Theres more to life than catfish, rubber gloves and palm oil

From Mahablog1. A long time ago when I was Prime Minister I met President Bush the father, at Boston University where he was conferring degrees for graduates. I met him in a side room and I told him of the unfair anti-palm oil campaign by America, blaming it for heart diseases.

2. We later submitted palm oil samples for three American chemical laboratories to examine the cholesterol contents. Their findings proved that although palm oil had more cholesterol than rival soya bean oil, the main edible oil in America, cooking reduced palm oil cholesterol but increased the cholesterol in soya bean oil.

3. The campaign against palm oil stopped but Americans still refused to use palm oil for cooking to this day. It was a case of non-tariff barrier. But that is the way America deals with competitions.

4. When the Vietnamese exported catfish to America, American catfish producers got their Government to declare that Vietnamese catfish is not catfish. The catfish farmers in Vietnam lost their business.

5. Malaysia-made rubber gloves were banned in the United States because out of the hundreds of millions used, one person had allergic reaction.

6. Foreign aircraft manufacturers wishing to export to the United States have to use American components and do part of the finishing in America. It is the same with the automobile. The Japanese and the Koreans have to put up plants in the United States and employ American workers in order to remain in the United States market.

7. Despite all these conditions Toyota's share of the world auto market grew. Then news came that Toyota was on the verge of becoming the No 1 automotive manufacturer in the world, displacing General Motors of the United States.

8. American's pride was hurt. Soon something was found to fail in the hybrid Toyota "Prius". Apparently one American user from t! ens of t housands was hurt because the brakes failed.

9. The news about the Prius failure hit the headlines in the American controlled world media. Toyota was forced to recall tens of thousands of the Prius model. The losses were enormous.

10. In order to put Toyota in its proper place the head of Toyota Corporation was summoned to Washington to face a congressional enquiry.

11. Toyota's position as a possible biggest automobile manufacturer in the world has been eroded. But while American auto manufacturers have to be put under Chapter II, i.e. as bankrupts, Toyota is still showing profits. In time Toyota will become the biggest automobile company in the world, the faults with the Prius notwithstanding.

12. There really is no free market. If tariff and other barriers fail to stop imports, the application of sanctions against countries, whatever may be the reason is also another form of non-tariff barrier. Free trade simply does not exist.

13. Truly hypocrisy prevails in the markets and in international trade. The greatest hypocrites are the very people who conceive and promote the idea of tariff free world trade.

I havedecidedto publish my responses to Tun's economic arguments (Mahanomics) in my blog. After all indirectly, Dr Mahathir Mohammad provided the inspiration for me to get down the details of this economic and finance mumbojumbo. This category will be called CHEDETORIAL (Am open to better tags).




Dear Tun and followers,

I was shocked when I read your posting. In fact I almost fell off my chair even though its a very strong and sturdy chair.

How can Tun accuse the United States of being protectionist? America is the biggest promoter of free trade. Yes, they protect their soya bean farmers and their catfish growers But I totally don't buy the Toyata story.

Primary agriculture is protected due to the strong congressional lobby. The farmers are based in rural America and I can't blame them for wanting to! protect their livelyhood. And personally I'd prefer American catfish. Its tastier and catching catfish via noodling is a way of life.

But lets put some data out to dispute this story.

The United States of America has been running huge trade deficits for the better part of the last 3 decades. For the last 5 years, their trade deficit was an astounding US$ 757 billion per year, or US$ 3.7 trillion in total.

Source:Bureau Of Economic Affairs

That means America imported USD $ 3,700,000,000,000 more than they exported over the last 5 years. This enabled millions of people around the world to find jobs and improve their quality of life. Without America's trade deficit, I dare say, a billion or more people will still be illiterate, hungry, unclothed and easily misled by a certain statesman's simplistic arguments.

Of course exporting to America is not easy. One way is by partnering with American firms as an OEM supplier. That is the way for those producing undifferentiated products. But if a country had invested properly in their education system, developed talent and not caused the biggest brain drain, then surely that country could produce some technologically innovative device that they can export.

You yourself have proved my point. Americans can appreciate technology. Whilst the Americans, grew up with all the propaganda surrounding Motown (home of the US automakers), still every year, millions of Americans prefer to buy Toyata and Honda cars because it offers a better product. And if Toyata slips up, the American high standards of customer satisfaction would force them to rectify the issue. The Prius had a defective brake pedal system. The Chairman of Toyata admitted it. I saw him getting grilled on TV. Of course he had to be pressured by the United States Government to come out and say so.

So if we want to export to America, we have 2 options. Option 1 is to operate sweat shops and produce goods under American labels. Option 2 is to invest in the citizen's educ! ation (a nd not monuments), produce a superior product, keep the manufacturers on their toes (ahem, am thinking of a certain power window in a car) and continue to innovate.

That sir is not hypocrisy. That sir is the American dream.
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