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A T-Shirt Triggering Free Trade And Protectionism

2011/3/22 9:48:00 83

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How can the free trade policy and protectionist tendency reflected by a T-shirt change the world of chaos?

Strictly speaking, the T-shirt in the book refers only to T-shirts worn by Americans.

Pitrira Rivoli, Professor of the Business School of Georgetown University in America, intends to reveal the hidden history of changes in the T-shirts worn by Americans, the trade process, and the interest relationship between the parties in the interest cooperation chain, thereby giving people the truth about major issues such as free trade, trade protectionism, labor protection, and genetically modified species.

According to Pitrira Rivoli's description, a T-shirt.

global economy

The tour includes six steps: the first step is to make cotton raw materials such as T-shirts and so on and sell them to cotton traders in the United States, and sell them to American cotton traders; the second step is to sell the goods to the textile and garment manufacturers represented by China; the third step is to pfer the garments made by Chinese enterprises to the retailers such as the US WAL-MART at a low price; the fourth step is to sell WAL-MART T-shirts to American consumers; the fifth step, the American consumers will treat the old clothes at low prices or without compensation to the charitable organizations and old clothes traders; sixth steps, the old clothes traders in the United States will carry out the two sale of the T-shirts and other garments, and the consumers are the consumers of many poor countries in Africa.

Using carbon footprint, water footprint and other tools to measure such an economic journey, it can be said that it is not environmentally friendly.

In recent years, many books advocating low carbon and energy saving have noticed that the "raw material production, industrial production, sales, use recycling" chain is too long, too complicated, and advocates "localized consumption".

This kind of advocacy will surely be regarded as the gospel by the textile and manufacturing industries of the developed countries such as the United States and so on. Under the circumstances that American protectionism can no longer provide them with more protection, it is fashionable and more convincing to play the "low carbon" brand.

The six step of a T - shirt defined by Pitrira Rivoli, each of which comes from the beginning of modern times

Global trade

The free trade tradition formed by the system is also related to the partial and phase competitive advantages of various interested parties in the selective or unconscious violation of free trade principles.

In other words, in the same fact and its causal relationship, free trade and trade protection are "perfect" integration and compromise.

This makes it difficult to evaluate free trade or trade protection.

Take the first step, for example, Texas.

cotton

To export to China, it is natural to benefit from free trade all over the world. Pitrira Rivoli also cited the fact that American cotton growers have higher level of technology and management efficiency. If we look at these narratives alone, it is natural that the free trade is absolutely right.

Is it true? The reason why the US cotton exports (rather than staying in the US) is because there are specific agricultural product politics and cotton politics in the US Congress political system, which are heavily subsidized through export to cotton farmers and Cotton Traders' interest groups (equal to us taxpayers subsidized cotton farmers and cotton traders).

Does this mean that free trade can only be achieved on the basis of trade protection?

The United States has provided huge subsidies to cotton and other agricultural products, which has effectively enhanced the competitiveness of domestic products in the international market, and has also led to many years of trade disputes between the United States and other cotton exporters.

But Pitrira Rivoli hinted that the United States subsidized cotton exports and made the international prices of cotton cheaper. In such a low price of raw materials, China and other countries could further form a highly competitive export garment processing and manufacturing industry. The Chinese made T-shirts can sell the world at high quality and low price.

Can it be said that a trade protection has created two free trade?

Again, the third, fourth step in the six step of the T-shirt journey, that is, the process that China's processed and manufactured clothing products are being sold back to the United States, is also full of entanglements between free trade and trade protection.

American cotton traders who benefit from the cotton export subsidy policy often hold or directly run their own textile and garment industries. They often participate in two interest groups at the same time, encourage cotton exports and defend export subsidies first, and then insist on collecting high tariffs on China's manufacturing, and advocate the adoption of quotas and other mechanisms to control imports.

This leads to a strange equation: free trade + trade protection = profit maximization.

But it needs to be pointed out that this strategy combination is the root cause of the decline of the competitiveness of the American textile and garment manufacturing industry. Pitrira Rivoli pointed out that the US cotton agriculture interest group successfully built up the import barriers of the lint, which increased the cost of raw materials of the American yarn Association; the American yarn Association in turn lobbied for the import and quota of yarn imports, and also restricted the ability of the US fabric producers to get the best yarn at the best price; finally, the coordination and tariff applied to the fabric increased the cost of the American apparel producers, and also restricted the ability of the clothing manufacturers to respond to the rapidly changing and unpredictable fashion taste of the American consumers.

The combination of every tiny victory has become the deadliest straw in the American textile and clothing industry.

In general, the global economic journey of a T-shirt, through the analysis of the "life cycle" and economic journey of the T-shirt, makes clear the historical and realistic problems of goods and trade globalization, free trade, trade protection, and trade regulation. It is especially worth mentioning that there is no empty, narrow or narrow affirmation of the right or wrong of free trade or trade protection, but reveals the truth of the two converged in the same goods and the same trade process, and helps people understand the essence of trade more clearly, thereby deepening the understanding of economics and related trade politics.