We are told USA billionaires need subsidies to "level the playing field." Therefore we fork over tax money to help that 1% to be in the market without fear of competition, or more to the point, without having to compete.
The argument is companies overseas get some sort of subsidy or regulatory advantage, which must be matched. No doubt subsidies and regulatory advantage is manifest, but why would anyone think, say the Chinese government, get any regulation or subsidy right, that is to say, effective, efficacious for the intended goal. The idea is delusional to begin with.
But let us allow the impossible, that the Chinese Government is capable of getting a policy right when it comes to distorting markets to Chinese advantage. So what is the USA response? We have many. To name a few:
1. Statutory restrictions.
a. tariff rate quota
b. absolute quota
2. Subsidies
OK, so we now have these to help "level the playing field."
What makes us think these means in fact level the playing field, whatever that means?
What makes us think that for whom the field is thus leveled, this treatment is efficacious toward the goal. Do we have any evidence field leveling works?
Have we tried not responding, assuming playing fields might be tilted, to unleveled playing fields?
In fact we have a long and rich history of not leveling playing fields, in which USA traders have played the hand dealt, and crushed the advantaged foreigners, with no help from Uncle Sam, since once upon a time leveling the playing field was ever contemplated.
Now, the conceit we can level the playing field occasions much allocation of resources, resources starved from opportunities where funding would yield better results. So we have misallocation resulting in malinvestment when we try to "level the playing field."
Those who claim to need a playing field leveled would no doubt fail if not given some advantage. That does not mean others in the field, unadvantaged, would not develop means to cope with disadvantage (if it was possible to ever formulate anyway). We in fact have seen those skilled at working in unlevel playing fields can do quite well.
And because we subsidize those who should simply go about of business, we have far more people in the 1% than we would otherwise. It is such policies that give us the ever widening gap between rich and poor.
Leveling the playing field is a tactic that has no good effect in the market.
Feel free to forward this by email to three of your friends.
The argument is companies overseas get some sort of subsidy or regulatory advantage, which must be matched. No doubt subsidies and regulatory advantage is manifest, but why would anyone think, say the Chinese government, get any regulation or subsidy right, that is to say, effective, efficacious for the intended goal. The idea is delusional to begin with.
But let us allow the impossible, that the Chinese Government is capable of getting a policy right when it comes to distorting markets to Chinese advantage. So what is the USA response? We have many. To name a few:
1. Statutory restrictions.
a. tariff rate quota
b. absolute quota
2. Subsidies
OK, so we now have these to help "level the playing field."
What makes us think these means in fact level the playing field, whatever that means?
What makes us think that for whom the field is thus leveled, this treatment is efficacious toward the goal. Do we have any evidence field leveling works?
Have we tried not responding, assuming playing fields might be tilted, to unleveled playing fields?
In fact we have a long and rich history of not leveling playing fields, in which USA traders have played the hand dealt, and crushed the advantaged foreigners, with no help from Uncle Sam, since once upon a time leveling the playing field was ever contemplated.
Now, the conceit we can level the playing field occasions much allocation of resources, resources starved from opportunities where funding would yield better results. So we have misallocation resulting in malinvestment when we try to "level the playing field."
Those who claim to need a playing field leveled would no doubt fail if not given some advantage. That does not mean others in the field, unadvantaged, would not develop means to cope with disadvantage (if it was possible to ever formulate anyway). We in fact have seen those skilled at working in unlevel playing fields can do quite well.
And because we subsidize those who should simply go about of business, we have far more people in the 1% than we would otherwise. It is such policies that give us the ever widening gap between rich and poor.
Leveling the playing field is a tactic that has no good effect in the market.
Feel free to forward this by email to three of your friends.
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