Oso, Can I tell Gustavito that in response to his comment I wanted to say somthing about “having babies” or have I reached my monthly limit?

The roll calls were as follows:

In the U.S. House:

Democrats in favor = 15 (7%).
Republicans in favor = 202 (87%).

Totals: 217-215-2, in favor.

In the U.S. Senate:

Democrats in favor = 10 + Jeffords (24%).
Republicans in favor = 43 (78%).

Totals: 54-45-1, in favor.

Btw, let’s hang out, I got nothing but time now.

I didn’t read all of that, so I’m not really sure what you said, but in case you didn’t mention it, 27 republican representatives voted against CAFTA.

As I said before, it is only Democrats, and the Democratic Party, that still debates free trade. Within the economic community free trade has been a settled issue for conservative and liberal economists since the time of David Ricardo, for example liberal economists Paul Krugman, Brad Delong, Jagdish Bhagwati, and Alan Blinder are known free trade supporters. In addition, it has only been until somewhat recently that Democrats have not been in favor of free trade. Remember, it was Bill Clinton and the Democratic support in congress that helped pass NAFTA, a free trade agreement much more encompassing than the little CAFTA just passed by Republicans.

Why are economists so unanimous in their support for free trade? Precisely because it is a win-win situation for both countries involved. Because of what economists refer to as comparative advantage, free trade allows both countries to do what they do best, and in the process each countries standard of living rises. In fact, free trade has been so successful that it alone (well, with capitalism also) has reduced absolute poverty faster than anything else in history. We have witnessed it in East Asia, an area that had the fastest reduction of poverty in the history of the world. India and China, while there is more progress to be made, are other examples of the speed at which free trade works to lift a country out of absolute poverty. So when one attacks free trade, one is not just attacking ‘evil corporations’ and so forth, but the very source of poverty reduction around the world. Those who care the most about the poor, especially the truly poor, those in absolute poverty in underdeveloped countries, should be the strongest defenders of free trade.

So whether or not free trade is good economically is not in question here. Since economists are universally in favor of free trade, those who wish to argue intelligently against it must find some other non-economic reasons of doing so. I answered one of those reasons (the cultural change argument) in the comments section on Oso’s blog, now I will address this one.

While Elenamary’s talks about ‘hazardous waste’ and ‘exacerbated environmental problems’ sound alarming, however those of us familiar with the area see something very different. I don’t know if Elenamary is aware that I spent some time in the lower Texas area. In fact, I got my GED from South Edinburg High School, a city right next to Mc Allen, Texas. I also go back there often, and was just there as recently as a couple months ago, to visit my childhood friends that still live there. So based on my experience, I would describe the area very differently than Elenamary does above. While it may be hard to see all the way from Ohio, free trade has clearly been a boom to the region. In fact, the area is growing so fast that if you leave for a year or two and later return, you will find many places to be unrecognizable. Freeways, home development, businesses, and prosperity in general is rising fast in the region, particularly after NAFTA and the recent rise in free trade with Mexico. This is especially important when you consider the fact that the area was known to be among Texas poorest areas. It still has poverty, and there are still many parts that remain poor, but current poverty pales in comparison to the poverty prior to NAFTA’s passing and the recent rise in free trade.

As far as specific environmental problems go, I strongly believe those to be exaggerated as well. In fact, after reading Elenamary’s article, I phoned my friends in Edinburg and Mc Allen, and they had no idea what she was referring too. But since the environment and ‘workers rights’ seems to be a common objection amongst anti-free trade advocates, allow me address that by quoting from Don Boudreaux, Chairman of the Department of Economics at George Mason University.

He writes:

First, there is no single, objectively correct level of environmental cleanliness. Ditto for worker safety. A cleaner environment and safer working conditions are unquestionably desirable, but they are not free. To achieve any particular level of, say, factory safety requires resources that could be used to produce other valuable goods and services. Ditto for achieving any particular level of environmental cleanliness.

The wealthier a society, the better able are its people to afford greater worker safety and more reduction in pollution.

For an American today to prevent people in places such as China and Chad from trading with Americans because factories there are less safe than ours are today, and because they emit more pollutants into the air and waters than do factories here, is to punish these poorer people based on the insupportable presumption that our standards today are the correct ones – correct not only for us, but for peoples much poorer than us.

It’s a curious bit of American chauvinism that elevates Uncle Sam’s current, specific legislative standards on worker safety and environmental protection into a global standard of morality.

Second, because trade promotes wealth for all trading parties, hampering the ability of people in poor countries to trade keeps them poorer than otherwise – which keeps them less able to afford safer working conditions and cleaner environments. (There’s an enormous amount of empirical support for these claims. See, for example, the just-released 2nd edition of Douglas Irwin’s Free Trade Under Fire, Johan Norberg’s In Defense of Global Capitalism, or Martin Wolf’s Why Globalization Works.)

Third, government-specified environmental safety and worker safety isn’t the only (indeed, not even the main) source of cleaner environments and improved worker safety. Common-law processes and, more importantly, economic competition fueled by more open trade and greater material prosperity also work to improve environmental quality and worker safety. (I’ll not get here into the very difficult question of the relative importance of statutory specification of minimum environmental and worker-safety standards compared with improvements on these fronts brought about through more decentralized, less-formal methods. I seek here only to record that a country’s actual level of environmental cleanliness and worker safety is not synonymous with the standards written down in statute books of that country’s government. The actual achievement might be better or worse than what is officially declared.)

Fourth, calls to prevent trade with people in countries that have less-strict environmental and labor standards than we have in the U.S. are typically ruses to protect domestic industries from foreign competition – ruses meant to camouflage the vile and greedy protectionist intent behind a pretend concern for the welfare of people in poor countries.

As far as egregious examples of health hazards and environmental pollution, we are in agreement there. Even the most extreme capitalists believe that the government has some role in protecting the environment. Clearly if a company has caused serious environmental harm to people, or the environment in general, we should all support severe punishments for that company. But it should be company specific, and not move us away from the overall plan, free trade and poverty reduction worldwide. You don’t remove the very tool underdeveloped countries are dependent on to reduce poverty because of some bad apples. The alternate would be much worse than the environmental problems free trade may cause. How many people died each year in underdeveloped countries before free trade was introduced? How many people did starvation and disease kill before free trade? What do you think India, China, Hong Kong, Taiwan and South Korea looked like fifty years ago? Free trade has the potential, and the record, of changing all of that.

When communism was shown to be the utter failure that it was, there were some liberals who couldn’t come to grips with this, there were some who just couldn’t accept that it is capitalism that reduces poverty and communism that leads to tyranny. They fought hard against all the evidence presented against communism. They just couldn’t understand how a system they put all of their hopes in could turn out to be such an abysmal failure. We are seeing the same resistance with free trade. While the economic community and the world in general have marched along with globalization, there are still some liberals who just don’t accept it. There are some liberals who cling to the outdated methods of the past and absolutely refuse to accept the overwhelming evidence presented against their views. As free trade continues, they are forced over and over again, to rephrase their arguments, yet free trade continues to show them just how absurd their beliefs are.

Call me a free trader, call me a capitalist, shoot, even call me a wanker, but don’t call me a protectionist, because that would imply that I am against the worlds greatest tool in fighting absolute poverty, in other words, a monster.

One of the things I said in my post that didn’t seem to get much attention is, I only support free trade if it comes with open borders. The best workers should be able to migrate freely to the best work.

It seems to be working well in the EU, but the US would never ever agree to it, which is why we should push for some economic regulation to balance our immigration policies.

And rather than use up Oso’s blog as my own platform go to my blog to understand why I disagree.

Yeah, I agree. Actually, Democrats used to be for trade, as recently as the Clinton years. It’s pretty sad, IMHO, the direction they have taken over the years.

As far as the NY Times goes, well, it would look very bad on their part if they were not for free-trade. Within economics circles, as you already know, free-trade is not a partisan issue, both, liberals and conservatives, are supporters of free-trade (It is one of the few things you can get all economists to agree on). So if the NY Times was against free-trade, they would lose all credibility, since they would essentially be at odds with the whole economic community.

I tried to call you. Your number changed.

EM,

I think keeping social costs in mind is important and a very good point. They need to be considered when writing free trade agreements. I’ll be talking more about social costs of capitalism and the alternatives when I write about Cuba.

HP,

I realize that the Democratic party has somehow become the protectionist party and the Republican party has become pro-free-trade. But – just like you don’t understand why more Latinos aren’t Republicans – I don’t understand it. To me, this shouldn’t be a partisan issue, it should be common sense. And, to make it clear, Republicans’ idea of free trade is just as far off from my own as Democrats’. Most American farmers and manufacturers are Republicans, but they’re the ones pushing for subsidies and protections.

If you read NY Times editorials – supposedly the US liberal oracles – they are consistently for free trade and against protectionism.

For those of you who espeaka espanish, Eduardo has an excellent update on the extent of TelMex’s telecommunications monopoly, which you can read more about (in English) here.