Trade War

Dick "The Retaliator" Gaphardt vs. "Sir" Winston Churchill in a 10-round battle to the death over protectionism.

The bellicose language in the debate on trade has changed little in the past 90 years.

In 1902, William Humble Ward, the Earl of Dudley, wrote to his friend Winston Churchill, “Free trade notwithstanding, we are gradually but surely being beaten [in world markets], and the defenseless position that our present system leaves us in, makes us powerless to arrest the downward tendency. A commercial war is being hotly waged against us and yet because we are cowards we refuse to avail ourselves of arms to combat our enemies. We are afraid of the temporary consequences of touching our free-trade policy and we therefore allow our enemies to ravage our territories unchecked.”

Echoing Ward, Rep. Richard Gephardt (D-Mo.) proclaimed in a 1989 speech, “Our past reluctance to use retaliation has left us without a credible deterrent. The limited and judicious use of retaliation will keep our trading partners convinced that we mean business. Too many analysts have reacted to a raised voice at the bargaining table as if it were the last step before a trade war. If we adopted that same posture across the board we would have lost out long ago.”

Now as then, those who oppose free trade claim they are for “fair trade.” Many deny being protectionists and claim their calls for “retaliation” are really meant to further free trade by opening foreign markets.

As today’s most prominent protectionist, Gephardt claims to want only to protect American industry from “unfair” competition: “We must forge a new trade policy that guarantees to our workers and business that if they make a good product at a competitive price, they will have the opportunity to sell it in foreign markets as freely as we allow those countries to sell their products in our markets. We must have free and fair trade.”

Free traders, on the other hand, have long had the welfare of consumers at the core of their beliefs and rejected nationalistic slogans about foreigners “taking advantage of us.”

“Our free-trade plan is quite simple. We say that every [citizen] shall have the right to buy whatever he wants, wherever he chooses, at his own good pleasure, without restriction or discouragement from the State. That is our plan .... In pursuit of this simple plan there came last year into [our country], from every land and people under the sun, millions’ worth of merchandise, so marvelously varied in its character that a whole volume could scarcely describe it. Why did it come? Was it to crush us, or to conquer us, or to starve us, or was it to nourish and enrich our country? It is a sober fact that every single item, however inconsiderable, in all that vast catalogue of commodities came to our shores because some [citizen] desired it, paid for it, and meant to turn it to his comfort or his profit.”

 These words were spoken by a 28-year-old politician and war hero, a journalist and best-selling author of five books, son of a prominent New York socialite, grandson of the founder of the Rochester Democrat and Chronicle, self-educated in economics, and, at the time, a first-term legislator. The year was 1903. The country was Great Britain, and the speaker was Winston Churchill.

At the time, Great Britain was the world’s preeminent economic power. Although its economy continued to grow, the economies of the United States and Germany were growing faster. As a result, Britain’s share of world industrial production and world manufactured exports decreased, and the share of the United States and Germany increased. In other words, Great Britain’s economic position at the turn of the century was strikingly similar to that of the United States today. And, then as now, many politicians blamed free trade.

So why not let Gephardt speak for himself and bring back that young free trader Winston Churchill to oppose him in a debate on free trade?

At first glance, Gephardt has the advantage. In the prime of his career, the former Eagle Scout has run once for his party’s nomination for president and finished first in the Iowa caucus. He is the majority leader of the US. House of Representatives and is recognized as the chief spokesman for severe retaliatory tariffs and quotas against our trading partners. Widely respected by his congressional colleagues, he is still prominently mentioned as a future president.

By contrast, Churchill was only in his first term in Parliament in 1903. While his political career looked promising and he had achieved notoriety at an early age through his books and career as a journalist-including a daring escape from a Boer prison camp in South Africa—he was best known as the son of Lord Randolph Churchill, who had served briefly as Chancellor of the Exchequer and Leader of the House of Commons in 1886.

In 1904, Churchill resigned from the Conservative Party of his father and “crossed the floor” to join the Liberal Party. He switched parties because the Conservatives had abandoned their commitment to free trade. Leaving the Conservative Party hurt Churchill’s reputation. As C.P. Snow observed in his biographical essay on Churchill in Variety ofMen, “He entered Parliament at the age of twenty-seven, and within a remarkably short space of time became the most-hated politician in the country, with the honorable exception of Lloyd George.”

Gephardt’s views on protectionism and free trade are well-known from his presidential campaign, interviews, and speeches. But despite all evidence to the contrary, Gephardt rejects the “protectionist” label. He made this clear in a January 1988 interview with David Frost.

Q: “Isn’t your trade amendment a form of protectionism?”

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