A follow-up to a friend.
Tim:
Thanks for your reply to my earlier note. You write:
Not all jobs lost are the same. Not all jobs lost to free trade are the same. Not all factories that close are the same. Not all communities in which jobs are lost are the same. And not all free trade agreements are the same. You treat them as if they are and thus dismiss claims that an FTA could raise mortality rates. But jobs long protected in company towns are simply not the same as jobs in say Silicon Valley. It has nothing to do with manufacturing being special and you are perhaps too quick to assume that’s what people are claiming.
I’m not seeing something that you see. I understand that not all jobs (and job losses) are the same. What I don’t understand is what is unique about trade at causing the loss of those jobs that are especially traumatic to lose.
The ultimate cause of job losses in market economies is economic change. Sometimes that change is transmitted by international trade. Sometimes – and most times in a large country such as the U.S. – that change is transmitted by forces having little or nothing to do with trade. What reason is there to single out trade as a source of economic change, or of economic change that causes especially acute harm to workers who lose jobs? I know of none. The fact that trade sometimes has unusually traumatic and heart-rending effects doesn’t make the case. Not only does trade usually not have these effects, sometimes these effects are caused by non-trade sources of economic change, such as labor-saving technology.
It might well be that the economic change fueled by NAFTA caused job losses that led several people to make life choices that put them in early graves. But what of other historical cases? What of manufacturing workers in the 1920s who lost jobs because of electrification? What of manufacturing workers in 1945 who lost jobs because the war ended? What of manufacturing workers in the 1990s who lost jobs because of advances in computer technology? And what about the technology-driven mass destruction of agricultural jobs in the mid-twentieth century – job destruction that was just as large a share of the labor force as was that caused by the “China Shock”? Surely some of those workers committed suicide, turned to drink, or fell into life-draining despair.
It is simply misleading – because mistaken – to single out trade as a source of economic change that causes traumatic job losses.
The right course is to recognize that some unfortunate individual and localized problems are caused by economic change (and, by the way, as well as by efforts to obstruct economic change). And honesty demands that we acknowledge that among the countless sources of economic change is international trade. But to single out trade as if it’s a categorically different, or special, source of economic change makes no more sense than to single out labor-saving technologies invented in Texas, or changes in the preferences of Asian-American consumers, as a special source of economic change.
If voters insist on obstructing trade in order to avoid these traumatic downsides, that would be too bad, but so be it. Voters, however, should then be informed that their aim is too low: To be consistent they should aim to prevent all economic change, no matter its source. Again, it seems to me that to write of trade as if the economic change that it causes is uniquely troublesome is deeply misleading – and dangerous, because it suggests that such economic change should be controlled by political authorities.
Sincerely,
Don
