- How the World Prospers
- We All Share the Same Goal: Maximize Happiness
- Love and Protect Your Econosphere
- The Marketplace Is Perfect: It Is Information That Is Imperfect
- You Live in the Econosphere
- Can You Be Green About Your Econosphere?
- The Econosphere's Tough Love
- What Happens When We Try to Stop Change? Here's Your (1952) Buick!
- The Protection Racket
- The Kinder, Gentler Econosphere
This chapter is from the book
This chapter is from the book
This chapter is from the book
The Econosphere's Tough Love
Consider some of the topical economic issues of our time, and how you might or might not view these issues depending on your understanding of the Econosphere and from where value really flows. Take for instance, the fear of trade. At its core, there's nothing alarming about trade, right? Someone somewhere makes something and is willing to trade it for something else made by someone living elsewhere. It sounds kind of nice in a sort of trade-bread-not-gunfire sort of way, doesn't it?
Oh, but how we worry about it. It makes some of us ache with fear; it makes others head to the street with signs and even bricks to throw through windows in protest. How can this simple exchange of talent and time generate such extreme passions? Why would you want to restrict the ability to trade the product of one person's toil for the product of another person's toil, and why does it matter if these exchanges take place over some distance?
The problem is that you do not live in the abstract. Exchanges of good and services, if you do not understand your economy as a system preserving sustainability and prosperity, might look something akin to anarchy, and within that anarchy there is one person in one land providing a good that could otherwise be produced domestically. Free trade can look a lot like theft: They're stealing our jobs! However, if you can see that if one region of the world can concentrate on those things that they do most efficiently, then another region can concentrate on what they do best. The end result is more goods for all because everyone would operate as efficiently as possible.
Part of the problem comes from the fact that we do not think as a region, or as a people. We are individuals; we think as individuals and, understandably, we value continuity and predictability in our lives. We are happiness maximizers within the Econosphere, and the happiness that we maximize is our own. If one person builds his life and his household around a particular vocation, community, or culture that is in turn built around a particular industry that is adversely affected by shifting comparative advantages around the globe, then talk of optimal efficiency is of no comfort at all! Free trade, certainly in the short term, has the potential to be upsetting, no question about it.
To see the industry where your parents toiled successfully now fail and whither or to watch the town where you grew up crumble is a genuine loss that is hard to get over. So what is the answer? To some, it might seem that the solution is to control trade flows to protect industries and ways of life that might well disappear if forced to compete with every distant competitor. Protection always sounds comforting to some, particularly those directly and severely affected by the changes that do take place in the economy over time.