The Bicycle Metaphor

A propos of the launch of the Canada – India trade talks, Bill Robson resorted to the tired old bicycle metaphor on CBCs Power and Politics. He is not alone. This cliche gets voiced all the time. Like a cyclist who will topple if she or he slows down, the momentum of trade liberalization must be maintained, we are told,  or we will fall into the abyss of protectionism.

I don’t get it. I cycle a lot (winter excepted.) I often stop without incident. I change direction, sometimes at random. I reflect on where I am going. I sometimes change destinations. I rarely fall down.  Cycling is freedom.

Come to think of it, maybe trade liberalization is like cycling after all. We can do what we want.

One comment

  • The term trade liberalization was used to designate the process whereby tariffs replaced quantitative restrictions on trade. To liberalize trade was to establish prices — to be paid by importers — so that all could judge what it would cost to sell into a market in a given country.
    The basic idea was that the importing country paid the cost of the tariff but was free to set it at whatever rate it wished.
    Exports are free of domestic tax, it is remitted at the border. So importers got to tax the (domestic tax free) export through a duty at the border (as well as imposing a sales tax or value added tax).
    Now liberalization is mistakenly taken to mean by Robson and others cutting tariffs, or doing away with them altogether. In fact as tariffs went down during the seven GATT rounds, quantitative restrictions went up. When they take the form of border inspections or trade remedy law, like those measures available to the U.S. they make a mockery of so called trade liberalization deals like the FTA and Nafta. And when routine harassment is not enough, you can make people get passports to cross the border, and fail to approve bridges across international waters.
    Ask Robson where his bike is made. It matters. Can you still buy a CCM, and is it made in Canada?

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