Jasper Smith

Commentary on politics, economics, culture and sports.

Crook on Rodrik on Hillarytrade

with one comment

Clive Cook talks about Dani Rodrik’s calm reaction to Hillary Clinton’s recent embrace of protectionism:

Dani is right of course that having doubts about the current multilateral arrangements does not make you a protectionist. Raising trade barriers, or turning your face against opportunities to lower them, is what makes you a protectionist. I also agree with Dani that taking a breather on trade agreements does not mean that the global trade regime will collapse. But collapse is an extreme scenario. The danger is not collapse, but erosion.

Dani argues that to maintain the openness we have, we must improve the legitimacy of the existing arrangements and build political support for liberal trade. Yet again, we agree. The issue that divides us is whether Hillary Clinton’s call for a time-out on trade advances or retards those goals.

Acknowledging that there can be winners and losers from trade, and developing better kinds of social insurance to ease the strain, makes sense. I am very much for that. But those policies do not envisage restrictions on trade. It is very hard to maintain that (a) trade is good for us in the aggregate and (b) it makes sense to go slow on trade liberalisation. If you are going to argue (b), before long you will find yourself failing to mention (a). And once you have forgotten (a), or decided it might actually be wrong, good luck in trying to “maintain the openness we have”.

If liberal trade is not good for America in the aggregate, why even try to maintain it? Why not join forces with outright protectionists and pursue the “fair trade” agenda without inhibition?…Once the US decides that liberal trade does not serve its collective interest–and Hillary, in effect, is proposing a time-out to think about this–the openness we have is indeed at risk.

I suspect most of the “US” — that is, the American people — already think liberal trade is against its collective interest. That horse has already left the barn. It’s a most deplorable state of affairs, and it unfortunately means that, in the party of the left, at least, the path to power requires mouthing protectionist bromides to peel off at least some protectionist voters.

I really doubt Hillary Rodham Clinton truly believes the fair trade nonsense. But she’s evidently concluded gaining the White House is going to require a certain amount of pandering. Nothing new there.  Pandering is as muc a part of the American political condition as baby kissing or chicken dinners. I now suspect however, that, perhaps ironically, free trade’s best bet is to put a Democrat in the White House. The Republicans certainly don’t appear interested in making safety net improvements (heck, they don’t appear very interested in making the case for trade, either).

Perhaps after eight years of a safety-net-repairing Democratic administration, it will once again be morning in America for free traders.


Written by Jasper

December 8, 2007 at 6:32 pm

One Response

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  1. The problem is that ratcheting up protectionist rhetoric will lead to those on the far-left demanding new trade barriers to be put in place once the Democrats control the government again. Protectionism will only hurt the American economy, making it ever more difficult to repair the American safety net and recover the economy. It’s hard for me to see how embracing an anti-trade candidate like John Edwards serves the economic interests of the country. The difference between Edwards and Obama on policy issues is minimal. However, since Edwards is running an protectionist campaign, he’ll be under more pressure to deliver results on that issue. Many of the people Edwards is trying to protect, the working class, will likely be laid off when we can’t sell our goods overseas because a US-instigated trade war. That is not good for the country, and will only see the US being left behind as Australia, Ireland, the EU and Asia race ahead.


    December 20, 2007 at 12:40 pm

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