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>> Right - and Australians couldn't possibly do this back to the Americans because everyone knows that Australians are fundamentally more stupid and incapable than Americans who all carry the exploitative capitalist gene. Well yes we might be able to, but where does that leave things? Australia loses tariff revenue that the Asians used to pay and now American producers get the value of it. Americans lose tariff revenue that some third party used to pay and now Australian produers get the value of it. But remember that our (and the US) producers are high cost compared to the Asians/third party and are only earning normal return on investment. So the net effect of this FTA is that we (the US and ourselves) are now getting the same goods at a much higher production costs - so all we've switched production from low-cost to high-cost countries. >>You can always create little niches of people who are worse off under any change to legislation (10 goat-farmers in Somalia can't compete with imports which prevent 100,000 starvations per year, therefore trade is bad etc etc).
I'm a little sick of being told "It's for your own good that we stop you from freely trading with X". Me too. But given that the government has already said that we can't freely trade with not just X but also A, B, C and everyone else, the question it seems to me is whether allowing free trade with X improves or worsens things overall. The economic analysis I've seen suggests that it often worsens things overall - or if not then is far inferior to multilateral reform. >>Actually I do think that the marginal value of government revenue is very close to zero. Tell me - if the government got a windfall of an extra billion dollars next year, where do you think it would go?... Well I don't necessarily disagree with you on the value of much government spending, even if I wouldn't go to the extreme, but here we have a case of not increasing government spending but rather giving away a whole heap of tariff revenue for no constructuve reason. What will the government do? Maybe it will cut welfare, but its just as likely to increase taxes.
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