Tim Worstall

Paul Krugman (yes, Paul friggin’ Krugman) is advocating a trade war.
In 1971 the United States dealt with a similar but much less severe problem of foreign undervaluation by imposing a temporary 10 percent surcharge on imports, which was removed a few months later after Germany, Japan and other nations raised the dollar [...]

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Apparently Gordon is cutting down his intake of Kit-Kats, and replacing them with bananas.
What a bastard eh?
Throwing honest British chocolate toilers onto the dole and subsidising instead Latin American oligarchies.
Quite disgusting, man should be shot, obviously.

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I’m seriously having a difficult time digesting this.
Yes, I know, he’s the Nobel Laureate in international and trade economics and I’m just a lowly blogger.
But he seriously seems to be advocating a protectionist trade war against China.
WTF?
Let me quote from a classic paper by the late Paul Samuelson, who more or less created modern economics: [...]

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OK, so this is about second hand photocopiers but the lesson stands for all goods.
The global cost of shipping has never been as cheap as it is now, according to Stephen Armistead. “We ship our fax machines to China for the same price as delivering a consignment from Penrith to the south coast of England.
You’ll [...]

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Yet he has defended the indefensible by saying that sanctions will remain in place until the communist government in Cuba frees political prisoners and improves human rights, just like his predecessor.
Yes, I think the embargo is a very stupid policy and one which props up the Castros.
However, I don’t see the above as being a [...]

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It has been a challenging and rewarding first ten months as minister for trade. Even doing this job at such a difficult time for the global economy and for UK businesses, I’ve been constantly impressed by the ambition, tenacity and success of UK firms.
I’ve been disappointed, [...]

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An interesting definition:
Mercantilism, which is the precursor of capitalism, originated in Rome and the Middle East, during the early middle ages. Mercantilism can be defined as the process by which goods are bought at one place for a certain price and sold at another place at a higher price, in order to realise a profit.
That’s [...]

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It’s an interesting claim, isn’t it? One that might slightly boggle the eyes in fact.
So what is the origin of this claim? As a new report about international trade, multinationals and taxation says, the origins of the claim are a tad obscure.
TJN (2009) claims that 60% of all global trade is routed through tax havens. [...]

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Even more fundamentally, we should be able to teach students that imports, not exports, are the purpose of trade. That is, what a country gains from trade is the ability to import what it wants. Exports are not an objective in and of themselves: the need to export is a burden that the country must [...]

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At the same time, the current tax regime employed by the U.S. is being abandoned by the two remaining large capital exporters – the UK and Japan – that had maintained similar regimes.

What?
I know we’ve exported a lot of capital in the past. That we’ve still got huge overseas holdings (well, people in the UK [...]

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I agree with Peter Mandelson:

Open trade has driven the rising levels of global prosperity that have defined the two decades leading up to the credit crunch. The growth of trade allowed countries and their companies to specialise and compete for sales globally rather than just in their home market. By allowing developing countries to [...]

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So the US Congress is guilty of the usual crowd pleasing stupidity, they’ve added protectionist measures to the bailout bill. However, the important thing is not what they do in their foolishness but what we do in response. Sadly, this isn’t looking good.

European Commission representatives and diplomats from the British, French, Canadian [...]

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Most sad this.

China, India and Brazil all vaulted ahead of Mexico, following a much less orthodox set of policies that would be illegal for Mexico under Nafta.

Mhm, hmm.
Brazil at 64 in GDP per capita at PPP (ie, after taking account of different price levels), China at 83, India at 112 (with a staggering $3,452 per [...]

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I’m referring to trade here. I simply don’t understand some people on the left and their attitude to international trade. In the 19th century, the ‘liberal-left’ in this country, including sections of what we would now probably describe as the ‘hard-left’, campaigned for free trade and against the Corn Laws on the grounds that it [...]

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The UK’s goods trade deficit climbed to its highest figure in more than 300 years in July, leading analysts to warn that the economy has fallen into recession.

A deficit in the goods trade balance (after adjustments for the services surplus of course) is obviously and clearly balanced by a surplus in the capital balance for [...]

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He’s swallowed the protectionist line….completely, entirely and sadly.

Neoliberal economists claim rich countries got that way by removing their barriers to trade. Nothing could be further from the truth. As Ha-Joon Chang shows in his book Kicking Away the Ladder, Britain discovered its enthusiasm for free trade only after it had achieved economic dominance. The industrial [...]

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Now there’s a surprise!

In a six-month investigation, The Sunday Times tape-recorded Fritz-Harald Wenig, a trade director, passing secrets to undercover reporters posing as lobbyists for a Chinese businessman seeking insider information.
Wenig discussed the possibility of payment or taking a lucrative job with the businessman. He said he would decide further once he had provided “results”.
He [...]

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Reduced government borrowing would let the country export more capital, buying assets in faster-growing regions of the world.

How does that work?
In order for us to invest overseas we would need to be exporting capital: that means running a trade suplus, no?
Whatever the effect of more or less govt borrowing, given the point that the balance [...]

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Richard Gott likes the new President.
It’s going to be a disaster, isn’t it?

In his inaugural speech, Lugo called for an unusual combination of austerity and happiness. He had already renounced his presidential salary, and he called upon young people to embark on the task of reconstructing the country with a smile. He invoked the great [...]

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The scale of Chinese imports into the UK.

But Britain has an insatiable appetite for Chinese imports, worth more than £15 billion in 2006, and China’s importance as an investor in the UK is growing.

We’ve got a (very roughly) £1.5 trillion economy. Total imports seem to be about £250 billion. Chinese imports are thus 1% of [...]

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