Kinsley: Free Trade Means Free Trade
Published January 09, 2004
....the real difference between traditional trade in heavy earth-bound objects and 21st-century trade in weightless electronic blips, or in sheer brainpower, is that the losers in new-style trade are more likely to be people that U.S. senators and fancy economic consultants actually know. These are people with advanced degrees and high incomes. Their incomes will likely be above average for our economy even if they are driven down by competition from poorer economies. Under these circumstances, denying the benefits of free trade to the whole nation - and denying opportunity to the rising middle class in developing countries - in order to protect the incomes of a relative few seems harder to justify, not easier, than it was back in the days when our biggest fear was Japanese cars.
....The reasonable free-trade position (i.e., mine) is that buying a product does implicate you to some extent in the process by which it was made. And there are working conditions so wretched and wages so low and practices, like child labor, so heartless that you do want your own government to ban imports of the product at issue, to avoid the taint of association and, with luck, to pressure the exporting nation to change.
But this is very different from demanding a "level playing field" on environmental regulations, worker health and safety, and so on. American standards on these things are a luxury of affluence. If we had insisted on these standards for our own economy while we were becoming affluent, we never would have gotten there. And indeed, the effect of a "level playing field" rule - blocking imports that weren't produced in accord with American-level regulatory standards - will not be to make jobs in poor countries as well-paying, safe, and good for the environment as jobs in America. The effect will be to wipe out those jobs. So there you have it: with a few caveats for the most egregious labor offenses against common decency, free trade means free trade. I give Democrat Kinsley high marks for intellectual honesty and for coming down on his fellow Democratic presidentail candidates for their politically expedient "free trade but" positions that are really mean "free trade not." President Bush, you'd better take note as well - that steel tariff thing was absolutely your worst move so far. Thank goodness you saw the light - let's not pull that kind of crap again.
- Kinsley: Free Trade Means Free Trade
- Published: January 09, 2004
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- Section: Culture
- Writer: Eric Olsen
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I forgot to mention Thailand, another country that has been thriving recently, since jettisoning IMF laizzes-faire for a more South Korean model.
Ah, facts! The enemy of ideologues everywhere.
Free trade is good, as long as the trade policies allow more of our goods to be exported to foreign markets, allowing American-based companies to profit from such policies, allowing the result of a greater number of Americans being hired to work in America.
However, when free trade includes human capital (i.e., employees), American workers suffer, and therefore should not be permitted without a price to ensure that American workers aren't eliminated from the job rolls (Unemployment claims were up today, by the way - jobless recovery - jobs leaving America for India, etc.).
Trade deals are just that: deals. A good deal requires a good negotiator, but we often give too much away and receive too little in return. Corporations win, but common working class, or even middle class Americans lose under the current deficient policies.
America was built by immigrants, and many of these immigrants worked at American factories. When free trade exports jobs overseas, America undergoes a process of deconstruction because immigrants stay in their country to work for an American company.
Free trade is a wonderful thing as long as it is fair to both trading parties. The current practice is not fair trade, nor is it free, as the cost of high unemployment does not benefit the United States of America.
It does, however, make it easier to create a global government and strengthen the argument for a one-world village and currency, but if you are a true globalist, that may be exactly what you're hoping for.
Cheers.
Many people confuse protectionist policies with state socialist policies. When the government is shielding an unproductive economy, protectionism only adds to the mess. But when protectionism is used on behalf of a dynamic economic sector--such as the Japanese and German auto industries--it is extremely effective.
The proof of this is in the garages of the yuppie free traders. They're all driving BMWs and Hondas on their way to the pro-NAFTA symposiums. What a laff riot!
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Well, no. Latin American followed strict free trade policies in the 80s and 90s, and collapsed. Asia--South Korea, Singapore, China--followed a mix of free trade and nationalist-protectionist policies, and thrived.
Open capital borders are important but only within systems that temper them intelligently (panicky steel tariffs are not intelligent).
The best car companies in the world--BMW, Audi,Toyota, Honda--are all in countries that subsidize these companies and protect them from foreign competition. This is an amazing little fact that completely discredits the free trade myth.
The United States rose to economic power in large part through the intelligent and strategic use of restrictive tariffs. Had it pursued strict free trade policies in anything but rhetoric, it never would have prospered.
U.S. prosperity has also relied historically on the defense industry, the mother of all protected markets.
In short, the "free trade" line is nothing but an ideological fantasy, similar in some ways to the socialist fundamentalism of decades past. Same ruinous result to those who follow it.