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Post by agito on Nov 19, 2008 14:20:14 GMT -6
there is an article in the new republic that does an excellent job of synopsizing what bretton woods was, the chronological order of things between then and now- and an argument that we've already lived under bretton woods II, and the recent meeting was for bretton woods III. www.tnr.com/politics/story.html?id=16872fed-798c-476b-a6c4-303923cd6388 it's a must read.
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Post by judes on Nov 19, 2008 18:39:40 GMT -6
That was a very good read. It gave a good account of the worlds interconnected economies over the last several decades. But once again I am disappointed at the complete silence on the use of tariffs to help smooth out some of the imbalances in currency valuation and trade, which were discussed as being central to the problem at hand. They act like we can only sit on our hands and wait to see what China does. No we can't wait. China is investing almost $600 billion in their own economy and infrastructure which is good for them, hopefully they will tend toward a policy of lifting their workers out of poverty.
But we can't just sit around waiting to see if they are going to change their policies to benefit us or not. So let's say they stop buying Treasuries, start investing in their own economy, that doesn't necessarily translate into them buying our exports does it? We can be proactive and put some protectionism in place here and now before the few remaining manufacturing industries we have left are decimated.
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Post by unlawflcombatnt on Nov 19, 2008 18:46:06 GMT -6
That's really an excellent article. In less than 5 pages, the author gives a pretty good synopsis of how we got to where we are today.
I do, however, think he understates the role of cheap foreign labor and global labor arbitrage. Though he mentions it, the implication is that it's been a relatively minor role. Also, he mentions a 5 million job loss in manufacturing since the 1980's. Since the early 1970's, the estimated job loss is in the 10-12 million category, based on a -$711 billion trade deficit.
I agree with Judes about the lack of discussion of tariffs. One of the biggest parts of the Bretton Woods I agreement was a great reduction in tariffs. The near elimination of US tariffs has contributed greatly to our current trade deficit. Tariffs in the 40-70% range were common throughout US history prior to World War II. Bretton Woods I changed that.
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Post by judes on Nov 19, 2008 18:48:20 GMT -6
... I do, however, think he understates the role of cheap foreign labor and global labor arbitrage. Though he mentions it, the implication is that it's been a relatively minor role. Also, he mentions a 5 million job loss in manufacturing since the 1980's. Since the early 1970's, the estimated job loss is in the 10-12 million category, based on a -$711 billion trade deficit. Yes, good point, I noticed that too.
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