Free Trade and American Jobs

   Anonymous CJ and I have had a difference of opinion on free trade versus applying import duties on foreign made goods. The exchange was as follows:

CJ:
        We are at opposite poles on free trade. It has been a pillar of
American policy for decades starting with GATT and continuing with
WTO.  It is certainly important to police trade agreements to identify
and penalize countries who try to defraud the system. There is a court
for settling such disputes.
       
ACS:
    I don't believe in pillars in general. It may be that GATT and WHO may have had some validity previously, but we are talking about now.
            I'm also not talking about defrauding the system. I am merely saying that free trade exports American jobs to countries where labor is cheaper. There's also no question that production in the US would be more costly, because of higher labor costs, but that is offset by the gain in American jobs. Conversely as I said before, exporting jobs, boosts the standard of living in those manufacturing countries at the expense of American jobs. While that also gives the American consumer lower prices, it is an unsustainable situation, because Americans then are consumers rather than producers. This has been going on for several years leading to our present job problems and is no different than various Americans being on general welfare or employed in nonproductive government jobs.

CJ:
    Building tariff walls generally leads to protecting national producers  who use that protection to raise prices.  It was an early form of  crony capitalism.  You probably remember that most countries in Latin  America followed that policy to their regret.

ACS:
        Yes. That is the purpose of tariffs. To protect national producers and allow them to make a reasonable profit, as opposed to squeezing them out of business, because they can't compete with free-duty foreign-made goods. It may have been abused previously and could be abused in the future because of "crony capitalism", but we have antitrust laws to handle that, providing we have a government willing to enforce laws.
        I don't know about most countries in Latin America using import tariffs to their disadvantage, but I can see that a banana republic dictator would have another source of income from foreigners by using import duties. Perhaps that was the case. However, the US is not a banana republic, even though we are embarked on establishing a dictatorship. Even so, our new dictator would have a reverse opinion; namely, continue free trade so that American wealth will be dissipated to the rest of the world.