Thursday, November 8, 2012

9. People argue from their vested interests.

Look at this article by Kevin Lovell, CEO of the South African Poultry Association. So, in the end they did introduce a tariff to stem the flow of "Dumping". Who were the losers. Not the wealthy that own and have shares in the the large chicken companies, but the poor - the millions that benefited from cheap protein in the form of cheap imported chicken.

This is a case where we were receiving "foreign aid" in the form of foreign country's taxpayers paying for our chicken! and what do we do - say no. This was one opportunity to lower our cost base so that we can become more competitive in the international arena. Now workers have to be paid more to afford the more expensive local chicken.

We shot ourselves in the foot once more by introducing heavy import tax on chicken. And remember in this interconnected marketplace - for every chicken that we do not import it is a a bag of oranges that we cannot export - they cannot buy if they can't sell. So we are all worse off because of interventionist policies.

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