Unfair
Friday, June 6th, 2008 By Mike Maurer
Vindy.com is upset that the Chinese are selling cheap steel .
The basic argument is that the bad old Chinese government is subsidizing its industry. When that’s no longer a winner, they’ll argue that China’s various laws (environment, health care, benefits, paid sick leave, it’ll be quite a long list) provide them an unfair advantage. When that’s no longer a winner, they’ll argue something else.
Could you make an investment in such a way as to destroy competition, and thereby gain a legacy advantage that no one can overcome? Maybe, but it’s not very likely and not a sound investment strategy. The real cure for such things is to ensure that entry costs are low, so that such an investment can never be recouped.
What Vindy really wants is for its favored workers to be paid a lot of money, and it isn’t really worried about any other consequences. Father PJ has an apt summary of the view that the world is overdeveloped: Just enough of me, way too much of you. There’s a corollary for economic matters: I’m paid way too little, and you charge way too much.
