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Buy nationally vs buy locally

Buy nationally vs buy locally

Machjo

#1Nov 15th, 2009

We're hearing ever more voice calling on us to 'buy Canadian', an echo of the 1930's protectionism that accompanied the Great Depression and even contributed to its deepening.

I take issue with the buy Canadian idea though on certain basic economic grounds. Canada is a geographically large country. Would it really make sense for, let's say, a Vancouverite to buy a product from Halifax when the same product is produced in Seattle? If we insist on buy Canadian, then certainly we ought to expect the Vancouverite to fork out extra cash to pay not just for the cost of the product itself, but the transportation cost of shipping the product cross-country to Vancouver just to keep to the whole buy Canadian philosophy. Add to that that taxes would have to increase too to build and maintain more highways to allow for the flow of all these extra goods. In other words, we'd be promoting a more inefficient economy just for the opportunity to beat our chests in nationalistic pride. Are we willing too to help the poor who'd be faced with the bill of having to pay these extra private sector costs for transportation along with the tax increase to maintain the infrastructure necessary to handle the increased cross-Canada traffic?

All of these costs add up: private transport costs, extra taxes to maintain a busier infrastructure, and additional taxes to help the poor who'd be hurt by this provision.

Alternatively, we could follow a buy local philosophy. In this case, the Vancouverite would buy from Seattle instead of Halifax. This would create jobs for Seatle residents, true. Bear in mind though that the New Yoker who wants to buy the same product would save on transport costs by buying it from Halifax. So it would balance itself out in the end. Or things we do best we export to the US, and things they do best we import. The traffic caused by shipping a product from Seattle to Vancouver is minuscule compared to the cost of transporting it from Halifax to Vancouver. This saves private transport costs, less of a tax burden on infrastructural development, and from an environmental standpoint, more efficient use of resources. The increased efficiency would also help fight inflation and avoid the creation of make-work jobs for truck drivers or pilots, etc. shipping products cross-country that could otherwise have been bought right across the border.

For these and other reasons, I lean more in favour of a buying locally over buying nationally. It just makes more sense when looked at objectively. The only reason I could see people supporting buying nationally would be for the opportunity to beat their nationalistic chests without having to actually analyze the impact of their policy on the economy in a rational manner.

L Gilbert

No Party Affiliation

Re: Buy nationally vs buy locally

Nov 15th, 2009

With us it's a mileage thing. The closer to here a product we want is, the more likely we'll buy it over one that's in St. John's or Mexico. That means if a widget is made in both Ymir, BC and Alert, Nunavut, we'll buy the one from Ymir. Or if gadgets come from Grand Coulee, WA and Redding, CA, we''l buy from Grand Coolee. If something comes from either WA or BC and is the same mileage away, we'll buy BC.

Machjo

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by L Gilbert

With us it's a mileage thing. The closer to here a product we want is, the more likely we'll buy it over one that's in St. John's or Mexico. That means if a widget is made in both Ymir, BC and Alert, Nunavut, we'll buy the one from Ymir. Or if gadgets come from Grand Coulee, WA and Redding, CA, we''l buy from Grand Coolee. If something comes from either WA or BC and is the same mileage away, we'll buy BC.

Now that's rational. And if the same product is produced in Seattle an Halifax, which is likely to be less expensive for you once transportation costs are taken into account, not to mention the Halifax one is subsidized more through taxes to maintain a much longer transport route?

Machjo

Re: Buy nationally vs buy locally

Nov 15th, 2009

Actually, this whole buy nationally vs buy locally discussion could be extended to a work nationally vs work locally one too.

For example, if you were a poor Vancouverite looking for work, and it just so happened that your skills, while not appreciated in Vanocuver, were in demand in Seattle and Halifax, would it be easier for you to get a job offer online to work in Seattle, get a passport, hop on a Greyhound bus, and go and get the job in Seattle, or to pay the plane ticket to Halifax?

Add to that, which would be the greater financial burden on you once you get the job between travelling from Seattle to Vancouver over the holidays to visit family by just taking the Greyhound, vs. buying a plane ticket each holiday?

If we look at it through the eyes of the poor, it would be beneficial to them for Canada and the US to enter into a free labour movement agreement.

Unfortunately, as always, we're always willing to set the poor aside for any opportunity to beat our collective nationalist chests.

Risus

Re: Buy nationally vs buy locally

Nov 15th, 2009

I wanted a dozen eggs at the grocery store this morning. I noticed a dozen large 'product of USA' $0.20 less than a dozen large 'Product of Canada'. Now does that make sense? Anywas I paid the extra to get Canadian product.

Machjo

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Risus

I wanted a dozen eggs at the grocery store this morning. I noticed a dozen large 'product of USA' $0.20 less than a dozen large 'Product of Canada'. Now does that make sense? Anywas I paid the extra to get Canadian product.

And how has that benefited anyone?

You lose because you pay more. The US egg produce loses because you did not buy his eggs. The Canadian egg producer is laughing in your face because he exploited your misplaced nationalism to his personal benefit, or alternatively he is an honest farmer but you bought the eggs from cross-country whereas the US products were from closer afield, saving on transport costs and resources. Now if the former is the case, then a totally greedy farmer exploited your sense of national pride and you got sucked into it. Obviously he's not too patriotic if he's ripping you off, whereas the US one is an honest one who cares about charging you a just price not because you're Canadian but a valued customer.

Now if it's the latter, then you've just burdened the Canadian highway system more than it needed to be, putting a tax burden on al of us to build and maintain more infrastructure to ship those eggs cross country to you, not to mention the added natural resources being exploited to do so. Very patriotic indeed.

This is what I mean when I say that by Canadian is pure irrational emotionalism.

L Gilbert

No Party Affiliation

Re: Buy nationally vs buy locally

Nov 15th, 2009

We balance the pros and cons of price to a certain extent. It depends upon the cost of the particular item. For $10 here or there we don't worry about it. If we wanted a vehicle and the one farther away was a few hundred cheaper we'd buy it if there were no border hassles to go through.

Risus

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Machjo

And how has that benefited anyone?

You lose because you pay more. The US egg produce loses because you did not buy his eggs. The Canadian egg producer is laughing in your face because he exploited your misplaced nationalism to his personal benefit, or alternatively he is an honest farmer but you bought the eggs from cross-country whereas the US products were from closer afield, saving on transport costs and resources. Now if the former is the case, then a totally greedy farmer exploited your sense of national pride and you got sucked into it. Obviously he's not too patriotic if he's ripping you off, whereas the US one is an honest one who cares about charging you a just price not because you're Canadian but a valued customer.

Now if it's the latter, then you've just burdened the Canadian highway system more than it needed to be, putting a tax burden on al of us to build and maintain more infrastructure to ship those eggs cross country to you, not to mention the added natural resources being exploited to do so. Very patriotic indeed.

This is what I mean when I say that by Canadian is pure irrational emotionalism.

Seems like you are pharting in the wind. The local eggs came from 200 clicks down the road, not from across the country. How do you expect the product from the states to be brought here?
It is best to keep our money in our country. I think you drinking those yankee brews has clowded your mind.

Machjo

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by L Gilbert

We balance the pros and cons of price to a certain extent. It depends upon the cost of the particular item. For $10 here or there we don't worry about it. If we wanted a vehicle and the one farther away was a few hundred cheaper we'd buy it if there were no border hassles to go through.

You say you'd buy the one farther away. I'm guessing you mean either because it's cheaper or alternatively because of it's of better quality?

If that is what you meant, then I have to agree. That's rational.

Now of course if you buy the one from farther away, you're also burdening me with higher taxes to maintain more roads to handle the extra traffic caused by your purchase. A simple solution to that is to reduce income tax and introduce a gas tax. That way I don't pay the extra cost in roads that your purchase is taking up. Instead, the company pays more tax and passes the cost to you, If the product then is still less expensive than a closer one or is of higher quality, it would still make sense to buy the one from farther away without a doubt. National borders though have nothing to do with it.

If the concern is with Canadians exporting our jobs, again, a simple free labour movement agreement with the US would solve that problem. It wouldn't matter then anymore where the jobs would be since both Canadians and Americans would be free to follow the jobs across North America wherever they should go. Then our governments would not be willing to adopt a policy that kills two jobs in the other country just to keep one job here since people could cross the border for the jobs and so this would hurt both sides. With such an agreement, a government would be willing to sacrifice a job within its borders if it could save two jobs across the border, since that way it would leave more jobs for everyone. Such a policy would put an end to tit for tat economic warfare and redirect our focus on cooperation for the good of all.

Machjo

#10

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Risus

Seems like you are pharting in the wind. The local eggs came from 200 clicks down the road, not from across the country. How do you expect the product from the states to be brought here?
It is best to keep our money in our country. I think you drinking those yankee brews has clowded your mind.

So how then do you explain that the US product was cheaper than the Canadian one? Is it that the Americans can produce those eggs more efficiently? If so, then let them produce the eggs and we'll produce what we make best.

Is it that the Canadian farmer ripped you off? If so, do you really want to reward him?

As for the US eggs, if they came from farther away, and are still cheaper, then clearly something's not right there.

As for keeping our money in Canada, that's just ridiculous. If I'm in Ottawa, I'm not going to buy an apple from across the province when I can buy one from just across the border in Quebec. Likewise, I'm not going to buy a product from Vancouver when the same product is being produced just across the border in Buffalo and sold to me at a lower price.

Mussolini tried your theories in his Battle for Wheat. He won the battle but made Italian farmers poorer in the process. They were better off before hand producing what they produced best and importing their wheat.

protectionism for the sake of protectionism makes no economic sense whatsoever. It is pure emotionalism, as your own post proves. Instead of coming up with rational arguments, you just insult me because you know darn well that there is no logic to protectionism.

gerryh

#11

Re: Buy nationally vs buy locally

Nov 15th, 2009

I buy Canadian....whenever I can...which means I don't buy newzealand lamb.... and I don't buy california or mexican tomatoes no matter how cheap they are. I buy Canadian. I support the Canadian economy, I support CANADIAN GROWERS. After all, I am Canadian.

Machjo

#12

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by gerryh

I buy Canadian....whenever I can...which means I don't buy newzealand lamb.... and I don't buy california or mexican tomatoes no matter how cheap they are. I buy Canadian. I support the Canadian economy, I support CANADIAN GROWERS. After all, I am Canadian.

I buy local bananas and pineapples too

gerryh

#13

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Machjo

I buy local bananas and pineapples too

Now your just enforcing your own stupidity.

L Gilbert

No Party Affiliation

#14

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Machjo

You say you'd buy the one farther away. I'm guessing you mean either because it's cheaper or alternatively because of it's of better quality?

If that is what you meant, then I have to agree. That's rational.

.... Or it may be because it'll be faster to get, also. If I need a screwdriver and the neighbor wants to sell onebut wants $10 for his used one and the new one in town costs $8, but the customer wants his machine within a half hour, I will spend the $10 because it's a half hour just to get to town.

L Gilbert

No Party Affiliation

#15

Re: Buy nationally vs buy locally

Nov 15th, 2009

We used to live in the Okanagan. It was a valley that produced apples like they grew on trees. lol It was less expensive to buy a Okanagan apple that had been shipped to Washington, packaged, and shipped back than it was to buy the apple in BC. Politics made it that way. "Trade deals". We bought our apples from fruit stand in the Okanagan and spent a couple cents a pound more. They were fresher and weren't subject to idiotic policies.

Avro

No Party Affiliation

#16

Re: Buy nationally vs buy locally

Nov 15th, 2009

My cottage is in South River and I spend quite a bit of money up there on local goods and services and i am glad to do it.

Machjo

#17

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by L Gilbert

We used to live in the Okanagan. It was a valley that produced apples like they grew on trees. lol It was less expensive to buy a Okanagan apple that had been shipped to Washington, packaged, and shipped back than it was to buy the apple in BC. Politics made it that way. "Trade deals". We bought our apples from fruit stand in the Okanagan and spent a couple cents a pound more. They were fresher and weren't subject to idiotic policies.

There's something fundamentally wrong when you can buy a bag of Okanagan apples that have been shipped to Washington, processed, and shipped back to the Okanagan for cheaper than you can buy a bag of Okanagan apples that just got puled off the tree and sold right on the spot.

Did I really understand you right when you say it's cheaper to buy Okanagan apples that have travelled so far and back than apples just pulled off the tree?

Risus

#18

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Machjo

So how then do you explain that the US product was cheaper than the Canadian one? Is it that the Americans can produce those eggs more efficiently? If so, then let them produce the eggs and we'll produce what we make best.

Is it that the Canadian farmer ripped you off? If so, do you really want to reward him?

As for the US eggs, if they came from farther away, and are still cheaper, then clearly something's not right there.

As for keeping our money in Canada, that's just ridiculous. If I'm in Ottawa, I'm not going to buy an apple from across the province when I can buy one from just across the border in Quebec. Likewise, I'm not going to buy a product from Vancouver when the same product is being produced just across the border in Buffalo and sold to me at a lower price.

Mussolini tried your theories in his Battle for Wheat. He won the battle but made Italian farmers poorer in the process. They were better off before hand producing what they produced best and importing their wheat.

protectionism for the sake of protectionism makes no economic sense whatsoever. It is pure emotionalism, as your own post proves. Instead of coming up with rational arguments, you just insult me because you know darn well that there is no logic to protectionism.

Seems like you don't have a clue. Maybe living in Ottawa has fried your brain. How about you miving to a 3rd world country and see how you make out?

Machjo

#19

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Risus

Seems like you don't have a clue. Maybe living in Ottawa has fried your brain. How about you miving to a 3rd world country and see how you make out?

What does that have to do with anything. The US is hardly a third world country.

Said1

Free Thinker

#20

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Machjo

And how has that benefited anyone?

You lose because you pay more. The US egg produce loses because you did not buy his eggs. The Canadian egg producer is laughing in your face because he exploited your misplaced nationalism to his personal benefit, or alternatively he is an honest farmer but you bought the eggs from cross-country whereas the US products were from closer afield, saving on transport costs and resources. Now if the former is the case, then a totally greedy farmer exploited your sense of national pride and you got sucked into it. Obviously he's not too patriotic if he's ripping you off, whereas the US one is an honest one who cares about charging you a just price not because you're Canadian but a valued customer.

Now if it's the latter, then you've just burdened the Canadian highway system more than it needed to be, putting a tax burden on al of us to build and maintain more infrastructure to ship those eggs cross country to you, not to mention the added natural resources being exploited to do so. Very patriotic indeed.

This is what I mean when I say that by Canadian is pure irrational emotionalism.

Lets get real, the US eggs were more than likely heavily subsidized.

If you want to argue absolute advantage, remove subsidies, then argue.

I could be wrong, though. Perhaps our poultry farmers are heavily subsidized too.

Machjo

#21

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by gerryh

Now your just enforcing your own stupidity.

I would have hoped you were bright enough to figure out that was humour. But alas...

Machjo

#22

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Said1

Lets get real, the US eggs were more than likely heavily subsidized.

If you want to argue absolute advantage, remove subsidies, then argue.

I could be wrong, though. Perhaps our poultry farmers are heavily subsidized too.

Hey, if your eggs are subsidized by the American taxpayer, why not take advantage of it?

Now you might say that gives the US egg farmer an unfair advantage. True. But seeing how all other American industries would have to pay more taxes to subsidize the US egg farmer, that just puts all the other US industries at a disadvantage. Again, it balances itself out.

Said1

Free Thinker

#23

Re: Buy nationally vs buy locally

Nov 15th, 2009

Not exactly. Canadian industry is heavily subsidized at the expense of the [egg] farmer.

Machjo

#24

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Said1

Not exactly. Canadian industry is heavily subsidized at the expense of the [egg] farmer.

There you have it. So the US would keep its egg farmers and Canada would keep its industries.

Or better yet. Stop subsidizing Canada's big industries and just treat all industries equally. Then while the US would get to keep its egg farmers, we'd get to keep our small and medium enterprises too.

karrie

No Party Affiliation

#25

Re: Buy nationally vs buy locally

Nov 15th, 2009

I take multiple things into consideration.

Shipping distance (I try to avoid large shipping distances when I can). Price. Locale of the production (I support Canadian business where I can). To name a few.

I think it's irrational to choose based solely on one thing.

#juan

No Party Affiliation

#26

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by Machjo

And how has that benefited anyone?

You lose because you pay more. The US egg produce loses because you did not buy his eggs. The Canadian egg producer is laughing in your face because he exploited your misplaced nationalism to his personal benefit, or alternatively he is an honest farmer but you bought the eggs from cross-country whereas the US products were from closer afield, saving on transport costs and resources. Now if the former is the case, then a totally greedy farmer exploited your sense of national pride and you got sucked into it. Obviously he's not too patriotic if he's ripping you off, whereas the US one is an honest one who cares about charging you a just price not because you're Canadian but a valued customer.

Now if it's the latter, then you've just burdened the Canadian highway system more than it needed to be, putting a tax burden on al of us to build and maintain more infrastructure to ship those eggs cross country to you, not to mention the added natural resources being exploited to do so. Very patriotic indeed.

This is what I mean when I say that by Canadian is pure irrational emotionalism.

Not entirely. The American farmer is the most subsidised animal in the civilized world. By paying the extra twenty cents, the man has thwarted yet another attempt by Americans to screw Canadians, and he has helped a Canadian farmer.

Machjo

#27

Re: Buy nationally vs buy locally

Nov 15th, 2009

Another thing I could support would be reducing income taxes and increasing gas taxes. Reducing income taxes would help local companies, like a subsidy really. But the gas tax would penalize companies from farther away, As a result, Southern US companies would have a hard time competing in the US market, while Northern US companies would have a hard time competing in the Northern Canadian market, simply owing to the upward pressure the gas tax would place on them. And all of that without subsidies or tariffs, thus perfectly in accordance with trade rules, and not protectionist at all since Canadian companies would be equally subjected to this tax.

Machjo

#28

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by #juan

Not entirely. The American farmer is the most subsidised animal in the civilized world. By paying the extra twenty cents, the man has thwarted yet another attempt by Americans to screw Canadians, and he has helped a Canadian farmer.

Reduce income taxes and increase the gas tax, and suddenly the income tax cut becomes like a subsidy to the Canadian farmer, while the gas tax automatically gives the advantage to the local farmer over a distant one. And the Americans can't cry foul over NAFTA since this would not be a tariff nor a subsidy, and Canadians would be subject to the same law as the American, whereby Canadian farmers from farther afield would have to pay more tax too, thug giving the local farmer an advantage not only over the American farmer, but over all other farmers including other Canadian ones.

gerryh

#29

Re: Buy nationally vs buy locally

Nov 15th, 2009

so....you're suggesting that both Canada and the u.s. put the same tax on fuel....is that right? any other tax you want to amalgamate with the americans? Maybe put our incone taxes together and harmonize gov't spending? Are you sure you're not an american trying to undermine Canadian sovereignty?

Machjo

#30

Re: Buy nationally vs buy locally

Nov 15th, 2009

Quote: Originally Posted by gerryh

so....you're suggesting that both Canada and the u.s. put the same tax on fuel....is that right? any other tax you want to amalgamate with the americans? Maybe put our incone taxes together and harmonize gov't spending? Are you sure you're not an american trying to undermine Canadian sovereignty?

To support closer ties with our neighbours is not the same as wanting Canada to become a 51st state. If you can't understand that, then I don't know what how else I can explain it to you. But I certainly do not support a Fortress Canada mentality.

As for the gas tax, I could see a number of scenarios. One would be as you suggested, that we coordinate our taxation policies, which might be tricky but not impossible owing to the difference in the debt load of the two countries.

Another would be for Canada to act unilaterally with its own gas tax. While this would not have much of an impact on Canadian border towns, it would have an impact on Canadian towns farther north as US truckers, etc have to pay for highly taxed Canadian gas. Meanwhile, Canadian export companies might decide to relocate farther south to those same Canadian border towns so as to avoid the Canadian gas tax. The fact that those companies would be paying less income tax than their US counterparts would act as a kind of subsidy, and since they'd be near the border, they could avoid most of the Canadian gas tax.

Sooner or later the US would have no choice but to follow suit. After all, to compete against those Canadian companies paying such low income taxes, the US government would have no choice but to lower US income taxes. But then they have to get their money from somewhere, and NAFTA restricts protectionism, so they'd turn to a gas tax of their own as a way of discouraging Canadian imports without violating NAFTA. As a result, in the end, while the Northern US might import from Southern Canada and vice versa, we'd likely not see much Canadian trade in the Southern states or US trade in northern Canada. Subsidies would not help much here either in the face of a high gas tax.

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