Posts Tagged ‘election’


Special mention

185863 185847_600


Late last month, I argued Donald Trump doesn’t know what he’s talking about when it comes to international trade. But his attacks on free trade are in fact resonating among working-class voters. That, and the fact that the polls show the presidential election much closer in recent weeks than anyone expected, has finally made others sit up and take notice.

And now we’re witnessing the free-trade, anti-Trump backlash.

Thomas B. Edsall cites the same Peter Goodman article I did last week, which included this astute observation:

Across much of the industrialized world, an outsize share of the winnings has been harvested by people with advanced degrees, stock options and the need for accountants. Ordinary laborers have borne the costs and suffered from joblessness and deepening economic anxiety.

But then Edsall goes all in with the mainstream economists who, as part of their unchanging mantra, celebrate free international trade.* He cites, as one example, Erik Brynjolfsson, an economist at M.I.T.’s Sloan School of Management:

No nation can succeed by trying to protect the past from the future. We will succeed by having the confidence to embrace competition, and leveraging our comparative strengths, which are numerous. We have the largest, most productive and most technologically advanced economy that’s ever existed on this planet. The more open the world economy is, the more we have an opportunity to leverage our many strengths.

My sense is that mainstream economists are doubling down on their free-trade argument, forgetting about the “ordinary laborers [who] have borne the costs and suffered from joblessness and deepening economic anxiety,” for two major reasons.

First, they fervently believe in free trade, because their models are designed to ignore the unequal costs and benefits of international trade. That is, the “gains from trade” that supposedly accrue to everyone are literally baked into their models. And they’re afraid to admit that some gain, and many others lose, under existing international trade regimes and agreements. They’re afraid because admitting the unequal outcomes opens the door to intervening and creating patterns of trade that might actually help workers and other losers within the current arrangements. They’re also fearful of incurring the wrath of other mainstream economists, who attack any exceptions to the free-trade mantra with a vengeance (as even Paul Samuelson discovered).

Second, mainstream economists are doubling down on their defense of free trade because they’re willing to say anything and everything to attack Trump. Just the fact that Trump has had the temerity of criticizing free-trade agreements, such as the North American Free Trade Agreement and the Trans-Pacific Partnership, thereby creating (in the eyes of mainstream economists) the specter of protectionism, has led them to cast aside all caution and reinforce their uncritical support for free trade. (Edsall even invokes the long-discredited idea that the Smoot-Hawley Tariff Act was “one of the principle causes” of the first Great Depression to make the case.) But, of course, in their determination to oppose the Republican candidate, mainstream economists also dismiss the indignities and injuries many of Trump’s supporters have suffered in recent decades.**

International trade is not the only thing hurting American workers. It’s probably not even the major factor. Decades of stagnant wages, rising inequality, outsourcing, and job-displacing technological change created by their employers are, in my view, even more important. But mainstream economists’ and pundits’ all-out defense of free trade, their refusal to recognize the unequal benefits and costs of globalization, and their determined efforts to let employers completely off the hook are among the important reasons that, against all odds, Trump is only 5-6 points behind in the national polls.***


*It should come as no surprise that, according to the International Monetary Fund, the World Bank, and the World Trade Organization, the solution to the problems of international trade is. . .more trade.

**Many of Clinton’s supporters have also been harmed by U.S. economic policies, including international trade agreements.

***I wrote this post before the revelation of the 2005 Trump tape and the Wikileaks publication of the emails concerning Hillary Clinton’s speeches. Given the media coverage of the two events (plus whatever happens in the Sunday debate), my guess is the new polls will register a much larger lead for Clinton—and there will be much less discussion of international trade (or economics of any sort) in the weeks ahead.


Special mention

cuqmhlfvuaaejfz www-usnews


Special mention



Special mention

pic_cartoon_100416 20160920edloc-a


Special mention

pound_cartoon_07-05-2016_normal 727x0


Special mention

0930mikeluckovich_creators wells_fargo_cartoon_09-30-2016_normal