Professor Elam

Robert Samuelson discusses the rise of mercantilism. This 19th Century promoted the idea of ‘put us first’ to build import income. This also led to tariffs to make sure work was done in our country not in their country.  Example-if you have been to Cancun you probably rode in either a VW or Nissan taxi, the reason is that those cars are made in Mexico.  Mexico puts high tariffs on cars not made in Mexico to give the advantage price wise to the home made product. The result is fewer choices for Mexicans.

So the idea of free trade after the disastrous Smoot Hawley tariffs of the 1930s seemed to worsen the Depression. Now however we are going back to the me first doctrine. China keeps its currency cheap to make its goods cheaper, the result is more manufacturing in China.  Chavez sells discounted oil to his friends.  How long will Putin be ‘friendly’ to Europe in terms of natural gas sales.

This is a good article that links economics with globalization.