Do hard-core “fair traders” who decry free trade and the global economy have any idea of what those two modern trade marvels are, how they work and how we American consumers benefit from them? We don’t think so.
They don’t seem to understand how cars are now made; Mexican assembled cars of all Asian, European and American brands, for example, have 40 percent American made parts as well as parts made in Asia, Europe, Canada and, of course Mexico. American made cars (Michigan, Ohio, et al) have parts from Mexico, Canada, Europe and Asia.
Do they know that cars would cost more, especially small cars, so far fewer people could afford them if supply chains stretching from Canada to Mexico and through Michigan, Ohio and Indiana didn’t exist?
Windshield wipers made in Mexico are installed on cars and vans made in Canada and the U.S.; ditto engine blocks made in Hermosillo, Mexico. Engine blocks and transmissions made in Ohio are installed in cars, vans and trucks made in Canada and Mexico. Engine blocks made in Germany are installed in BMWs made in South Carolina and Mexico. And, on and on.
This seems to overwhelm anti-free traders. They hide their real position by calling themselves “fair traders.”
Here is an example everyone can understand – we hope – of what the global economy and free trade is. It isn’t as complicated as $30-$60,000 cars with thousands of parts made in different countries that are installed in thousands of cars in other countries.
I have in my hand a can of “Medallion” MIXED NUTS. It cost $2.00 at Walmart. We assume Walmart made money on that $2.00 can as did the company that sold it to Walmart, as did the company that made the metal can and another that made a plastic top to protect the contents when the metal seal is broken. So did the company that printed the can’s label. The can of mixed nuts made money for warehouse workers who handled the cans and the truck drivers or railroad engineers that moved the cans around the U.S. and Canada.
Besides “Packaged in the USA” we find “Ingredients” itemized on the can’s label. Ingredients – Peanuts (from the USA, Argentina and Mexico); Cashews (from Vietnam, Brazil, India and Indonesia); Almonds (from the USA – California); Brazil Nuts (from Brazil, Bolivia, Peru and Colombia). The salt for salting the Mixed Nuts comes from Mexico.
So, in addition to all the companies and people that make money off this $2.00 can of Mixed Nuts here in the United States, we see that people who cultivate, pick and sort the nuts in 12 different countries make wages, as do truck drivers, railroad engineers and boat drivers who bring the nuts half way around the world to be packaged in the U.S.
When we add in owners and/or shareholders of all the companies involved in the 12 different countries that cultivated, harvested, processed and shipped the nuts to those people that moved/shipped the nuts in the U.S. to the workers who mixed the nuts and packaged them – we have thousands upon thousands of people involved, all making salaries and wages. To them we must add the people who move the packaged can of Mixed Nuts around the United States, stock them on shelves and cashier their purchase.
All those people in the U.S., Mexico, South America and Asia work hard so that I can buy an 8 ounce can of mixed nuts.
This $2.00 can of mixed nuts is a far better example of global trade, of free trade than a $60,000 Mercedes Benz made in Alabama with parts from Germany and Mexico. All of us can buy the $2.00 can of Mixed Nuts because of the global economy, free trade and the retail genius of Walmart; without global and free trade and retailers like Walmart, that 8 ounce can of Mixed Nuts might cost $20.00-$30-$40 or more.
That is the lesson of the day, a lesson that started with my $2.00 and cashews picked in India, Vietnam, and Indonesia; peanuts from Mexico, the USA and Argentina, almonds from Central California and Brazil nuts from Peru, Bolivia and Brazil.
Raoul Lowery Contreras is the author of “The Mexican Border: Immigration, war and a trillion dollars in Trade (Floricanto Press, 2016) and Murder in the Mountains: War Crime at Khojaly Floricanto Press, 2016).
