Who will sally forth and defend free trade?
The Wall Street Journal passes along a frightening statistic: The latest Wall Street Journal/NBC News poll conducted earlier this month found that 60% of voters nationwide agreed with the statement that "foreign trade has been bad for the U.S. economy." It's no surprise, then, that many politicians, especially Democratic presidential contenders, are starting to sound ...
The Wall Street Journal passes along a frightening statistic:
The Wall Street Journal passes along a frightening statistic:
The latest Wall Street Journal/NBC News poll conducted earlier this month found that 60% of voters nationwide agreed with the statement that "foreign trade has been bad for the U.S. economy."
It's no surprise, then, that many politicians, especially Democratic presidential contenders, are starting to sound like old-school protectionists. Economists can cite chapter and verse as to why this astonishingly large majority of Americans is deeply, deeply wrong about trade. The basic argument is familiar: The benefits from trade (e.g. cheaper, better, and more varied products at Wal-Mart) are dispersed and hidden, while the losses (e.g. layoffs in textile mills in South Carolina) are far more concentrated and easier for people to see. But perhaps a little philosophy is in order. What is the real purpose of trade? As Russell Roberts put it in a recent Web exclusive for FP, we trade in order to buy things we want:
We don't export to create jobs. We export so we can have money to buy the stuff that's hard for us to make—or at least hard for us to make as cheaply. We export because that's the only way to get imports. If people would just give us stuff, then we wouldn't have to export. But the world doesn't work that way.
Read the whole thing, especially if you're on the fence about trade.
But what about how Chinese and Indian workers are pushing down wages, you might ask? In the same WSJ article mentioned above, another FP contributor, former Secretary of Labor Robert Reich, has an answer:
The truth is that trade is good for the U.S. but that some people are burdened by it far more than others. We've got to make them all winners, but you don't make them winners by attacking trade," he says.
Right on.
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