Wednesday, March 3, 2010

Protectionist Campaigning for Dummies, pt. 3

My blog post yesterday rebutting an anonymous congressional staffer's factual misrepresentations about NAFTA, free trade and US manufacturing elicited an immediate reply from the anonymous staffer himself - Mr. Brian (aka "Researcher") Martin, policy director for Congressman Gene Taylor (D-MS).  I promised Brian this morning that I'd reply to his new comment tonight, and that's what I'll be doing here.  Brian's reply is lengthy, so I am not going to paste it below.  But if you'd like to see the comment in all its glory, you can view it in the comments section of the aforementioned blog entry.

First and foremost, I'd like to thank Brian for commenting here.  While I'm quite sure that it wasn't his intent, Brian's comments have allowed me to focus some disparate themes that have been floating around my blog since its inception.  Last night, I focused on some of the most prevalent myths propagated by protectionists - US manufacturing decline, trade and manufacturing jobs, and trade and national security - and systematically debunked each of them.  Judging by the nice response I've received, I think I did a pretty decent job.  Tonight, however, I'd like to take a slightly different approach and focus on the many standard rhetorical devices that protectionists use, especially in American politics, to win arguments about free trade.  Such focus, I think, is important because, as Americans' continuing trade suspicions and the many protectionist policies in place make clear, such political tactics have proven very, very successful for the anti-traders.  Well, just my luck, Brian's comment from last night stands as a fantastic example of how such rhetorical tricks are used in practice.  And, quite honestly, after a quick re-read of Brian's comment tonight, I realized that my approach here is quite necessary because a direct and substantive rebuttal of his main claims would simply rehash 99% of yesterday's blog post.  And where's the fun in that?

So here we go.  In all, I found five common rhetorical tricks used by Brian to justify his protectionist position (which, I think, still remains the dissolution of NAFTA and other US free trade agreements).

Trick #1: The ad hominem attack.  The protectionist knows that, because free trade is almost universally supported by economists and economic historians worldwide, the free trader will come armed with boatloads of great data and historical evidence supporting his claim.  By contrast, the protectionist will have only a few datapoints, so he often seeks to discredit his opponent's arguments and data by simply calling the opponent bad names (don't laugh: this approach is often successful).  Case in point: while my blog entry (and many others like it) presented a ton of historical evidence undermining Brian's original protectionist myths, Brian's response cited very little such evidence and instead attacked me personally.  Indeed, if you didn't know me and were only judging me by Brian's comment, you'd very likely think that I woke up every morning on a mountain of money, drove to work in my Bentley and spent my days at the office dressed like the monopoly man and conspiring with my fellow "smug elitist investment banker/lawyer" buddies about how we can create the next big "investment bubbles" while simultaneously oppressing America's working poor (whom I "know nothing about and obviously care nothing about.")

Now, normally, I'd leave this nonsense be and just move on to the next rhetorical trick, but as my workday dragged on today Brian's mischaracterizations really ate at me.  Why?  Well, because if Brian did know me, he probably wouldn't have tried the "fat-cat" ad hominem attack (even though it's quite en vogue these days among the demagogues).  He probably would have known that I don't come from privilege, that I've worked a job every year of my life since I was 15 - several of which for minimum wage right beside the people I supposedly "care nothing about," that my first job out of college paid $200/week, that I paid my way through college and law school with part-time jobs, student loans and credit card debt (which literally leveraged me to the brink), and that I didn't do all that just so I could someday become a heartless "investment lawyer" (whatever that is) out to "make millions of dollars from [poor workers'] suffering."  And, sure, all of my work and debt paid off, and I'm doing well now, but come on, Brian: do you really think that a guy like me - a guy who has schlepped dirty ice skates, cleaned bathrooms, sold women's shoes(!) and literally been so cash-strapped that he ate one meal per day (double quarter pounder extra value meal) to stretch his budget - is really trying to advocate policies that would undermine the US economy and destroy America's working poor?  Hardly.  The fact is that I do what I do - and blog here - because I've seen first hand just how helpful free trade is for those working poor, and just how cynical, manipulative, political and pernicious protectionists and their policies can be.

Trick #2: Seizing the moral high ground.  As I've already made clear in discussing trick #1, protectionists just love to claim that their protectionism has moral backing, while dirty free traders like me are heartless souls who are just out to make a buck (see, e.g., Edwards, John).  Brian claims to speak for Mississippi's working class and he apparently knows what's best for them - including the fact that not all of them "can or should become software engineers, investment bankers, or investment lawyers."  Brian also assigns an odd sort of moral superiority to manufacturing over services, and casts me as just out to create a nation of unemployed workers and underemployed hamburger-flippers.  Of course, nothing could be further from the truth.  In fact, the greatest case for free trade is a moral one.  As I said a few weeks ago:

[Free trade] is rooted in some of the very ideals upon which the United States was founded: the pursuit of life, liberty, and happiness, and the rule of law. Every American should be free to transact with whomever he wishes to transact, regardless of the nationality or location of the other party. Voluntary exchange is inherently fair, benefits both parties, and allocates scarce resources more efficiently than a system under which government dictates or limits choices. Individuals deciding for themselves how and with whom to conduct commerce will advance their own well-being, and thus the nation’s, far more efficiently than would some centralized authority that tries to influence private decisions by tipping the scales.

Furthermore, government intervention in voluntary economic exchange on behalf of some citizens at the expense of others is inherently unfair, inefficient, and subverts the rule of law. Instead of individuals seeking to optimize their conditions subject to the rules, they are incentivized to divert resources from productive endeavors to changing the rules to their advantage through politics and backroom dealmaking.

Alas, this very sound and simple justification for free trade has been distorted over the years by groups seeking to tip the scales in their favor. They mischaracterize trade in the ancient but false dichotomy of the haves versus the have-nots. Evil corporations, they say, benefit from trade while regular people suffer its wrath. The public is told that companies like Wal-Mart profit from trade, but that the vast benefits afforded Americans who shop at Wal-Mart—benefits like more-affordable clothing, food, and other everyday products—count for nothing. The public is told that trade enriches the Chinese government, but that the benefits to U.S. manufacturers and their workers from record export sales to Chinese customers over the past few years are meaningless. In the political realm, trade is never about individuals acting in their own best interest by transacting with whom they choose to transact. Instead, trade is a zero-sum game featuring the collective “Us” versus the collective “Them,” and “they” are gunning for “our” jobs and wealth using underhanded tactics.
 I think that sums up Brian's attempted moral superiority pretty perfectly, so I'm just going to leave it at that.

Trick #3: claiming that correlation is causation.  Protectionists routinely find causation where only correlation actually exists.  They do this by blaming imports and free trade for concurrent problems and events that actually have little or nothing to do with trade.  In Brian's case, he tries to convince us that free trade and FTAs like NAFTA are to blame for the manufacturing job losses across the country and in Mississippi all because NAFTA began at that time, or because imports or the trade deficit increased over the same period.  Indeed, Brian claims that "Mississippi has lost 40% of its manufacturing jobs since 1994" when NAFTA began, and even though he acknowledges "Nissan opening a plant in the state" since then, he wants us all to desperately believe that free trade (and NAFTA in particular) - not productivity gains, technology or changing consumer tastes - caused all of those job losses.  Of course, after I've clearly demonstrated that imports, trade deficits (which Brian again brings up in his reply), total trade and FTAs have nothing to do with manufacturing job losses, and that developing and developed countries around the world are losing manufacturing jobs, Brian's "causation" mirage falls apart. 

As an aside, perhaps one of the best examples of the "causation-correlation" trick comes from the 2008 presidential campaign when the Obama-Biden team accused John McCain of supporting free trade policies that, they asserted, shut down a Corning plant in Pennsylvania and eliminated the jobs of hundreds of local manufacturing workers.  The reality, however, was far different.  As wrote back in 2008, the Corning plant actually made cathode ray tubes (CRTs) for old-school TVs that weren't being made anymore.  Thus, it was technology and consumer preference that eliminated those jobs, not free trade agreements or a rising trade deficit.  But you can't attack someone for supporting flat-screen TVs, so.... (Of course, we all know who won that election, so I'm certainly not saying that such garbage isn't effective.)

Trick #4: Schmaltzy anecdotes as surrogates for, and superior to, hard data.  Because protectionists only have a few datapoints - manufacturing job losses, the trade deficit, etc. - to support their policies, they resort to a lot of anecdotes, and Brian's reply is no exception.  After laying out his one stat - a 40% decrease in Mississippi manufacturing jobs - Brian then proceeds to "prove" how bad trade is by citing to random anecdotes about problems in Mississippi (disappearing rail lines, depressed wages, etc.) and elsewhere (military procurement), without a shred of supporting evidence of the problems' actual prevalence or their relationship to free trade.  Now, anecdotes are a fine way to settle an barstool argument between friends about whether a dude can actually eat an entire jar of maraschino cherries without barfing, but they are hardly an appropriate way to advocate policies that would dramatically overhaul a 14.2 trillion dollar economy and severely infringe upon individual liberty.  Yet this is precisely what protectionists do.

And I must admit that they're pretty successful at it.  One of the most vivid memories from my first year as a researcher at the Cato Institute was a 1999 congressional hearing on steel tariffs featuring, among others, my boss Dan Griswold.  Dan was slated to go last, and I had helped him put together a blistering array of stats and figures which clearly demonstrated how the proposed tariffs not only wouldn't help the US steel industry, but also would really hurt a lot more American businesses, workers and consumers (through higher prices and limited supply).  Appearing right before Dan, however, was a representative from the UAW who said something to the effect of "I'm no economist, but here in the real world, and not in some Econ 101 class, trade has destroyed our town.  Take for example my friend John who lost his job last year because of cheap imports and no longer has the health benefits he needs to care for his cancer-stricken daughter Betty."  The man provided no support for these statements, other than a sad-looking family, and yet he crushed Dan's great, fact-filled presentation.  (Here's Dan's testimony if you think I'm making this all up.)

So what are free traders to do?  Well, for one, they can reassert the moral high ground, as I noted above.  But they also can use their own anecdotes - about American families and businesses that rely on trade - to supplement the myriad stats and historical facts which support their policies.  This is precisely the approach I took a few weeks ago when debating the President's new export initiative, and it proved quite effective. 

One last, humorous note here.  Every time that I hear a protectionist preface his misleading anecdote with the "Econ 101" line (which Brian uses twice) or the "I'm no economist, but" line, I immediately think of the old SNL skit "Unfrozen Caveman Lawyer."

See what I mean? (Phil Hartman, RIP)

Trick #5: I'm a free trader, but.... - The last rhetorical trick employed by protectionists is the claim that they support "trade," just not this type of trade.  Brian does precisely this when he concludes that he only wants to "repeal NAFTA and take back concessions to China and other countries with which we have high trade deficits, then we just go back to bilateral agreements with the United States negotiating in the interests of the nation as a whole and not just the investment elite."  In other words, Brian wants trade, but he and his fellow government employees want to pick-and-choose what kind of trade (how much, which products and with whom) in order to determine what they think is in the  "interests of the nation as a whole."  Of course, this leaves the door wide open to pretty much oppose any trade at all, but what's even more ridiculous is the insinuation that 535 people on Capitol Hill can determine which specific trade arrangements are in the "national interest," and which aren't.

Now, I don't know about you, but I don't feel even remotely qualified to make such decisions, and I seriously doubt that the US government - including folks like Brian's boss Congressman Taylor - are so qualified.  Moreover, isn't a system of limited government intrusion and isolation from special interest influence a far better way to ensure that the "national interest," rather than the interest of a few well-connected cronies, is pursued?  Or does Brian really want me - after documenting all of the backroom deals, misleading statements and smarmy payoffs that drown US trade politics - to really believe that his boss and other elected officials are absolutely immune from such influence?   


So where does that leave us?  Well, without their rhetorical tricks, protectionists' arguments are pretty light on content, and I hope that I've shown how Brian's comment is no different.  Then again, I really can't blame Brian for his reply: I mean, if you remove all the fluff, all the baseless conclusions and moralizing, and all the personal attacks from the protectionists' arsenal, there's just really not much to say.


Node Runner said...

There is another common myth that I think the protectionist camp has used against the "dirty capitalists" successfully and that is characterizing who the winners and losers are (as if there could even be a loser) when it comes to free trade. The view is that freedom of trade and un-regulated markets necessitates that only the elite are successful. If you have a high IQ, were born into wealth, or have good looks, you are one of the lucky people who succeed in the market, and everyone else "loses". This is the myth that people like Brian exploit to characterize these arguments into false "us" versus "them" battles and this is the myth that voters believe to be true. I think that one of the most important messages we need to be getting out there is that free trade is what enables regular people to be successful and wealthy. We need to get people to celebrate the fact that poor, ugly comedians without a diploma can still get rich by making us laugh, or that some ex-con drug addict with no prospects can write a book about his life and sell enough copies to live like an investment banker. The free market is the only thing that makes value the measurement of success, instead of IQ, natural talent, good looks, or rich parents. The only way we can get people to stop asking "What goodies does Uncle Sam have for me today?" and return to the question that it used to be: "What opportunities am I going to seize today to make my dreams come true?" is to convince people they aren't doomed to failure if they try. Unforuntately people like Brian are just all too skilled at convincing people they aren't good enough to succeed on their own.

Scott Lincicome said...

Excellent point, Node. And no man personified that protectionist trick like John "Two Americas" Edwards (and look how that turned out!).

Thanks for the comment.

Anonymous said...

In point 5, don't you understate the potential for trade diversion that can arise from bilateral trade agreements as opposed to multilateral policies? As a free trader, if a particular good was made most cheaply in Japan, I'd want the US to import it from there, not from Korea on the back of an FTA-enabled preferential tariff rate.

Scott Lincicome said...

Well, if you assume that Brian's not advocating US witdrawal from all trade agreements (incl. the WTO) - something I don't assume at all, given his China comment- then, yes, you make an important point. As I've stated repeatedly here on this blog, completely unfettered trade (i.e. unilateral liberalization of trade barriers) is obviously the best course. Multilateral arrangements are next, and bilateral/regional agreements third.

But, again assuming we're just talking NAFTA, those aren't our choices in the context of my discussion with Brian. Today it's (i) NAFTA "free trade" vs. (ii) protectionism (i.e. no NAFTA), with Brian and the rest of our political class giving us permission to trade freely when and where they see fit.

In that case, the choice is very simple. Or at least it should be.

RickRussellTX said...

Node: 'If you have a high IQ, were born into wealth, or have good looks, you are one of the lucky people who succeed in the market, and everyone else "loses".'

Oh Node. Don't you realize that not everyone can or should be a lawyer, banker or engineer? Mr. Martin said it was true!

As a corollary to Mr. Martin's invocation of "us-vs-them" elitism, I was recently reading a book, Matthew Crawford's _Shop Class as Soulcraft_, a deconstruction of the modern world of work and an exultation of the mechanical arts.

Based on that description, you'd think he might be pro-labor. In fact, he considers manufacturing to be one of the most execrable jobs imaginable, a series of discrete tasks which have been so thoroughly subdivided and optimized that there is zero room for creativity or initiative.

He recounts that when Henry Ford set up his first assembly line, he couldn't find workers who would stay. He was hiring journeymen carpenters, smiths and sheet metal workers, but he had to hire 900 just to retain 100.

He didn't enjoy success until he upped the pay rate -- to well above the going rate for carpentry, smithing or sheet metal work. He later described it as his most brilliant business move ever, because once the pay rate was increased, he could increase the assembly line rate without complaint. People were too afraid of losing their premium-salary jobs. His variable labor cost per unit actually went DOWN as his hourly wage went UP.

These are the jobs that Mr. Martin and Congressman Taylor want -- the dehumanizing jobs that select for the least initiative and the least complaint. I imagine such people are also compliant voters.

Tim Hampton said...


Great point with the Henry Ford anecdote there.

It should come as no surprise to people that the automatic COLAs for Congress and their respective power via Big Special-Interests is the primary reason they won't "leave" their jobs. They're afraid of losing their jobs and so they feed us protectionist lines as a way to stave off critical assessment of the job they are doing for us their constituents. I for one won't be tricked so easily.

For the sake of full disclosure, I'm the Libertarian candidate who's running against Gene this year. H.R. 4759 is simply an attempt to curry favor with voters who are fed up with Gene by now being able to say "Hey look folks, I wrote a bill to help protect your jobs. How can you say that I haven't done anything for you lately?" I, and many others in South MS, feel that it's too little too late. If Gene thought NAFTA was so bad that he voted against it in '93, b/c of the false premise of unfairly taking MS jobs, why hasn't he been fighting the 17 years hence to overturn it?

I can think of one worker we can't afford not to lose: Gene Taylor.