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[QUOTE]Originally posted by zarahan- aka Enrique Cardova: [QB] [QUOTE]Originally posted by tropicals redacted: [qb] I sense that protectionism might trump all of these in the nurturing and development of local industries. [QUOTE] [b]The only thing you need beside the market is your brain(education, experience, imagination, etc) and the funding (personal savings, family and friends, banks, government program, internet, etc).[/b] [/QUOTE]From George Monbiot's The Age of Consent (2003): "Many poor nations have recognized that their people, their environment and their economies would be better served by excluding the rich world's companies until they are able to defend themselves, but they are forced by the international institutions to let them enter. The rich nations argue that liberalization of this kind is essential for development: if countries want to make money, they need to open their economies as much as possible. This claim is challenged by a remarkable but little-known truth: that almost every nation which has industrialized successfully and can now be counted as belonging to the developed world has done so not through free trade but through protectionism." "Britain, for example, regards itself as the patron of free trade. The British believe that they established their industrial revolution and acquired the wealth on which their global empire was built by means of a strict application of the doctrine of laissez-faire, permitting businesses to compete freely in a scarcely-regulated market. Nothing could be further from the truth. Britain's industrial revolution was founded, in its initial stages, upon the textile industry. In the eighteenth century this accounted for over half the nation's export revenues. The industry was nurtured and promoted by means of ruthless government intervention. Textile manufacturing began to develop in the fourteenth century, when Edward III brought Flemish weavers into the country, centralized the trade in raw wool and banned the import of woollen cloth. His successors extended this protectionism. Henry VII, for example, ruined Britain's (sic) major competitors - Flanders and Holland - by banning British (sic) merchants from exporting raw wool and unfinished cloth. Imports of competing products were not just discouraged through tariffs; in some cases they were prohibited. In 1699, for example, the British (sic) state destroyed the Irish woollen industry by forbidding the import of its manufactures, which were of higher quality than English cloth. In 1700, Britain (sic) did the same to the Indian producers of calico (cotton cloth), extinguishing the world's most efficient cotton manufacturing industry. Britain also banned steel mills in America, forcing its colony to export only pig iron. While tariffs on imported raw materials were reduced in the 1720s and 1730s (providing British industry with cheaper inputs), manufactured goods from abroad continued to be heavily taxed. At the same time, the government granted British manufacturers of every processed product from refined sugar to gunpowder generous export subsidies. Only when Britain had established technological superiority in the production of almost every manufactured good did it suddenly discover the virtues of free trade. It was not until the 1850s and 1860s,when it was already the world's dominant economy, that the country opened most of its markets. Even then, the process of liberalization was strictly controlled by the state. Britain's enthusiasm for free trade did not last long. In the early twentieth century, as it began to slip behind the United States and Germany, its manufacturers started lobbying for protectionism, which they were granted during the global Depression in 1932" (pp196-198). In the same chapter, Monbiot also writes on the role of protectionism in the economic development of the US, Japan, Taiwan and South Korea. [/qb][/QUOTE]Yes, the notion of "pure" free markets and so on doesn't hold up. Britain and all the rest used and benefited from tariffs. Today the Europeans use tariffs to keep out or reduce goods from elsewhere, including African produce. Are they protecting their own markets? Sure. Which raises questions about the smug lectures often delivered to Africa. Protectionism plays a part- provided it is SMART protectionism. It is nice to have an indigenous steel industry for example, but what is the hard-nosed cost/benefit bottom line? If you are gonna be building steel mills in the bush have you accounted for the huge expense of the IMPORTED machinery, fuel and technicians needed? And what's the point of cranking out "indigenous" steel after all that spending if the product is gonna be unusable? Too often people start from what is "nice" and symbolic, rather than a hard=nosed analysis of costs, benefits and tradeoffs. But what solutions or suggestions to do you have to curb "The Looting Machine"? [/QB][/QUOTE]
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