Wednesday, October 10, 2007

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Grading out the GOP debate on trade

I didn't see the GOP debate yesterday, but looking through the transcipt, I was surprised to see trade came up as an issue.

According to the Wall Street Journal's Jackie Calmes and Amy Shatz:

{S]everal [candidates] reflected skepticism about free trade that is gaining hold in both political parties. The others, while professedly free-traders, acknowledged widespread job losses as a consequence of globalism and a public sense that trading partners, particularly China, are taking advantage of the U.S.
Looking at the transcript, I think Calmes and Shatz are overinterpreting what was said.

The fringe candidates (Hunter, Tancredo) were perfectly happy to sound protectionist. But they're not going to win, so let's skip them.

Some of the mainstream candidates (Romney, Giuliani, Huckabee) had some caveats:

Romney: "We need to make sure that the Chinese begin to float their currency and they protect our designs and our patents and our technology."

Giuliani: "I think you've got to almost separate them into two different categories. There's economic protection and then there's protection for safety, security, and legal rights. And I don't think we've done a particularly good job on the second, and we have to improve those agreements. But we can't throw out the baby with the bathwater. We can't say, because these agreements weren't perfect, because they have problems, because they have issues, we're going to turn our back on free trade."

Huckabee: "the fact is, we don't have fair trade. And that's the issue we've got to address."

The other candidates (Paul, McCain, Thompson) didn't pander at all on this question. Which, of course, means they're doomed.

So, on the whole, the only possible nominee who scared me was Huckabee. The rest of the field sounded relatively sane on the topic. And, credit where it's due, Giuliani scored the best combination of sound policy and sound politics on the issue.

Oh, one last thing -- no one let Ron Paul anywhere near the Federal Reserve.

posted by Dan on 10.10.07 at 02:47 PM


I was surprised to see trade came up as an issue

It was a debate primarily about economics, in Michigan. Why is free trade not a natural issue for that?

posted by: Shelby on 10.10.07 at 02:47 PM [permalink]

I'm sorry, about the economy -- not "economics".

posted by: Shelby on 10.10.07 at 02:47 PM [permalink]

On one level I agree with Huckabee - it's hard to see how some of our recent agreements count as FTAs. A legitimate FTA is one sentence: "My country will treat products produced overseas exactly the same as we treat products produced here." The IP-bullying of TRIPS, the countless lobbyist-induced exceptions, requirements on bank regulations, etc., are all not real trade. CAFTA, though important, was far, far away from a legitimate free trade agreement.

posted by: cure on 10.10.07 at 02:47 PM [permalink]

Cure is describing an MFN agreement, not a free trade agreement.

I do agree that the tendency to apply the label "free trade agreement" to agreements intended merely to liberalize trade can create misleading impressions of what such agreements actually do.

posted by: Zathras on 10.10.07 at 02:47 PM [permalink]

Curiously, no one really addressed the 7 year recession in Michigan, which was the reason for being in Michigan, as has been pointed out.

Oh yeah, cut taxes and blah, blah....

The GOP probably cannot win the presidency without taking either Michigan or Ohio, and both economies are still tanking (Ohio is a fraction of a percentage point out of recession now).

Even the Wall Street Journal now recognizes that the job market is hollowing and the labor force dividing to the two extremes (Wessel).

posted by: save_the_rustbelt on 10.10.07 at 02:47 PM [permalink]

Like all sane people, I too want to beat Ron Paul about the head with a copy of M. Friedman's _Monetary History_ or J.M. Keynes's _General Theory_.

On the other hand, if Ron Paul had been President, we wouldn't have gotten into this catastrophic war which you, Dr. Drezner, supported. Since this war is going to cost over $1 trillion (say it Dr. Evil style for full effect) and has also diminished our security, prestige, moral standing, and military readiness, I'd say it is a bigger deal than Rep. Paul's idiotic ideas about fiat money.

After Ron Paul ends the War on Drugs, I'm going to make my (gold) income by selling abundant quantities of opium and marijuana, while using the rest to put me out of the misery I feel when read, I dunno, Immanuel Wallerstein.

posted by: kizzle on 10.10.07 at 02:47 PM [permalink]

Ohio's economy is tanking? The GDP of the state of Ohio is equal to the continent of Australia. Don't tell the people of Delaware county or Columbus their economy is tanking--it's only the fastest growing urband and suburban area in the entire US. Michigan's economy is not tanking either. Those who have relied on gov't handouts and UAW security blankets are having a tough time, but the rest of us are doing quite well here in the state of Great Lakes & Great Times. And yes, Rusty, the state gov't was completely wrong to let the money run out in the first place and then add a bunch of new taxes to "save" us. Where's Dick Hedley when you need him?

posted by: Useless Sam Grant on 10.10.07 at 02:47 PM [permalink]

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