Thursday, January 01, 2009

America and Free Trade

Here is an excellent article from Orrin Woodward on his Leadership Blog.

I have been asked my thoughts on free trade numerous times. I believe the World is Flat as Thomas Friedman says and that America must learn to compete with the world. Protectionism does not work and we know this from the world of sports. Can you imagine going to the Olympics and learning that certain countries were penalized for being too competent? The Olympic ideal is may the best person win and the best country win. In economic parlance, their win does not have to be another countries loss. Adam Smith, at the time of the American Revolution, clearly spelled out the advantages of specialization and economies of scale in his Wealth of Nations. America must not fear other countries, but embrace a win-win trading policy with other countries.

David Ricardo shared the concept of Comparative Advantage that is essential for the specialization between trading partners. As I began my research for this paper, I realized that Alan S. Binder had already captured all the essentials in his excellent article. I will share his well researched and reasoned article with you. Great job Professor Binder in providing quality information that is explained simply. America must remain free for the best entrepreneurs to try different ideas and processes to satisfy customers’ wants. Every time we lose freedom, we lose the ability to compete. Let’s replace fear with hunger to learn and grow. Chris Brady and I wrote our WSJ #1 Best Seller, Launching a Leadership Revolution to encourage all people from every country to grow personally and be part of the global community. God Bless, Orrin Woodward