This Wall Street Journal story on page one is getting a lot of attention today. Our bias is that polls aren’t news, but ….the trend in public opinion being measured is not good.
WASHINGTON — By a nearly two-to-one margin, Republican voters believe free trade is bad for the U.S. economy, a shift in opinion that mirrors Democratic views and suggests trade deals could face high hurdles under a new president.
The sign of broadening resistance to globalization came in a new Wall Street Journal-NBC News Poll that showed a fraying of Republican Party orthodoxy on the economy. While 60% of respondents said they want the next president and Congress to continue cutting taxes, 32% said it’s time for some tax increases on the wealthiest Americans to reduce the budget deficit and pay for health care.
What’s happening? The Lou Dobbs effect? The media’s incessant hyping of contaminated food and other imports? Just more of the anti-foreign bias as detailed by George Mason University economist Bryan Caplan* in his new book, “The Myth of the Rational Voter?” Or are the advocates of free-trade not working hard enough?
It’s certainly frustrating, because the evidence is so clearly in favor of trade as a pillar of U.S. economic strength. Here’s U.S. Trade Rep Susan Schwab in today’s Christian Science Monitor:
“The sad story about NAFTA is that it has been a tremendously successful agreement by virtually any measure,” Schwab said. “If you take the 10 years prior to NAFTA and the 10 years following NAFTA, the unemployment rate went down after NAFTA, manufacturing output went up after NAFTA, the economic growth rate went up after NAFTA.” She added that export-related jobs in the US pay 13 to 18 percent more than other jobs.
And here are two key paragraphs from the NAM’s October economic forecast, written by Chief Economist David Huether:
Trade (↑) Economic growth abroad remains healthy. The dollar has fallen 19 percent since February 2002 and as of September it stands at its lowest level in ten years. This combination has produced favorable results.
Over the past year, real exports have increased by 7.1 percent. This is more than triple the 1.9 percent rise in imports during this time. This trend will continue going forward and partially offset the negative effects from the housing downturn.
Glenn Reynolds at Instapundit headlines it, PERHAPS THE WORST NEWS OF THE
WEEK MONTH YEAR:
A general opposition to free trade will be terrible for the U.S. — and the global — economy. I hope that this anti-free-trade sentiment is aimed only at new agreements, and doesn’t extend to a rollback of existing free trade, but I’m not that optimistic.
But the new agreements are important too! Turning our back on Colombia’s markets and democratic strivings would be disastrous, just for one example. (NAM fact sheet here.)
We advocates simply have to work harder in making the case for trade in terms that the public can appreciate, connecting good-paying jobs to trade. And not let the anti-trade rhetoric stand unchallenged. Because protectionism makes us poor.
* A few of us had dinner with Caplan last night to discuss his book. Reason Magazine put an excerpt on the cover recently. All four of the biases he cites come into play here: The anti-market bias, anti-foreign bias, the make-work bias, and the pessimistic bias. Worth considering in a discussion of economics, but understanding them may not be enough to move policy.
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