I recently debated the topic “Free Trade and Blue Collar Americans” with Oren Cass, executive director of American Compass. The event took place at the annual Freedom & Progress conference hosted by the Foundation for Research on Equal Opportunity. Iain Murray, Vice President for Strategy and senior fellow at the Competitive Enterprise Institute, moderated.
Pictured: Moderator Iain Murray from the Competitive Enterprise Institute, Bryan Riley, and Oren Cass
I argued that so-called “new conservative” trade policies are neither new nor conservative, comparing them to policies advocated by Democrats like Walter Mondale, Richard Gephardt, and Bernie Sanders. I added that since 1994, just before the creation of the North American Free Trade Agreement and the World Trade Organization, real U.S. manufacturing output has increased by 60 percent. Real income for the poorest 20 percent of U.S. households has increased by 44 percent. After accounting for taxes and transfer payments, real income for those households has increased by 55 percent.
One of the few areas where there was some common ground between the two of us may have been with respect to federal budget deficits. Cass criticized foreign financing of deficits as a claim on future U.S. production. I responded that the core problem is government deficit spending, not foreign purchases of Treasury securities.
I wrapped up by suggesting three ways trade policy could be improved to better reflect the interests of blue-collar Americans:
- Require the government to consider the impact of trade on those workers before imposing tariffs. For example, if the fertilizer industry asks for tariffs, the government would be required to consider how that action would affect farmers and food prices.
- Adhere to the Constitution and prohibit presidents from imposing tariffs without congressional approval.
- Instead of withdrawing from our trade agreements, do a better job of enforcing existing agreements and start negotiating new ones.
Note: For a more detailed critique of trade proposals that have come out Cass’s American Compass organization, see A Reality Check for American Compass's Version of Capitalism.