Molson Hart

This is nothing but a conjencture but i suspect some protectionism (tariffs, very mild autarky) could be a viable alternative to high levels of taxation to keep society intact. Not so much to replace government revenues but to make it easier to make it on your own.

Interesting idea.

Let me try to synthetize the idea. 1 there is a tradeoff between redistribution via taxes and inequality (helps) and productivity (hurts). 2 i propose the same is true for tariffs. 3 w/o global governance the world seem to default to protectionism anyway. 4 accept as lesser evil.

Cool I was going to ask you to do that. To put things in concrete terms, if Africa had better competent protectionist policies their people would be forced to make shoes, apparel, etc., which might even be better than gov't handouts generated by tax revenue.

Most nations default to protectionism. If you're the best at making everything, you might want open trade...I think that was a big motivation for the push made by the U.S. pre-Japan. We had all the resources and all the know-how, so of course lets open the borders.

Yes, plus the USA (thought it) had the military power to back the necessary global rule of law up. There are reasons besides incompetence though, e.g. risk of capital flight of the global economy crashes.

Sorry, I don't understand your second point.

I thought we talked about this before. Foreign investment poses a higher exposure to risk from overseas crashes. In 2008 the countries who opened up to foreign capital the most (Baltic states, Ireland?) suffered the most as capital withdrew quickly.