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Is 'Fair Trade' Free Trade?

Jul 4, 2017


Editor's Note: The Bonner & Partners offices are closed today for the Fourth of July holiday. So today, we're sharing an essay from Bill that explores the founding principles of America and considers if we've lived up to those ideals.


Recently, I saw this quote from Steve Bannon. He described his core belief... It is that 'we're a nation with an economy, not an economy just in some global marketplace'.

When I read that, it sounded familiar. Then I is almost a direct translation of a remark by Juan Perón: 'The nation does not exist for the benefit of the economy. The economy must serve the nation.'

This is what is known as 'economic nationalism'. It is not necessarily either wrong or right. Neither good nor bad. But it is packed with myth, magic, delusion, and cockamamie groupthink ideas. And when you unpack it...when you deconstruct it...when you peel away the layers, what do you find? Something you might not expect.

Someone yesterday mentioned that our children's brains are being shaped by new media...that their attention spans are shrinking. If you can't say something in twenty seconds, don't even bother to try. They'll flip the channel or hit the delete button...or whatever it is they do.

But some ideas take time to understand. Eventually, the idea can be compressed into a sound bite...but only after it has been studied and understood.

New ideas need brain space...and time. This is one of those ideas. Someone with a short attention span will hear the phrase 'economic nationalism' and think... 'Well, that sounds pretty good.' It takes time and attention to get beyond that...and to really understand what it means.

What I'm talking about today is not really a new idea...but it is new to most people.

I don't usually like to talk about politics or even think about politics. It's usually a waste of time. But there are times when you can't ignore them...when you might not be interested in politics... as Stokely Carmichael put it...but politics gets interested in you. And then, if you ignore politics, you could be ignoring a serious threat to your wealth or your family.

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'Fair Trade' Is Not 'Free Trade'

But let's begin by exploring another idea - 'fair trade'. It sounds harmless. Even attractive. Who's against fairness? Again, for the iPhone Age, it may be just the thing perfectly adapted to short attention spans.

But wait. Who's to say what's fair? The whole world is full of buyers and sellers. They are all searching for the best deal. Isn't the only possible 'fair' deal the one that buyers and sellers willingly come to on their own? So how's that different from 'free trade'?

Back in the '70s and '80s, we ran a business that was chiefly on paper. So we found that we could often get the best prices for printing in Quebec. They've got a lot of wood pulp up there, I guess. So we negotiated with the printers and came to a deal.

It was a free-trade deal. It was the best we could do.

Now, the feds came in...and they said no...if you're going to buy from a foreign supplier, you will have to pay a tax. That will make it 'fair'.

From our perspective, we didn't care where the printing was done. If it was done in New York or in Canada made no difference. From a fairness standpoint, there was no difference. From the point of the state of Maryland, anything done out of the state was foreign.

'Fair trade' only makes sense to the group imposing it on others. And since it is imposed by the government, it only really makes sense for the people who control the government. We call the group that controls the US government the 'Deep State'.

They are people in Congress, in the bureaucracy...even in international organisations such as the IMF...on Wall Street...and in major crony industries...

They are the people who actually run things...year in and year out...working with or against the people who have been elected to serve in the White House of they find necessary and convenient...

In other words, there is no such thing as fair trade between individuals and companies. There is only free trade. Fair trade is a tool for the Deep State to use to bring more power and money to itself.

I remember a strange scene in Argentina...

An old tractor drove up, pulling a wagon. It had a tire bolted together with cables. The tire should have been replaced years ago. Why was it not? Fair trade. That is, Argentina was supposedly protecting its young tire industry from foreign competition. Who owned the Argentine tire maker?

It turned out that the major owner was the family of the president herself, Cristina Kirchner.

So when Donald Trump says 'Buy American...make it in America...with American workers...' I become suspicious. There's no way you can benefit all the people of the country with fair trade. You will only benefit some, at others' expense. Who will you benefit? Those who control the system, of course.

The Idea of America

'America First,' says Donald Trump.

Again, it sounds like a good campaign slogan. But when you deconstruct it...what do you find? The same cast of characters...the same plot...and the same Deep State again.

It's not 'Americans First'. That would be a whole different thing. It would mean that we could decide for ourselves which deal was best for us. 'America First' is a slogan that glorifies and elevates the government, while diminishing the power and freedom of the people in the country.

This is a big departure for America. We're not like the French or the Spanish. We don't share a single culture... or even a single language...or a real national identity. We're a nation of immigrants.

The idea - which I explored in my book The Idea of America - was that we could each worship our own God...follow our own goals, free from the dictates of the federal government. The government was supposed to protect us.

And the Constitution was supposed to protect us from the government, making it possible for us to find life, liberty, and happiness in our own way.

Grosso modo, the idea of a national purpose above and beyond the interests of the citizens themselves...or an economy that is supposed to serve the nation rather than the individual people who make up the as old as the Old Testament. In it, the Jews are described as a nation of people working out their relationship with God.

America is a different thing. You don't have to be a Jew or a Persian...or a gentile... You don't have to speak Aramaic or Hebrew. America is a product of the New Testament, where each individual can work out his own relationship with God.

We're not a nation in the traditional sense. We're a nation of different peoples...different groups. We were meant to be treated as individuals...not as part of a big collective... We were never meant to be ein Volk, but lots of volks.

BILL BONNER Founder, Agora Inc

Bill Bonner is the President & Founder of Agora Inc, an international publisher of financial and special interest books and newsletters.

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