After years of dismissing the hordes of street protestors denouncing free trade and the pernicious effects of globalization, it appears that our nation's leaders have suddenly, and definitively, turned against free trade. Everywhere you look these days, the zeitgeist is anti-globalization. For a while, I thought it was just because I spend a lot of time in San Francisco and Berkeley, where the "localvore" movement reigns supreme. But the directive to grow, buy and eat local is even permeating the heart of Silicon Valley, which thrives on and could not even exist without globalization. A cynic would say that the growing anti-globalization vibe is merely a marketing ploy, and indeed in some situations that seems to be the case (to wit: tiny downtown Menlo Park has put up a banner in recent days urging people to "Shop Menlo Park: Buy Local-Support Local Economy," even if the vast majority of goods sold there are not, in fact, produced in our fair town).
It used to be that the only people you could find being very vocal against free trade were those who lived in places where their (mostly manufacturing) jobs had been outsourced, or environmental and labor groups concerned about a global race to the bottom in standards and wages. But as growing numbers of Republicans and Democrats alike turn against free trade and question the effects of globalization on economic opportunity and prosperity (for a window into one Republican's change of heart, check out this article on realclearpolitcs.com), it's worth trying to get to the heart of the matter.
Like immigration, the current debate over free trade is dominated by emotion- many middle-class Americans blame globalization in general and free trade in particular for the tremendous anxiety they feel about their economic security. The traditional economic wisdom-that a rising ride lifts all boats-clearly doesn't cut it anymore. And why should it when an increasing number of job categories from lawyers to tech workers are being outsourced? Americans are right to question whether the expansion of free trade agreements is beneficial to them. After all, markets cannot be ethical or moral. But the current move toward market isolationism is a misguided throwback to a time that does not exist anymore, and sets up an unnecessary tension between local needs and broader prosperity that can be shared through globalization.
Of course, the devil is in the details, and questions about labor and environmental standards, farm subsidies, and economic competitiveness will trip up even the most astute policymaker. But globalization need not be the death knell of American prosperity. The challenge we face as a nation is how to harness the power of free trade to benefit us all.
