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Morning Line: is protectionism the answer?

As America plans to close its borders to foreign goods, is it time we thought about doing the same?  

 

As the world's leaders in politics and business meet on the slopes in Switzerland, protectionism is the word on everyone's lips.

While America is preparing to ban the import of raw materials and parts as part of its $825 billion stimulus package, many other world leaders are already warning they would challenge the move and could retaliate. They also warn of the threat to world growth posed by growing protectionism. 

On Monday, UK prime minister Gordon Brown is expected to re-iterate his call for global co-operation as he believes it is crucial to help revive the global economy.

But he may already be too late. The latest stats suggest the world's nations are already all trading less.

For many, protectionism is an obvious answer to the recent downturn.

After all, isn't it the very fact that borders have been so open that caused the current globalisation of recession?

As the jobless toll rises in the UK and we begin to realise the error in focusing so much of our energy on financial services, many here also seem to be backing a call for greater protection for our businesses and a new focus on boosting UK manufacturing.

Is it really fair that while the UK producers and farmers have been driven into the ground, Chinese factories have sprung up supplying us with everything from socks to electronic goods?

And isn't it time we put an and end to Indian call centres and the off shoring of so many other white collar jobs from IT to journalism?

There is also an obvious environmental argument against globalisation.

If we were to buy locally produced goods, we would reduce our carbon footprint.

But if it is so blindingly obvious that protectionism is good for us, why is free trade so popular with economists? And why are so many of the world's leaders so keen to make sure we don't slide back to the period after the Great Depression when US borders were closed and international trade capped?

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6 comments so far. Why not have your say?

Sara Jess

Jan 30, 2009 at 12:15

Talk about how to make enemies with the rest of the world!

Something worth remembering: yes, we are in a terrible financial state, but that's nothing compared to some countries which rely on us to bring them trade. Take that away from them, then what?

Wasn't it our selfish attitudes, ultimately, that helped create this mess?

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John Lacy

Jan 30, 2009 at 13:11

Its down to the fact that the UK government is naive and STUPID. We've got enough protection inside the EU but unfortunately our dear leaders are too stupid in obeying the letter of the rules every time. The French, Germans and Italians aren't so coy---they enforce the rules that suit them and drag their feet on the rest leaving us to cut our own throats.

An example from the agricultural industry (so close to destruction by bigots like Lady Caravan alias Margaret Beckett)

Several years ago the EU brought in a rule that all abbatoirs had to be supervised by "vetinaires". The British government decided that they must mean qualifie Vets and succeeded in shutting down over 85% of the local facilities in the UK. Everyone else re-designated their existing supervisors as "vetinaires" and just carried on---simple and effective--no rules broken, no EU fines.

UK yet another sector wiped out.

My point is that if we make good use of assets that are already available protectionism seems less necessary and we don't get all the hassle that it will cause.

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David P

Jan 30, 2009 at 13:21

No it was not our selfish attitudes that got us in to this mess.

It was our greedy attitude wanting things for less and wanting more profits.

Charity begins at home.

It is about time we started putting the british people first again.

What a mess this dying country is in.

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David Shaw

Jan 30, 2009 at 15:59

There is no other answer unless China, India etc buy from us to the same value of our purchases from them. Which is unlikely

We cant carry on with our wealth disappearing to them in £billiones every year. Only time before we go bust. And not very much time now

What about rebuilding our manufacturing again ? Or is that against Labour dogma

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Alex Grattan

Jan 31, 2009 at 12:06

I agree that there has been too much focus on financial amrkets in the UK but would suggest that this has also resulted in too much London-centric focus, under-investment in the rest of the UK and assume that only by feeding the City cab we grow. The evidence is close to home even within London which contains some of the most deprived communities in the UK yet is on the door-step of the alleged wealth creators.

Gordon B should be taking this opportuntiy to redress the balance and focus upon high-tech investment across the UK and encourage more social rsponsibility rather than tokenism.

Alex

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Sharon in Tampa Bay

Jan 31, 2009 at 12:09

A lot of us normal American citizens have wanted to return to protectionism for years. That way we will have JOBS to buy what we make! I'm all for bringing the troops home, having them protect our shores and borders and saying that if we can't make it, we don't need it. I am in favor though, of including our best friends in "we", meaning the UK and Canada, Japan, Mexico (yes,really), and Australia. The rest of the world we don't need. We HAVE oil, plenty of it. We just need to drill and in the meantime continue our research to find the best of the renewable energy sources.

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