Obama and Clinton Threaten to Bully Our Neighbors over Trade

When they weren’t jabbing at each other over health care and Iraq, Barack Obama and Hillary Clinton spent a good chunk of their debate last night arguing over which of them is the strongest critic of the North American Free Trade Agreement. Both declared that they would withdraw the United States from the agreement if Canada and Mexico did not agree to inserting “enforceable” labor and environmental standards into the agreement.

Talk about a non-starter. It is unlikely that our two neighbors would agree to reopen a 14-year-old agreement that has worked well for all three nations. [You can read my assessment of NAFTA here.] In effect, Obama and Clinton will be asking our two neighbors to bend their national labor and environmental standards to the demands of the U.S. Congress under threat of trade sanctions. Where exactly is the upside for Canada and Mexico in such a request?

Of course, there is no upside. So the only motivation will be the threat that the United States will unilaterally withdraw from NAFTA. That, of course, would result in the re-imposition of tariffs on trade with our two most important trading partners. And because Mexican tariffs on imports from the rest of the world are significantly higher than U.S. tariffs, U.S. exporters to Mexico would face a much steeper tariff increase than Mexican exporters to the United States. By withdrawing us from NAFTA, the Democrats would transform what has truly become a “level playing field” of zero tariffs into one tilted against U.S. exporters.

And even if the U.S. government were able to demand that Mexico impose new and tougher environmental and labor restrictions on its producers, there is little reason to believe that goods now made in Mexico would be soon be produced in Youngstown, Ohio, and elsewhere in the United States. The far more likely scenario is that producers in Mexico would shift production to China, Vietnam, and other lower-cost producers.

Finally, consider the foreign policy implications of threatening to withdraw from NAFTA. The Democratic candidates have been critical of the Bush administration for its checkered record of winning friends abroad. But have the Clinton and Obama campaigns considered how our friends in Canada and Mexico will react to the heavy-handed demand that they re-write their domestic labor and environmental laws under threat of face tariff retaliation from Uncle Sam?

This would confirm the worst fears of our closest neighbors.

Cato Scholar Comments on Breakup between Bush, U.S.

A lot of my colleagues here were really excited when The Onion, to my mind America’s premier fake news source, cited the work of our colleague Dr. Adam Stogsdill recently. But now Brian Whitaker has also made it onto The Onion’s pages to comment on another important story.

WASHINGTON—Amid allegations that his thoughtless and insensitive decisions have damaged his relationship with the nation, President George W. Bush vowed Monday that he would, starting now, “make everything better.”

“This time I’m serious,” Bush said. “I am ready to make a fresh start if we can just put the past behind us. I promise.”

[…]

Despite Bush’s seemingly conciliatory stance, public response to Bush’s promises has been frosty at best. Cato Institute policy scholar Brian Whitaker echoed the sentiments of many Americans, calling Bush’s recent overtures “too little, too late.”

“We want to believe that he’s finally going to be the president we always wanted, but we’ve given him so many chances,” Whitaker said. “I don’t think we can handle another disappointment. Maybe it’s time to realize that President Bush will never be the head of state we need him to be.”

“Then again, maybe our expectations are unfair,” Whitaker added. “He seemed so sincere this time. He wouldn’t abuse his executive powers if he didn’t care about us, right?”

Whitaker predicted that the nation will likely move forward and try to forget Bush, though it may be difficult for Americans to ever trust a president again. He said the current crop of presidential contenders offers little in the way of an alternative to Bush, but maintained that “at least Barack Obama listens to us.”

Wow, congrats, Brian. A lot of folks in the building are bound to be pretty jealous today.

Donnelly on the Surge

AEI’s Thomas Donnelly writes for the Weekly Standard blog:

More moderate Democrats are increasingly adjusting to the reality that the Iraq surge has been a military success, and that it is starting to create conditions for workable political compromise in Baghdad as well as Iraq’s provinces–see, for example, the air of desperation that has seized the hard-core anti-war crowd. Yet today’s Washington Post carries an op-ed by former Clinton chief of staff John Podesta clearly intended to intimidate Democratic candidates into sticking to their withdrawal pledges no matter what happens in Iraq. The article’s headline, “A War We Must End,” is a hint of the pay-no-attention-to-the-facts nature of the argument.

Donnelly’s readers might be interested in this shocking nugget buried in a smart op-ed by Andrew Bacevich a few weeks back:

In only one respect has the surge achieved undeniable success: It has ensured that U.S. troops won’t be coming home anytime soon. This was one of the main points of the exercise in the first place. As AEI military analyst Thomas Donnelly has acknowledged with admirable candor, “part of the purpose of the surge was to redefine the Washington narrative,” thereby deflecting calls for a complete withdrawal of U.S. combat forces. Hawks who had pooh-poohed the risks of invasion now portrayed the risks of withdrawal as too awful to contemplate. But a prerequisite to perpetuating the war – and leaving it to the next president – was to get Iraq off the front pages and out of the nightly news. At least in this context, the surge qualifies as a masterstroke. From his new perch as a New York Times columnist, William Kristol has worried that feckless politicians just might “snatch defeat out of the jaws of victory.” Not to worry: The “victory” gained in recent months all but guarantees that the United States will remain caught in the jaws of Iraq for the foreseeable future.

Something to keep in mind when Donnelly and his fellow-travelers comment on the surge’s impact on the Washington narrative.

My boss Chris Preble was beating this drum weeks ago in the American Prospect.

What It Says, What It Will Say

Yesterday, the School Choice Demonstration Project (SCDP) released several reports kicking off their five-year longitudinal study of the Milwaukee Parental Choice Program (MPCP), arguably the nation’s best-known school voucher initiative.

Throughout the most important of the reports—the one establishing achievement levels for voucher students and socio-economically similar Milwaukee public school kids—the authors warn readers not to use the scores to judge schools’ effectiveness. Because it is “snapshot,” baseline data, the scores alone say nothing about how much a school teaches over time, only where students sit at a single moment.

Sadly, some in the media didn’t listen, reporting that private and public schools perform equally poorly. As education reporter Alan Borsuk wrote in the Milwaukee Journal Sentinel, “the first full-force examination since 1995 of Milwaukee’s groundbreaking school voucher program has found that students attending private schools through the program aren’t doing much better or worse than students in Milwaukee Public Schools.”

It seems some reporters just don’t read research, don’t understand it, or want to push their agenda regardless of what the research tells them.

Unfortunately, as bad as reporting on school choice is, in the end Milwaukee-style choice probably won’t have a huge effect. Sure, the voucher kids will probably learn more than comparable students in traditional public schools, as research has found over and over again, but the research has never found large advantages, and there’s nothing in current school choice programs to suggest that that will soon change. The simple fact is that even with slowly growing school choice the amount of market freedom in American education is far too small to foster real competition and innovation. The public schools are still the 800-pound guerilla and what choice we have is seriously hamstrung.

Just look at Milwaukee. It has more choice than almost any other district in the United States, but has only about 17,000 students in its voucher program and 16,000 in its charter schools, constituting just about 28 percent of the city’s roughly 120,000 school-aged kids. Making matters worse, within those systems freedom is heavily curtailed. Charter schools are only given their right to exist by public authorities, their enrollments must be racially balanced, and they can’t deny admission for academic reasons. Similarly, the MPCP forbids parents from supplementing vouchers with their own funds, is open only to low-income children, and requires participating schools to admit all choice students for whom they have seats.

School choice in Milwaukee is light-years from the free-market at work, and though it’s better than no choice at all, it will likely make some news stories today come close to fitting the facts tomorrow.

The Politics of Freedom: Libertarianism with Sizzle

Brian Doherty, the author of the magisterial Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement, has some generous things to say about my new book The Politics of Freedom in Sunday’s New York Post. I especially like the subtitle in the reason.com version: “sells the libertarian message with sizzle.”

Brian discusses my claims about the extent of libertarianism among American voters and writes:

Whatever the near-term prospects for libertarian political victories, The Politics of Freedom reminds you of the service libertarians provide to public discourse: They can point out the hypocrisy, power grabs, hubris and counterproductive folly issuing from Washington under either political brand name since they are beholden to neither. …

No major political party has fully embraced the implications of the proper role of government that follow from Boaz’s simple limited-government vision. But when expressed that plainly, it’s a moral vision many Americans can cheer.

The Politics of Freedom is available at all fine bookstores, at Amazon, and from the Cato Institute.

The Laffer Curve: Reviewing the Evidence

I’ve been pleasantly surprised by the number of views and the positive feedback for the free-market tax videos I’ve been narrating. Part I of the Laffer Curve video series already has been seen more that 14,000 times - and nearly 15,000 times if the Capital Hill Broadcast Network is added to the count.

Part II of the Laffer Curve video series is now available for your viewing pleasure. Building on the theoretical discussion in Part I, this new video reviews some of the real-world evidence on the Laffer Curve.

As always, I’m interested in feedback. And feel free to circulate any of these videos to friends and colleagues. It seems that success begets success on youtube. More people watch a video if they see other people have watched it. And since, as of this morning, the Part II video is #49 for today’s most-watched list in the News & Politics category, it’s encouraging that it is getting some attention.

Demander-in-Chief

Bill Kristol’s column in yesterday’s New York Times contained an interesting, if disconcerting, quote from Michelle Obama:

Barack Obama … is going to demand that you shed your cynicism… That you push yourselves to be better. And that you engage. Barack will never allow you to go back to your lives as usual, uninvolved, uninformed.

The President of the United States is the employee of the American people. He is not there to make demands of people. If I want to sit on my couch for the rest of my life eating Doritos and watching trashy television – unengaged, uninformed and uninvolved – that’s my prerogative.

(Hat tip: our beloved founder, Ed Crane).