A new Pew poll out shows that Americans are dead last among 24 nations in their support of the very concept of trade, with only 15 percent saying "trade is very good for the economy". The Pew poll confirms what is already clear from anyone who watched the swing state primaries: you can't expect to get elected in 2008 by advocating more of the same failed NAFTA-WTO agenda.
Still, I am amazed that the very idea of trade is so problematic. In general, people tend to be in support of the notion of international exchange; our complaint has always been that pollsters don't ask specific enough questions, like, "Would you support an act of Congress that would reduce barriers to trade with a poor country that would push U.S. wages downwards?"
So the Pew poll is very clunky, not asking about specific trade policies or impacts, but rather about views of trade in general. If they asked more sophisticated questions, we would have likely seen more demonstration of the global rejection of this agenda as well, which are obvious from the protests in Korea against U.S. beef to the Irish public's rejection of a corporate-friendly EU treaty.
And some of our friends weigh in for a piece on the Pew poll by National Journal's Winter Casey:
"You have to remember that since 2002 wages have not moved in the United States despite six years of economic growth," said Mark Weisbrot, co-director of the Center for Economic and Policy Research. "Our leaders have forced most Americans into very harsh competition through international trade, but they have protected the upper-income groups from the same competition. Therefore, international trade has played a significant role in redistributing income from the lower and middle classes to the rich. A lot of people can see that, even though the pundits and the Beltway bloviators try to deny it."
Advocates of globalization love to argue that free trade lowers prices, and the argument seems sensible enough. Think of all the cheap goods from China that we can buy at Wal-Mart. But anyone who understands comparative advantage knows that free trade affects relative prices, not the price level (the latter being the province of macro and monetary factors). When a country opens up to trade (or liberalizes its trade), it is the relative price of imports that comes down; by necessity, the relative prices of its exports must go up! Consumers are better off to the extent that their consumption basket is weighted towards importables, but we cannot always rely on this to be the case.
And thanks to David Sirota for addressing taking down the crock that Roger Lowenstein spewed over the weekend. I was so angry yesterday that this kind of garbage gets any play from serious newspapers that I had to rip down half the trees in my yard. Hey, anger is a gift, right?
I could make a much better case for so-called "free trade" agreements than Lazy Roger here, because he (and by extension his editors) are so blinded by their own privilege that they fail to take seriously any weaknesses in their pamphleteeing hoo-haa. They do not help their corporate or ideological masters by recycling 30 year old Chamber of Commerce fact sheets. At least we know where the re-educated editors from Pravda were sent.