The Political Inquirer

Trade, in the classic economical sense, is advantageous to all parties. What follows is a brief economics lesson on how this is true. All figures and parties are purely hypothetical.

Jamaica can grow 150 bushels of bananas and 75 bushels of apples per acre.

Michigan can grow only 10 bushels of bananas per acre and can also grow 75 bushels of apples per acre.

If each party had only an acre to spare and each wanted 50 bushels of bananas and apples, in the absence of trade Michigan would be screwed. Jamaica could split up their land 33% to bananas and 66% to apples and would harvest 50 bushels of bananas and apples. Michigan might be able to get 50 bushels of apples by diverting 66% of their land to apples but would only get 3 bushels of bananas.

With trade, Jamaica can divert 66% of their land to bananas and 33% to apples and can grow 100 bushels of bananas and 25 bushels of apples. Michigan will choose to only grow apples and will have 75 bushels at the end of the year. Since Jamaica has an excess of 50 bushels of bananas and Michigan has an excess of 25 bushels of apples, the parties would likely trade with each other and each end up with 50 bushels of apples and bananas. Everyone is happy.

Of course in the real world, Jamaica might decide that they don’t want to engage in this trade agreement any more because of US sanctions against their island neighbor and because the trade relationship was only really advantageous to Michigan anyways. Jamaica could grow enough of their own bananas and apples to suit their needs. But I digress.

The sad reality of the situation though, is that Michigan could probably grow and harvest much more than just 75 bushels of apples if they operated like the Jamaicans. You see, the Jamaicans work 12 hour days during harvest time and the company is able to hire flex employees for harvesting. The workers climb trees wearing only jeans and gloves to get the bananas and sometimes fall hurting themselves. In Michigan, the overtime costs and unemployment they would have to pay to the seasonal workers because of a local fruit harvesters union would make it too expensive for them to hire more people. Also, the safety regulations which state that scaffolding needs to be used with harnesses would not apply in Jamaica. Because of this, the workers are faster, but not as safe. Finally, let’s not forget about all the medical benefits, retirement plans, minimum wage, and other benefits such as job security for pregnancy leave that the workers in Michigan enjoy.

Now for the politics.

The Conservative Response: Hire Jamaicans, break the Union, increase productivity, use excess apples to trade for kumquats. Michigan fruit harvesters can flip burgers for all they care. They should have worked hard and gotten a college degree.

The Liberal Response: The Jamaicans are being mistreated! The US must demand better working conditions for Jamaican laborers or refuse to do business. Jamaicans end up trading with Canada instead and US consumers buy more expensive Dominican bananas.

The Libertarian Response: Get rid of all the regulations imposed on the Michigan growers. If people are willing to work for less money in unhealthy conditions why should the government get involved?

The Populist Response: Institute a widespread tariff and anti foreign worker legislation to protect the US apple growers. Prices go up. Productivity goes down due to decreased competition.

The Ideal Response: Institute a selective tariff for every requirement that we have for US working standards, environmental concerns, etc. that the Jamaican businesses are not willing to do or give to their employees.