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Anti-Trade Tirades Scare World March 3, 2008

Posted by tkcollier in Geopolitics, philosophy & politics.
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Zakaria: Dems vs. Free Trade | Newsweek Voices – Fareed Zakaria | Newsweek.com
A senior Latin American diplomat, who asked to remain unnamed because of the sensitivity of the topic, says, “Look, we’re all watching Obama with bated breath and hoping [his election] will be a transforming moment for the world. But now that we’re listening to him on trade—the issue that affects us so deeply—we realize that maybe he doesn’t wish us well. In fact, we might find ourselves nostalgic for Bush, who is brave and courageous on trade and immigration.”

The facts about trade have been too well rehearsed to go into them in any great detail, but let me point out that NAFTA has been pivotal in transforming Mexico into a stable democracy with a growing economy. And, in Lawrence Summers’s words, “[it] didn’t cost the United States a penny. It contributed to the strength of our economy because of more exports and because imports helped to reduce inflation.” Trade between the NAFTA countries has boomed since 1993, growing by about $700 billion. There are no serious economists or experts who believe that low wages in Mexico or China or India is the fundamental reason that American factories close down. And labor and environmental standards would do very little to change the reality of huge wage differentials between poor and rich countries’ workers.

Despite their spirited squabbling, the two Democratic candidates are united in the view that one of the big benefits of electing either of them would be an improvement in America’s reputation and relations with the world. Hillary Clinton promises to send special envoys to foreign capitals the day after she’s elected. Barack Obama offers to reach out to America’s foes as well as friends. Unfortunately none of this will matter if they continue to spout dangerous and ill-informed rhetoric about trade.

For the rest of the world—particularly poorer countries—nice speeches about multilateralism are well and good. But what they really want is for the United States to continue its historic role in opening up the world economy. For a struggling farmer in Kenya, access to world markets is far more important than foreign aid or U.N. programs. If the candidates think they will charm the world while adopting protectionist policies, they are in for a surprise.

Already the mood is shifting abroad. Listening to the Democrats on trade “is enough to send jitters down the spine of most in India,” says the Times Now TV channel in New Delhi. The Canadian press has shared in the global swoon for Obama, but is now beginning to ask questions. “What he is actually saying—and how it might affect Canada—may come as a surprise to otherwise devout Barack boosters,” writes Greg Weston in the Edmonton Sun. The African press has been reporting on George W. Bush‘s visit there with affection and, in some cases, by contrasting his views on trade with the Democratic candidates’. The Bangkok Post has compared the Democrats unfavorably with John McCain and his vision of an East Asia bound together, and to the United States, by expanding trade ties.

But both candidates surely know that no one is really paying attention to their policy papers on the topic. It is their general attitude and rhetoric that matter. And on this crucial topic they are pandering to the worst instincts of Americans, encouraging a form of xenophobia and chauvinism and validating the utterly self-defeating idea of protectionism. Most economists point to Technology & Automation for most of the job loss in Manufacturing.
I know, I know. This is all about the Democratic primaries in states like Ohio and the support of unions. But you can’t target these messages so easily anymore. What is said in Ohio is heard in Ghana and Bangladesh and Colombia as well. And isn’t the point of leadership to educate and elevate people, not to pander and drag them into the swamp of ignorance and fear? There is a way to speak about the pain of globalization—and about the need for investments in retraining, education, health care and infrastructure—so that we can both compete but also absorb the shocks of a changing global economy. Unfortunately that is not what the Democratic candidates are talking about.

I’m not even sure that protectionist rhetoric works that well in a general election. Americans like optimists. They want leaders who look out at the world and see broad, sunlit uplands. Railing against Mexicans, Chinese and Indians for stealing American jobs smacks of anger, paranoia and fear of the future. Americans want hope, as Obama says, “hope in the face of difficulty, hope in the face of uncertainty, the audacity of hope.” Where is that courage now?


© 2008 Newsweek, Inc.


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