  
 Supporting American-Made Products and Services from American-Owned Companies 
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by Roger Simmermaker
Peter Lynch, in his book "One Up Wall Street," says that by his second year at Wharton College, it seemed most of what he learned there that was supposed to help him succeed in investment business, could only help him fail. He studied statistics, advanced calculus and quantitative analysis, which taught him things he saw happening around him couldn't be happening. He was using his common sense.
The heavily educated people that were part of these think tanks decided that free trade, in theory of course, must be beneficial for the United States. All the things they said wouldn't happen are happening, and now they are busy trying to formulate theories to explain what is happening.
Peter Lynch also mentions a friend in his book who did extremely well in small stocks. ''The secret of his success is that he never went to business school - imagine all the lessons he never had to unlearn."
That may just be the problem with all these NAFTA proponents. Education is a great foundation on which to stand, but you have to use your God-given common sense. Common sense tells you that when you enter a trade agreement with another country, as we have with Mexico, and the US trade surplus turns into an even larger trade deficit, that agreement is not working in our national interest. Common sense tells you that when you force high wage earners in America to compete on an unlevel playing field with fractional low wage earners, that wages will stagnate or fall.
This is not only common sense, it is reality! Theodore Roosevelt said ''Thank God I am not a free-trader.'' Abraham Lincoln said ''By the tariff system, the whole revenue is paid by the consumers of foreign goods.... The man who contents himself to live upon the products of this country pays nothing at all."
NAFTA proponents say that removing trade barriers will enhance competition, but removing these barriers will actually decrease competition in the long run. Larger companies will continue to acquire smaller ones unable to compete as efficiently or effectively, which leaves fewer companies, therefore reducing competition.
According to the Wall Street Journal earlier this year, two-thirds of Americans blame trade and immigration for stagnant US wages, a recent poll found. Adrian Wood, University of Sussex, argues that the growth of trade with developing nations has reduced demand for unskilled workers in industrialized countries and has caused wage declines in the US and unemployment in Europe.
The trade debate assures a deeper problem, one bound to be a big issue in the presidential race. The US isn't growing fast enough to produce enough well paying jobs for those harmed by trade or technology.
We need tariffs like Ronald Reagan slapped on the Japanese to save Harley-Davidson. Protectionist barriers do just what the term implies - it protects American industries. Without tariffs, Harley-Davidson would be gone. There would no longer be an American Motorcycle industry, just like there is no longer an American TV industry.
America simply cannot afford to risk her industries that remain in the name of free trade. After all, which is it we should be more concerned about? The health of economic theory, or the health of the American economy?
Another trade myth is that if we allow lower wage countries to manufacture consumer goods, it will always result in cheaper prices for the American consumer. The last time I went to buy jeans, one particular brand offered pairs made in Morocco, Costa Rica, and some in America.
Each pair was the same price. If the above proposed theory is true, why didn't the jeans made overseas cost less to reflect lower manufacturing wages? The reason is the savings are not being passed on to the consumer, because excess profits are being reaped by the company instead. If companies are free to do this, which they apparently are, it would be better to have tariffs so the government could collect revenue on those imports, and there would be less incentive for companies to relocate abroad.
In other cases, imported products are actually cheaper than their domestic counterparts. Years ago, when you wanted to impress someone by spending more than usual, you could boast of buying foreign products exclaiming "It's imported". Today, the question is "How did you get it so cheap?" The answer is "it's imported."
During the industrial revolution, a period where our nation experienced the greatest economic boom in it's history, the United States utilized protectionist tariffs, and wages were steadily on the rise. In the 1970's, our companies began to move offshore, and the government went along with a massive deregulation of imports so these companies could get their products in because they were moving out.
Also in the 1970's, wages began a steady decline as companies took advantage of cheap labor abroad to satisfy the consumers supposed desire for cheaper prices, and that wage decline continues today. Is there a connection between companies shutting down domestic production, laying off Americans, employing cheap labor to ship products back to the United States and the decline of the American standard of living? You bet there is!
The basic economic argument for free trade is this: If one can buy a product made in America for $20, and the same product made in a foreign country for $10, the consumer should buy the imported product for $10 so they can have $10 left over to buy other American products. The problem with this line of thinking is that eventually there will be no American products left for the consumer to buy.
Why? Because this scenario gives companies, American and foreign alike, incentive to relocate factories in lower wage countries to meet the demand for cheaper products. The money left over will most likely also be spent on imported products. In the meantime, more and more companies have relocated overseas to meet the consumers demand for still cheaper goods. Even less goods can now be found that are made in America, as imports have increased while exports have decreased. There are fewer American jobs because of the increased trade defecit. The government collects less tax revenue, unless it raises taxes to maintain the same level. Since the government is low on revenue, it must borrow money from other countries, quite possibly from the same ones where our factories have relocated.
Remember, we have their goods and they have our money. Where did they get the money to finance our debt? They got it from us when we bought their products which are now worn out and need replacing! Which product will the now tax over-burdened consumer most likely buy this time as well? The cheaper imported product.
Why? Because wages have been declining, taxes have been rising, and the consumer is struggling to keep up. What is the government's answer to these problems? More free trade so the consumer can buy products at cheaper prices! Our reduction of protectionist tariffs in the name of free trade has left us with fewer jobs, larger trade defecits, and a bankrupt government. This is not fantasy or theory, but reality! This is the state we find our great country in today.
If wanting to protect American industries and American Sovereignty labels me as a protectionist, then I am a protectionist. I want to see my country consciencious about protecting it self from foreign invasion, whether that invasion is based on the past disaster of war, or the current economic disaster of free trade. Most proponents of free trade know better. They just favor the interests of the multinational corporations over that of the American worker.
The most recent NAFTA version of free trade is an obvious failure. What can we do about it? We have the vote. We can vote out those politicians that voted NAFTA in. We have the pocketbook. We can buy American, and lessen the negative impact NAFTA has on our economy should it remain.
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