If I say “protectionism” what comes to mind? Perhaps a miser in a dark overcoat, suspiciously glancing over his shoulder as he rushes off to his hoard of gold. The word sounds dark, dreary, and stale.
Let's try another one. “Free trade.” That just sounds better. It conjures up images of liberation and unity, people exchanging goods and services with great big smiles on their faces—the fragrant smell of utopia.
Most people have a bias towards free trade and against protectionism. Tariff has become a dirty word, and history has let Smoot-Hawley take the blame for the Great Depression. Never mind that the most infamous of many such acts was enacted almost eight months after Black Thursday. Ignore the fact that the United States had elected protectionist Republicans from Lincoln through Hoover—excepting Cleveland and Wilson—in a time of unprecedented prosperity in our nation's history. If tariffs were so bad, why on earth did people keep electing those who supported them?
Times—and economic policy—have changed. NAFTA (the North Atlantic Free Trade Agreement) was passed in 1992 by Clinton and it paved the way for other free trade agreementsm, this time passed by Republicans. This isn't your great-great-granddaddy's G.O.P.
Over the course of the last five years, the results of a national commitment to free trade are in. This according to Former Reagan Assistant Treasury Secretary Paul Craig Roberts, an economist who was also the Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review:
Communications equipment lost 43% of its workforce. Semiconductors and electronic components lost 37% of its workforce. The workforce in computers and electronic products declined 30%. Electrical equipment and appliances lost 25% of its employees. The workforce in motor vehicles and parts declined 12%. Furniture and related products lost 17% of its jobs. Apparel manufacturers lost almost half of the work force. Employment in textile mills declined 43%. Paper and paper products lost one-fifth of its jobs.
Notice that Roberts does not focus on profits, but rather on lost jobs. In other words, he takes ordinary people into account. Many CEOs have made a killing by shutting down American facilities to set up shop offshore where foreigners will work for a small pittance in horrific conditions. But the people do not exist to serve the global economy. The economy should serve the people. As corporate profits continue to climb, real wages for average working Americans have stagnated and our leaders insist that this poison is medicinal.
Before you hightail it to Mexico, it seems free trade has been a stern master for them as well. According to the Washington Post, since the passage of NAFTA, nineteen million more Mexicans now live in extreme poverty. Read that one again.
On the upside, Wal-Marts are opening across the fruited plain, giving us all just a little bit of hope, unless of course you don't want to work in retail.
In his State of the Union Address, Bush stated that “...the road of isolationism and protectionism may seem broad and inviting—yet it ends in danger and decline.” If free trade had been the harbinger of prosperity it was supposed to be, Bush wouldn't need to warn us of being tempted away from it. Free trade has been a gigantic bust.
“What all the wise men promised has not happened, and what all the damned fools predicted has come to pass,” noted Lord Melbourne. Damned fools who support tarriffs may be in short supply in the plutocracy that is Washington D.C., but it's still high time we returned to the honored tradition of protectionism. With things as they are, what can we lose?
No comments:
Post a Comment