The Truth On Free Trade

By Big Tent Democrat

Speaking for me only

I am an avowed supporter of free trade agreements like NAFTA. But I am not a rube. I realize that demagoguing against free trade is now standard issue Dem politics, but that does not mean it is right. Today The NYTimes explains why:

As Barack Obama and Hillary Clinton travel the Rust Belt, the Democratic candidates seem to be eschewing the advice of their economic advisers and turning to Karl Rove’s playbook. It was Mr. Rove who urged Dick Cheney in 2000 to forget the free trade spiel and promise voters in West Virginia that a Bush administration would protect American steel from cheap imports. “If our trading partners violate our trade laws, we will respond swiftly and firmly,” Mr. Cheney thundered.

Those words seem to echo in Mr. Obama’s attacks against “unfair” trade deals — including Nafta, Cafta and President Bill Clinton’s decision to establish regular trade relations with China. Mrs. Clinton seems to draw inspiration as well, railing to the Pennsylvania A.F.L.-C.I.O. against alleged dumping of Chinese steel: “When I’m President, China will be a trade partner not a trade master,” she said.

Such pandering may play on the stump, especially in Pennsylvania, where workers fear for their jobs as the country’s manufacturing base shrinks. Mr. Bush won West Virginia, only the fourth Republican to do so since 1932. Still, whoever wins in November would be foolish to choose protectionism.

Indeed. I hope and trust our candidates do not actually believe their own demagogy on trade.

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    Educating vs. Pandering (5.00 / 2) (#5)
    by Stellaaa on Sun Apr 06, 2008 at 11:49:54 AM EST
    I have no idea how but whoever becomes president has to do a major reeducation of the American voter.  She/he needs to set off by clearly explaining to the American people the realities and how within that reality we can work to maintain and improve our economy.  Then, the main point will be how not to allow the economic strand, change our social and political lives.  How we have to reempower government to protect our economy and our rights as citizens.  

    We are not as a people educated enough to fight the corporations that have taken over our government.  This is where the discussion should be.  How I miss Edwards.  

    NYT Editorial (5.00 / 1) (#8)
    by cal1942 on Sun Apr 06, 2008 at 11:59:29 AM EST
    explains nothing.  We're always told that free trade is good. End of story. There were some interesting statements in the editorial.  This one stands out:

    "Immigration reform would most likely top Mexico's list."

    What would those 'reforms' contain.  The last thing that Mexico's ruling class wants is for their impoverished citizens to remain in the country to cause an uncomfortable political situation.  Agricultural exceptions in NAFTA have put many Mexican farmers out of business driving many people into enough desperation to leave their homes and emigrate north. One of the accomplishments is that we are guaranteeing that Mexican governments will be either right or farther right.

    While I agree that universal health care is needed as well as improved unemployment insurance it's also interesting that the Times admits that workers have to take lower paying jobs.  Jobs I might point out that often pay as little as one third as much.  That's only part of what explodes the whole argument in favor of free trade.

    Without the space to write a full discussion of free trade it should be pointed out that the loss of manufacturing jobs does grievous harm to many communities.  When communities are damaged the social fabric can torn beyond repair.  The continued loss of manufacturing base is not in the short or long term interests of the nation.  A skill not practiced is a skill lost.

    Living in an industrial state is like having a front row seat at a Greek tragedy.  The investment in human capital that the Times and other supporters of free trade like to talk about is never accompanyed with a specifio "what.'  "Lifelong education" to learn to do WHAT? Retraining a 50 or 55 year old worker whose job has been outsourced to do WHAT?   Empty bedpans?

    Selective Misrepresentation (none / 0) (#13)
    by squeaky on Sun Apr 06, 2008 at 12:31:00 PM EST
    Of the Times Editorial, is a dishonest way to champion your protectivist ideology.

    The Times has offered progressive solutions to offset free trade. To characterize their position as right wing doesn't lend credence to your oft repeated bedpan analogy.

    It seems clear that the Pols are acting like pols here, both Clinton and Obama are pandering just like GW did in West Virginia. Hopefully they will adopt some of the suggestions of the Times editorial when one of them takes the baton.


    Of course trade should be as free as possible. (5.00 / 1) (#9)
    by magisterludi on Sun Apr 06, 2008 at 12:04:02 PM EST
    But without fair wages and environmental standards, it's just a corporate giveaway. That's exactly what we got here.

    Why can't free trade be fair trade? Clinton was great on Kramer speaking about smart regulation and balance.

    That's what I'm looking for- balanced trade. The fact that the natives are restless here is no wonder as  the last eight years there's been an all-out assault on everything we thought was the American Dream. I'm surprised people haven't taken to the streets with torches and pitchforks.

    I actually purchased a pitchfork recently. I got it to turn the compost pile for my "recession" garden.

    My pitchfork.... (none / 0) (#33)
    by kdog on Mon Apr 07, 2008 at 11:57:43 AM EST
    is in the garage, ready to rock-n-roll.

    I'm just waiting for numbers:)

    Though if my state passes their proposed new tobacco tax that will bring the price of a pack to around 10 bucks, I might have to whip it out early.  Where's my and my tobacco suppliers free trade and free market I wonder?

    Speaking of which, if the corporations want free trade and a free market, I'm down, but you gotta go all the way.  I want the right to open a speakeasy in my basement without licensing.  I want the right to buy and sell reefer.  Otherwise, I want the big players in the global economy f*cked with as much as you or I are when we try to conduct business.  


    I don't get the impression that (5.00 / 1) (#10)
    by inclusiveheart on Sun Apr 06, 2008 at 12:12:57 PM EST
    anyone is swinging all the way over to protectionism.  Fair trade is the objective for most Democrats I think.

    I have to say also as I lived (5.00 / 1) (#11)
    by inclusiveheart on Sun Apr 06, 2008 at 12:20:14 PM EST
    in your neck of the woods for a while that I don't think that the Caribbean Free Trade Agreement has been all that great for the islands, nor have the imposition of Federal laws on the USVI and PR that require a much greater base of infrastructure in order to keep people in compliance than many of the islands actually have or can afford.  So I understand why "fair trade" may be viewed with trepidation, but I would argue that we are imposing it in many ways already - just not in ways that really help either side of the deal imo.

    Without enforceable restrictions... (5.00 / 1) (#15)
    by fiver5 on Sun Apr 06, 2008 at 12:58:36 PM EST
    on slave labor, child labor, dangerous working conditions, etc., "free trade" merely allows multi-national corporations the "freedom" to exploit these "opportunities."  While that's obviously great for profit margins, it's not clear that there is much benefit in any other area.

    Until we rebuild (none / 0) (#17)
    by Stellaaa on Sun Apr 06, 2008 at 01:19:15 PM EST
    the authority of our government and the expectation of citizens that government should have a role nothing will happen.  Right now government has take a back seat.  

    Government is doing.... (none / 0) (#34)
    by kdog on Mon Apr 07, 2008 at 12:12:07 PM EST
    what it was designed to do...protecting wealth and power by preserving order.  Occasionally, as a means to that end governments have thrown working people some bones, but always as a means to protect wealth and power when they are endangered by angry masses.

    We all see what we end up with....regulations that legalize and legitimize certain levels of pollution and exploitation. A rigged market and unfair trade labeled "free".


    They don't (none / 0) (#1)
    by Lora on Sun Apr 06, 2008 at 11:23:51 AM EST
    NAFTA and CAFTA are not working for us.

    If the past is any indication of future performance, however, I doubt they are in any real danger.

    Mark Penn (none / 0) (#2)
    by squeaky on Sun Apr 06, 2008 at 11:28:58 AM EST
    Was working on it, but because Clinton is against it he was fired.


    Well given thier meetings with (none / 0) (#3)
    by Faust on Sun Apr 06, 2008 at 11:29:40 AM EST
    Canada and Columbia I don't think you have anything to worry about.

    BTD (none / 0) (#4)
    by Dave B on Sun Apr 06, 2008 at 11:48:01 AM EST
    What do you propose this country should do about it's disappearing manufacturing base?  Is that a healthy thing?

    Manufacturing base misinformation (5.00 / 3) (#6)
    by Stellaaa on Sun Apr 06, 2008 at 11:54:43 AM EST
    Recently I have had some contact with people working for a German company that sells machines used in manufacturing.  The people I met basically do tech support for those machines all over the world.  Their comment about America was that the factories using their machines are under represented in younger people, people to take over when the older ones retire.  What do we do?  We have basically neglected the need the companies have for mid level highly technical labor force.  The push to get everyone into "college" without some kind of national strategy has millions of kids struggling with educations that go nowhere, when there are jobs that we need and have to fill.  There is no national policy.  

    Exactly (5.00 / 1) (#12)
    by tree on Sun Apr 06, 2008 at 12:30:25 PM EST
    And this is what Clinton was talking about on Leno the other night. Another reason why she would be a great President. She understands and would create a national policy to get us back on the right track.

    Like immigration (5.00 / 5) (#14)
    by Stellaaa on Sun Apr 06, 2008 at 12:40:26 PM EST
    this issue is used as a political football.  At the end we get nothing that makes things better.  Americans need to join in the movement of working to sustain western standard of living and civil society in a time of globalization.  We have allowed the corporations to take the lead, when civil society has to say what the limits are.  Makes my skin crawl.  

    She talks about this all the time, but no one in the media covers it. They would rather keep people ignorant about the fact that their government can take action to make the economy viable.  


    You are right on Stellaaa (none / 0) (#16)
    by hairspray on Sun Apr 06, 2008 at 01:18:59 PM EST
    Vocational education has collapsed in this country. My ME son says that there are plenty of theoretical engineers working on rocket science where he lives (FLA) but getting well educated/trained technicians is getting harder every day.  It is like the tail chasing the head.

    There is no vocational training (none / 0) (#20)
    by bruhrabbit3 on Sun Apr 06, 2008 at 01:29:37 PM EST
    that will matter when an employer is looking at paying an American 20 dollars an hour versus cents on the dollar in another country. This is the fundamental issue being asked here. If people believe in the market, then they must admit to its failures with regard to national interests. Only countries are worried about its own people, companies are not. This means that while education is nice, it's not the solution. Getting more and more education or changing up education may have the appearance of doing "something" but what exactly are you doing? Are you creating job opportunities?

    Some jobs can't be outsourced (none / 0) (#21)
    by tree on Sun Apr 06, 2008 at 01:52:44 PM EST
    You can't take your car to a mechanic in India, you can't get a plumber from Romanis to make a housecall, you can't get anything built in the US by laborers  WHO LIVE IN another country. If we go heavy into solar and wind energy, there will be need for technicians here to install the panels and turbines, etc., etc. And likewise, as energy costs continue to soar, bringing items in from overseas will be less and less cost effective. To ignore the need for a skilled labor force here is to lose a great opportunity to improve the quality of life here for many.

    Actually my point is that a skilled labor force (none / 0) (#22)
    by bruhrabbit3 on Sun Apr 06, 2008 at 02:05:24 PM EST
    doesn't matter , the issue is pressure to reduce the cost of labor, and thus promoting a race to the bottom in wages in the U.S. Re-education within this scenario doesn't answer the wage concerns. It also doesn't answer the question to say that all jobs aren't transportable abroad. The question is what types of jobs are being transported,a nd how are they valued. intellectual capital jobs are the issue and manufacture jobs. Service jobs- the ones you describe- pay less. That reduces American wages, and our quality of life.  Fixing a machine maybe important, but building it and design it earns the most money.

    heh (none / 0) (#25)
    by jimakaPPJ on Sun Apr 06, 2008 at 09:10:59 PM EST
    As long as society is making heroes of journalists, doctors and lawyers you will continue to get journalists, doctors and lawyers.

    go to law.com and look up the issue (none / 0) (#27)
    by bruhrabbit3 on Sun Apr 06, 2008 at 10:35:45 PM EST
    Actually my son is working on developing (none / 0) (#28)
    by hairspray on Sun Apr 06, 2008 at 10:38:18 PM EST
    alternative energy out of petroalge ponds and finding technically competent mechanically trained technicians has been hard throughout the industry.

    That's great- but I am still interested (none / 0) (#29)
    by bruhrabbit3 on Mon Apr 07, 2008 at 12:45:01 AM EST
     in the wage issue. How much are they earning? Will this replace the wages that are lost by the jobs that are leaving?

    On the macro-level and in (none / 0) (#36)
    by hairspray on Mon Apr 07, 2008 at 01:25:35 PM EST
    some states the new job growth does not make up for those dislocations.  That is why I think we need a robust industrial policy.  We really cannot stop certain industries from leaving and there has been much evidence that in NAFTA at least there have been some modest pluses for America..  BUT NAFTA needs to be renegotiated and both candidates have said they would do that.  What I like about Hillary's plan is the great emphasis she places on alternative energy investment and perhaps Obama does that also.  I remember that Bill talked about it years ago as the next new wave of American manufacturing resurgence. It just needs a hardworking leader to do it.  My son's company is a research and development company and I am praying for new capital to keep it going.

    I don't have a problem with fair agreements for (none / 0) (#37)
    by bruhrabbit3 on Mon Apr 07, 2008 at 11:48:02 PM EST
    trade. I have a problem with the characterization of criticism of these agreements and issues as demogues. I studied MITI in Japan and I know what a well thought out industrial policy can mean. I've also studied the other developed countries with smart industrial policies. I am not saying we should become protectionist of every industry that faces competition. I am saying let's get beyond the useless rhectoric of calling those who want to change policies 'demogues" I am skeptical of policy changes that focus on education. This is Clintonian 1990s rhectoric for this is allw e are going to do without regard to determining if its all that needs to be done. in some cases you may need to protect an industry while there is a transition or you may neeed to look at what jobs are replacing a,nd asking how are the other countries achieving it- perhaps it really is competition, or it could be that they are willing to kill their country men to do it. That can't be our standard for competition. It's complicated, but there are some real issues that can't be glossed over by pretending its just demogues.

    There is nothing wrong with protecting (none / 0) (#38)
    by hairspray on Tue Apr 08, 2008 at 12:20:18 AM EST
    a few nationally important industries.  However, there are still lots of libertarians and Republicans who don't think the govt should be determining the winners and losers in industrial policy. On the other hand we should not be rewarding companies for "outsourcing.  But i do believe that investing in new technologies like our alternative energy potential will pick up a lot of the lost jobs in the industrial belts. The clothing industry is gone, and so are others, but that is not the end of the world. Alternative fuel and super rail systems are the wave of the future and has the potential to be very lucrative if we get the right leadership to push it along.  By the way my son's job pays quite well and the technicians make aroung 40k.  That is good for FI.  I am just furious that Bush set us back so many decades by his asinine and criminal foreign policy.

    I don't care what Republicans or liberterians says (none / 0) (#39)
    by bruhrabbit3 on Tue Apr 08, 2008 at 07:18:45 AM EST
    and if you are, then you are worrying about the wrong priorities. I care what the bulk of the American people say, and what policies makes sense for protecting their interests. This  isn't about Bush. It's about a mind set amongst Democrats about what our priorities are. I have no power so you don't have to worry, but if I did, the first thing to go would be this mind set of defensively looking over one's shoulder to what the Republicans think to formulate our own thinking.

    Please no, not a Republican EVER (none / 0) (#40)
    by hairspray on Tue Apr 08, 2008 at 11:32:30 AM EST
    but I do know that they still have a lot of power in our government. Anything a new Democratic president does will be held hostage by a small coalition of blue dog Democrats and GOP. Therefore, the most sucessful policy will not be any kind of protectionism or unfortunately industrial policy.  I have read a great deal about FDR and his times.  He had a 25% unemploymnent rate and worse times than we have now but was unable to enact many reforms.  It won't be a lot different this time either.  So if you think we have someone on the national stage right now who will enact bold programs, I've got a bridge to sell you.  I think as long as the media controls the group think in America we are in for tough times.

    some questions... (none / 0) (#7)
    by selise on Sun Apr 06, 2008 at 11:59:26 AM EST
    I am an avowed supporter of free trade agreements like NAFTA.  But I am not a rube.

    1. please explain why you are a supporter of chapter 11 of nafta.
    2. please explain what nafta has to do with free trade, other than the words are are in the title?


    I am a supporter of NAFTA. Not a rube. (none / 0) (#18)
    by jerry on Sun Apr 06, 2008 at 01:19:17 PM EST
    I am an avowed supporter of free trade agreements like NAFTA. But I am not a rube.... Indeed. I hope and trust our candidates do not actually believe their own demagogy on trade.

    There are many intelligent, educated, people including economists that dislike NAFTA for many reasons and are not rubes.

    Mencken's definition: demagogue: "one who will preach doctrines he knows to be untrue to men he knows to be idiots."

    "I am such an avowed supporter for free trade agreements like NAFTA that it is evidence that I am a rube.  I am hopeful that what any progressive liberal democrat says about free trade is just demagoguery and not something they actually believe.  I prefer politicians lie to us in order to gain votes from idiots.  I am a Barack Obama supporter."


    You don't see any problems with NAFTA (none / 0) (#19)
    by bruhrabbit3 on Sun Apr 06, 2008 at 01:25:04 PM EST
    And if so, what and, if you have already written about it, can you provide the links? Free trade is a larger discussion of globalization. It's also a discussion about labor practices in the U.S. It would be interesting to hear why you believe what you wrote. I find it interesting that nearly every other part of the world which has a GDP faster than us doesn't exactly take our views on trade- as in free trade without any consideration of domestic pain caused. Even if one thinks trade agreements are a good thing, one has to admit they are the cause of creative destruction:


    What of the race to the bottom issue? The environmental and wage pressure concerns? Let's talk about non manufacture jobs. Let's talk about white collar jobs such as lawyers and engineers , etc. The theory is that low paying jobs will be replaced by higher paying jobs.

    These aren't necessarily trade related, but I argue they represent a mind set. If you want to talk about it in a non black-white way, I think it would be great to read a non black-white, non-"I realize that demagoguing against free trade is now standard issue Dem politics"  conclusion.

    NAFTA has nothing to do with creative destruction (none / 0) (#24)
    by jerry on Sun Apr 06, 2008 at 06:05:25 PM EST
    Creative destruction is a good thing.  The problem is destruction that is not creative, and the destruction that free trade encourages is destruction of safe labor practices, job benefits, environmental regulations, child labor regulations and many restrictions on corporate behavior that we have learned are needed and good.  Restrictions that were paid for in blood.

    Free trade benefits those countries and companies that can avoid those regulations and hurts those countries and companies that are forced to abide by those regulations.

    It's quite literally stupifying to find self identified liberal progressives that favor free trade and disparage fair trade practices.

    But creative destruction?  That's a very good thing.  No one's job and no one's profit and no one's company or industry should be protected from smarter people doing things in a smarter way.


    my point was that even if one thinks that (none / 0) (#26)
    by bruhrabbit3 on Sun Apr 06, 2008 at 10:34:51 PM EST
    the pains caused by trade agreements are a good thing (the creative destruction) one should still have a problem with the pain and not reduce it to demogery

    It's a one-way street (none / 0) (#23)
    by LCaution on Sun Apr 06, 2008 at 05:12:36 PM EST
    My concern with globalization as currently practiced  is quite simple: capital is free to travel around the world, labor is not.

    A textile company can build a plant in a country with no labor laws and pay barely survival-level wages, but the sweatshop workers in that country cannot simply pick up and move to, say, England or the U.S. in order to earn a higher wage.

    Thus we have the proverbial race to the bottom - and an increasing number of articles in U.S. papers and magazines asserting that U.S. income disparities are meaningless because everybody has indoor plumbing - which is not true of, say, people living in Uganda.

    Very well said.... (none / 0) (#35)
    by kdog on Mon Apr 07, 2008 at 12:25:58 PM EST
    for trade to be truly "free", every border in the world must be open.  The drug trade cannot be prohibited.  Business licensing, mandatory trade unions, government subsidies...all must be abolished for both markets and trade to be truly free.  Anything less is rigging the market.

    free trade, in theory, (none / 0) (#30)
    by cpinva on Mon Apr 07, 2008 at 03:33:14 AM EST
    is almost always beneficial, to all parties. in theory. unfortunately, it's the practice that causes problems. this is the issue that sen. clinton wants to address: free trade, as mandated under NAFTA, etc. doesn't establish a level playing field for all parties. it doesn't require that all parties have the same (or at least similar) labor and environmental laws.

    and there's the rub. not only are manufacturing jobs moving to low wage countries, they do so with environmental impunity. sure, they provide jobs to the locals, while destroying the local air, water and ground. that's the real critical economic factor, not so much wages.

    when you add in transportation costs (to ship the goods from there to here), the wage differential becomes minimal. however, the fact that they have little or no environmental protection costs in most of those countries then makes it profitable.

    as well, since their profits aren't taxed in the US (transfer pricing), we lose out there as well.

    this is where the reform efforts, for all those treaties, needs to focus on, not cutting it off.

    Free trade myth (none / 0) (#31)
    by bernarda on Mon Apr 07, 2008 at 06:08:56 AM EST
    Free trade has never happened and will never happen. From the WTO to NAFTA, these agreements have been written to favor the large multi-nationals and screw everyone else. That is there raison d'être.

    After the war, what nation became wealthy with "free trade". It didn't happen in Europe and it didn't happen with Japan and Corea. It isn't happening in China. Countries get rich on protectionism. Show me a different example.

    It was only after these countries became relatively rich, that the rich corporate oligarchy started promoting "free" trade. Workers on all sides get screwed.

    The U.S. is giving 20 billion dollars in subsidies to super-rich American farmers. They then undermine foreign agriculture by dumping their excess production.

    Free trade myth II (none / 0) (#32)
    by bernarda on Mon Apr 07, 2008 at 06:19:57 AM EST
    I note that the NYT's lying propaganda article only uses the term "free trade" once. Otherwise it says,

    "Democrats need to tell voters the truth: First, trade is good for the economy, providing cheap imports and markets for exports, spurring productivity and raising living standards. And second, while trade can drive down some wages and displace some jobs, Democrats have real ideas to help workers cope."

    Note "trade", not "free trade". But even so, what they say is not true. Especially, it doesn't raise standards of living in the U.S. It only does so for a privileged minority in developing countries.

    Big Trickle Down Democrat (none / 0) (#41)
    by jondee on Tue Apr 08, 2008 at 02:24:41 PM EST
    it sounds like to me.

    Increasingly NYT looks and sounds like a bastion for Rooseveltian elites who are wise enough to know you have to toss a few crumbs on occasion in order to avoid revoloution, all the while secretly more at ease with the pink, manicured, Kristols and Brooks' of the world.

    btw, Those wmds will be found any day now.


    Beware of people (none / 0) (#42)
    by jondee on Tue Apr 08, 2008 at 02:28:07 PM EST
    who talk about "the Truth" with a capital T.

    Unless its L. Ron Hubbard. lol