More DeLong Contra Faux

Whereas I last commented on a good one-liner he used, Brad really gets down to business in his latest post:

I think we live in a world in which the tremendous wave of globalization over the past two decades has produced enormous benefits for those members of China’s urban working class lucky enough to get jobs in export-oriented industry and for those ex-peasants who have managed to move to China’s coastal cities.

In general, we have a choice between policies. We can eliminate or sharply restrict trade with an odious regime–as we do with Cuba–in the hope that it will put pressure on it for reform. We can encourage the maximum possible trade with an odious regime–as we do with China–in the hope that the more economic, cultural, and political contact there is the more we strengthen the forces over there that we like. Which of these policies we follow will have impacts on domestic income distribution–but much smaller impacts than do our educational, social insurance, and tax policies which do much, much more to move wealth and opportunity down or up the American income distribution.
I tend to be on the side of free trade abroad and social democracy at home.

This is totally right. Trade has minimal effects domestically. For consumers they are quite positive; for workers in very specific industries (manufacturing for instance) they are devastating. In total, however, the effects are positive.
But for developing nations, there is no better tool for poverty reduction than trade liberalization. When we implement tariffs and subsidies and whatnot, we don’t really notice their effects, but they are devastating to the third world. Even if the effects of free trade were universally and consequentially negative domestically, we have a moral imperative to liberalize trade for the rest of the world’s poor, who are much greater in number and much poorer than American losers from trade.
So for a social democrat whose primary concern is poverty reduction – like myself – support for trade liberalization and support for an extensive social safety net are not in tension. They are complementary. My support for universal health care and my support for NAFTA both originate in my desire to help the poorest among us.
When social democrats – like Jeff Faux – oppose trade liberalization, they’re either a) intellectually dishonest and refuse to accept that it is a net gain for the vast majority of the world or b) don’t care and are only concerned with its concentrated negative effects in the US. Faux’s a smart guy, so I refuse to believe his reason is a). But that leaves b) as his motive, which leaves me little choice but to consider him a shill for the union lobby and a xenophobe. The former isn’t surprising, as he’s president of the Economic Policy Institute, a union-funded think tank. The latter is extremely disturbing.
And for those annoyed by my ferocious opposition to Edwards: re-read the above paragraph, replacing “Faux” with “Edwards.” Still works.

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