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Middlemen – A Solution to Trade Imbalance

President Trump is concerned with trade imbalance. While many seem to praise the Buy Local idea.

Trump’s solution is to negotiate trade quotas or impose tariffs.

The President’s plan makes the government a middleman, separating willing buyers from willing sellers, and perhaps with tariffs getting a piece of the action.

Sometimes middlemen perform important services, but at other times middlemen just raise costs.  How often do we hear about companies trying to cut-out the middlemen.

We don’t need to have the government be the middleman, raising costs without providing any tangible benefits to consumers. We can have thousands of middlemen doing the job.

There is no reason to have the government involved in commercial transactions and negotiating deals for favored companies with foreign governments. Instead, the government should more rigidly take our natural right to buy from anyone, and force everyone to buy locally.

First, we have to define local. I’ll leave that to the politicians – they are good at making arbitrary rules. For now, lets define local as the distance people can drive and return in the same day. So a 500 mile radius around each person’s home would define local for each person.  Don’t worry, the politicians will also define local for homeless people.

My proposal would do away with mail order, phone purchases or internet sales, and require that all purchases be done face to face. The plan would both help the trade imbalance, and make everyone buy local.

If you want goods or services produced more than 500 miles from home, you would buy from a middleman who lives not more than 1,000 miles from your home. You would meet near your 500 mile border, and exchange your dollars for the goods. But since, the middleman is local, there is no trade imbalance.

This plan would make items produced a long distance from home more expensive. To buy a car produced 3,000 miles from home would take 3 or more middlemen. Each middleman would add a markup. It might workout that someone will build a plant closer to your home, to cut-out some of the middlemen. Of course, the new producers would have to live within 500 miles of their plants, and all the raw materials used by the plants would have to be bought from someone who lived within their 500 mile boundary or bought from a middleman on their border.

But at least the costs imposed by the middlemen would not be arbitrarily set. Middlemen would compete for business, with rates set by the market. If the middlemen make their markup too high, that will give local businesses an advantage. Just like tariffs.

Such a plan would also eliminate a lot of long distance business travel. You could only do business with someone less than 500 miles from home. There would be no reason to travel to distant parts of the world for business. All you have to do is deal with your middleman.

People living in places like Hawaii that are more than 500 miles from the mainland will especially like this plan since it will probably discourage people from moving there. If they need things not locally available, they would have to find middlemen willing to live on ships. Those ships would have to stay within a 500 mile radius of their base.

Shipping oil would be discouraged, since the oil would have to be off loaded at sea onto another tanker. Although middlemen could arrange to buy the ship with oil, and then sell it back on the return trip.

Want to take a vacation in a far off location. You would take a plane that goes, no more than 1,000 miles, and then land and change planes owned by another airline.  Entrepreneurs may build airports in locations not currently served by airports, but if you live more than 500 miles from an airport, you will just drive to your boundary, and then take a bus, or taxi from your border to a site closer to an airport. Eventually you will get there.

This plan would be cumbersome, and it would make things more expensive than how we live today. But expense is not the issue. It is about having more local jobs, and not having a trade imbalance.

Banks, phone companies, stock markets etc would all have to be local. Just think of all the jobs that would be created.

You want to talk to aunt Sarah 1,500 miles from home. Your phone company would have to connect to a phone company whose base was less than 500 miles from your border, who would then connect to another phone company, and eventually connecting to aunt Sarah’s local phone company.

Maybe doing business this way would cost more, but everyone would feel good knowing that whether they like it or not, everyone will be buying locally.

Author’s comment: Please do not suggest this plan to anyone in Washington, DC. They might think it is a good idea.

 

 

 

Kanye West prompts question

Kanye West is getting grief for saying “When you hear about slavery for 400 years … For 400 years? That sounds like a choice.”

Is it wrong to say that when people find themselves in a bad situation, and do not die trying to get out it – “it is a choice”?

Should I be criticized for making a bad choice if I assess my situation and decide I would be worse off fighting, then submitting to the slaver?

If I am in slavery, and believe it is wrong, should I be criticized for having children that will be enslaved?

Response to New-Press Article

Brian Page wrote
https://www.news-press.com/story/opinion/contributors/2018/04/13/funding-lee-county-schools-remains-major-concern/507373002/

My comment:

As Margret Thatcher said “The problem with socialism is that you eventually run out of other people’s money.” Government run schools in the United States are such an old institution, that most people do not even consider it a socialist program. But it is a government welfare program that competes with other bureaucracies for taxpayer money. With the advent and growth of other programs clamoring for money, politicians are not willing to set priorities, but rather calling on the taxpayers to pony up more money. It is not just the new increment for schools that concerns some of us, it is the whole idea that we need government schools to encourage growth in Lee County, and that growth is good. If it takes taxing Lee County residents and visitors more, to accommodate the growth, then lets cutback and maybe the growth will go away. People should be encouraged to create and use non-government schools, and let government schools just be a safety net for the those irresponsible people who cannot afford to pay for their own children’s education.

Say it is not so.

Trump no longer wants us to be the world’s policeman, just the world’s parents. When someone does something wrong (we are also the world’s judge and jury) then it is up to us to punish them. Not to accomplish anything just to let them know we did not like the behavior, and to let them know there is more of that where that came from. Trump et al think of the bombing as a “time-out”. When a parent gives a child a time-out, there are no repercussions for the parent, so why would anyone expect bombing Syria would have repercussions for the United States.

Open Borders

Those who think private property rights explain why the government can keep honest and peaceful people out of the country are confusing laws with morality.

Moral governments don’t give and take rights, they help people protect their natural rights. Your private property rights don’t extend beyond your private property.

People use politics to obtain advantages over others without paying for the rights they take from them.

Privacy is foolish public policy

Zoltan Istvan writes

Liberty Might be Better Served by Doing Away with Privacy

I agree and would also say that knowledge is power, and the more that knowledge is spread through society the more just is the society. With everyone having equal access to knowledge, fraud and deceit are minimized especially when it is politicians and government that are trying to deceive by keeping secrets. Knowledge like liberty is something you can give everyone without taking something physically from someone. The idea that knowledge can be used for economic or political advantage should be considered immoral just as the use of force is considered immoral by those following the Non-Aggression Principle.

 

Questions for those who want Abortion to be illegal

  1. If abortion is illegal:
    • 1a – what should the penalties be for the woman who has an abortion?
    • 1b- the man if he supported her decision?
    • 1c. the medical staff or drug companies who assisted the event?
    • 1d. a doctor or other person who learns of an abortion and does not report it to the authorities?
  2. Should the government investigate all miscarriages to determine if a crime has been committed?
  3. Should women who are pregnant have to register with the government when they know they are pregnant, so the officials will know who to monitor for possible criminal activity?
  4. Should doctors have to report to the government when they learn a woman is pregnant, so officials will know who to monitor for possible criminal activity?

I am not trolling, these are questions I would like someone who wants to make abortion illegal provide either answers, or a link to a site that provides answers to these questions.

Lets make America Stronger by making the Government Weaker.

In a previous post Jacob Hornberger  argues in favor of making the government weaker. I support his position, but extended the discussion to the following with some editing.

Ben:
One of the push backs by those who favor at least some significant standing army/navy is that today we would not have the time we had before WWI and WWII to mobilize and without large conventional forces the U.S. government would be more likely to use nuclear weapons.

Jacob:
“No nation state has the remotest military capability (or the interest) in invading the U.S. It is an absolute impossibility. Most people have no idea of what would be needed to cross the ocean and carry out a successful invasion. By the time some nation had gathered together the millions of troops, ships, aircraft, supplies, bullets, bombs, and other things necessary for an invasion (and occupation), the U.S. would have plenty of time to prepare to defend, especially since the nation would already be oriented to defense. See Switzerland. They are not separated by an ocean and still no one jacks with them. It is much easier for a force to defend than to attack. It was a terrible mistake to convert the U.S. into a national security state–in my opinion the worst in U.S. history. It is taking our country down, both with the destruction of our freedom and financial bankruptcy.”
 
Ben:
People seem to want more than protection from total invasion. They want protection from:

  •  lone wolf terrorist attacks
  • rogue states like North Korea lobbing a nuke at us
  • and even internet hacking or alleged hacking.

Those attacks don’t take months of preparation to be sure, but people also need to understand it does not take a standing army with outpost in 100 nations to try to protect us from those occurrences.

The public doesn’t want to trust that the problem is our interventions, and that other people would not bother us if we did not bother them.  Most people still think that Japan bombed Pearl Harbor for the hell of it, and the World Trade Center attack was because Arabs do not like our freedom.
The U.S. should pull its troops out of South Korea and let the world know we will not defend South Korea unless:
  • South Korea formally notifies the U.N. that South Korea is a U.S. protectorate,
  • and all South Korean businessmen annually send in 1040 Forms and remittances to the the U.S.

When I have nothing better to do, I will try to get John Bolton to make that policy recommendation.

Final words from Jacob:
“The problem is that anti-American terrorism is rooted in what the military and the CIA do to people over there. So, it becomes a never-ending racket–they go kill people over there, people retaliate, and then people say, “we have to be over there to kill them before they kill us over here, and so they kill more people, which then causes people to retaliate, etc. etc.

In other words, the threat of retaliation becomes the justification for doing what is causing the retaliation. That’s why I keep bringing up Switzerland. It limits itself to defense. It isn’t killing people in other countries. It’s not stationed in Korea or anywhere else. No terrorist retaliatory strikes. North Korea is much more concerned about a U.S. war of aggression than in invading South Korea. It just wants to be left alone but it knows that the US national securty state isn’t  going to leave it alone, any more than it left Iraq alone, or Libya, or Syria.
 
Morever, terrorism is a criminal offense. You don’t need an enormous standing army to deal with it.
 
Japan bombed Pearl Harbor because FDR squeezed them with the embargo on oil. Once that embargo went into place, Japan had two options: cease military operations in China, which it was never going to do, or try to knock out the U.S. ability to interfere with taking oil from the Dutch East Indies. There was never any threat by Japan to invade and occupy the U.S. And Germany couldn’t even cross the English Channel to invade England. Fat chance of crossing the Atlantic to invade the U.S. In any event, FDR got what he wanted and why he was provoking the Japanese into attacking–entry of the U.S. into WWII.
 
People are still convinced that the military industrial complex, the CIA, and the NSA–all Cold War institutions–are necessary for their security and wellbeing. Our ancestors had it right–which is why America lived without these things for more than 100 years–they bring a nation down, not only with respect to the destruction of liberty and privacy but also financially.”