If anyone had a fine-tuned gut instinct regarding the means to destroying the rich it was the angry economist Karl Marx. One option he suggested to bringing the captains of capitalism to their knees was free trade, but unfortunately like most things born in an anti-Christian spirit, the results would not be what the intellectuals had expected: roughly 94 million lives would be taken as Marxist ideology would be forced upon them in the pursuit to eliminate corporate profits. Tragically, only the long forgotten Marxist Maltman Barrie could grasp the proper and painless solution to English subsistence wages of 1800s that had Marx so enraged (and classical economists such as Smith and Ricardo so confused). Barrie understood in his ground breaking epiphany that exports are harmful to the well being of the English worker. As a result, he simply suggested that by closing the economy the worker could now consume what he produced. But to some extent, his protectionist mindset was already old news to several generations of American protectionists, beginning with our founding fathers. To make the point, Daniel Webster argued the primary reason the founders hammered together the Constitution was to stop the economic chaos unleashed by free trade (with Britain) under the Articles of Confederation. In short, it gave Americans the new power to lay tariffs. But it came with a price: Tariffs would eventually split the soul of the nation. The constitutional question of tariffs would come to a head in the form of Civil War as the protectionist industrial North rejected the free trade ideology of the plantation owners.
Yet, more than a century and half later we find China having adopting a mercantilistic form of Lincoln’s logic, while we unwittingly have adopted Marx’s road to ruin. In this theater of economic disorder, we are reassured by trade lawyers, politicians, economists, and corporate globalists that this is all for our own good (the 99%). The economic textbooks of nearly all stripes tells us this must be true, turning American economic history and reality into an inconsequential dot, not worthy of discussion. Unfortunately, what no one seems to be asking is on what theoretical assumptions these textbook models of economics rest. The rigid mindset is compounded by the 1%, secure in their wealth, who are either oblivious of the looming free trade deals, or convinced they have nothing to loose. But, I as an engineer who has devoted six years to the study of the history of economic thought and theory, will argue the 1% have everything to lose if these models are logically flawed.
The premise behind this claim is relatively simple: There has never been a sound theory of economics. The consequences are also straight forward: The destruction of the industrial base (directly and indirectly the 99%) under free trade ultimately means a looming economic crisis which will destroy the 1%, because as the 1% in China understand, it is ultimately the industrial base that secures their prosperity. In other words, a modern economy cannot survive without industry. Not only will the 99% go down with the sinking free trade ship, so will the 1%, because the means to protecting their wealth will not be possible during an economic collapse. In other words, there will be no life boats left when the torpedo of de-industrialization hits.
If you doubt this, just ask the Chinese, who like the founding fathers, learned their common-sense economics from the brutal hard knocks of economic chaos that led them to the light of protectionism. But surprisingly, in spite of all the gut instincts driving China to superpower status, there has never been a theoretical economic model to explain the historical success of protectionism and the ruin of free trade. It is the goal of this blog therefore, to fill in the missing logic. Critique is of course welcome, since this is a radically ambitious goal that cannot be done alone.
As a result, a set of links to help guide reader into this new model of protectionism and its logic consequences (e.g. the risks of the Euro) are listed as follows:
Condensed Summary of New Protectionist Model
Overview of 200 Years of Flawed Economic Theory
Summary of Additional Links:
Just Measures by Geldstone / Amazon Kindle