-Caveat Lector- Keep in mind I'm a mere amateur in economics, but the history of these systems is something that must be studied if we are to understand who is behind conspiracies. Linda ====== from: http://www.drury.edu/faculty/ess/history/modern/econhist.html Because mercantilism depended upon large amounts of gold and silver there is a push towards the exploration of distant lands to find more gold and, at least for the mercantilists, more wealth. This desire for gold coupled with the belief that a state should only import raw materials led to colonialzation. A colony could provide the raw materials a nation would need, without having to pay someone else for them. If your goal is to maximize the store of gold in your state this is a good way to do it. As I noted above there was a large increase in the amount of exploration during this time frame. To be able to discover something, to trade with a distant nation, or to bring goods into your state from a distant colony required the use of navigation. In order to sail the open oceans, one would need better navigational instruments and better mathematical techniques.(Alioto 162) This led nations to set up places where advanced mathematical techniques and where advanced geography could take place.(Boorstin 49 ) Because mercantilism was concerned with the political, as well as the economic, power of a state the art of warfare changed. Alioto notes that the Hundred Years War between the French and the Engilsh changed warfare.(Alioto 162) Armies were now professional and science was used to further the ability of weapons to kill. New fire power required improved skills in engineering and mathematics.(ibid) Alioto also notes that the financial burden of these wars led to an interdependence between the state and the merchant class, and the "old local economic patterns of the Middle Ages were gradually swept away by this new rationalization of violence."(ibid) Here it is evident that the development of new scientific inquiry was a direct result of the role of the mercantile economic system. Mercantilism ultimately lost intellectual respectabilty..... -------- LM: Or so they say. I am developing a theory that mercantilism is what our country is based on today. --------- Mercantilism also broke down because many people at this time were beginning to realize that a state regulated economy was not providing well for the nation as a whole. Men began to reject a purely rationalistic view of knowledge in favor of an empirical view, that stressed that we can only know what we can sense.(Ekelund 65) This can best be seen in a poem by Bernard de Mandeville called The Grumbling Hive; or Knaves Turn'd Honest, written in 1705. Mandeville's point was that through observing people in the real world he noticed that people often times do things that are "wrong" or in their own interests, but that their wrong doing leads to an overall benefit to society at large. Mandeville's conclusion was that economic freedom should be given to the society at large in order for the entire community to benefit from anothers "vice". -------- LM: Mandeville was an apologist for the drug pusher mentality of Freemasonry which controls our world today. ------------- In conclusion, mercantilism led to colonialzation, the exploration of the New World, the further development of science, and in its down fall led to the beginnings of economic liberalism. ++++++++ Example of Today's Rent-Seeking Mercantilism: from: http://www.cato.org/pubs/regulation/reg19n4b.html Desperately Seeking Rentseekers For years many academics have suggested that regulatory policies are more the result of interest-group manipulation than dispassionate consideration of the public interest. Many firms find it easier to lobby for wealth transfers than to compete for wealth in an open marketplace. This practice is commonly referred to as "rent seeking." The "rents" sought are economic returns in excess of those that a competitive marketplace would allow. As defined by economist Robert Tollison, "Rent seeking is the expenditure of scarce resources to capture an artificially created transfer." Rent seeking occurs, in part, because firms can receive concentrated benefits through government action while the costs are dispersed throughout the whole of society. In the case of sugar subsidies, for example, the benefits accrue directly to U.S. sugar producers, while the costs, estimated at $1.4 billion per year, are paid by sugar consumers in the form of higher sugar prices. When such policies are enacted, a narrow interest arguably wins while everyone else loses. In the regulatory context, rent seeking typically consists of pursuing government intervention that will provide a comparative advantage to a particular industry. By restricting entry or reducing output, regulations often reduce competition, create cartels, and increase returns. Thus, tariffs and licensing restrictions are regulatory measures commonly sought by rentseekers. Less-direct measures can heighten preexisting comparative advantages or manufacture a comparative advantage out of incidental differences in an industrial sector. While often disparaged, rent seeking can be viewed as the natural outgrowth of firms seeking their best interests in a regulated environment. If regulations are here to stay, the argument goes, a firm might as well make the best of the situation. In fact, given the courts’ current interpretations of antitrust laws, one could consider rent seeking as the only legal form of predation. Whether defensible or not, rent seeking has become rather pervasive in regulatory policy. As economist Robert McCormick notes, "There is abundant evidence in the economic literature that when the flag of public interest is raised to support regulation, there is always a private interest lurking in the background." There is no reason to expect environmental regulations to be immune from the economic pressures that create rent seeking in other contexts. In fact, by their very nature, environmental regulations are conducive to rent seeking, for in the environmental context, both regulated firms and "public interest" representatives stand to gain from reductions in output and the creation of barriers to entry. Regulated firms and public interest groups may not always agree on the nature and design of specific regulatory programs, but they often share a common interest. One definite effect of much environmental regulation is to privilege larger facilities. "Compliance with environmental laws has not only reduced the number of plants in the affected industries but has placed a greater burden on small than on large plants," concluded B. Peter Pashigian in a 1984 study. "Small plants have found it more difficult to compete and survive with larger plants under environmental regulation." This should be expected. Small firms by nature are particularly vulnerable to regulatory costs. Reporting and other paperwork requirements, which appear insignificant, often significantly drain the labor force in small firms that have few employees to spare. Even the Environmental Protection Agency (EPA) acknowledges that small firms "do not have legal and engineering staffs to assist them, nor do they have the financial resources available to larger firms. Often their costs per unit of production to comply with environmental regulations are much larger that those of their large competitors." Thus, for larger companies regulation is a hurdle that can be cleared by reducing profit margins or delaying capital investments; for small businesses regulation may be a threat to existence. Warring Coalitions A classic example of environmental policy "by and for special interests" is the 1977 Clean Air Act amendments that mandated the use of scrubbers on coal-fired power plants. One book on the subject bears the subtitle How the Clean Air Act Became a Multibillion-Dollar Bail-Out for High-Sulfur Coal Producers and What Should Be Done About It. Under the 1970 Clean Air Act, the EPA established a policy whereby all coal plants were required to meet an emission standard for sulfur dioxide. The original standard of 1.2 pounds of sulfur dioxide (SO2) per million BTUs (British Thermal Units) of coal could be met in a variety of ways. Despite its apparent flexibility, the regulation had disparate regional effects. Most of the coal in the eastern United States is relatively "dirty" due to its high sulfur content. Western coal, on the other hand, is cleaner. By using western coal, utilities and other coal-burning facilities complied with the federal standard without installing costly scrubbers. Scrubbers were so expensive that many midwestern firms found that it was cheaper to haul low-sulfur coal from the West than to use closer, "dirtier" deposits. When the Clean Air Act was revised in 1977, eastern coal producers got even. As Bruce Ackerman and William Hassler note in Clean Coal, Dirty Air, eastern producers of high-sulfur coal elected "to abandon their campaign to weaken pollution standards and take up the cudgels for the costliest possible clean-air solution—universal scrubbing." The amendments required coal plants to meet both an emission standard and a technology standard. In particular, the law contained "new-source performance standards" (NSPS) that forced facilities to attain a "percentage reduction in emissions." In other words, no matter how clean the coal was, any new facility would still be required to install scrubbers. This destroyed low-sulfur coal’s comparative advantage. Since all new facilities had to invest in scrubbers, there was no longer a need to transport low-sulfur coal from the West to meet the SO2 emission standard—the cheaper, high-sulfur coal from the East would suffice. Unsatisfied with this measure alone, eastern coal producers and the eastern-based United Mine Workers successfully pushed for additional provisions to encourage the use of "local" coal in the eastern United States. In particular, Congress adopted "Measures to Prevent Economic Disruption or Unemployment" (Section 125). This provision gave state and federal officials the authority to order power plants to use regional coal if purchasing coal from elsewhere would threaten to put local mine workers out of work. Section 125 was naked regional protectionism, pure and simple. "The dominant thrust of this amendment is not its relationship to clean air, but its relationship to the economics of the areas it is designed to protect," complained Senator Edmund Muskie (D-Maine). No matter. The amendment was adopted by an unrecorded vote in the House and squeaked by with a 45-44 victory in the Senate, with most senators voting along regional lines. <snip> Rent seeking in environmental policy is not new, and it is not likely to go away. So long as environmental decisions can potentially reallocate billions of dollars from one set of interests to another, those interests will be sure to have their say. Lifting the green curtain and exposing the rent seeking that lies behind it, however, is a useful educational exercise that can demystify the public-interest aura that is attached to any policy labeled "pro-environment." The foregoing strongly suggests that the traditional framing of the environmental debate is a false one. There is no corporate monolith that opposes regulation across the board, and one can never assume that support for more regulations comes primarily from those who have the public’s well-being at heart. Environmental policy conflicts are not epic struggles between white hat public-interest crusaders and greedy black hat corporate interests. Indeed, in the environmental arena, as in most policy debates, there are few black hats or white hats—most are shades of gray. Here's another interesting example given by the Cato Institute site concerning Archer Daniel Midlands: http://www.cato.org/pubs/pas/pa-241.html But on the other hand, here is an excerpt from another Cato article which glorifies free trade: Free trade, like the free market in general, allows people to live freer and more prosperous lives. A policy of free trade reduces the power of government and special interests to dictate the shape of an economy, leaving that task to the countless daily decisions of decentralized producers and consumers in the global marketplace. Free trade among nations increases global prosperity by allowing people to specialize in what they produce relatively more efficiently. As Adam Smith argued more than two centuries ago, it would be foolish for a family to insist on making its own shoes, tailoring its own clothes, and growing all its own food when it could buy them more cheaply from the shoemaker, tailor, and farmer. “What is prudence in the conduct of every private family, can scarce be folly in that of a great kingdom. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage.” [2] Trade with other nations allows American consumers to enjoy a wider range of goods and services at lower cost than if we produced everything for ourselves. American exporters gain through access to a much larger world market. The increased sales in a global market can lead to lower costs through economies of scale, leading to lower prices, yet more sales, and further efficiency gains, in what economists call a “virtuous cycle.” Increased competition from imports spurs innovation among domestic firms while protecting consumers from potential monopolies. For these reasons, nations that pursue free trade policies tend to prosper while those that hide behind protectionist barriers stagnate. [3] The American economy has become increasingly intertwined with the rest of the world. Since 1970, America's total imports and exports in the broadest measure--goods, services, and investment income--have increased from 13 percent of our gross domestic product to nearly 30 percent. [4] Today the United States is both the world's largest exporter and its largest importer. Exports provide a livelihood for a growing share of American workers. During the last decade, the number of jobs supported by exports rose four times faster than the overall number of private-industry jobs, to more than 12 million. And export jobs, on average, pay about 14 percent more than jobs in nonexport industries. [5] While expanding trade does not significantly affect the total number of jobs in an economy, it does tend to raise the quality and pay of the jobs available. Benefits of free trade spill beyond our own borders, creating a more peaceful and prosperous world. Nations with strong commercial ties tend not to fight wars with each other. As nations become more economically integrated with each other, the economic cost of disrupting those ties through war rises dramatically. Free trade also has allowed millions of people in less developed countries to rise out of poverty, proving itself far more effective than failed and costly U.S. foreign aid programs. Protectionism, in contrast, makes people poorer by raising prices and diverting resources away from more efficient industries. When the U.S. government protects the steel, automobile, textile, and sugar beet industries, it raises profits in those industries at the expense of consumers. In the typical case where an industry gains protection, the losses in efficiency and consumer welfare far outweigh the gains to the protected industry and to the government--leaving the nation as a whole poorer. Protection acts as a kind of tax, robbing from the mass of consumers for the benefit of a narrow slice of producers. By concentrating power in the hands of government officials, it breeds rent seeking by special interests. This is why protectionist measures that were supposed to be temporary, such as the textile import-quota agreement of 1962, tend to remain in force for years and decades after they were originally set to expire. Protection becomes just another government subsidy, with consumers paying the cost. As a result, the total cost to Americans of all protection against foreign-made products comes to about $1,500 a year for a family of four. [6] One argument that cannot be made for free trade is that it benefits everyone equally or immediately. The dislocation caused by trade can be painful for workers and investors in industries that are becoming relatively less competitive. Our response to the uneven effects of trade should not be protection but rather enhancement of the ability of workers and business to adjust to change by making our domestic markets more flexible. After all, technology itself causes dislocation. Consider what has happened to the typewriter industry in the past 20 years, or the horse-and-buggy business in the 1920s. Should the government attempt to “save jobs” by slowing the introduction of new products and technology? That is essentially what protectionists want to do. Like modern Luddites, opponents of free trade seek to slow economic progress at its source rather than adjust to the consequences of a dynamic free market. http://www.cato.org/pubs/briefs/bp-034.html I think there are two heavily vested merchant classes at war here, and neither of them has the interest of the consumer uppermost in its mind. Linda DECLARATION & DISCLAIMER ========== CTRL is a discussion and informational exchange list. Proselyzting propagandic screeds are not allowed. Substance—not soapboxing! These are sordid matters and 'conspiracy theory', with its many half-truths, misdirections and outright frauds is used politically by different groups with major and minor effects spread throughout the spectrum of time and thought. That being said, CTRL gives no endorsement to the validity of posts, and always suggests to readers; be wary of what you read. CTRL gives no credeence to Holocaust denial and nazi's need not apply. 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