Free Trade Good, Bashing it Bad

In the movie, Horrible Bosses, Kevin Spacey’s character, one of the horrible bosses, said, “You can’t win a marathon without putting a few band-aids on your nipples.” Now bear with me, I know the line was likely written for comedic affect. I mean, band-aids on your nipples. Come on, like huh? Freaking hilarious, right? But still for me, the line had a more purposeful meaning. Which was: worthwhile goals sometimes take time and often painful effort in order to reach them. But like the saying goes, anything worth having is worth working hard for.

Globalization is worth working hard for. Free trade is a means to that end. I know it’s popular now to trash globalization and free trade. But before you do, consider, it was because of globalization and free trade that America even exists in the first place. After all, Christopher Columbus was trying to reach India by a shorter route when he accidentally discovered America. Why do you think he was trying to reach India in the first place. Don’t strain yourself. It was to trade. Spain wanted to put its footprint in the spice trade that had been all the rage in Europe. You see countries have always wanted to trade with each other. Trade brought and continues to bring opportunity. New products. Better ways of doing things.

Yes, I understand that factories have closed down in many communities, especially smaller ones which in turn essentially shut those communities down as well. I’m from a small eastern North Carolina community where once upon a time, a person could graduate high school, land a good paying factory job, raise a family off the salary from said good job, and then retire with a pension from said good job. It was the American dream. But since NAFTA, i.e. the North America Free Trade Agreement–our country’s trade agreement with Canada and Mexico, many such jobs are no longer with us as the factories which provided them have either shut down or moved the jobs out of the country. Of course, some of those factories were wobbly before NAFTA, but that’s beside the point here as most anyone knows that no factories, equaled no jobs which in turn equaled, stagnant, dying, or dead communities. When you can’t feed your family or put a roof over their heads, bashing free trade seems not only smart, but prudent. A reasonable person’s common line of thinking holds that if companies didn’t send jobs overseas, we’d have money to buy things here in this country, thus keeping our local economy going. That was and is a logical argument. One I used to make myself. Thing is, it’s a simple thing to say and any politician can feed the anger by saying it. Problem is, there’s nothing simple about preventing free trade. Business is competition. And really there are three scenarios in business. You either make a better mousetrap, or find a more cost efficient way to make mousetraps, or you create some contraption that has nothing to do with catching mice, but is either needed, or craved by people with money and willing to spend it. And if your business doesn’t do one of those three things, some other business will, and you will soon be out of business. In other words, even if America didn’t and doesn’t compete in the global economy, companies in other countries will, and whether it would’ve been yesterday, today, or tomorrow, American jobs were destined to suffer, and eventually disappear anyway.

Still, what does any of this mean to the American worker? What’s in NAFTA or the other trade agreement in the news recently, TPP (Trans-Pacific Partnership) for the average American? In short, it’s opportunity. When we freely trade, we open up other areas of opportunity for our products. Yes, other countries can manufacture many of our products cheaper than we can. Not exactly a remarkable feat when you consider that few governments offer the work-related benefits our forebears fought hard to get us over here– 40 hour workweeks, overtime pay, holiday/vacation pay, etc. We take these things  for granted, but really would you give them up just to have a job. Probably not, especially when you consider how life was before our forebears won us those rights. But yes in the short run, America is losing jobs to other countries because of it. In order to compete on a global scale, American companies have to go where labor is more cost effective. Of course, it would help optics if CEOs of American companies who take jobs overseas weren’t so obviously greedy in pocketing much of the excess revenue from the adjustment in labor expenses, and would instead invest in worker retraining and product research. Imagine if companies would spend a certain amount of their resources researching and identifying different products in which our workers would be the most cost effective producers! That would be the ideal scenario.

Closing our eyes, burying our head in the sand, and pretending that if we just close our borders and force American companies to produce here that everything would go back to how it was in yesteryear will not change what is. Other countries will simply and more efficiently build the better mousetrap, beating American countries fair and square in the global economy, and thus crushing American jobs anyway.

It’s incredibly easy for any politician to speak to the anger of people by simply and only voicing the anger. It’s too simple to only diagnose the problem, or to proclaim there’s a magic button to push that will bring jobs back and give us yesteryear America. Man, would I love that fantasy to be true. My hometown would be so much better off if it was. But the reality of it is, that ship has sailed. A lot of the old manufacturing jobs are not coming back. EVER! In order to make it in the new labor force, workers will have to retrain themselves to do different jobs. Politicians will have to encourage entrepreneurs (by way of tax incentives and relaxed regulations) to seek new and better ways of doing things that will most benefit and utilize America’s current labor force. We must encourage and embrace free trade. Now is not the time to isolate ourselves from the rest of the world. Isolation has never been an American trait, nor should it be now. America was founded because of free trade. America has thrived on free trade, as well as on immigration. We shouldn’t let fear or ignorance of the value of free trade rule us. America has been great since its inception. It has never stopped being great. Don’t let anyone tell you different. But, we can always be better. Our place is as a world leader. But you can’t lead the world if you isolate yourself from it. Building walls and ending free trade is akin to isolation. I know times are challenging for a lot of Americans right now. But better days are on the horizon. It’s like Kevin Spacey said in Horrible Bosses, you can’t win a marathon withouy putting a few band-aids on your nipples. That’s freaking funny. But oh, so true.

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