ECONOMYNEXT – Sri Lanka should raise taxes on imported films and television dramas to force people to watch domestic productions, a legislator in the Indian Ocean island said taking a leaf from the economic nationalism of US President Donald Trump.
"Donald Trump is raising import duties in America," Opposition legislator Vasudeva Nanayakkara said.
"If such a powerful country is raising import duties, a small country like Sri Lanka should not give in to globalization."
Trump, who is courting white supremacists and has the support of a section of the Christian clergy, is raising taxes on imports mainly from China.
Some Hindu nationalists originally from India (Indian-Americans in the Republican Hindu Coalition) who were initially happy with Trump’s anti-Islamic stance have found that their own country is in his economic nationalist cross-hairs (Donald Trump’s trade tirade targets India).
India however generally has higher import duties than the US favouring business moghuls producers against the poor, while Americans have lower duties, businesses are forced to compete and the less affluent consumers are better off.
Trump is raising import duties to bring down trade deficits, and to boost domestic production by raising retail prices of goods for consumers.
But in the process Trump is disrupting global trade including that of US firms which rely on global supply chains. Trade deficits are caused mainly due to capital inflows, especially US budget deficit financing from foreign borrowings.
Nanayakkara, who backs ex-President Mahinda Rajapaksa’s ‘Joint Opposition’ group of legislators said steps were taken during his time to tax television dramas which were imported.
"Do television channels show what the people want to see?", he questioned. "They show what gives them the biggest profits. It is not what people want?"
Television channels show programs that have the highest ratings, decided by what people want, which in turn draw sponsors.
The Rajapaksa regime also slapped taxes on production including commercials that use foreign talent.
Economic nationalism and protection (for infant industry) originated by Alexander Hamilton, was populatized in Europe by Fredrick List, who belonged to the German historical school of econmists, a type of Mercantilism.
German nationalism eventually took the country to Nazism, deating liberal ideas of freedom for the common people and equality to all comprehensively.
"The liberals too are patriots, but their opinions with regard to the right ways toward national prosperity and greatness radically differ from those of the nationalists," explained Austrian economist Ludwig von Mises, who had watched how nationalism gained ground in former states of the Austro-Hungarian Empire, including Germay.
"They recommend free trade, international division of labor, good will, and peace among the nations, not for the sake of foreigners but for the promotion of the happiness of their own nation.
"It is the aim of nationalism to promote the well-being of the whole nation or of some groups of its citizens by inflicting harm on foreigners."
But Sri Lanka’s legislators who inherited the institution of British colonialists have used their legislative powers to slash people’s freedoms and control what they see or consume, giving profits to favoured special interests.
In the current United National Party administration diected by Prime Minister Ranil Wickremesinghe, the National Film Corporation, a state agency coming under a ministry headed by Deputy Leader Sajith Premadasa has re-nationalized film distribution using a 1971 control-economy era law.
The distribution of films will be decided by a politburo style group of political appointees not the audience and price signals. Since independence from British rule, Sri Lanka has lagged behind East Asian nations where people had greater economic freedoms and monetary stability.
"The further a nation goes on the road toward public regulation and regimentation, the more it is pushed toward economic isolation," explained Mises. "International division of labor becomes suspect because it hinders the full use of national sovereignty. "The trend toward autarky is essentially a trend of domestic economic policies;
"it is the outcome of the endeavor to make the state paramount in economic matters." (Colombo/Aug20/2019 – Update !!!)