Tag: International

A Clash of Worldviews on Free Trade

If you want to witness the clash of two worldviews on trade, check out the online debate I’m having with Ian Fletcher of the U.S. Business and Industry Council. A self-described protectionist, Fletcher has written a new book with the unambiguous title, Free Trade Doesn’t Work: What Should Replace it and Why. In the opposite corner, I argue for eliminating barriers to trade, drawing on my own recent book, Mad about Trade: Why Main Street America Should Embrace Globalization.

The debate is being hosted by the International Economic Law and Policy Blog. We’ve already filed two 600-word posts each, with a third to come at the end of this week and concluding arguments early next week.

Charles Krauthammer, Rocket Scientist

Last evening on FoxNews, host Bret Baier reported that the Iranians had launched a rocket carrying ”a mouse, two turtles, and a can of worms” into space. He asked the panelists to speculate on the implications.

Charles Krauthammer inveighed “if you can put a mouse into space, you can put a nuke in New York, in principle.” Given that they are clearly developing the technological capabilities that would allow them to nuke New York, Krauthammer concluded, “our only hope on the nuclear issue or any other is a revolution and to help that revolution ought to be our task.”

Well.

To her credit, Jennifer Loven of the AP wasn’t having any of it. “It’s an incredibly large leap,” she pointed out, ”between a mouse in space and a nuke in New York….[I]t’s a…ginormous gap.”

How “ginormous”? The analogies are imperfect, but I can throw a football a fair distance. In principle, I could start in the Super Bowl.

More seriously, there are modest parallels to the subject of my first book – the mythical missile gap of the late 1950s. The missile gap was precipitated by the launch of the Sputnik satellite in October 1957. Millions of Americans became convinced that the beeping silver sphere orbiting the earth signified that the Soviets could, in principle, drop a nuclear weapon on any city in the United States. This misconception was helped along by some opportunistic fearmongering by, chiefly, Democrats who delighted in embarassing President Dwight Eisenhower. And the ploy worked. The Dems rolled up huge victories in the mid-term election of 1958, and John F. Kennedy capitalized on the missile gap to help get elected president in 1960.

The actual missile gap – in the U.S. favor – was irrelevant. It would have been equally irrelevant if the roles were reversed, with the Soviets in possession of hundreds of ICBMs, and the U.S. with only a handful of shorter range weapons. Even if the Soviets had perfected the ability to throw a nuclear warhead onto U.S. territory, what ultimately prevented them from doing so was not technological but psychological – they were deterred by our vast arsenal. And they continued to be so deterred for decades until the entire edifice of Soviet power came crashing down, from within, without any significant assistance from the United States.

Would Krauthammer contend that Eisenhower’s refusal to overthrow the Soviet regime in 1958 was “an embarassing failure?” The Soviets did, after all, actually have nuclear weapons, many of them. The Iranians have none, and have not even mastered the enrichment cycle, let alone the long process toward weaponization.  By implying that the only thing that stops the Iranians from immediately nuking New York is their technical capabilities, Krauthammer demonstrates a shocking ignorance of some of the most basic principles of international relations, beginning with deterrence. This makes him a horrible political scientist.

But as a rocket scientist, he’s even worse.

Tuesday Links

  • Gene Healy on today’s election in Massachusetts: “If Republican Scott Brown wins the Massachusetts special election Tuesday, the Bay State will have its first GOP senator since the era when disco was king. And Brown will have the much-derided Tea Party legions to thank.”
  • George W. Obama? “Bush’s successor—who actually taught constitutional law at the University of Chicago—is continuing much of the Bush-Cheney parallel government and, in some cases, is going much further in disregarding our laws and the international treaties we’ve signed.”
  • Podcast: “Our America Initiative” featuring former New Mexico Governor Gary Johnson. Johnson discusses out of control government spending, immigration, the Bush years, the drug war, defense policy and more.

Tuesday Links

  • Afghanistan: A war we cannot afford. “Democrats say raise taxes. Republicans say no worries. The best policy would be to scale back America’s international commitments.”

Imports Wrongly Blamed for Unemployment

Import competition can throw Americans out of work. Even advocates of free trade like me will readily acknowledge that fact. And nobody needs to remind the people of Hickory, North Carolina.

On the front page of the Washington Post this morning, under the headline, “In N.C., damage not easily mended: Globalization drives unemployment to 15% in one corner of state,” the paper reports in detail how the people of that community are struggling to adjust to a more open U.S. economy:

The region has lost more of its jobs to international competition than just about anywhere else in the nation, according to federal trade-assistance statistics, as textile mills have closed, furniture factories have dwindled and even the fiber-optic plants have undergone mass layoffs. The unemployment rate is one of the highest in the nation–about 15 percent.

Nobody wants to lose their job involuntarily, but a story like this needs to be read in perspective. As I document in my new Cato book Mad about Trade, the large majority of Americans who lose their jobs each year are not displaced by trade. Technology is the great job disruptor, but Americans also lose their jobs because of domestic competition, changing consumer tastes, and recessions.

For every person who loses their job because of globalization, I estimate there are 30 who have lost their jobs for other reasons. I’m waiting for a front-page story on all the newspaper workers who have lost their jobs because of the Internet, or the 30,000 workers laid off by Kodak in the past 5 years because of the spread of digital cameras and plunging film sales, or the book stores and record stores that have shut down and laid off workers because of Amazon.com and iTunes.

Trade is not a cause of higher unemployment nationwide, either, as the Post story seems to imply. Imports have fallen sharply during the latest recession along with the trade deficit. In contrast, imports were rising at double-digit rates when the unemployment rate was below 5 percent. Like technology, trade can put people out of work, but it also creates new and generally better paying opportunities for employment, while raising our overall standard of living.

Obama, International Law, and Free Speech

Stuart Taylor has a very good article this week about the Obama administration, international law, and free speech.  This excerpt begins with a quote from Harold Koh, Obama’s top lawyer at the State Department:

“Our exceptional free-speech tradition can cause problems abroad, as, for example, may occur when hate speech is disseminated over the Internet.” The Supreme Court, suggested Koh – then a professor at Yale Law School – “can moderate these conflicts by applying more consistently the transnationalist approach to judicial interpretation” that he espouses.

Translation: Transnational law may sometimes trump the established interpretation of the First Amendment. This is the clear meaning of Koh’s writings, although he implied otherwise during his Senate confirmation hearing.

In my view, Obama should not take even a small step down the road toward bartering away our free-speech rights for the sake of international consensus. “Criticism of religion is the very measure of the guarantee of free speech,” as Jonathan Turley, a professor at George Washington University Law School, wrote in an October 19 USA Today op-ed.

Even European nations with much weaker free-speech traditions than ours were reportedly dismayed by the American cave-in to Islamic nations on “racial and religious stereotyping” and the rest.

Read the whole thing.

Curbing Free Trade to Save It

In the latest example of “We had to burn the village to save it” logic, Sen. Sherrod Brown (D-OH) argues in a letter in the Washington Post this morning that the way to “support more trade” in the future is to raise barriers to trade today.

Brown criticizes Post columnist George Will for criticizing President Obama for imposing new tariffs on imported tires from China. Like President Obama himself, Brown claims that by invoking the Section 421 safeguard, the president was merely “enforcing” the trade laws that China agreed to but has failed to follow. He scolds advocates of trade for talking about the “rule of law” but failing to enforce it when it comes to trade agreements. Brown concludes, “If America is ever to support more trade, its people need to know that the rules will be enforced. And Mr. Obama did exactly that.”

Nothing in U.S. trade law required President Obama to impose tariffs on imported Chinese tires. As my colleague Dan Ikenson explained in a recent Free Trade Bulletin, Section 421 allows private parties to petition the U.S. government for protection if rising imports from China have caused or just threaten to cause “market disruption” to domestic producers. If the U.S. International Trade Commission recommends tariff relief, the president can decide to impose tariffs, or not.

The law allows the president to refrain from imposing tariffs if he finds they are “not in the national economic interest of the United States or … would cause serious harm to the national security of the United States.”

As I argue at length in my new Cato book Mad about Trade, trade barriers invariably damage our national economic interests and weaken our national security, and the tire tariffs are no exception. If the president had followed the letter and spirit of the law, he would have rejected the tariff.

And since when is causing “market disruption” something to be punished by law? Isn’t that what capitalism and market competition are all about? New competitors and new products are constantly disrupting markets, to the discomfort of entrenched producers but to the great benefit of the general public and the economy as a whole.

Human beings once widely practiced an economic system that minimized market disruption. It was called feudalism.

C/P Mad About Trade