Trump is right to challenge orthodoxy of free trade

Russell McDermott, columnist
Russell McDermott, columnist

Many who oppose President Donald Trump have adopted the same tactics President Barack Obama's foes used during his eight years in the White House: If he's for it, I'm against it.

That's a mistake. No one is always wrong, nor always right. For the good of the country we should look at each position individually before deciding our stand.

I have to admit Trump's not making it all that easy.

His Cabinet picks for example. He promised to "drain the swamp" but he really just changed out the alligators.

His temporary ban on refugees from certain Muslim countries speaks more of paranoia than protection.

And he is obsessed with criticism of any kind. He can't help but lash out against anyone who dares say anything that most of us would find mildly annoying. But nothing mildly annoys our president. Everything is a big deal to him.

But there is one position even Trump's harshest critics should give some serious consideration: Free trade.

Now, free trade has become something of a "third rail" for economists and for those on both sides of the political spectrum. It is considered gospel that free trade brings more advantages than disadvantages.

And it's true that free trade means American companies can produce goods at lower prices-usually by outsourcing labor to foreign countries. American retailers can buy goods at lower prices from overseas and pass that savings on. That means American consumers can buy more goods for less money.

But at what cost?

Two new books are worth a read. One is called "Economism: Bad Economics and the Rise of Inequality" by James Kwak. The other is "The Upside of Inequality: How Good Intentions Undermine the Middle Class" by Edward Cunard.

Both make the case that for all the good free trade brings, it carries a price that makes it a bad deal for a more developed nation like the U.S. and a very good deal for poorer countries-as well as the investors and business owners here at home who profit from cheap foreign labor and goods.

So what's the price? Jobs, good American manufacturing jobs that pay far above the kind of work that has replaced them in our free trade reality.

Another "truth" of free trade is that, with barriers low or nonexistent, American manufacturers can sell more goods overseas, thus creating more jobs. But considering the huge trade deficit that the U.S. has developed since the 1970s, that "truth" has been shown to be a myth.

Free trade means consumers can buy more for less. But it also means that as high-paying jobs are shipped to Mexico, China, India and other countries, Americans, stuck with the service industry jobs that have largely taken their place, have less money to buy those goods. So there is a question we have to decide as a nation. What's more important? Free trade, big profits for the few and lower prices? Or good jobs for Americans?

To me the answer is clear. Manufacturing since the early 20th century and especially in the post-World War II era elevated millions of Americans into the middle class. But free trade is a major factor in the steady demise of that middle class.

If higher prices at the store and lower profits for the 1 percent is the price for correcting all these years of decline, then it's worth paying.

Trump isn't the first businessman-turned-politico to point this out. Many readers will remember Texarkana native H. Ross Perot's warning of a "giant sucking sound" of American jobs lost to the North American Free Trade Agreement back when he was running for president in 1992.

Perot was lampooned for his choice of words. He was castigated for challenging the orthodoxy of free trade. But he was right to a great extent.

And on free trade Trump is right. The challenge is figuring out the best, most productive way to reshape our trade policy. Let's hope he's up to that challenge.

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