TCS Daily


Our Siamese Twin

By Jerry Bowyer - March 2, 2007 12:00 AM

Tuesday's market melt-down is exactly the sort of thing the Dobbs-Buchanan-Hillary Clinton-economic-school-of-nationalism loves to complain about. In fact, they just did; as I stepped away from my computer a moment to watch the news, I saw this letter from Hillary Clinton to the Treasury Secretary. China's market crash causes a mini-crash here. Aha, they say, this is what's wrong with globalism.

But I'm not sure they've really thought things through. After all, if a ten percent drop in the SSE, yields a three percent drop in the Dow, what would taking China completely out of the economic picture do? In other words, if the sino-screechers are right that trade with China leaves us vulnerable to downturns such as this week, then doesn't that require them to believe that the run-up was due to the trade to begin with? If trade with China is to blame for the value lost on Tuesday, than it gets the credit for the value that was there before?

Forgive the somewhat culturally insensitive analogy but this is a little bit like being one of a pair of Siamese twins. Yes, if one twin gets the flu, the other may get infected too, but surgical separation could kill them both. A trade war with China would shield us from fluctuations in their market, but it would plunge Asia into depression and the world into recession to boot.

Yes, we are dependent on one another, but that's life. Asia depends on the west, and vice versa. Canada and the US depend on one another. New York and Texas produce different goods and services and trade them. I depend on my local gas station for gas and the police for protection. They depend on my payment and taxes respectively, for their livelihoods. I mow the lawn, my wife cleans the kitchen. We're dependant on one another. If she gets sick, my life gets harder too. This a decision that I thought we made a long time ago. We were forced to choose between self-sufficiency and prosperity. We chose the latter.

Once, the tribe was the biggest thing that most people ever saw in their lives. Life was nasty, poor, brutish and short. Eventually we left the tribe behind and entered the marketplace, the marketplace of ideas, of geopolitical power and of goods. We got richer, a lot richer. We also become more dependant on one another. The principle is the same no matter what the scale, whether it's an attempt to create an utterly self-sufficient Bowyer Tribe (complete with organic farm and guard dogs) or an attempt to create an utterly self-sufficient America Tribe. The result is the same - destruction of wealth, not just America's, but the whole world's.


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9 Comments

interesting piece
But the problem is that too many of us haven't yet left the tribe.

The governments are protecting their turf.
There are hundreds of billions of dollars in goods and services and terabytes of information flowing between individuals in China and the US. The useless dopes in the governments are trying to get a cut and trying to control the activity. In other words, the governments of China and the US are trying to protect their turf. China being a totalitarian state has an obvious advantage in doing this. The government of the US must first convince/hoodwink/trick/flim flam/etc. the US populace into allowing it to the same things.

I hope that the US population realizes what their "representatives" are up to and puts a stop to it. There are trillions of dollars and millions of jobs at risk.

Oh yeah, outside of some union halls there is only downside and zero upside.

dependant on education
according to my dictionary, it's actually spelled "dependent"

depends
The spelling depends on whether you are a pedantick (sic!) snob or not. Most people on such forums (fora?) are more concerned with communikating their ideas, not the Queen's proper enlish. C how u r?

Joined at the hip
Good article. Many people will point out potential problems about such globalization. But actually it's good because the whole world is less dependahnt on one big country going awry. For example, it was the stupidity of the US that cause the great depression, because it was the main, biggest country back then. Now it's getting less likely that the same would happen, since there are more big rich countries. It's good for the world. Indded, when the downturn happened, it took advantage of it to up my stakes aby about another 18K. Bought at a bargin price. I think warren buffett did the same.

Hell Dietmar and I agree on something.
its fnuny how you can mix the the letetrs up but you can sitll read it, and that's wahts cuonts.

This is a good piece sort of.
It's got the usual TCS bias but hell the real issue is most people think anything is a good idea if it looks like they get the lions share. Just as most people don't like ideas were someone else gets the lions share. In fact studies have shown most people would take a pay cut if it meant their peers got a even bigger one. When the ultimate goal of globalisation is well globalisation then it's easy for a Polly to be a nationalist. Remember all Polly’s are vote chasers and when their not in power their just that little most desperate.

Hillary's Letter
Although a short article, I thought it was a good message. I really get irritated when the same govt officials who keep reminding us of "the global village" and how we have to be a part of it, then find problems with our role in the "village" when something unfortunate happens. We take the good with the bad and we work together...what's so hard to understand about that?

My biggest shock (or laugh) in Hillary's letter to the Chairman was her comment about "markets are volatile and to some extent will always be volatile." I paraphrase of course, but geez, I hope the markets are always volatile. I'd hate to see my stock price remain the same day after day after day. Isn't that the whole point of a "market"?


re: spelling
I don't criticize spelling errors on the forums; I make enough myself. The repeated misspelling of 'dependent' is in the article. One would hope that the arguments are proofed at least as well as the mechanics.

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