2016 Democratic Convention

Protectionism Runs Rampant at DNC. And, Sadly, at RNC.

Sen. Bob Casey's empty gotcha on Donald Trump's business practices betray a lack of thought on trade issues.

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So here's Sen. Bob Casey (D-Pa.) tweet after speaking at the Democratic National Convention in Philadelphia. It sums up a lot of what's wrong with the way politicians think about jobs and economic growth:

Grant Casey a bit of gotcha here. Trump has talked constantly about how he will shut down trade with countries that don't buy more from us than we do from them, how he will renegotiate trade deals to screw over countries that he says are screwing us now, how he will refuse to militarily defend countries with whom we have a trade deficit, how he will slap tariffs on Chinese goods, and more. So good on him for slamming The Donald for hypocrisy.

All of Trump's positions violate the basics of free trade and, more importantly, free-er trade. We'll never have truly free trade among nations for all sorts of reasons. The question is always one of direction—are we heading toward more, less cumbersome trade or not? NAFTA wasn't perfect, but it was better than what it replaced. That's likely true of the Trans-Pacific Partnership too, though the details are still not fully clear. Trade with foreign countries—or more precisely, with sellers and customers in foreign countries—is a good thing that grows the economy here and abroad. Contrary to what Trump (and Hillary Clinton) say, NAFTA has been good for American workers and our economy, creating 25 million jobs on net through 2008.

But we already know that Trump and Clinton, whose trade positions are indistinguishable from his, are all wrong on trade.

What I'm more interested in here is Casey's general complaint during his remarks that Trump chose to locate his production facilities overseas rather than in various cities in Pennsylvania. Apart from the politics of the current moment, we're right to ask a couple of questions. First, why should anybody not source stuff where it's cheapest, assuming that the quality is high enough for whatever they and their customers want? And second, what are you, Mr. or Ms. Politician, going to do about it? That's the real question lingering over the current mood of protectionism.

Bob Casey, Google +

On the first question, of course producers are going to move to where stuff goods and services can be made more cheaply and efficiently. They move around the United States and sometimes they leave the country together. Do any of us force ourselves to buy more-expensive, lower-quality stuff simply because it's local? Maybe, for a time, out a sense of patriotism or whatever, but that always gives way to economic reality and it should. Pennsylvania, like a lot of states in the broadly defined Northeast or industrial Midwest, has taken it on the chin when it comes to old-style manufacturing jobs because it has a cost structure that is relatively high for whatever is being produced. It's not up to purchasers of labor and things to pay more for something they can get more cheaply elsewhere. It's up to the people whose jobs are on the line to figure out how to add more value to whatever they're doing so they still have jobs. This happens all the time, by the way, and there's any number of production jobs and services that have been brought back to the United States from overseas because American workers do a better job than cheaper producers elsewhere. But Casey's general idea that somehow it's an affront to American workers that they wouldn't automatically be chosen over cheaper alternatives is exactly the problem with residents and pols in places like Rust Belt Pennsylvania and elsewhere.

Which leads to the second question: What are politicians planning to do about companies that outsource jobs? Well, we know what and on this score, Clinton and Trump sing the same song. They'll come up with various penalties and taxes to make it even more difficult to do business and turn a profit. Instead of, say, changing U.S. tax laws so that they make the country a place where all sorts of businesses want to set up shop, they will continue to try and screw companies who act in away they disapprove. They will certainly not reduce government spending and regulations in a way that allows the economy to grow, but they will instead punish those that don't get out quick enough. This isn't smart economic policy, it's the worst sort of zero-sum thinking.

Related: Here's a vid from 2009 about why "buy American" campaigns are bogus. It features another speaker from tonight's DNC, Richard Trumka of the AFL-CIO, who also bragged on how Hillary Clinton would be even more protectionist than Trump (like that's a good thing).

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22 responses to “Protectionism Runs Rampant at DNC. And, Sadly, at RNC.

  1. “whose trade positions are indistinguishable from his”

    Only Gillespie would be dumb enough to believe this.

    President Hillary will preserve the trade SQ. She has no use for inducing another Great Depression during her first term. One of the reasons she is the lesser evil.

    1. What makes you so sure she can’t unwilling induce one?

      She’s not a lesser evil. She is just plain an evil.

      1. ‘unwittingly’.

      2. First line: good point.

        Second line: wrong. She is definitively less awful than Drumpf.

      3. What makes you so sure she can’t unwittingly induce one?

        She’s going to have to do something about trade, minimum wage/income inequality, school/vocational training, affordable housing, green energy, universal healthcare… or not get re-elected and that any one of those issues could certainly trigger a Great Recession if not a depression depending on how bad she fucks it up I’d say it’s not at all outside the realm of possibility.

        Considering she’s going to fix all of those things, consequences be damned, think ‘unwittingly’ is being generous.

    2. “She has no use for inducing another Great Depression during her first term.”

      Ass is Shrill has any idea how she would do so. Only toxic is stupid enough to presume she does and then presume her finer intent.
      2X fail.

      1. Sorry:
        “As if”

      2. You’re funny when you’re incoherent. Okay not really that funny.

  2. We always find it interesting here in Pennsylvania when Casey chooses to crawl out from under his rock to show his face. Not that I mind not seeing either of the Commonwealth’s senators. The more they stay hidden and inert, the better.

    1. When he crawls out, do you get 6 more years of winter?

      1. I could deal with 6 years of winter right about now.

        #hottown

  3. Unilateral free trade is the only truly moral and sensible trade policy.

  4. OT: Someone just sent me this.

    http://theimmoralminority.blog…..talks.html

    Are they seriously focusing on Phil Robertson? I forgot that show was still on TV!

    But Bill Clinton the sexual predator and the fact the Clintons were friends with a known pedophile…well, that’s okay and no outrage.

    Progressives are vile little shits.

  5. So good on him for slamming The Donald for hypocrisy.

    Uh, what hypocrisy? Good for the Donald and good for America are two different things, I think everyone can agree.

    1. The turn of phrase “good on so-and-so” is kind of like saying “kudos”, so the author was saying “kudos to Sen Casey for slamming The Donald for hypocrisy”.

      1. Which is irrelevant to my question, which was what the hypocrisy was.

    2. Uh, what hypocrisy?

      I agree with the opposing the general stance against trade, but a libertarian specifically mentioning/criticizing a more capitalist approach to military protectionism seems just as much if not more hypocritical.

  6. Clinton’s “trade positions” on the campaign trail are pretty obviously lies. She supported NAFTA as First Lady and in her autobiography, voted for six of the seven trade deals she voted on as a Senator, and supported three trade deals as SoS (after having opposed them on the campaign trail in ’08). Given the chance to open up the Japanese market to the US with TPP, who can really imagine she won’t?

    Trump’s trade positions, however, are almost the only positions he’s been consistent on over the last 17 years. He’s gone from supporting partial-birth abortion to opposing all abortion, supporting an assault weapons ban and waiting periods to opposing both, and from unquestionably supporting Israel to neutrality. But he has always been for tearing up existing trade agreements and renegotiating.

  7. All of Trump’s positions violate the basics of free trade and, more importantly, free-er trade.

    Opening up China’s and Mexico’s markets to more American exports results in free-er trade.

    Trump wins again!

  8. Why is Reason so eager to simply repeat memes by politicians that ‘free trade’ is whatever politicians decide to call ‘free trade’. Y’all can see through the BS that the Patriot Act has nothing to do with patriotism and Affordable Care Act has nothing to do with Affordable Care. But hey – call something ‘free trade’ and Reason will fall for it every time.

    Multilateral agreements that primarily affect intracompany product transfers within multinationals are NOT ABOUT TRADE. They are about protecting financial investors of those companies – and protecting big companies from smallco competition. The only TRADE is some arms length transaction between producers and consumers – not accounting/tax games within producers.

    And overt cronyism (ie intellectual property protection or quid pro quo deals involving some sector) are obviously not about free trade at all.

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