Change of Heart on Free Trade

Posted by ikabod Crane on 08.03.2007

Why this open markets man has done a 180 on the issue of free trade.

Like any 17 year old who thought he knew everything, I was excited when Al Gore's surprise drubbing of Ross Perot in the "NAFTA Debate" led to new life for the trade agreement. My 17 year old logic went something like this: The U.S. has low tariffs to begin with if the U.S. can get another nation-state to drop what were high tariffs to zero while dropping our low tariffs to zero this is a major gain for U.S. export industries relative to the gain those seeking to export to the U.S. would receive.

That logic seemed nice to me, but then I went to college and took 4 courses in economics. I would learn to do the math and draw the diagrams that demonstrated what gains awaited with free trade. Today, I could no longer do the math, but the diagrams and gist of free trade pros and cons are still in my head. In fact, the logic of it all still resonates with me. What no longer resonates is the loss of sovereignty and the nasty details of under inspected products on U.S. shelves.

What used to strike me as paranoid rhetoric that only fed into theories of black helicopters and secret armies of super-soldiers under UN command now seems to be a serious critique of the idea that free trade also means giving up the ability to apply U.S. safety laws to products entering U.S. markets. Not subjecting imports to tariffs does not logically add up to legally assuming that imported beef, toys, toothpaste and pet food to be of equal quality or equivalently safe to products produced within the U.S.

The Choices We Face

If free and freer trade was on the table with the U.S. still being able to inspect products and requires high levels of safety, then I would support that. As the WTO rules are currently construed, that option is not on the table. So if I have to choose between product safety and free markets, I will choose safety 100% of the time. Profits that needlessly and knowingly put lives and wellbeing in danger are profits that are ill gotten.

The cold splash of tainted pet food raised this issue into the consciousness of the average citizen. Most people do not like to see pets suffer. The shock of led paint in children toys was a serious jolt. Endangering pets and children is a good way to force the citizenry into revolt demanding changes. Throw in tainted toothpaste and suddenly dental hygiene is under a real assault unlike the one General Jack D. Ripper mistakenly envisioned in fluoridation in Kubrick's Cold War classic Dr. Strangelove.

Pets, kids, dental health, what's next? Well rumor has it black market counterfeit drugs may be replacing needed medications with indistinguishable placebos. Suddenly, if blood pressure medications and diabetes medications cease to be reliable, many people will be in open revolt. Trade laws that force an assumption of confidence in under inspected products will not stand.

Wildcard Issue in 2008?

To think this issue will not have political repercussions is to be naïve. China already has many voters attention as a rising global power. Defense hawks and anti-Wal-Mart activists both seek a more effective China policy. Pat Buchanan's wing of conservatives are dolling out "I told you so's" to their more free market oriented conservative cousins. The issue has legs, it is just unclear where the issue will resonate and which bloc of voters it will inspire.

The anti-immigration crowd will likely try to harness the issue to ramp up xenophobia and stronger defenses of actual and cultural U.S. borders. The populist wing of the Democratic Party will be emboldened by this as yet another example of corporate policies that promote profits over every other human need. The Labor Unions may be able to parlay this issue into a renewed look at combating outsourcing and restoring some protectionism.

Which Candidate Might Benefit

Given that blocs within both major parties are likely to be mobilized by this issue, it seems reasonable to wonder which candidates will benefit from making this a pet issue. On the Republican side of the aisle, the tight rope is much thinner because free trade is still well liked by some important sections within the GOP. Some of the so called "second tier candidates" could use this issue to run an outsider campaign. The anti-immigration crowd might beat this drum, but Arkansas Governor Mike Huckabee could make the best use of the issue. He has used his weight loss to promote public health. Protecting drug and toothpaste quality as well as ensuring the safety of children's toys dovetails nicely into Huckabee's personal story.

On the Democratic side of the aisle, this issue stokes the fires of populists, anti-globalization zealots and labor unions. Of the top 3 candidates, Hillary Clinton is too associated with Bill Clinton signing GATT and NAFTA. She may have to back off of policies from the Clinton-Gore administration and that is not a place she wants to be. Barak Obama will not be hurt by these issues, but he has positioned himself as a pragmatic internationalist and this is somewhat of an isolationist issue. That leaves John Edwards as the candidate whose policies already prefigured the policies this issue is likely to demand. Edwards is also a good talker and can likely frame the issue in ways that excite voters. Other Democratic candidates will be unlikely to outshine Edwards when it comes to rhetoric so no underdog candidate is going to get a major push.

Confluence of Parties

Economically speaking, some cultural conservatives are not served by the policies of free trade and opening every market. Culturally speaking, many union members and populists are not comfortable with the emphasis cultural issues receive within the national Democratic Party. That means that the voters Edwards will seek to fire up and the voters Huckabee could inspire are more or less the same bloc of voters. My guess is the party that makes the most inroads with these voters will be the party to have the most success in 2008's congressional and presidential elections. In the mean time, I am looking for a sensible policy that opens markets without sheding consumer protections. Of course, the promise of cheaper toothpaste, pet food and children toys could always trump my faith in the common sense and common decency of the American people. "Blue Light Special on aisle 6 …"