It’s Okay, Ed.

by Little Miss Attila on January 29, 2009

Haven’t you heard the news? Those who wrote the Pelosi-Reid-Obama Debt Bill—the so-called Stimulus Bill—meant well. So it’s all right.

Morrissey compares the P-R-O Porkulus bill to Smoot-Hawley during the Great Depression, over at Hot Air.

Buy American is a slogan that practically guarantees popularity. What could be more patriotic than looking for the “Made in the USA” label, especially when taxpayer dollars are on the line?

Nothing, if you don’t mind killing the entire American export sector. We already have large trade deficits, thanks to our massive wealth transfers each year to oil-producing nations based on our unwillingness to pump our own crude. If we touch off a trade war, which this will almost certainly do as it violates all of our WTO and bilateral trade agreements, other markets will close their doors to American products, such as cars and technology. Instead of closing our trade gap, we will explode it, and even those oil imports could get retaliatory tariffs from our two closest trading partners, Canada and Mexico, our two largest foreign suppliers of crude.

We have done this before, and under worse circumstances, which is why this such sheer folly. The Smoot-Hawley tariff act turned a severe but recoverable recession and turned it into a generational depression. Instead of working cooperatively, the major trading nations had to respond to American penalties with more penalties, and the Buy American provisions of the New Deal entrenched those divisions, making recovery impossible. The rest of the world — Europe, Asia, Latin America — would likely shut out the US and trade amongst themselves, and we would lose decades of work in building American economic strength abroad.

America doesn’t need a trade war at this moment in time. We need to ensure our access to as many foreign markets as possible. Protectionism now will take us down a primrose path that we have traveled before, and the end result will be bread lines and 25% unemployment, and worldwide misery.

Will the Democrats succeed in turning this recession into another Great Depression? I don’t know.

I do know that back in 2001 a lot of people got mad at George W. Bush for even uttering the word “recession.” But that was then, and this is now, and in 2009 it is fashionable to talk the economy down. That way, if it bounces back, Obama may get the credit while he pursues policies that have only exacerbated such downturns (and tragically so) in the past.

That works only if we don’t publicize the wastefulness of this bill, even as the money is being spent.

But we will.

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