Wednesday, June 9, 2010
Buy American may not be the best way to help us
It is rare that a decision in the market place doesn’t come down to that. If we buy an American car, you may be supporting yourself, your family and your country. But, that makes other countries economically weaker. If you buy a foreign product, you are helping the world and your country (storage, shipping, dealerships are all in the states, sometimes the car is even built here) but may not be helping you or your family. That is a simplistic view, but it helps set up a solution.
The reality is each country tries to control every aspect of economics so that investment and business will come to their part of the world, to the detriment of other countries. The products and services that are produced are actually secondary to the jobs that it provides. Every country knows that jobs and income create stability in a community. Illegal immigration, civil wars, terrorism and other ills are born directly from a lack of economic prosperity. If people do not feel like their future will get better for them or their children, they will look for ways to express their dissatisfaction.
To get the investment for jobs, third world countries have many tools that will make their countries interesting, both formal and informal. Taxes can be reduced to start with, environmental laws can be weakened, and regulation of the production process and of human resources can be lessened. Countries that haven’t dropped all regulation often ignore their own laws to keep a job providing company in the country. This degrades the environment and the human condition. It can be argued that it actually makes things worse because when the false promise of prosperity is found out, people will rebel.
Some of these countries are rogue states that do not deserve our support. Those countries that don’t allow the same rights and freedoms that we enjoy in America should not receive a favorable position in the market place. But, other than boycotts, there is no individual country mechanism that controls that other than legislation and taxes. No law will totally guarantee that some money will not get into the wrong hands, but it can be limited.
If we as a culture and a nation believe in the universality of human rights (as the Declaration of Independence states, “we hold these truths to be self-evident, all men are created equal”) why should the question be them or us? If we are to stop illegal immigration, civil wars, terrorism and so many other ills, we must find a way to support third world countries. It could be by just giving them money, a payoff for our own lack of direction and no united front by all successful nations.
But, the better way, to borrow from an old adage, is to teach them to fish. Instead of just giving aid, if we understand that economics and the market place do have a place in solving world problems, then maybe making a decision in the market place that supports everyone will help. Purchasing products and services from other countries spurs more investment in the host country.
When people earn money and instead of just taking it, they see a better future.