Saturday, December 30, 2006

Persistence of Protectionist Drivel

A Mr Paul Kenny, General Secretary of the GMB (one of Britain’s larger trades unions) reveals the shallowness of his internationalism (a much flaunted virtue of people of the so-called Left) in his attack on Mr (from today ‘Sir’) James Dyson, inventor and manufacturer of the revolutionary Dyson vacuum cleaner.

According to the lively economics Blog, Stumbling and Mumbling, Mr Kenny asked, sarcastically – with that special bile practised by Little Englanders: "Do people now get a knighthood for services to exporting jobs?"

Chris Dillow, the economist who confronts such issues on Stumbling and Mumbling, calls this outburst from Mr Kenney an example of ‘Trades Union Stupidity’ and ‘drivel in both economics and ethics.’ And so it is.

Chris Dillow sums up the economics admirably with: “Had production of Dysons stayed in the UK, they would have been more expensive to make. Housewives buying Dysons would therefore have less money to spend on other things, like getting their hair done.”

He could have gone further. Expensive UK-made vacuum cleaners would have become less competitive from imports of rival products and the sorry cycle of UK manufacturing would repeat itself, destroying jobs in the process and not providing the revenues that could replace them. Scotland used to have thousands employed in shipbuilding, steel, coal, textiles and motor cars, to name a few. How? They’ve all gone, and worse, from the protection they received for decades, instead of innovating and substituting for profitable jobs, their net revenues, when they had any, and their massive taxation subsidies that could have been better used elsewhere (including in the private incomes of households taxed to pay for them), were dissipated on falsely ‘preserving jobs’, often low-paid, semi-skilled and technologically uneducated, that when the government eventually faced up to the realities appreciated by King Canute, it was too late to do other than close them down.

Even then, trades union leaders, like Mr Kenny and his predecessors, led wasteful campaigns, costing vast sums unnecessarily on police crowd control, demanding that every single job was preserved, as if in aspic, doing exactly whatever the people involved did, for ever at public expense. One notorious trade-union leader demanded (and was supported by some MPs) that no coal mine ever closed until every last ton was extracted from a pit, no matter what the cost.

While Britain paid attention to this nonsense, employees in other lands, both rich and poor, attended to developing new industries with new technologies and refining their manufacturing skills. That is why Dyson now manufactures in Malaysia, ships its output to the UK (and around the world) and rivals the largest and oldest vacuum cleaner company, Hoover, profitably and with confidence. Those profitable earnings are taxed and distributed in Britain, some of them replacing used equipment, funding continuing R&D, and supporting sales in Europe, all of which involve jobs.

Chris Dillow notes that: ‘If "exporting jobs" were a bad thing, we'd all be better off doing everything at home - growing our own food, making our own clothes and so on. But this is obviously absurd. As Adam Smith pointed out, we get richer through the division of labour. And this requires that jobs be exported.’

Absolutely true. Where do trades union leaders get their ideas from? To some extent their myopic vision is conditioned by the brutal fact that they serve the interests of their members, and not the interests of other workers, including members of other unions, and certainly not, judging by Mr Kenney’s insular anti-foreigner attitude, with the interests of foreign workers in poorer countries in mind, which is more in keeping with a reactionary colonial imperialist from the 19th century, than the self-image that union leaders, and some of their members, like to bask in, while in private regarding foreigners as the ‘enemy’.

It is strange and it should be surprising, but we have got used to it I suppose, that over 200 years after the death of Adam Smith, who wrote about the enduring and beneficial division of labour (including the international division of labour in the manufacture of the day-labourer’s woolen coat in Book I, Wealth of Nations) and the fallacies of protectionism, that people in prominent positions still mouth what Chris Dillow, rightly if boldly, describes as ‘drivel’.

Bookmark The Stumbling and Mumbling Blog to correct the doses of drivel offered up by luddites like Mr Paul Kenney.

The above piece is found at


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