Saturday, January 30, 2010

Free Trade Deals Unlikely Right Now

I have written before about the importance of free trade to our economic recovery.  However the current political climate is not amenable to making trade freer.  Unemployment and labor unions are preventing any progress which ironically might hurt them in the long run.  Mark Drajem wrote an excellent article on the difficulties which you can read here.

Do you think free trade is a good idea right now and is there any way to make it more politically feasible?


  1. Nick Parrish, Skuba 1140 sectionJanuary 30, 2010 at 10:50 PM

    Promoting free trade when people are more fearful and uncertain the future than any era since the Depression is a tough sell. I believe that free trade is undoubtedly a long-term solution, but as with most things I would not endorse it to be the absolute answer. One of the major factors I believe to be fueling the paranoia is simply, misonformation. Generally speaking the populace has a skewed opinion of free-trade whether it be pro or con. Perhaps one way to persuade constituencies would be a campaign to explain the benefits of expanding trade. Second, a phased integration would be useful. Instead of signing legislation and making it an immediate change, it could be gradual. This could provide a buffer preventing domestic job loss, and simultaneously promoting competition, which usually benefits the consumer.

  2. Michael Lapidus/Skuba 11:40February 12, 2010 at 8:19 PM

    Certainly, there is a level of misinformation, but I think the greater issue is that those in favor of the legislation are not as vehement as those against it for reasons being short v long term gains.

    In the short run, those against the legislation might feel that such FTAs are significantly detrimental and disruptive enough to their operations to justify spending enormous resources both in monetary and political capital fighting the passage of such legislation.

    Those groups in favor of bills must fight a media campaign against groups claiming "American Job Loss." There is no misinformation there - jobs will be lost in the short run in certain industries. Granted, as we know, this position is skewed as FTAs do generate significantly more money and jobs in the long run. It is difficult to fight groups who claim American legislation is taking American jobs and sending them oversees. Though more money is coming into the states, people need to see tangible results. People care more about people than they do about numbers.

    As such, I do not think any informational campaign to the public will be successful. The battles over FTAs are about special interests. I do not use the term in a derogatory manner, but to illustrate that those involved in the process have very specific foci. The way to win is to work with these groups to give them enough in the short run so that they are willing to cooperate for long term legislation that is beneficial for both them and the American people.