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Bloomberg: The dangers of populist protectionism

Posted December 12, 2007

"A growing China creates jobs for our export producers, keeps consumer prices low, expands our choice of goods and services, and increases our access to capital and talent." –New York Mayor Michael Bloomberg

by Michael Bloomberg

Blogger's Note: As populist politicians of all persuasions shamelessly stoke public fears and insecurities with anti-free trade rhetoric and protectionist slogans, we're well served to remember the benefits the world economy — and particularly the US economy — have enjoyed thanks to the anti-inflationary influence of the global marketplace. New York City Mayor Michael Bloomberg has just written an article that puts it into words far more succinctly than anything I've heard our other elected representatives put it. Published December 11 2007 by the Financial Times.

The US economy has turned downward. People are feeling insecure. There are grave concerns about jobs moving overseas and about losing ground to Asian countries. Heavy pressures are mounting on the presidential candidates in both parties to pander to protectionist and even isolationist sentiments. The year, however, is 1992. Fortunately, the two parties’ candidates – Bill Clinton and George H.W. Bush – refuse to cave in to the pressure. They resist the special interests and stand strong for the long-term health of the American economy – and the country begins one of the greatest economic expansions of our history.

Today, we would do well to remember this lesson. (…) If America is to remain the world’s economic superpower, it must capitalise on the opportunities and confront the challenges. Countries that run away from globalisation in the 21st century – as with those that ran away from capitalism in the 20th century – will pay a heavy price for decades to come.

(…) Some in the west believe that a growing Chinese economy is a threat. As a businessman, and now as mayor of the world’s largest financial capital, I believe the opposite is true: Read on…

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