RE: Free Trade Benefits Everyone Re: *DO* we share a civilization?

[Baardwijk, J. van DTO/SLBD/BGM/SVM/SGM]

> -----Oorspronkelijk bericht-----
> Van: John D. Giorgis [mailto:[EMAIL PROTECTED]]
> Verzonden: Wednesday, August 01, 2001 1:40 PM
> Aan: [EMAIL PROTECTED]
> Onderwerp: RE: Free Trade Benefits Everyone Re: *DO* we share a
> civilization?

> >Marc is right on this one: he needs to find only one person that
> >doesn't benefit from free trade to prove you wrong. Can you prove to 
> >us that he won't be able to find such a person?
> 
> It depends how you define "better off."    If you really think that
> there is even *one person* in the candle-producing country that would
> not benefit ffrom the import of lightbulbs, I am not sure that we have 
> much to talk about.

I'd like you to meet a friend of mine. His name is Hans, he's 70 years old,
and he was a candle-maker in Candleville, Candle Country. One day a man in a
big Mercedes came, and build a lightbulb factory in Candleville. This caused
a major crash in the candle market, and sent Hans into unemployment. He now
has to live of a meagre state pension (which is significantly below his
previous income). The only trade he ever learned was candle-making, and now
he's too old to learn new skills, and nobody needs a candle-maker anymore.
Nowadays, Hans spends his time walking around, and waiting for Death to come
and take him.

<sniff, sob, sniff, sob, sniff>

Hans doesn't see how he benefits from losing his job. Can you explain to him
that he's better off now that his job and a good part of his income have
vanished?


> >But will our candle-maker consider the net result a benefit?
> >Personally, I'd consider it a net loss if the price for cheaper 
> >lighting would be the loss of my job (and thus, my income).
> 
> It doesn't matter what the candle-maker considers.   The truth of the
> matter is that everyone benefits when the cost of lighting goes down,
> because that reduction in price gives everyone more money with which
> to create more demand for other products, and thus, other jobs.  

My friend Hans sold his candles at $1 a piece, and earned a nice $2,000 per
month that way. When the man in the big Mercedes came, Hans got unemployed
and saw his income drop from $2,000 to a mere $900 per month.

The lightbulbs are sold at $0.75 each. This means that Hans now has to spend
only $50 per month on lightbulbs, instead of the $125 he used to spend on
candles. In that respect, he's better off by $75 per month. However, his
income dropped by $1,100 per month. Bottom line: Hans has lost $1,025 per
month.

IOW: the price reduction did not give everyone more money -- it gave someone
LESS money...


> >John, do you even know what it's like to loose your job and income?
> >When something like that happens, it's NOT a consolation that the rest
> >of society will benefit from you losing your job. At a time like that,
> >*you* have a problem, a problem so big that you couldn't care less
> >about the rest of society.
> 
> IAAMOAC.   I would never expect to deny society a benefit simply so I
> could keep my current job.    So long as I am able-bodied, I have a 
> moral obligation to not accept charitable assistance, unless I am 
> already earning the fruits of my labor.
> 
> Moreover, I could never be so narrow-minded.   Even though I produce
> candles, even I would recognize that lightbulbs are superior.  If I
> was honest, I'd employ them in my own home.   I'd also purchase goods 
> and services that were only made possibly by the superior lighting of
> a lightbulb.

That's what the man in the Mercedes told my friend Hans, too. However, the
man in the Mercedes conveniently forgot one thing: he forgot to tell Hans
that he wouldn't be able to buy all those wonderful new things because with
his incom


> 
> If my job becomes obsolete, it is my obligation to learn a 
> new trade, or
> else take a job as unskilled labor.   I may not like it, but there are
> almost always unskilled jobs available.   (And even when there are not
> low-tier jobs available, making goods cheaper to the entire 
> society will
> boost GDP, and fuel job creation.  Thus, I should plan on 
> living off of
> charity for a while, until I can land one of these new jobs.)
> 
> JDG
> __________________________________________________________
> John D. Giorgis       -         [EMAIL PROTECTED]      -       
>  ICQ #3527685
>    We are products of the same history, reaching from Jerusalem and
>  Athens to Warsaw and Washington.  We share more than an alliance.  
>       We share a civilization. - George W. Bush, Warsaw, 06/15/01
> 


Jeroen

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