June 26, 2006
From the desk of Jane Galt:Good point.
From Greg Mankiw:
Compare the numbers from two articles in today's NY Times:Warren E. Buffett, the chairman of Berkshire Hathaway Inc. and one of the world's wealthiest men, plans to donate the bulk of his $44 billion fortune to the Bill & Melinda Gates Foundation and four other philanthropies starting in July.According to the study [by the International Food Policy Research Institute], a deal similar to what is now on the table — modest cuts in real tariffs, limited cuts in domestic support payments, full elimination of export subsidies and 97 percent duty- and quota-free access for exports from the poorest countries — would create global gains of $54 billion per year.
In other words, success in the Doha round of international trade talks would give the world more every year than what Buffett can give once after a lifetime of being the world's most successful investor.
At the end of this week, there will be a WTO conference in Geneva. In all likelihood, this will finalise the collapse of the Doha round of negotiations, putting together a face saving package with little real progress on either agricultural subsidies or lowering tariffs in developing countries, the two major issues that have derailed Doha. If ministers do not reach a substantial agreement on those issues this week, there will not be time to finalise the deal and put it before congress before George Bush's fast track trade authority runs out next July.
Mr Mankiw's post tells you just how big a tragedy that is.
Posted by Jane Galt at June 26, 2006 12:05 PM | TrackBack | Technorati inbound linksThe irony goes deeper than that, because Buffett is an avowed protectionist, who has advocated abolishing the trade deficit by fiat through the issuance of "import credits" to exporters that would give the holder the right to import goods of value equal to the value of the exports, credits that could be traded on the open market. The result would be to make a trade deficit legally impossible. It would also, presumably, shut low value-added producers - like third-world agriculturalists - entirely out of the market, since the import credits would presumably get bid up quickly to a level that priced their products entirely out of the market. Wonderful idea, eh?
As others have pointed out,Buffett has two opinions about the estate tax.
(1) It's a great idea.
(2) It shouldn't apply to his estate.
Except, one would be a voluntary donation and the other would be a continued coercion by state power. I donate because I want to, without caring if others do. Let's leave the coercive power of the state out of this.
Kingsley, I think you need to read more carefully:
full elimination of export subsidies and 97 percent duty- and quota-free access for exports from the poorest countries — would create global gains of $54 billion per year.
We're not talking about foreign aid, we're talking about wealth creation through trade and development.
In other words the coercive power of the state is being used to prevent people from getting wealthy, not to accomplish wealth transfers.
Sorry, that's why I shouldn't be commenting at 12.30 am after a couple of beers.
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