Saturday, June 11, 2005

FREE TRADE AND THE LEFT BLOGOSPHERE

Max Sawicky has been running a small series of late he calls "Postcards from the Edge", and yours truly gets a mention yesterday as one of the few bloggers who has the temerity to dissent from the free trade faith. Well, I can thank my education in economics for that, for I am not a professional economist nor have I any degrees in economics. I have a B.A. in Political Science and Russian Language and Literature; an M.A. in International Affairs; and a Ph.D. in Political Science with a supporting program in Geography. In these fields you can do all the political economy you want and never be spoon-fed liberal orthodoxy nor face immense professional pressure (whether social or ideological) to bow down at the altar of free trade. Political economy is truly the land of the free where dissenters are liberated from their shackles.

Brad DeLong, who is a fine person and a fine economist as well as a darling of the pro-free trade liberal blogosphere, takes issue with Max as you might expect.
Well, free trade is a very important pie-growing mechanism--and, as a way of boosting growth in poor parts of the world, an important step toward a truly human world and a secure world.

Plus there are much better tools for repairing the income distribution than tariffs and quotas. If only we could assemble a political coalition behind any of them...

And effective trade regulation is hard to do and inevitably polluted by politics.
Ah, spoken like a true liberal: "polluted by politics". The market is the pristine heaven tainted by the grubby hands of power.

Globalization doesn't work (see here and here for recent and easy summary statements). One look at the US trade deficit will show you this. Per the religion of comparative advantage the US is surrendering its manufacturing base but without replacing it with anything the US can exchange for all the manufactured imports the country is hell-bent to consume. Furniture, cars, iron and steel, even food -- you name it, we're turning it over to the pristine heaven of globalization. And we will pay the price.

Hell, lots of folks already are. I must dissent from Paul Krugman (another pro-free trade liberal) in that the story of the demise of the American middle class is not simply one of corrupt men in positions of power (read: the Bush administration) -- as if Bill Clinton was God's gift to America! At a structural level, the vision of Robert Reich (another pro-free trade liberal -- they're everywhere!) is basically the same as that of George W. Bush. Reich would just give the country six months more unemployment insurance.

As Friedrich List said, "And who would be consoled for the loss of an arm by knowing that he had nevertheless bought his shirts forty per cent cheaper?" Well, you have your answer if one fellow gets the shirt and it's somebody else's arm.

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