Advice to Obama at G-20 Summit: A Rising Tide Lifts All Boats
I don't know precisely when progressives in this country gave up on free trade. Because when they did, without perhaps even realizing it, they turned their backs on the developing world. In the 1960s, President Kennedy outlined a global vision based on the premise that a "rising tide lifts all boats." And lift it did. In the last 15 years alone, global trade has helped to lift 400 million people out of poverty around the world.
Yet, when it comes to boosting living standards in places like Colombia and Panama, we hear hardly a peep from progressives. These stalled trade deals would improve economic and humanitarian conditions in those countries while helping U.S. companies, including many consumer electronics and technology companies, access new markets. The last 15 years are proof of that.
I understand that at a time of economic pain, nations tend to look inward, but that is why it's so important for President Obama, as he heads to the G-20 Summit on April 2, to rise above insular, regressive politics and truly work to protect and expand global trade. His choice is either to embrace the world of trade or to build on the barriers Congress has begun to create.
I am optimistic that President Obama gets it. In recent days, He sees the link between our economic prosperity and open markets. In an op-ed for the Chicago Tribune, he wrote, "Once and for all, we have learned that the success of the American economy is inextricably linked to the global economy. There is no line between action that restores growth within our borders and action that supports it beyond."
Now he can back up those words with action. Our President must rebuff protectionists within his party who, in their well-intentioned zeal to insulate U.S. jobs from competition, are actually harming American workers by denying them access to 21st Century jobs and opportunities. And he must take his knocks from world leaders who will, rightly, question why the country that is based on the fundamental principles of capitalism, competition and innovation has resorted to trillions of dollars in bailouts and subsidies.
But most importantly, President Obama must be the champion of free trade and ensuring that open markets continue to "lift all boats." In isolated regions of the world, technology can be the difference between life and death, prosperity or squalor. These countries need trade to access technology to keep people alive. What is more a progressive goal than life itself?
Through health-care kiosks and telemedicine sites, the people of rural India gain access to doctors and even specialists. In a country with five times fewer doctors than the United States, the ability to use technology to communicate with a doctor is transformational. And in remote regions in Africa, SMS messaging is vital for commerce. Launched with fruit and vegetable exporters in Burkina Faso and Mali in 2006, the "Trade at Hand" initiative uses mobile phones to send a daily SMS message to exporters in developing economies with the day's product prices on international markets. These messages give exporters information to react to demand and negotiate prices.
Helping developing countries means we do well by doing good. When new industries develop in emerging countries, they rely on the technological expertise of U.S. companies to help them achieve their goals. And when billions of people achieve prosperity, they demand of their governments political reforms that stabilize their countries and lead to more peaceful resolutions of disputes. International trade exposes developing companies to new technologies, communications and democratic ideas.
Progressives in the United States have a rich history of looking beyond themselves to try to help the world. In recent years, they seem to have lost their way on trade issues. Hopefully, with a President they trust, they can once again lead the United States to policies that build bridges around the world instead of putting up protectionist walls.
Gary Shapiro is the president and CEO of the Consumer Electronics Association.
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Shapiro parrots the talking points for free-trade, that time has revealed as BS.
US manufacturing jobs and service jobs are being shipped over-border to cheap labor and the manufactured goods shipped back to the US tariff free ; good deal for outsourcers; bad deal for American workers. Fact: Re. Trade Facts, July, 2008: The average industrial tariff for imported goods of US trading partners is 30%; average US industrial tariff for imported goods is 3%. Thus, by design, "free" trade is not fair trade; helps corporate profit, but US workers. Trouble with this design: US national economy depends 67% on consumer economy. Consumer economy depends on US jobs and wages. Conclusion: National economy will not recover until US consumer economy is recapitalized ( until we recapture most lost jobs) by re-instituting common-sense, fair, trade policy and non-predatory, usurious, consumer financing.
Free-trade lifts all yachts; US don't even have life vests
US policies have deregulated finance as well as trade. The consequence has been predatory banking and finance, with consequent loss of consumer protections (e.g., home buyers and credit card users) as well as jobs, and thus the inevitable, gradual bankrupting of American workers (a repeat of the 1930s)-followed by the collapse of consumer finance markets. This is not rocket science, but, apparently they don't teach this basic logic in the Wharton, Chicago and Harvard business schools that have produced the 'talent' guiding our bloated finance industry.
Do you really want us to close our borders and become self sufficient? So Americans will line up for the soldering, motion repetiitive non-automated factory jobs that others in the world are willing to do? Is this want we want for our nation?
How is this consistent with the President's goal of having the highest college graduation rate in the world. We will educate our students and then we want to send them into factories?
We need to recognize that our strength is innovation and we need to focus on policies which encourage innovation. Access to investment capital, attracting the best and the brightest, IP protection, education, is our future - not putting college grads into factory jobs.
How many here want to go work in a factory? Have any of you even worked in a factory? I have at age 14 and the memories kept me studying and in school for a long time!
OVERSIMPLIFICATION. "So Americans will line up for the soldering, motion repetiitive non-automated factory jobs that others in the world are willing to do? Is this want we want for our nation?"
Is everyone in our country above working in a factory?
We all didn't go to the IVY LEAGUE SCHOOL of LIE, CHEAT AND STEAL
Progressives never embraced free trade or globalization--only the wolves in sheep's clothing did that.
I withhold judgment on Obama, as it is far too early to see how this will play out--but initial indicators are far from positive.
Free Trade Fundamentalism is nothing more than a sugar-coated method of deception by which the working class and all labor movements are beaten down and marginalized, in effect subjecting the bottom 95% of American workers to feudalistic system.
Globalization is the same expanded effort with slightly different means to accomplish the same goals globally. Selling free market fundamentalism and globalization as a means of humanitarian benefit to ANYONE other than the richest among us is absurd, dishonest, and altogether disgusting.
You sir are selling snake oil, and should be deeply ashamed.
Sorry guys, but I sold my boat years ago. Perhaps FEMA could get the Coast Guard to send a helicopter?
Our appraisal of living conditions in the less developed world are wrong. You may have read that the average income in Vietnam was once $4 a year. You might imagine a family would visit a Vietnamese restaurant once a year and draw lots as which of them got to eat that year or, perhaps, share the appetizer course. In fact, they lived well. A village grew its own food and shared largely without formal money. Their actual income should have been calculated as similar to America's when all the labor and production was factored in. The misery of Mexico after subsidized American agriculture undermined the local farmers and factories abusing their labor appeared at the border is an excellent example of the demerits of "free trade." Local production and local markets are the most efficient and practical.
Consider the import and export of cookies between Denmark and the United States. Clearly, it would be more practical to trade recipes and produce at home. The global market is artificial and awkward. It undermines a society by under paying the employees so they can't fully perform their function as consumers.
There are economies of scale and particular resources of a region. A solid culture and economy will access these without prejudice but as a minor factor. These should never be the be-all and end-all of a nation's economy, but basically, each country should fundamentally manage itself -- or, like the Sahara Desert, be abandoned.
Yes self-sufficient India worked really well, oh wait decades of extreme poverty. Well North Korea is really isolated they must be doing fine too right? How about Cuba they only trade oil and tourists they must by really well off, oh what still a third world country? Oh nevermind.
Self-sufficiency is a surefire path to poverty. Just because this country could technically be self-sufficient the gains from trade are in the trillions of dollars annually. Do you really want to use scarce resources making toys, sewing clothes, assembling toasters and doing mundane tasks? If you do then more power to you but the world is much better off using comparative advantage and taking advantage from liberalized trade. Read Paul Krugman if you have any doubts.
*Subsidized agricultural is certainly not free trade but advocated by powerful special interests.
So what would North Korea export...Nuclear weapons? So what happened to Africa's localized farms after Multinational Corporations moved in? How much has the poverty rate changed in some of these mentioned countries in the last 10, 20 ,30 ... years???
Reagan ended metrification
I bought liters of gas for may car in the USA just a few times. Right after he was elected, Reagan stopped the metrification of the US, We are the only country that uses inches, pounds, pints, gallons, except for some tiny former colony.
When you are a buyer, people will entertain you and talk to you in your own language. But if you are a seller you better be able to use their language.
Reagan's action was a signal that "fair trade" is just an empty advertising pitch. He and his buddies wanted to pour imports into the US but they did not support provisions that made us competitive as exporters.
-- "fair trade" goes way back, and was a liberal ideal, but that assumed much more fair conditions - fair for us too. Criminals can take Pollyanna ideals and really work a scam. The ideal has repeatedly been misused as an excuse to dump stuff in the US and dismantle whole industries. Check out Big Pharma.
Yes by all means let us all reject the evil that is freetrade, it is time to once again let millions of people in countries like Vietnam and Tiawan, and hundreds of millions in places like India and Bangladesh slip back into the iron grip of abject poverty that free trade has selfishly lifted them from.
Free trade as it has been formulated by the right agenda ideologues (RAI) over the last four decades, comprises taking $50K pieces out of the world economic pie (exporting N. American and W. European consumer creating jobs) and replacing the newly unemployed former champion consumers of all time with Asian and third world workers who can barely feed and clothe themselves and will never consume a single imported non-food good from any previously industrialized country (N. America & W. Europe). The notion that countries with no internal demand or developed internal economy can ever become consumers of imported N. American of W. European manufactured goods is completely crazy – which means the trade is all one way and the jobs are going the other way. The really nuts part of this is that by importing N. American and W. European jobs at such an uncontrolled and economically damaging rate China and other Asian countries are killing the consumers that they depend on to develop and sustain their economies. Widespread and damaging unemployment is currently chewing up the economy of China/Asia which will accelerate as more and more manufacturing jobs leave N. America un-employing more and more of the champion consumers of all time and drastically shrinking consumer demand in N. America and W. Europe for Chinese and Asian goods thereby shrinking Chinese/Asians economies and jobs dependent on N. American and W. European consumers being employed and consuming.
By cooperating with the RAI in N. America to export middle class manufacturing jobs to Asia the Chinese and Asians are busy killing the goose that has laid the golden egg (expanding N. American/W. European unemployment of middle class workers without replacing or adding to golden egg production - development of champion consumers to replace those outsourced and unemployed previous champion consumers in N. America and W. Europe).
Signing 'free trade' agreements with countries with no internal consumer demand and zero consumer demand for imported manufactured products punishes unionized and middle class N. American/W. European workers at the cost of grossly shrinking the global consumer demand which will un-employ workers in N. America/W. Europe first and then the slave-wage Asian/Chinese workers who took the jobs and now have no export market for their goods.
The economic depression which we are now entering was not created by financial industry failures as the RAI would spin it, rather it is caused by the RAI irrational war against N. American/W. European workers characterized by exporting manufacturing jobs to dead end economies with no existing or potential consumer import demand or even any existing or potential internal consumer demand.
He asks when I gave up on free trade. I never supported in at any time for several reasons. It is not,has not been or will ever be free trade. If you are talking about helping American businesses I assume you mean Wal Mart. The only way free trade would work is that any country could sell anything in this country they would care to sell but they would only receive credits with which to buy things made in this country.
We pay in dollars which derive their value from things made in this country. "Credits" are redundant.
Otherwise, I totally agree. We aren't just contrarians; we're right. International trade is a marginal activity and inefficient. The United States has the resources to keep itself. Outsourcing our "real economy" undermines everybody's security. I do favor importing petroleum: Drain them first, then let them buy from us when the price covers the expense of our more difficult oil. This is about cheap energy to keep American production competitive.
AMEN
Free trade is an urban legend. In addition to import duties, our American products get subjected to a number of expensive inspections at the ports of entry of our so-called trading partners. Most countries then throw on a 20% value added tax, which they can justify to the WTO on the grounds that it's the same tax levied on their domestic manufacturers. Fair enough, but then these same countries rebate the money to their domestic companies in the form of employee subsidies such as government-funded universal health care, mass transit subsidies and day care. Maybe we should do the same, and then add an extra 20% tariff on the goods from any country that doesn't allow its currency to float. OR—we can continue to get our butts kicked by government-subsidized companies in the "free" marketplace.
Why not "Free Trade" how about melamine in dog food, baby formula and who knows what other food products?
Sorry, but I'm willing to pay a little more to buy local and/or organic rather than take the risk.
ACCORDING TO SOME OF THESE POSTERS IT IS OK TO POISON OURSELVES AND OUR CHILREN (I AM NOT ONE OF THOSE "SAVE THE CHILREN" CROWD) AS LONG AS SOME CORPORATION ARE SAVING MONEY ON LABOR WAGES AND THE STOCK PRICES of the WAL-MARTS ARE GOING UP. THIS IS NOT A FOOTBALL GAME ROOTING FOR YOUR FAVORITE TEAM.
Gary Shapiro omits one important additional reality - global warming. A fleet of freighters trimpsing across the world add a huge carbon footprint to our planet. The port of Los Angeles, for example, has toxic air and too many of the people living near trade corridors that link the Port of Los Angeles with the rest of the country contract cancer. LA also has an alarming rate of childhood asthma. These conditions contribute to the soaring costs of our health care. (We'd need to spend less on SCHIPS if we had fewer poor children with asthma.)
Furthermore the cost of oil is not going down. The more international trade, the higher the price of oil. Sooner or later we are going to run out of oil. Then what?
International trade has both economic and environmental costs. Both must be factored into any discussion on trade, free, fair or otherwise.
"The port of Los Angeles, for example, has toxic air and too many of the people living near trade corridors that link the Port of Los Angeles with the rest of the country contract cancer."
Correct me if I'm wrong, but wasn't the air in Los Angeles terribly smoggy back in the 1960s, before the foreign car manufacturers began to make major inroad into American markets? I know that Volkswagens were visible back then--my family drove one--but their market share wasn't the threat to the Big 3 that came in the 1970s.
"Furthermore the cost of oil is not going down. The more international trade, the higher the price of oil. "
If you're speaking strictly from a US perspective, the cost of gas would be higher if we had to rely on domestic sources. They hadn't grown nearly as fast as demand. Even from a world perspective, I think this is scapegoating. Much of the high price of gas is caused by resistence to alternative sources and conservation; and blaming free trade reduces the pressure on the real enemies.
Gary Shapiro cites Colombia as an example of a country where the living standards have risen. For real, whose living standards??? Last I checked, most Colombians are dirt poor - a reason that the narcotics trade is such a lucrative opportunity. Furthermore, union organizers are routinely murdered by right=wing, and pro-government militia. Should we trade with this country.
Truth told. American corporations are not off-shoring jobs because they love Jesus. They are off-shoring jobs because they can pay miserable wages, subject their employees to inhumane working conditions, and pollute the environment. If you don't believe me, check out the sweat shops along the Pacific rim, or the Niger River Delta.
Free trade translated means free labor. I have nothing against international trade, but it should be fair trade. Workers in foreign countries deserve the right to organize unions. (We need to pass the Employee Free Choice Act.) They have a right to decent wages and humane working conditions. We must enforce strict environmental protection and consumer protection codes both in this country and abroad.
Henry Ford recognized that underpaid workers could not buy his product, so he raised the wages of his employees. Modern corporate leaders, including Gary Shapiro, just don't get it. As a small-time investor, I am aware of the losses I suffer because 3 billion people must survive on less than $ 2 a day. Forget the rising tide, in which yachts swamp rowboats. A race to the bottom messes everybody up.
You seem to be confused. If you forced an American multinational out of lets say Vietnam because say Intel only pays it's workers 75 cents an hour you do realize that the domestic industry in Vietnam only pays 45 cents an hour, how does this help poor people? Multinationals pay higher than domestic wages in 99% of the cases according to Columbia Professor Jagdish Bagwattii.
Vietnam is very poor it can't afford to pay it's citizens $5.00 an hour for low productivity work. If you tell a poor country that you must pay a "living wage" or we won't trade with said country then guess what? We won't be trading with that country and thus the poor people there will continue to be stuck in the domestic 45 cents an hour job or no job. How is this "fair". It's only fair to the rich world union worker who lobbies his government to "protect" his job at the expense of the poor. This is a moral issue and you're on the wrong side (although you mean well). All corporations must be watched but don't force companies from investing just because they pay less than a rich country.
YOU AND YOUR IDEAS ARE PART OF THE PROBLEM!!! A LOT OF US DON'T FEEL ANY OBLIGATION WHAT SO EVER TO AID VIETNAM OR CHINA IN ANY WAY, MUCH LESS TO AID THEIR ECONOMIES AT OUR EXPENSE.
"A rising tide lifts all boats?" Great if you're a yacht owner, but I'm afraid the rest of us may all drown.
From the 16th to the first half of the 20th century, exploitation and enslavement of the third world was accompanied by the rhetoric of "the White man's burden," "bringing Christianity to the heathens," "planting the Flag," and other slogans that Western governments were grudgingly forced to abandon.
Since the days of Ronald Reagan, the mantra for exploiting third world countries has shifted to "free trade" and "the benefits of a rising tide."
Unfortuneately, the underlying reality has not changed. The working poor in third world countries are being exploited for the benefit of the top 1% of the world's populace. In addition, the biosphere is rapidly being ruined, and today China, a third world power, has surpassed the U.S. as the world's worst polluter. Even in our own country the right of workers to unionise has been undermined by Reagonomics.
Exploiting third world countries because of their dirt-cheap labor costs, and the lack of almost all regulations, is indeed profitable for a miniscule percentage of the world's populace, but that is not a good thing. There is a huge difference between dealing fairly with workers, and exploiting them, no matter what culture-war colloquialisms are thrown into the mix.
Thats a Marxist interpretation of history. How does one account for the millions lifted out of poverty through trade? Was China better off as a closed agricultural economy (think this through) or when millions joined their middle class?
The Naomi Klein types seem to leave this out. Human misery has been lowered thanks to trade there is little empirical doubt about this. Socialist India could not alleviate poverty, export oriented growth did. The goal is to have more countries look like Japan, South Korea, Singapore, Hong Kong, Ireland, Botswana and Vietnam. Were those countries all better off poor? This fatalist marxism doesn't hold up under scrutiny.
Did the evil capitalists allowed those countries above not to be "exploited"? If being exploited allows a country like Malaysia to be transformed quickly from agricultural poverty to middle income than so be it. There is no quick fix that lets a poor country become rich. It took Britain 100 hundred years it took Singapore less than 50. Free trade and openness is good. As countries grow richer pollution decreases. The fastest way to reduce pollution is to increase growth unless you advocate letting poor people stay poor in agricultural subsistence.
How is this a MARXIST/ CAPITALISM confrontation??? How does shipping manufacturing jobs to CHINA, a COMMUNIST country, which increases China's ability to expand their MILITARY for future confrontations keep America strong?
You don't know when progressives "gave up" on the idea of free trade, because you haven't been listening to progressives. Why should we now listen to you? Why should we accept your profound (but wrong) conviction that free trade is an absolute necessity and will benefit working class and professional people, not just the corporate class such as yourself, when we know better?
Progressives used to believe in free trade. Ever heard of Woodrow Wilson or David Lloyd George? Higher prices on goods will only lower poor people's purchasing power. Even if wages stagnant lower prices for manufactured goods of high quality still raises living standards. If wages go up because of misguided protectionism the price of common goods will also go up. You can't have something for nothing. Propping up wages by banning imports will increase the cost of said goods. This is basic economics.
Redistribute the wealth, pay for universal health care and fix broken education system and leave liberal trade alone.
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