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Wednesday, May 07, 2014 7:54 PM


Does Economic Patriotism Work?


A recent poll in France shows 59% of those surveyed for "Les Echos" consider economic patriotism "effective redress for the French economy." Only 38% disagree.

This no doubt will please Arnaud Montebourg, the Minister of Economy and Productive Recovery and singer of "Made in France".

I have commented on Montebourg numerous times before.

Here's a notable image from Made in France: Montebourg Ridiculed in Text and Pictures; France Goes After "Red Bull" Energy Drinks to Finance Social Security.





Above: Montebourg advertises "Made in France" while holding Moulinex blenders and wearing classical "marinière" shirts.

Economic Patriotism Cannot Succeed

Economic patriotism as championed by Montebourg cannot possibly work.

Every country wants to increase exports. But how can every country do that if they all engage in economic patriotism?

On an individual basis, does it make sense to buy crappy cars just because they are "made in America"?

Of course it doesn't. And in that regard, US cars finally got better for two reasons:

  1. Unions made concessions and as a result US cars became more cost competitive.
  2. Consumers buying foreign-made cars forced GM and Ford to build better cars if they wanted to improve sales.

If you really want to do something to increase the quality of goods and services, then buy the best-value "whatever".

Competition, not phony patriotism, provides the desired result. In the long run, individuals making the most cost-effective solutions for themselves will ultimately do what is best for the country as a whole.

If governments correctly acted the same way, Davis-Bacon, forced collective bargaining, and other idiotic measures would be scrapped in a second.

Given that public unions increase costs while adding negative value and effectively robbing taxpayers, one could easily argue that the true patriotic thing would be to get rid of them.  

For further discussion, scroll past the ads and consider what I have written about Davis Bacon.

Also consider the Message from FDR in BART Holds San Francisco Hostage; Best Way to Deal With Public Unions.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

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