Playing with Protectionist Fire

I've frequently cautioned against supposedly free-market Republicans toying with "I'm a free trader but [blank]" protectionism on the grounds that the strategy is misguided on economic, principled and political grounds.  A new web ad from far-left Democrat Tammy Baldwin - who's running for Senate in Wisconsin - really hits this last point home, and shows that Republicans who toy with protectionism are playing with political fire:



There are a lot of substantive problems with Baldwin's anti-China demagoguery, but I'm not going to waste my time re-hashing them here.  Instead, let's just focus on the politics.  The "bi-partisan" measure which Balwdin claims she spearheaded through the House and will "punish [China] for making billions breaking trade rules" is H.R. 4105 - the legally and substantively dubious bill that overturned a US federal court ruling and allows the U.S. Department of Commerce to keep imposing countervailing duties on imports from China and other "non-market economies."  Contrary to Baldwin's claims, however, she didn't really lead the charge on H.R. 4105.  No, that inglorious distinction falls to none other than the bill's sponsor, Ways & Means Chair and sometimes-free-trader Republican Dave Camp (R-MI), who not only sponsored the bill but also, along with his fellow Republican (and mostly-free-trader) Trade Subcommittee Chair Kevin Brady from Texas loudly advocated the bill's passage and ensured its way-too-rapid passage through the U.S. House of Representatives.  Camp even went so far as to get his staff to issue a "fact" sheet which accused us critics of H.R. 4105 of peddling "myths."  As one publication wrote shortly after the House vote:

In the House – where H.R. 4105 was passed on Tuesday by a vote of 370 to 39 – the bipartisan bandwagon was driven by Representatives Dave Camp (R-Michigan), chairman of the House Ways and Means Committee, and Kevin Brady (R-Texas); as well as Sander Levin (D-Michigan) and Jim McDermott (D-Washington).

Baldwin's political fib aside, her ad remains instructive because it shows what Republican "protectionism-lite" breeds: even stronger and more onerous anti-market demagoguery from politicians - usually Republicans' opposition - who typically have no problem taking the protectionism to the next level and now have "bi-partisan" cover to do so.

In this case, Camp's and Brady's strong support for H.R. 4105 helped lay the groundwork for way-more-protectionist Baldwin's first Senate campaign ad.  And given that myriad hackish media reports emerged after the CVD/NME bill became law - here's one crediting campaigning Democratic Senator (and bigtime protectionist) Sherrod Brown for passing the Senate bill and helping save Ohio jobs - it's almost certain that we'll see more campaign ads like Baldwin's, in which anti-trade Democrats use Republican-sponsored China trade legislation to seek a "bi-partisan" advantage over their (mostly) pro-trade Republican competitors through unabashed protectionist pandering.

Thus, the Baldwin ad serves as a cautionary tale for Republican politicians who are tempted to dabble in part-time protectionism for short-term political gain: it might seem like a great, mostly-harmless idea at the time, but it could end up helping their Democrat competition - most of whom have far fewer reservations about going "full protectionist" on the campaign trail - get elected.

(Unfortunately, it doesn't appear that Governor Romney will be heeding these lessons anytime soon.  Sorry, Japan.)