♠ Posted by Emmanuel in Economic History,Trade
at 5/30/2008 01:51:00 AM
For some reason I can no longer recall, I was reminded of John Connally, Richard Nixon's Treasury Secretary between 1971 to 1972. Oddly enough, he was a Democrat appointed by a Republican president. Indeed, he stepped down from his post as Treasury Secretary in order to head "Democrats for Nixon" in 1972. Connally is remembered for scaring other nations with the notion of dollar hegemony as encapsulated in the phrase, "our currency, your problem." The context then, of course, was that changes the US made to its monetary policy would be borne by other nations. However, Connally also made another statement which is even more over the top but is nonetheless insightful. In talking about trade relations, he made perhaps the best statement on the idea of mercantilism I have yet heard in plain terms: "My basic approach is that foreigners are out to screw us. Our job is to screw them first." [!] Even if many officials are not as forthright as Connally, surely the idea persists. Given this environment, ask yourselves this: Are you macho enough for world trade?
