A New Track for U.S. Trade Policy

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For over six decades, free traders in this country have pursuedtrade liberalization through a strategy of diversion andappeasement: diverting attention away from opening the U.S. marketby focusing on exports and foreign policy goals, and appeasingprotectionists at home with "fair trade" policies in the hope ofpreventing even worse import barriers. That strategy achievedconsiderable success: it shifted the basic orientation of U.S.trade policy away from protectionism and toward gradualliberalization.

But the diversion-and-appeasement strategy is no longer workingwell. With the end of the Cold War, free traders have lost theirforeign policy trump card. Meanwhile, the advance of economicglobalization means that trade policy is no longer an insider'sgame; international economic issues now arouse popular passionsthat the old approach was never designed to address. In this newenvironment, continued reliance on diversion and appeasement hasactually become self-defeating. By refusing to challenge (and evenendorsing) the mercantilist and fair trade fallacies of theiropponents, free traders are helping to perpetuate a politicalculture that is hostile to their own agenda. The rising tide of"globalphobia" in the midst of unrivalled prosperity demonstratesthat free traders are doing something wrong.

It is time for a change of strategy. Free traders need to takeprotectionist misconceptions and special interests head-on, and tomake an unapologetic case for international free markets. This newapproach is not merely rhetorical; it is programmatic as well. Freetraders should expand beyond their traditionally exclusive relianceon negotiated liberalization and launch a campaign for theunilateral elimination of specific U.S. trade barriers. At the sametime, they should develop a new model for trade negotiations inwhich commitment to free-trade principles replaces the old dogma ofreciprocity.

Brink Lindsey

Brink Lindsey is a senior fellow at the Cato Institute and director of its Center for Trade Policy Studies.