The benefits of free trade

From the Washington Post:

Free trade generates economic growth through exports, but it also improves the real wages and purchasing power of American families through imports. The two major U.S. trade agreements during the 1990s, NAFTA and the Uruguay Round, increased incomes and provided consumers with a greater choice of goods at better prices, raising living standards for a typical American family of four by up to $2,000 a year.

Imports also boost the productivity of America's businesses. From auto parts to computer parts, they help hold down production costs and make U.S. products more competitive at home and abroad.

Open global markets create investment opportunities, too, and the United States receives more foreign investment than any other nation in the world. International capital flows have helped keep U.S. interest rates low, funded new U.S. business ventures, increased U.S. productivity and wages and created new American jobs.

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So what do the Uruguay Round

So what do the Uruguay Round and NAFTA have to do with "free trade"? They're just economic governance on an international scale. What they do is called corporate mercantilism, not free trade.

Check out Joe Stromberg's tongue-in-cheek prescription "How to Have Free Trade":

"For many in the US political and foreign policy Establishment, the formula for having free trade would go something like this: 1) Find yourself a global superpower; 2) have this superpower knock together the heads of all opponents and skeptics until everyone is playing by the same rules; 3) refer to this new imperial order as "free trade;" 4) talk quite a bit about "democracy." This is the end of the story except for such possible corollaries as 1) never allow rival claimants to arise which might aspire to co-manage the system of "free trade"; 2) the global superpower rightfully in charge of world order must also control the world monetary system....

"The formula outlined above was decidedly not the 18th and 19th-century liberal view of free trade. Free traders like Richard Cobden, John Bright, Frederic Bastiat, and Condy Raguet believed that free trade is the absence of barriers to goods crossing borders, most particularly the absence of special taxes - tariffs - which made imported goods artificially dear, often for the benefit of special interests wrapped in the flag under slogans of economic nationalism....

"Classical free traders never thought it necessary to draw up thousands of pages of detailed regulations to implement free trade. They saw no need to fine-tune a sort of Gleichschaltung (co-ordination) of different nations labor laws, environmental regulations, and the host of other such issues dealt with by NAFTA, GATT, and so on. Clearly, there is a difference between free trade, considered as the repeal, by treaty or even unilaterally, of existing barriers to trade, and modern "free trade" which seems to require truckloads of regulations pondered over by legions of bureaucrats.

"This sea-change in the accepted meaning of free trade neatly parallels other characteristically 20th-century re-definitions of concepts like "war," "peace," "freedom," and "democracy," to name just a few. In the case of free trade I think we can deduce that when, from 1932 on, the Democratic Party - with its traditional rhetoric about free trade in the older sense - took over the Republicans project of neo-mercantilism and economic empire, it was natural for them to carry it forward under the "free trade" slogan. They were not wedded to tariffs, which, in their view, got in the way of implementing Open Door Empire. Like an 18th-century Spanish Bourbon government, they stood for freer trade within an existing or projected mercantilist system. They would have agreed, as well, with Lord Palmerston, who said in 1841, "It is the business of Government to open and secure the roads of the merchant." ....

"Here, John A. Hobson... was directly in the line of real free-trade thought. Hobson wrote that businessmen ought to take their own risks in investing overseas. They had no right to call on their home governments to "open and secure" their markets."

"Free Trade, Mercantilism, and Empire," February 28, 2000

Kevin, You're right, but

You're right, but when the NY Times and the Washington Post run a series of editorials espousing the spirit of free trade, even if they get the details wrong, it's blogworthy.