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Suicide by Free Trade

They are calling it “the jobs issue.” For 43 straight months, manufacturing jobs have disappeared. One in six has vanished since Bush took his oath. Now Americans are alarmed over reports of the outsourcing of white-collar jobs. It is an issue on which the presidential election could turn.

And what has been the response of the candidates? Kerry is denouncing executives who move plants overseas as “Benedict Arnold CEOs,” and Bush is echoing his father’s rants against “isolationism and protectionism.”

“Some politicians in Washington want to build a wall around the country and to isolate America from the rest of the world,” said Bush in Ohio. “The old policy of economic isolationism is a recipe for economic disaster. America has moved beyond that tired defeatist mindset …”

Both candidates and both parties seem clueless about what is going on and what to do about it. For Bush Republicans and Kerry Democrats both backed NAFTA, GATT, the WTO, and MFN for China.

There is this difference, however. Republicans are principled free traders, while the Democratic Party, as a wag put it a while ago, is simply a gathering of warring tribes that have come together in the anticipation of common plunder. Democrats worship power. They will do what they must to get it. Thus they have begun to drop the free-trade mantra and play to the populism of the people. And they have tapped into the public mood. USA Today cites a University of Maryland poll that reveals that, “among Americans making more than $100,000 a year, support for actively promoting free trade collapsed from 57 percent to less than half that, 28 percent.” This is the first time this has happened.

If President Bush is going to spend eight months as a traveling salesman for free trade and a crusader against “protectionism,” as his father did, he is inviting the same result his father got.

An opportunist is to be preferred to an ideologue who will not entertain the idea he may be wrong and that the philosophy in which he was schooled and devoutly believes may be irrelevant to the new era. Like companies that continue to make products no one wants to buy anymore, parties that persist in policies that are visibly failing—like LBJ in Vietnam—end up being abandoned.

If the GOP persists in this free-trade fanaticism, it is courting suicide. For the policy is not working in the eyes of the people. And if Republicans insist the returns from global free trade—a disintegrating dollar and a merchandise trade deficit of $550 billion a year and rising—are good for America, folks are going to conclude that Republicans are too out of it to govern.

Given that the GOP today controls both Houses of Congress and the White House, this may sound alarmist. Yet GOP dominance today does not approach what it was in the 1920s under Harding, Coolidge, and Hoover, before the wipeout.

If the GOP does not offer ideas to halt the de-industrialization of America and the hemorrhaging of blue- and white-collar jobs, it is going to wind up on a landfill.

The problem with the columnists and think-tank scribblers who make up the intelligentsia of the GOP is not that they believe in free markets but that they worship them. They believe that if NAFTA, GATT, the WTO, and MFN for China mean production goes overseas, the market is telling us where production ought to be. And the voice of the market is to be obeyed, because that is the voice of their god.

When Reagan, a devout free trader, saw the U.S. auto industry sinking, he did not let ideology interfere with a rescue. He imposed quotas on imported Japanese cars and saved Detroit, though he was denounced for apostasy and heresy.

Free-trade Republicans are like militant Christian Scientists who prefer to let patients die rather than call in a doctor—which is fine, as long as you’re not the patient.

Americans believe that the interests of U.S. workers and their families come ahead of what may be good or best for the Global Economy. For years they have seen industrial jobs disappear. Now white-collar jobs are being outsourced. They want to know what Bush and the Republicans are going to do about it.

If the president’s answer is to echo his father and denounce opponents as “isolationists and protectionists,” he risks ending up like his father, a one-term president. Indeed, if the issue is jobs, Republicans ought to be thrown out. For not only are they not creating them, they have no idea how to stop exporting them. In their hearts, some of them think it a good thing. They are like the doctors of old who sincerely believed bleeding the patient was the way to get rid of the disease because that is what their textbooks and wise men told them.

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