Free Trade Is Truly Progressive

By George A. Pieler, IPI senior fellow, and Jens F. Laurson, editor-in-chief of the International Affairs Forum

Trade’s most ideological critics want us to believe that free trade is some sort of luxury, something we can ‘afford’ only when we first have assurance that domestic jobs will be preserved and domestic companies protected from too much turbulence.

But trade is not a luxury, it is a necessity. Without trade, there would be no luxury – anywhere – in the first place. The siren song of protectionism is the idea that the US or any nation can freeze things in place when the economy is healthy.   But it’s not just not   that simple, it’s simply not true. Economies are dynamic in nature, they thrive of their own movement, the constant traffic of trade. If we merely try to preserve the status quo, we are bound to fall backwards.  

Trade is the key source of that dynamism.   It increases competitive pressure, it enables nations to pursue the markets where they do best (Australian wine, American software, Japanese cars—pace, GM) and benefit from imports that help restrain prices and broaden consumer choice.   All that translates into higher productivity:   more goods and services for the same production inputs.   Higher productivity equals lower inflation, faster job creation, and technological progress.

That means there is a lot at stake in advancing open trade,   but the case for it is really quite simple.   Trade is the linchpin of economic – and civilisatory – progress.   The turbulence of opportunity   is a small price to pay for keeping the doors to our economic future wide open and the stagnation of privation out.