2/14/2005

OPPRESSED AFRICAN COWS

Who would have known that Gov't subsidies actually repress African Cows? In the article “Brown urges end to ‘scandalous’ trade barriers”, I was informed that “more was spent on an average European cow every day than on a poor African.” This all has come about from subsidies and trade barriers put up but rich countries to hold back the poor countries. It costs poorer countries millions of dollars extra to trade and sell their cows because of the trade barriers.

Gordon Brown is the British Finance Minister. He went out on a limb Jan. 16th to boldly declare that unequal trade is being created by Gov’t subsidies and artificial trade barriers.

The idea in Brown’s speech is that we are holding poorer countries down while instituting our barriers and subsidies. By having a trade barrier, we’re making the competitive playing field uneven in our advantage. In effect, this will hurt us in the long rung. As we learn in economics, competitive companies benefit society in that prices are driven down and efficiency is driven up. At this point, barriers have done nothing but stunt this efficiency growth by keeping new foreign companies from entering into the market.

It's time to break the barriers and let the cows out!

8 comments:

Jim said...

Very interesting observation on Cows vs. People. Just about every country in the world has some sort of trade barrier, and your artical describes European's disavantage they have placed on their border. Open trade markets would, I believe, help a lot of these poor countries.

Jim said...
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Marie said...
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Marie said...

It seems to me that is what business is all about! If you can create high barriers to entry than you will be able to be more successful in your market. Why would bigger countries want to decrease their ability to gain more market share and profit for poor countries?

Dr. Tufte said...

This is a well known problem. Personally, I find it immoral. But, it gets worse. Not only do we put tariffs on imports to keep goods from developing countries out, but we subsidize things like agriculture. This creates surpluses that have to be disposed of - usually to developing countries, and at prices that undercut their local producers.

To some extent, Marie has a point. It is the job of businesses to erect barriers which allow them to make more money. One would hope that our government officials are not dumb enough to be complicit in that. But they are.

Bart said...

I think that if we can do away with trade barriers with our neighbors to the north and the south that we should be able to lift trade barriers with everyone.

Tom said...

Trade barriers are the pits! In microeconomics I heard that we (the U.S.) pay a ridiculous amount for sugar because of trade barriers/tariffs. The reason is because some rich sugar cane farmers in the U.S. go to the legislator and organize themselves and plea to save the American jobs. I found this to be obscene because of the lack of understanding of the great benefits from trade. Kudos!

Luise said...

I believe the surplus that Tufte is talking about is created by price ceilings and floors, which we should have learned about in microeconomics. The price floors are to help producers, such as farmers, make a better price off their product. This in turn creates a surplus. The Government then turns around and sells our surplus to under developed or developing countries at a price that is below their local producers cost. The sad thing about it all is that the surplus is created on items (milk, cheese, butter, ect.) that we as Americans buy all the time.