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Of Trade and Tariffs

Recent talks of trade wars have been missing the fundamental discussion of how the needs of people around the globe could be met in the most sustainable way, and the core of that discussion are some clear agreements on what those needs really are. Pre-industrial societies met their most of their needs locally, most often within a few days walking or riding distance. Locally scarce items, such as salt for food preservation, were important and easy enough to transport. As ruling aristocracies developed tastes for items from farther away, their political and military power was used to control the supply and distribution of those relative luxuries. Empires were built on the ability to control the flow of goods made cheaply by foreign natives, who in turn were conditioned to want the manufactured goods from the empire. An absurd example is the Imperial use of the color red, whose manufacture from plants and tiny creatures was so labor intensive that no peasant would ever have anything red, but entire armies could wear red coats dyed by the result of peasant labor. Just the sight of thousands of red coats made the natives cower, an empire that could do that had to be strong.

A modern example is the change in local peasant agriculture, where the thousands of species of food crops suitable for small scale self sufficient farming are being replaced with genetically altered, herbicide resistant, proprietary crops whose seed can not be saved for replanting and whose costs are controlled by global corporations. In these cases, the local varieties are lost, the chance for massive crop failure increases as a disease or climate shift can destroy everything, the costs for seed and chemicals often don’t get balanced by world commodity price shifts, and the traditional local food staples are priced too high for the peasants (e.g. corn tortillas in Mexico).

A sustainable economy would allow for trade in items not locally available, but would price the difference in labor rates and transportation (and all external costs) correctly to allow locally produced goods to compete fairly. The revenues of the US government from its beginning into the 20thCentury when the income tax was created were almost all from tariffs. The original idea was to tax the difference in labor rates. Commodities are priced in a world market but the costs of moving them and the cost of adding labor value to them vary. A fair trade concept is to keep labor rates even, which then supports local production because the transportation is cheaper. This model is quite the opposite of finding the cheapest labor possible, colonizing it, extracting raw materials for export back home, and importing finished goods made in the center of the empire. The Imperial model worked well for the Brits because of those red coats, a bunch of ships, and firepower. The losers were the wogs who were at the bottom of the food chain, and no “white man’s burden” could get them back their old regional economy, since the missionaries’ “burden” was to set them up as permanent dependents of the economic/political empire.

Globalization is the Empire turned inside out, where the home-front is colonized and the corporation is the ruling elite, whose person-hood is recognized politically, but whose lack of responsibility to the consequences of it actions is quite inhumane. The use of jumbo jets to haul tomatoes to places that could grow their own is a stunning development. So is the fact that the pollution from container ships bringing manufactured goods to the US is greater than that of 18 wheelers on our roads. You can buy wood shavings (a very light weight product) in the Midwest, where we have abundant forests, that come a thousand miles from the  western mountains. Milk is hauled from Florida to Wisconsin to make cheese while Wisconsin farmers make too much already.

None of these trades would take place if labor was not exploited by low wages and external costs were included.

 Now we have the irony that new tariffs are being placed on imports by our President with the resulting tit for tat tariffs being placed on export commodities directly impacting the farmers who elected him. These farmers have built their businesses based on growing too much with capital intensive systems that are very fragile in shifting economic times and have lost their diversified rural lifestyle as a result. The loss of export markets will sink many of them if the trade war heats up. That development will just consolidate the failed farms into larger corporate entities that use semi-skilled hired hands with bigger equipment to squeeze a few more cents of labor out of the bushel. The quality of the life for the farmers  is declining just as it happened to the natives who were colonized by the Empire, but in this case we bought into it whole hog, and did it to ourselves.

Regional economic models can return us to living wages and long term prosperity if developed with sustainable principles.  These must include questions of what we actually need and what kind of lifestyle we should be strive for. Madison Avenue marketing has taken away the cognitive powers of most of us and the majority of stuff coming across oceans in containers is junk.

Real prosperity for all would include more leisure time instead of a second or third job. Renewable materials tastefully made into durable goods don’t have to be thing of the past. Locally grown food offers great opportunities for meaningful work, better health, and a reduced carbon footprint. Manufacturing wastes need to become raw materials for other products. Waste energy needs to be reused in other forms. None of these ideas are new or difficult. Implementing them as a holistic plan cuts against the global/top down/short term profit model that rules the world. And that’s intentional.

We must change that.

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