Free Trade: the Real Issue

I have seen a lot of criticisms of anti-globalization efforts and attempts to block new free trade agreements. The most recent example is President Bush’s reaction to the Democrats’ opposition to the Colombian free trade pact. Bush said the “need for this agreement is too urgent; the stakes for our national security are too high to allow this year to end without a vote.”(1) The president places such a high priority on free trade that it would seem the future of the country depends on it. He is not alone. Many economists, perhaps the majority, believe in free trade as a means of opening up the world’s markets and bringing new products to consumers.

Critics of those who oppose such agreements are called “protectionist”. In the common economic view, free trade opponents wish to protect the jobs and wages of the country’s workers. Foreign workers who accept lower wages can produce products much cheaper than American workers, which results in an exodus of American jobs to plants overseas. That argument may apply to some opponents of free trade pacts, but it misses the core argument, and amounts to a straw man.

The real problem with opening rich American markets to unfettered trade is that it encourages behavior in other countries that is harmful to workers and families. In the United States we have outlawed child labor, unsafe work conditions, and sweatshops. Our labor unions have gained such basic benefits as the weekend, health benefits, and reasonable working hours. These advances have afforded us a standard of living that allows us to purchase foreign products. It was not always so. A survey of the pre-Progressive, laissez-faire era shows us how far we have come. Workers in third world countries have none of these benefits. Not only are they without basic benefits and safe working conditions, they are being systematically denied the opportunity to negotiate improvements. Opening America’s markets to the products of their countries has had predictable results. The rich industry owners want to tap into the new market while keeping costs low, thus lining their own pockets and denying their workers the benefits of the new wealth.

Both Democratic candidates Hillary Clinton and Barack Obama have similar responses to the Colombian free trade agreement. Both agree that there should be no free trade deal with Colombia until violence against union organizers ends. Unions would allow workers to negotiate with the robber barons on a more even playing field. The middle class in America was expanded by collective bargaining and the better wages it produced, and the same could be done in Colombia and other countries seeking trade with the United States and Europe. The violence against union organizers reflects the interests of the moneyed class.

The economists may argue that it still comes down to American jobs. Without unions or government regulation, foreign industries have an unfair advantage against American industries. The loss of American jobs to foreign firms is a result of free trade, but it is unfair to accuse opponents of being disingenuous. A humanitarian seeking to improve the lives of people around the world must confront the problems created by market forces between rich consumer countries and poor producer countries. The loss of American jobs is very important to American workers, but the desired solution is not protectionism, but the improvement of conditions for foreign workers. The progressive answer to free trade is fair trade.

If you are an ardent free-trader, you may resort to old laissez-faire arguments that inequality in poor producer countries isn’t so bad. Children are taken away from the drudgery of work in the fields, where they must live on their own labor. Instead of that rough life, they work in a factory where conditions are not necessarily safe, but at least they earn a minimal wage. This hardly satisfies the humanitarian, who looks at that child’s future and sees little hope. Those children should be in school, where they can learn skills that they can use to better their lives. We expect nothing less for American kids. Are third world children any less valuable? Confining them to sweatshops denies them of more than humane treatment in the present; it robs them of a better future. It is specious to argue that workers are better off under the robber barons than they otherwise would be. It is akin to choosing the frying pan or the fire.

I think the Democrats’ approach is the correct one. Instead of protection, opponents of exploitive trade should seek fairness. Capitalism is a powerful tool for human betterment and prosperity. Our goal as progressives is to make sure that as many people as possible receive the benefits of capitalism. That will not happen if we reward countries that exploit workers and refuse to allow unions to level the playing field.

© 2008 Bryan Lower

Feedback: