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FREE TRADE: Benefits of dropping tariffs are a myth

Letter by William F. Johnston, Tacoma on Dec. 9, 2010 at 11:29 am with 25 Comments »
December 9, 2010 11:29 am

I was somewhat amused by your editorial (‘Congress must fast-track Korean trade pact,’ 12-9) your baseless claim it “will create American jobs.”

The fact is so-called free trade agreements have shipped 5 million good manufacturing jobs overseas to cheap labor countries.

The North American Free Trade Agreement sent American jobs to Mexico, destroyed part of the Mexican economy by fueling illegal migration and established the drug trade like never before just across the border.

These agreements are the reason we are in debt to every major nation in the world – especially China.

Just one page back from your glowing recommendation to enter yet another one of these disasters, the TNT has a article on how Sen. Maria Cantwell is fighting to get Mexico to open its market to Washington products because they have refused to carry out their end of the an agreement made in 2003.

Tariffs used to pay almost all the expenses of the federal government and other countries owed us.

Free trade” is myth. It’s time for Congress to start acting in our interests again.

Leave a comment Comments → 25
  1. aislander says:

    We’ve lost a lot of leverage due to the sorry states of our government and economy, but tariffs should be used only to assure an even playing field. Otherwise, trade SHOULD be free. I have unbounded confidence in the abilities of our businesspeople and workers to compete with anyone in the world, if they are working toward the same goals, and they aren’t trying to move the ball uphill.

  2. First_Lefty says:

    I agree, Mr. J., but what do you think China would do about our debts if we suddenly slapped them with a tariff? Not to mention how Walmart’s financial influence would cut the funding of GOP congressional races.

    Sort of like quicksand, we are already up to our chins.

  3. Wow, free trade sounds all powerful: not only did it increase unemployment in the US by sending lots of jobs to Mexico (thereby reducing Mexican unemployment), but it simultaneously increased Mexican unemployment, causing unemployed Mexican workers to come to the US looking for even more jobs. Not only that, we evidently had relatively minor drug issues until free trade came along.

    To top it all off, we didn’t have any debt problems until the free trade agreement happened. More insidious than Satan, free trade is!

    On a personal note, NAFTA came into force on 1/1/1994. Less than three years later, my grandmother died. Coincidence? I think not.

    I do want to commend Mr. Johnston, though, for not invoking Godwin’s Law. This displays remarkable growth for him, although it is possible NAFTA caused him to forget about free trade’s Nazi roots, too. I wouldn’t put it past it.

  4. sumner402 says:

    I wonder how many people know that NAFTA and free trade, globalization and all are republican pushed and backed ideas?
    At least they were until it looked like they weren’t doing as promised, then they of course became ‘leftest’ ideas.

  5. beerBoy says:

    free trade is great for international corporations and their stockholders – not so great for countries.

  6. beerBoy – the consumers take advantage of the lower priced foreign goods, resulting in having additional income to spend and invest. Isn’t that good for countries?

  7. nwcolorist says:

    High tariffs are good for those who manufacture American goods, but bad for the consumer who must pay more for them. The welfare of the majority is sacrificed for the benefit of the minority.

  8. bugme – consumption driven economies are never as good a producing based economies. America was, until supply side voodoo, had the mightiest manufacturing sector in the world. No more.

  9. I don’t see the connection you are making between free trade and consumption driven economies and producing based economies.

    How does free trade result in the former and drive out the latter?

    Is that what you are implying?

  10. We have an obligation to protect our borders. That includes tariffs.

    We didn’t have this problem when we added a meaningful tariff to all imports.

    This is the largest factor in the destruction of our economy.

  11. blakeshouse says:

    Straight out of the big labor union talking points!!!!! While we bleed dry any and all industry we can get our hands on, and make product prices skyrocket, we can’t allow industry to go where they can actually make a profit AND provide goods that people can afford. Add to that crushing regulations, corporate taxes that are the highest in the world, and the socialists who want even more to finance the nanny state from cradle to grave.

    If this socialist crap keeps up, third world nations will look like eden compared to here

  12. You expect American workers to live like their Chinese counterparts on slave wages, just so you can pay less for manufactured goods, blakeshouse?

    You wouldn’t. But then, you’re special.

  13. When unions were strong and tariffs were appropriately applied, our economy thrived, compared to now, when we’ve given away our jobs and livelihood to provide more profit for the unusually wealthy.

  14. sumner402 says:

    You expect American workers to live like their Chinese counterparts on slave wages, just so you can pay less for manufactured goods, blakeshouse?

    That is the goal of the GOP. And therefore his answer is yes.
    Has been for the last 30 years and they have brain washed people into helping them achieve that goal.
    Sadly they are getting pretty close to winning.
    But if you don’t agree with them….you are a socialist.

  15. bugme – my “implication” is based in observing what has happened to American economy in the past 30 years.

  16. aislander says:

    Polago: I recall that, on another thread, you raised the specter of Smoot-Hawley when I suggested that tariffs could be used to counter unfair trade practices by other nations. Now you are advocating for them. What changed? Are ideas worthy only when they come from the left, in you estimation?

  17. bB – I’m not sure what gives with your scare quotes. Your observation wasn’t obvious to me. Maybe I should have used the word “asserted” but my question remains, what is it about free trade that leads you to believe that it is the cause of whatever degraded state our economy is in?

    I often see your views stated by others, usually in less colorful ways than Mr. Johnston’s, but I am interested in what it is about free trade that makes it such a bogeyman to so many people.

    Maybe it is just a matter of how we each use the term “free trade”. I don’t consider big corporations getting favored treatment free trade, for example.

  18. aislander says:

    …that should have read: “…in YOUR estimation…”

  19. Your recollection is backwards, aislander. I’ve always been in favor of protecting our economy.
    Polago says:
    August 24, 2010 at 10:40 am

    “we need to become less dependent on imported manufactured goods and regain our manufacturing strength”



    aislander says:
    August 27, 2010 at 8:33 pm

    “By the way Polago, have you never heard of Smoot-Hawley and its role in prolonging the great depression? And just how are we going to control imports if the Chinese can crash what remains of our economy at the slightest provocation? We need to reduce our debt, and we can do that only slashing spending and unshackling the actual producers of wealth…”

    Hope this helps.

  20. bugme – the WTO (and other “free trade” agreements) prevent local, state and national governments from making laws that contradict those agreements (environmental, worker protection, etc) In my mind that is contrary to what makes sovereign governments sovereign.

  21. I rather agree with your point, believe it or not. If trade between two countries requires such agreements, then it is something less than free since such agreements always seem to end up picking favored companies, industries or services at the expense of others, even if the general result is freer trade.

    In that vein, as flawed as WTO was, it was a step towards less protection. Whether it was worth the price is certainly debatable, though. Tariffs are one thing, but the arguments against free trade, as you just alluded to, have a whole lot more to do with non-tariff issues than they do with tariffs.

    It seems to me that too much of the argument about free vs. fair vs. protected trade is between parties who are arguing about concepts for which they have no common definition or understanding.

    Yikes, did I just hear an argument in favor of states rights from beerBoy?

  22. aislander says:

    I remember advocating “retributive tariffs,” Polago, and you brought up Smoot-Hawley as an example of tariffs’ being counterproductive. Either you were tweaking me for being inconsistent (I wasn’t. I think tariffs can be used to battle for REAL free trade), or I am mistaking you for another poster. If it is the latter, I apologize; if it is the former, you should acknowledge it…

  23. American workers bad, lazy. and expensive.

    Foreign workers good, energetic, and cheap.

    So let’s send our jobs to overseas so the now unemployed
    American workers will have cheaper goods to buy.

  24. aislander says:

    I remember that exchange, Polago, but it seems there was another. HOW in the world did you locate that, anyway? I mean, August…

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