Comments on: Protectionism by Another Name?

By: Emmanuel

Emmanuel — Sun, 25 Jan 2009 15:39:50 +0000

JK, please read Geithner’s statements carefully for he did not accuse China of currency manipulation. He merely reiterated his boss’s opinion on the matter which he does not necessarily share.

By: Erik

Erik — Sun, 25 Jan 2009 11:55:35 +0000

“Theoretically, devaluing your currency is not as bad as import tariffs.”

This statement is not clear, and seems to be wrong. The devaluing of a nation’s currency merely acts as a recallibration of nominal prices; an import tarriff accomplishes a simllar goal although only domestically.

I think you may be talking about the potenital international implications of raising tarriffs, and even about the welfare distorting effects of such actions.

Under this analytical framework, a devaluation of a currency affects far more stakeholders as all product prices change. There is a (theoretical) possibility that the “zero-sum” game you describe happens; that is, all countries competitively devalue leading all nations back to square one. Although possible in theory, it’s never happened in practice. China’s monetary conundrum, and the US’ baffling insistence to bring it up during this critical time (most likely to give rhetorical support for Union support) will be a key variable down the road.

By: Commode on Legs

Commode on Legs — Sun, 25 Jan 2009 04:01:11 +0000

How about taking this one step further and discussing how US national interest intersects the Euro system?

Geithner’s use of the “m” word set some people on edge, but I see it as a very positive engagement with reality. What other cannons might be fired leading up to G20 in April?

Cheers & thanks for blogging,
$35,115

By: efw

efw — Fri, 23 Jan 2009 23:08:41 +0000

Are restrictions countries impose on the movement of capital or labor also forms of protectionism?
Also, during the 19th century, the tariffs imposed by the US on British imports aided the industrialization of the US. These tariffs allowed the shoe and textile industries to develop here in New England.