in 1991 the government of that country instituted freer trade, deregulation, privatization, and a significant change in tax policy. This is the Indian economy, folks *graph showing the Indian economy growing*. For the first 43 years of its existence it was tightly managed by government. You see what happened? And do you see what happened when they finally liberalized the sucker? Yeah, huh? (12/31/2013 at 8:42pm).

The Libertarian blogger believes this is irrefutable evidence that decreasing regulation and eliminating tariffs is key to economic success. And he posts on this subject because he thinks Progressives oppose "liberalization" and support "strong government controls". But this is just another strawman from Willis "I Love Strawmen" Hart (AKA the Libertarian blogger or "Mr. LB").

But Mr. LB is wrong about Progressives. Progressives acknowledge that the private sector is key to a healthy economy. Although we do know that smart regulations and tariffs are NEEDED to protect workers (the 99+ percent that actually drive the economy) and the environment. I suspect Mr. LB favors "liberalization" because it allows the plutocrats to run roughshod over both (workers and the environment). A regulatory system that works well, isn't corrupt and protects workers and the environment should be our primary concern (not liberalization). Although "liberalization" certainly is not a bad thing (necessarily). But the two need to be balanced.

In any case, the Indian economy was not quite "liberalized". Certainly not to any kind of degree that proves or lends any credence what-so-ever to full-on Libertarian economics, as pointed out by Live Mint (India's second largest business newspaper), in an article titled "The myth of liberalization?"...

Manas Chakravarty, writing for Live Mint: Laura Alfaro of Harvard Business School and Anusha Chari of the University of North Carolina at Chapel Hill [examined the data and found] an economy still dominated by the incumbents, state-owned firms, and to a lesser extent, the traditional private firms, that is, those firms that existed before the first wave of reforms. [The] evidence [shows] continuing incumbent control in terms of shares of assets, sales and profits accounted for by state-owned and traditional private firms. (Live Mint & The Wall Street Journal, 10/31/2009).

State control, crony capitalism, and corruption still are VERY much a part of the picture, in other words... all opposed by Progressives, BTW. So, is India a case study that proves that when Libertarian economics is adopted success follows? The answer depends on how you define success. The following Wikipedia excerpt explains the downside of Liberalization...

Wikipedia/Economic liberalization in India: Since 1992, income inequality has deepened in India with consumption among the poorest staying stable while the wealthiest generate consumption growth. As India's GDP growth rate became lowest in 2012-13 over a decade, growing merely at 5%, more criticism of India's economic reforms surfaced, as it apparently failed to address employment growth, nutritional values in terms of food intake in calories, and also exports growth - and thereby leading to a worsening level of current account deficit compared to the prior to the reform period.

So, what really happened is that the Indian government instituted limited "liberalization", and the plutocrats rushed in to take advantage of the cheap manual labor and the cheap skilled labor... provided thanks to India's socialist educational system. Wikipedia notes that "the various articles of the Indian Constitution provide for education as a fundamental right".

Wikipedia also notes that in India "the medium of education is English". This explains why so many of our White-collar jobs were outsourced to India. Under Liberalization jobs that can be outsourced go to the lowest bidder. India underbid American workers (who couldn't go lower due to a higher cost of living in the United States). Indian workers won, in that they got decent paying jobs... in the context of what the cost of living is in India (or at least some of them did) and American workers lost.

But there was another, even bigger winner... and those winners were the plutocrats (or the elites mentioned in the quote at the top of this commentary). The plutocrats are always the BIG winners under Libertarianism. But the strawman Mr. LB presents is that any country adopts Libertarian economic policies will come out ahead... and that just isn't true. India is proof of this. India experienced impressive economic growth because they were a poorer country to begin with. And the fact that their population benefits from a socialist educational system didn't hurt either.

What Libertarian economics does is pit wealthier workers against poor workers (worldwide). The wealthier workers invariably lose, and their wealth is transferred to the poorer workers... with the plutocrats as the middlemen who skim off a very healthy percentage for themselves. I don't know about you, but I think there are better ways of achieving economic success without the plutocrats taking such a very large cut for themselves.

Me, I'm thinking Fair Trade (as opposed to Free Trade) might be a part of the solution. Governments should act in the best interest of all it's citizens, instead of pitting workers against each other for the benefit of the plutocrats. This would involve us increasing our tariffs to protect American jobs (less liberalization). Impoverishing American workers so the plutocrats can become even richer is utter stupidity, IMO. But clearly Mr. LB disagrees.

SWTD #221, wDel #43.

9 comments:

  1. The plutocrats bought off our legislators and got them to adopt "free trade" agreements that screwed American workers. One of the countries they moved our jobs to was India. Will Hart is the sucker, IMO.

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  2. Will loves to take one fact and build a whole belief system out of it.

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  3. I think the problem is that Will takes these facts, spoon fed to him by the Libertarian think tanks, and never digs any deeper. The plutocrat-funded Libertarian think tanks tell him that India "liberalized" it's economy and economic growth followed, and Will immediately sees this as validation of his beliefs. He doesn't bother to ask WHY (because the IMF stepped in and primed India to be taken advantage of by the plutocrats) and he assumes such a "liberalization" would have the same effect here (even though we have already dropped our trade barriers, which was what enabled the plutocrats to send our jobs to India). The plutocrats will continue to send the jobs where the labor costs are the lowest... as long as we let them.

    Will's blog is all about doing what is best for the plutocrats... Global Climate Change necessitates regulating carbon... Will denies it exists because that would hurt the bottom line of the big polluters. Lowering tariffs is impoverishing America? Will says the opposite is true. In fact, according to him, It's good to send our jobs to lower wage countries because we benefit with lower priced goods (no matter than without a job people can't buy those goods). And who cares if the plutocrats enrich themselves even more in the process or if inequality grows and the poorest suffer? That is the price we have to pay, folks!

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  4. Will published a commentary in which he rebuts my rebuttal... by guessing what I said! I mean, why bother? Except that his guessing enabled him to set up some straw men (something Will absolutely LOVES to do) and knock them down. Can there be any doubt now that this guy is highly dependent on straw men and finds it hard to engage in actual debate? That is, without flying off the handle and losing his temper big time.

    The title of his post? "Think Insanity", as in, it is I who is thinking insanely... or that is what he thinks of when he thinks of me. Whatever the title means, it is clearly ad hominem. And (in that vein) Will brings up a lot of past issues he disagreed with me on and (in his mind) proves I think insanely. And, when citing the issues he says I got wrong, Will says I "scoured the entirety of the internet" and found ONE guy that agrees with me (yes, just ONE person agrees with me, according to Mr. Hart).

    Will says that I'm wrong (and insane) in thinking that [1] Bush is a war criminal, that [2] Smoot-Hawley was actually good for the economy and that [3] we should have handed bin Laden over to "his fellow Middle-Eastern tyrants". But my arguments in regards to these issues are not insane, nor did I need to "scour" the internet to find "one guy" who agrees with me...

    [1] bush IS a war criminal. Primarily, I would say, because he lied us into the Iraq war. GWb KNEW Iraq did not have WMD because the IAEA told him. In regards to bush lying, Mr. Hart said "you gave me no evidence that Bush KNEW that there weren't weapons of mass destruction and then lied to the American public... No testimony. No paper trail. Zero".

    Mr. Hart is wrong. The following is from my blog post on the subject...

    The invasion of Iraq was ordered by ex-president bush on 3/20/2003 AFTER the head of the International Atomic Energy Agency (IAEA), Mohamed El Baradei, told the Security Council (on 3/7/2003) via written report that the "UN inspections in Iraq worked". Mr. ElBaradei's team conducted 247 inspections at 147 sites and found "no evidence of resumed nuclear activities... nor any indication of nuclear-related prohibited activities at any related sites". The IAEA report went on to say that "Iraq had not imported uranium since 1990... no longer had a centrifuge program, [and that] Iraq's nuclear capabilities had been effectively dismantled by 1997 ... [and] A report by the IAEA submitted to the UNSC most certainly qualifies as the PAPER TRAIL that Mr. Hart says does not exist".

    bush lied about WMD and violated the UN charter. These are FACTS. "War criminal" is certainly an inflammatory word, but I strongly believe it applies to bush.

    (continued in next comment)

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  5. (Continued from previous comment)

    [2] Smoot-Hawley was actually good for the economy because, according to Thom Hartmann "American businesses now had strong financial incentives to do business with other American companies, rather than bring in products made with cheaper foreign labor [and as a result] Americans started trading with other Americans".

    What Mr. Hartmann argues is that Smoot-Hawley prompted American companies to manufacture good in America. Of course it took some time for them to accomplish this, and over all Smoot-Hawley did have a negligible negative effect. Now, the depression and unemployment did get worse after the passage of SH, and Will Hart says SH was definitely a factor in this, but he is wrong. The facts show that SH may have "accounted for a total GDP loss of less than 1/2 of 1% ($0.2 billion)". As I asked in my blog post on the subject "does this sound like an amount that would cause, according to the Conservative blogger Will Hart, the unemployment rate to skyrocket?". The answer is clearly no.

    [3] I never suggested that we should have handed bin Laden over to "his fellow Middle-Eastern tyrants". I did say that I agreed with Thom Hartmann and Gareth Porter (an investigative journalist and historian specializing in US national security policy) who both believe that we should have taken the Taliban up on their offer to turn bin Laden over to the "Organization of the Islamic Conference (OIC), which is a Saudi-based international organization of Islamic countries. It is a moderate Islamic organization". Gareth Porter said (in an appearance on the Thom Hartmann Radio Program, 5/2/2011) "I believe it is a fair presumption that bin Laden being tried by an OIC international panel of jurors would certainly result in a guilty verdict for the 9/11 attacks".

    Now, Mr. Hart (and others who comment on his blog) contends that the OIC would haven't found OBL guilty, in fact they would have SET HIM FREE! An utterly ridiculous assertion, IMO. Gareth Porter is an expert in this field, and the OIC is considered moderate by the world community. It is NOT an organization of OBL's "fellow Middle-Eastern tyrants". This claim is simply factually inaccurate. In any case, even *if* they had found him "not guilty" setting him free was HIGHLY unlikely (as the Saudi leaders expelled OBL from their country and had no love for him). Instead of getting him into custody, WH and cohorts think the better course of action was us letting him get away! Talk about insanity.

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  6. Mr.Dervish,a.k.a. GPB, does it ever depress you that no one gives a shit what you have to say?

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  7. Wow....dmarks is giving you an opportunity at a work release program.If you can complete the requirements you will be allowed out in public.A generous offer by dmarks.

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  8. More proof that Liberian is a mental disorder. Just read this blog.

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    1. I've never discussed "Liberian" on my blog, Mr. Degorio. Honestly, I don't know what it is. In any case, thanks for stopping by.

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Unfortunately comment moderation is necessary in order to screen out insanity from an idiot calling himself "Luke" of the "Words And Music" blog (a liar who has made bogus accusations that many others are stealing his posts) as well as homophobic hate from TOM of the blog "Stay A While" (actually the same person).