Free-Trade Free-Fall

Published



FREE TRADE and free elections do not always coexist peacefully. In an economy in which workers find jobs hard to come by, employers find their pricing power sapped by foreign competition, and the 2004 election campaign is on fast-forward, free trade is likely to find itself among the badly wounded. When the gaggle of Democratic candidates appeared before the AFL-CIO trade union conference last week, vying for the dollars and foot soldiers so important in the primary campaign, most promised to veto any new free trade agreements. In a display of protectionism red in tooth and claw, the steelworkers’ union declared that President Bush’s 30 percent tariff on imported steel does not satisfy their appetite for protection: They denounced Bush and promised to back any more protectionist Democrat in the general election.

Meanwhile, the president’s economic team was touring the nation’s hinterland to announce that the economy is a coiled spring, about to unleash a full-blown recovery on the nation. Treasury secretary John Snow, Commerce secretary Don Evans, and Labor secretary Elaine Chao picked their venues carefully, holding their meet-the-citizen sessions in the plants of some of America’s most successful companies, such as motorcycle maker Harley-Davidson. The famous motorcycle maker was on the verge of bankruptcy before it won tariff protection in the 1980s. Today the company is happily profitable and a major exporter of heavy bikes to Japan. That should give free traders something to think about!

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