No Straw MenEnlightened discourse proscribes arguments that are weak or imaginary, like straw, set up only to be confuted summarily.

First Thoughts on Free Trade

A version of this blog post appeared on Dollars and Crosses (January 19, 2004) and in the Hamilton College Spectator (January 23, 2004).

How do today’s politicians rationalize their politics? In a recent New York Times op-ed titled “Second Thoughts on Free Trade,” Charles Schumer, the senior Democratic senator from New York, and Paul Craig Roberts, an assistant treasury secretary under President Reagan, give us a glimpse: “[T]he United States may be entering a new economic era in which American workers will face direct global competition at almost every job level—from the machinist to the software engineer to the Wall Street analyst. . . . When American companies replace domestic employees with lower-cost foreign workers in order to sell more cheaply in home markets, it seems hard to argue that this is the way free trade is supposed to work.”

Of course, these “second thoughts” are old-hat; protectionism, whatever the rationalization, amounts to a money-grab.

It’s also racist, as Harry Binswanger observes in an essay titled “‘Buy American’ Is Un-American.” As Binswanger writes, “Economic nationalism, like racism, means judging men and their products by the group from which they come, not by merit.”

Furthermore, one big reason American businesses transfer labor overseas is because the relative cost of doing business stateside is artificially high. Why artificially? Because the federal government, via tariffs, subsidies, minimum wage laws and countless other statist mechanisms, insulates myriad domestic industries from the global market.

Yes, Indians and Chinese will probably always work longer hours for cheaper wages. (As the land of opportunity, the U.S. should welcome these assiduous “foreigners,” instead of heaping the welfare state on domestic moochers.) Yes, Japan will heavily underwrite its automobile industry, as will the European Union vis-à-vis Airbus. But Americans—we titans of industry—rather than fear competition, should embrace the challenge.