Free Trade Cause The Recession.....I Think Not

Friday, July 3, 2009

I would like to challenge Dave Johnson's article titled: Did Free Trade Cause The Recession. This is why more people need to study history. Here is the most important part of the article in my eyes, "I submit that nothing in this example is "traded" except that our standard of living has been traded away. And this exchange brings little benefit to the workers in the low-wage country. This is exploitative trade, not free trade, and we need to protect our workers, the workers in other countries and the world's economy by demanding that our trade partners provide living wages and benefits. We can enforce this demand by attaching import tariffs at a level that makes our own goods competitive." I made this bold not him.

Let's look at a moment in our history that Dave, (and unfortunately so many others), don't seem to know anything about. Want proof that tariffs the likes of which people who think like Dave does don't work? Fine, then read about the Smoot-Hawley Tariff Act of 1930. Once you read what this act did to America then maybe you'll see why I think Dave is out of his mind to ask for tariffs under the do-gooder intentions of protecting American workers etc. As you will read when you follow the link about this 1930 tariff you can see for yourself what it's intentions were and what the actual results were: (these stats are from the above link)

1. Such policies contributed to a drastic decline in international trade.
2. U.S. imports from Europe declined from a 1929 high of $1,334 million to just $390 million in 1932.
3. U.S. exports to Europe fell from $2,341 million in 1929 to $784 million in 1932.
4. Overall, world trade declined by some 66% between 1929 and 1934.
5. Smoot-Hawley did nothing to foster trust and cooperation among nations in either the political or economic realm during a perilous era in international relations.

We have good reason to worry about new protectionist tariffs being imposed to make America more "competitive". Consider point 5 above. Wouldn't you say we are in another "perilous era in international relations"?

When others lie it is our duty to correct. When others mislead we must take the lead. We are proud to call ourselves conservative on this website. However it is my pledge that I will always provide evidence. I will always work for what's best for America as a whole. I will not provide a perspective meant to drag us back into a left-right finger pointing shell game. My goal here is more about showing you what so many are afraid to. My goal is to show that many of the problems we face today in America are problems we have faced before. If we don't look at our problems without relating to what has worked before.....then I fear we will repeat what hasn't worked before.

This is too important for blind partisan bickering. As I find myself saying more and more lately, it's not about right and left, it's about right and wrong.


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