SOME ECONOMICS

US protectionists accuse economist of treason -- though he is of course a benefactor of U.S. taxpayers: "Sumner, an agricultural economist at the University of California at Davis, played a key role in an international trade case that is shaping up as one of the most significant defeats the United States has ever suffered on the trade front. An analysis that he wrote helped frame a preliminary decision issued two weeks ago by a World Trade Organization panel, which held that the federal subsidies paid to U.S. cotton farmers violate WTO rules because they cause overproduction, drive down world prices and impoverish farmers in developing countries". (See post of May 15th. The permalink is kaput).

How America came to dominate the phone business. America left it to the market. State control in countries such as France caused a much slower development of phone service there.

Indian Communists back globalization: "The communist leader of the Indian state of West Bengal, Buddhadev Bhattacharjee, is quoted by the New York Times as declaring that "Globalization is a must." More meaningfully, he succeeds in implementing some policies that encourage firms such as Mitsubishi and I.B.M. to invest in West Bengal".

Reality denial: "Current examples are many political commentators, as well as elected politicians, who frequently say the country went from surplus to deficit because of the Bush tax cuts. The deficit actually was caused by a large increase in government spending (voted for by majorities of both parties), which began at the end of the Clinton administration, and the recession was under way when President Bush took office."

No to outsourcing? You're sure? "What's the dirtiest word in the United States political dictionary these days? That's easy: 'outsourcing.' There's an ironic aspect to this fear of outsourcing. The U.S. happens to benefit a lot when consumers in foreign countries outsource their wants and needs to American companies. Take the example of 'copyrighted' products such as software, motion pictures, and sound recordings. The U.S. exports $90 billion US worth of these items each year."

"Yes, gas prices have spiked upwards by at least 30 percent in most local markets this year, and yes, it's infuriating to pay $2.00 a gallon to fill up the tank. And yes, higher oil prices are a significant tax on the U.S. economy -- given that we're the world's largest importer of crude. But prices, properly measured, are nowhere near their historical peak. In fact, the long-term trend in oil, gas, and electricity prices is downward, not upward."

************************************