Donald Trump

Joint Address: On Fair Trade vs. Free Trade, President Trump Sounds Like a College Leftist

Trump has destroyed the GOP's advantage on economics.

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Trump
Douliery Olivier/Sipa USA USA/Newscom

When I was a college student at the University of Michigan (a mere 10 years ago), fair trade was a talking point deployed by leftists who hated capitalism and free markets. Today, fair trade is the official position of the Republican president.

"I believe strongly in free trade but it also has to be FAIR TRADE," said President Trump in his remarks to a special joint session of Congress Tuesday night.

His remarks stressed one key theme above all others: the U.S. must enact a form of robust economic protectionism that is directly at odds with everything the Republican Party supposedly believed for the last 40 years.

"Currently, when we ship products out of America, many other countries make us pay very high tariffs and taxes, but when foreign companies ship their products into America, we charge them almost nothing," said Trump—signaling that he would like to even the playing field.

Trump cited President Lincoln, not in service of racial harmony, or civil rights, or even national unity, but on trade.

"The first Republican President, Abraham Lincoln, warned that the 'abandonment of the protective policy by the American Government [will] produce want and ruin among our people,'" said Trump. "Lincoln was right—and it is time we heeded his words. I am not going to let America and its great companies and workers, be taken advantage of anymore."

Lincoln had a lot of virtues, but his economic policy wasn't one of them.

Trump vowed to punish companies who try to move jobs overseas (or prevent them from doing so outright). Such a policy would not help American workers. When government prevents businesses from making decisions that benefit them, it drives up the cost of goods—and workers, like the rest of us, are ultimately consumers.

This is Economics 101. It also used to be Republican Policy 101. For decades, the GOP was the party of Milton Friedman. Now it's just the party of Donald Trump—a man whose economic views would have been warmly embraced by the University of Michigan's self-described socialists circa 2007.

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  1. What if his policies turn out to be successful? What are you guys gonna say then?

    1. Protectionism has been tried many times in many places. It has never been successful, so that’s not a serious concern. The best you can say is that it might not completely offset other pro-growth policies that Congress is able to sneak by him.

      1. That will be a hell of a surprise to Britain, the US and now China, all of whom got very rich indeed under mercantilism. I’d point out that the US was never a free trade nation until the 1930s.

        1. The argument you and MikeP2 offer is no different from the arguments leftists always argue to justify their assaults on the free market: we don’t have a free market anyway, so we’re not assaulting anything. Why don’t you inject your family and friends with the Ebola virus? After all, they’re going to die someday anyway. We’re all mortal. It doesn’t matter.

          1. So what’s your point? You seem to have none.

        2. Correction: Some got rich under mercantilism. But those countries, in general, would have gotten much richer with Free Trade.
          call your mom says — “I’d point out that the US was never a free trade nation until the 1930s”.
          Government has never promoted Free Trade. The essence of Government is to protect themselves and their cronies at everybody else’s expense. If they believed in Free Trade, we would be able to choose whether to purchase or forego their services. Don’t confuse programs misleadingly labeled as “Free Trade” to really be “Free Trade”.

      2. Protectionism is the current state of our economy….and it has been for decades.

        People seem to be under the misconception that we have “free trade”. We most certainly do not.

      3. Never worked?

        From 1816 until 1967 the United States was the most trade protected country on earth. During that time we overtook free trade Great Britain and created the jobs we have lost to free trade outsourcing. From Abraham Lincoln in 1960 to Alt Landon in 1936 every Republican presidential candidate ran on a platform promising trade protection. All who won delivered. From the election of Lincoln until our tariffs were seldom under 40 percent and on occasion toppped 50 percent. The Ivory Tower Free Trade theory says we should have had a stagnant economy with low technology, few jobs, low wages and high prices. Did not happen. None of it! We were a world leader in technology, grew many jobs with high wages and saw prices decline.

        Otto von Bismarck tried free trade to build Germany only to see it fail. He then adopted tariff protection and turned Germany into a world class economy.

        Great Britain used trade protection to become wealthy then adopted free trade. After suffering a hundred years of the harm of free trade there citizens went socialist. China, which had free trade forced on them by Great Britain after the Opium Wars, went communist.

        In the real world free trade always harms citizens to the benefit of elites. Today we have more free trade than we have ever had. Where is the prosperity the Ivory Tower theory of free trade promised? If the manifold blessing promised had been real instead of an illusion Trump would never have been elected.

    2. It depends upon your measure of success.
      – if consumers have more choices for purchase at lower cost then that would be a success
      – if consumers have to pay more to cover tariffs or overpay Americans just to “balance trade” then that’s a failure

      1. It’s pretty obvious which is going to happen. Obvious to those who paid attention in Econ 101 beyond just passing the final.

        1. This is so far beyond Econ 101, that that kind of comment simple demonstrates the commenter’s lack of understanding.

          Nothing is obvious. Almost all “free trade” theory discussed on Reason is based on hard currency. We have had a grossly distorted fiat currency for decades. It is impossible to use classical “free trade” arguments in a fiat system filled with currency manipulation. Comparable valuation of two fiat currencies (yuan versus dollar) is a far larger factor in trade than typical tariffs.

          1. Feel Free, Mike, to explain to us how a country can manipulate their currency to give themselves advantage over their freely purchasing customers.

            1. Touche’ ! And I won’t hold MY breath waiting for his answer…. 🙂

    3. How much are you willing to bet that he’s right on this? What are you going to say if they’re not successful?

      1. How much are YOU willing to bet? Dollars to bolivares?

    4. “What if his policies turn out to be successful? What are you guys gonna say then?”

      Yeah, when Maduro turns Venezuela into a workers’ paradise, we’ll all eat our words.
      You think reality is optional? When the policies lead to the oh, so predictable results, are you going to come up with one more excuse?

    5. Me and the North Koreans will be waiting for that day.

    6. What if central planning works THIS time? Huh, Libertarians? Then what??????

      1. Well, then we’ll say “there’s a First Time for just about Everything, eh?”

    7. That Utilitarian arguments can be used to justify most anything.

  2. His remarks stressed one key theme above all others: the U.S. must enact a form of robust economic protectionism that is directly at odds with everything the Republican Party supposedly believed for the last 40 years.

    What the hell are you talking about? Where would you get the idea that Republicans believed in free trade since the last century?

    1. For decades, the GOP was the party of Milton Friedman.

      LOL Now you’re just spouting pure fiction.

    2. Well, that was the party line anyhow. We now see just how much they meant it.

    3. The GOP is the party of less more government.

  3. Needed more Ivanka.

  4. God help us with what president he looks up to on civil rights.

    1. Maybe he’ll look up to Obama!

  5. What can you expect from Trump when even his economic advisor, Navarro, believes this crap? If free trade is bad, explain Hong Kong. Explain Singapore. Explain Switzerland.

    Even Democrats are free traders compared to Trump.

    1. The progs arent. The more normal dems arent for free trade…they are for crony trade

    2. The progs arent. The more normal dems arent for free trade…they are for crony trade

    3. DemocRATS are hopped up on free trade coffee. It has more caffeine than that shitty sustainable stuff.

    4. I’d suggest you should have payed more attention to History 101. If mercantilism is bad, explain Britain, the US and China.

      1. I’m sure you’ll be ready to tell me how I’m wrong, but my understanding is that the countries that flourished in the late 1800’s and early 1900’s had more do to with access to valuable resources and the willingness to aggressively use those resources than it did embracing any particular economic doctrine.

      2. What’s to explain? It would be like saying that because a guy was successful with two missing fingers, those missing fingers made him successful.
        Britain, the US, and China, would all have been far more successful with Free Trade. They didn’t practice Free Trade because Leaders and their pals prosper more under Mercantilism at the detriment of the rest of their citizens.

  6. I listened to almost all of President Trump’s first address to Congress.

    1. Charles, you either have amazing self-control or you are a masochist.

      1. Or drunk.

        1. Clearly, I am myself.

  7. So he directly referenced protectionism.

    Great.

  8. “Trump has destroyed the GOP’s advantage on economics”

    Presumes they had an advantage. I’m a fan of free trade, but lets not kid ourselves: Rent Seeking, bailouts for industries, and the threat of tariffs have always had as much popularity with the public as Free Trade, and open market competition.

    As for everything else.

    So far he’s indicated his administration is going to be terrible on drug policy, criminal justice, and trade.

    But he’ll be decent on regulatory policy, education, and taxes

    Sigh. You know if he would just reign in that jackass he picked for AG and he just cut regulations and got out of the way of businesses and their decision making, he could be one of our better Presidents.

    1. “Sigh. You know if he would just reign in that jackass he picked for AG and he just cut regulations and got out of the way of businesses and their decision making, he could be one of our better Presidents.”

      Given the constant press TDS and the strong possibility that congress isn’t gonna rubber-stamp, we still have some hope.
      But then we’re dealing with a politico…

  9. Given the constant press TDS

    Sevo: YOU’RE DREAMY, MR. PRESIDENT!

    1. Stop projecting your Obama Mandingo fantasies onto Sevo, d00d.

    2. Turd:
      “I’M A LEFTY IGNORAMUS WITHOOUT A CLUE!”
      Sorry, turd, I do not defend Trump; I call lying assholes like you on your constant bullshit.

  10. Trump says that “many other countries make us pay a high tariff”. But who is actually paying the tariff? It’s the people who live in those countries. The US isn’t paying anything. The only time US citizens actually pay anything is when our government puts tariffs on goods coming in from other countries. Then we pay extra for them.

    1. It’s far more complex than that.

    2. Is that an actual direct quote? If so then his verbiage was improper. The issue of foreign tariffs is not what we pay, it is what it costs us.

      Plainly stated, absent the tariff would the US manufacturer be selling more in that other country. If the answer is yes, then the tariff costs us additional sales, with corresponding loss of productivity.

  11. So this prove Trump is an early 90s Democrat, just like we all knew. It’s a sad state of affairs, but an early 90s Democrat is a far sight more conservative than the current left. (and Rico, you know his FAIR trade isn’t the same as FAIR trade Coffee or the like, but go on conflating terms)

  12. Robby has a talent for click-bait headlines to articles that invariably disappoint.

    1. Thanks, jofik… I was waiting for that…

      Congratulations…

      http://www.plusaf.com/homepage…..-badge.jpg

  13. For decades, the GOP was the party of Milton Friedman.

    What freaking planet are you on?

  14. “I believe strongly in free trade but it also has to be FAIR TRADE,” said President Trump in his remarks to a special joint session of Congress Tuesday night.

    Okay, that makes sense–as long as you don’t immediately assume that leftists own the words ‘fair’ and ‘trade’.

    But what does he mean?

    “Currently, when we ship products out of America, many other countries make us pay very high tariffs and taxes, but when foreign companies ship their products into America, we charge them almost nothing,” said Trump?signaling that he would like to even the playing field.

    He wants to protect American interests.. Okay. So how do you do that within this framework of ‘free and fair trade’?

    Do you create “Free’ trade agreements that contain endless rules and regulations designed to help causes more than commerce? No.

    You do something simple like–‘You don’t tariff US, we don’t tariff YOU’. Free AND fair.

    Leftists masquerading as libertarians seem to believe that the US starts any trade negotiation with an unfair advantage and must, therefore, enter into ‘free’ trade agreements that glamper the US to the benefit of their trading ‘partners’.

    Any attempt to throw of these handicaps must be resisted.

    1. Rico’s entire premise rests on concern for what Trump might do to the state of the Republican party.

      Make of that what you will.

      1. Also note which authors are leading the Reason response to Trump’s first address to Congress.

        Make of that what you will.

        1. So once again…it is the messenger not the message.?

    2. Not even a nice try. It clearly isn’t the leftist masquerading as anybody else and also clearly believe no such thing as the US starting out with any imagined unfair advantage. The so-called free-trade agreements are creatures of the rent-seeking right that are not free trade agreements at all but in fact seek to codify American monopoly and intellectual property advantages that even Australia had let it be known…would never pass their legislature.

      The entire concept of free trade agreements, so-called is for American designers to be able to completely abandon the American work force in exchange for oppressed or in fact, a virtually enslaved workforce,to manufacture and assemble their products to then import back into the US…duty free.and even then…report the profits in Ireland. Isn’t that precious?

      Yes, the c a u s e of trade agreements is the problem. The cause of higher profits at the expense of the American labor force whose impoverishment of the last for 40 years is directly tied to the doubling and in some cases…tripling of corporate profits over that same time and the obvious cause of a very long term bull market in the DOW.

      1. And here we have an actual college leftist in the wild!

        Note the profuse screen of bullshit. It’s probably scented a rival.

        Soon, it will bloviate and puff itself up to hide it’s stench.

    3. How about This as a Bottom Line…?

      Protective Import Tariffs, which is what this is really all about, are blatant admissions that the country’s OWN manufacturers and service suppliers are too fucking incompetent to compete with anyone without those “protections.”

      … Whether it’s US, China, Japan, China, Russia or any other country on this planet.

      Testimony to incompetence.
      Bottom line.

      And I use the same ‘argument’ with anyone who says “the Jews are Running The World…”
      If 4% of the world’s population can control it so well, all that tells Me is that the other 96% are too fucking incompetent to compete…

  15. Hmmm… Fair Trade Warrior – sounds suspiciously like a Social Justice Warrior – after all, what could be more social than fairness?

    1. Well of course and the last thing we all want…is social justice.

    2. Anyone who uses the word “Fair” without first defining it in their own words is trying to manipulate you.

    3. Anyone who uses the word “Fair” without first defining it in their own words is trying to manipulate you.

      1. … and I HATE user interfaces that won’t let me delete accidental double-posts, too.

  16. B.S. article. Reason used to be one of my subscriptions as a Libertarian, but I find the narratives put out in the publication to be increasingly leftist instead of objective. I gave up on the Republican party many years ago as not hewing to the Constitution of our Republic and registered as Libertarian. I do not regret that but find that many compatriots have unrealistic views of what our constitution represents. Reason magazine has changed a great deal over the years, and I do not find it for the better.

    1. …..and just what does our constitution ‘represent ?’ A vastly over-empowered minority of 1% rent-seekers pulling the strings of our enriched plutocracy, ‘spending’ all of that free speech they have in the bank, making billion$ more in free speech ? Where in the constitution does it say property (money) is speech ? Where in the constitution is congress allowed to transfer the power and supply of the currency to something called a federal bank ? Where in the constitution does it say corporations are people and endowed with any rights beyond association and property rights ?
      Nowhere are any of these ‘rights’ found in our constitution.

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  18. You mean, the advantage the GOP had from 1/20/09 to 1/20/17?
    Oops!

  19. Our founding fathers enacted many high tariffs and with the approval of even Hamilton because they knew America had a very young industrial and agricultural industries and couldn’t compete with countries with much more established economies.

    Never mind that Lincoln still felt the same in the 1860’s and was correct as exemplified by the new industrial base that didn’t exist until following the civil war even though he mourned and criticized the ‘enshrining’ of something called the corporation. Something else our founding fathers hated and was as mush the catalyst for revolution as any other single factor.

    Given that the corporation was much more highly regulated back then, the right of today are not original economic conservatives at all or the progressives they once were and as late as the 1930’s. The right of today has become nothing more than the power hungry, rent-seekers they continually show themselves to be.

    1. …and there we are, right on cue, full bloviation.

      But will it disguise the stench enough that the rival will accept it as part of the herd?

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  21. urrently, when we ship products out of America, many other countries make us pay very high tariffs and taxes, but when foreign companies ship their products into America, we charge them almost nothing,” said Trump?signaling that he would like to even the playing field.

    Trump cited President Lincoln, not in service of racial harmony, or civil rights, or even national unity, but on trade.
    ???? ?? 10 ??????? ?? ??????
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    “The first Republican President, Abraham Lincoln, warned that the ‘abandonment of the protective policy by the American Government [will] produce want and ruin among our people,'” said Trump. “Lincoln was right?and it is time we heeded his words. I am not going to let America and its great companies and workers, be taken advantage of anymore.”

  22. “The first Republican President, Abraham Lincoln, warned that the ‘abandonment of the protective policy by the American Government [will] produce want and ruin among ???? ?? 10 ????? ?????
    ???? ?? ?? ??????? ????? our people,'” said Trump. “Lincoln was right?and it is time we heeded his words. I am not going to let America and its great companies and workers, be taken advantage of anymore.”

  23. For the last time “Reason”, NAFTA isn’t “free trade” it is crony capitalist trade, all the big, politically connected companies benefit from it. That isn’t libertarian, no matter how much you dice it, quit defending statists.

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