Thursday, February 05, 2009

More Thoughts on Protectionism

It's lonely being one of the few people banging the drum in favour of protectionism, but I'd like to think there is some goof in my refusal to be an ideological fashion slave. I'm glad to see I am at least in good company for one of my arguments, that protectionism was not the cause of the great depression. Stephanie Flanders, the BBC's economics editor makes the case here, Oliver Kamm adds a little more over here.

I would like to think that that puts that little argument to bed and it's safe to say: Protectionism was not the cause of the great depression

On the Obama plan, I'm very cynical about some of the protectionism accusations. $800 billion is a lot and it's not surprising that international companies are angling for a slice of the pie. I have a worry that some of this anti-protectionism rhetoric is actually a PR offensive on behalf of multinationals looking for a government handout. I happen to think that Obama's concession is incredibly generous given that this the US government's money and they really should be able to spend it how they like. With the concessions it becomes more of a world stimulus package.

What I'd like to see is a less obviously dismissive attitude towards protectionism, protectionist policies can be harmful but it is worth evaluating them on a policy by policy basis. I'd also like to see politicians calling a spade a spade, when Gordon and Wen talked about the need not to resort to protectionism I thought it massively inconsistent, China has strict currency and investment controls while the UK is spending £2.1 million bailing out it's car industry, if that's not protectionist, I don't know what is.

A little less grandstanding, a little less misinformation and a little more throught, is that too much to ask?

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