Free Trade With China Wasn’t Such a Great Idea for the U.S.

In his recent book “Economics Rules,” Harvard economist Dani Rodrik laments how economists often portray a public consensus while disagreeing strongly in private. In effect, economists behave like scientists behind closed doors, but as preachers when dealing with the public.

Nowhere is this evangelism clearer than on the issue of trade. Ask any economist what issue they agree on, and the first answer you’re likely to hear is “free trade is good.”  The general public disagreesvehemently, but economists are almost unanimous on this point.

But look at actual economics research, and you will find a very different picture. The most recent example is a paper by celebrated labor economists David Autor, David Dorn and Gordon Hanson, titled “The China Shock: Learning from Labor Market Adjustment to Large Changes in Trade.”

The study shows that increased trade with China caused severe and permanent harm to many American workers…

  • Physics grad

    The american govt does not care about american workers, it is only interested in looting the country and feathering their cronies pockets.

  • Liberal Progressive

    But we know that having favorable trading agreements with our former enemies will convince them to be completely peaceful, not to seize other countries land and to not support terrorist regimes.

    Peace brothers and sisters, kumbaya.

    • Amen.

    • Blacksmith

      Do you feel the need to wash you mouth out with soap now? Or your fingers 😉

      • dance…dancetotheradio

        Once he gets his fingers out of his ass he may spray a little water on them before making your shawarma.

  • The Butterfly

    Thanks but I’m more concerned about all the import workers brought into replace us. Our universities are Chinese outposts. We need to stop selling out our kids.

  • canminuteman

    Free trade is good, as long as the people you are trading with have more or less the same standards as you do.

  • Norman_In_New_York

    This is another one of Donald Trump’s issues. He would slap stiff tariffs on China before they ate anymore of our lunch.

  • Drunk_by_Noon

    My favorite rebuttal to this is the blaming of the American consumer’s “addiction to cheap Chineese products”.
    As usual, it’s crap as in many instances there are no other choices.
    I say crank the tariffs and see what happens.

    • Blacksmith

      Amen to that, You either get quality and a very high price or cheap chinese crap that no one in North American can compete with. It you mad the chinese products cost more via tariffs,people would want to compete and the prices for some of the better quality North American goods would come down to compete, and I would definitely be willing to spend more for a product that lasts.

    • dance…dancetotheradio

      There should be a store where you can buy lifetime quality products like corkscrews.
      VCRs on the other hand, not so much.
      I paid three hundred and fifty dollars for a VCR in 1992 and now it’s past obsolete.

    • Brett_McS

      They still make crap, but the Chinese also make quality gear as well, mainly because of their massive investment in automation. Chinese factories are the most heavily automated factories anywhere and that was done mainly because – ironically – they couldn’t get the number of skilled people they needed.

  • FactsWillOut

    Our gang of economic totalitarians making deals with foreign economic totalitarians, and they have the audacity to call that free trade.

  • Brett_McS

    I recently bought a couple of pairs of metal (aluminium-magnesium) frame sunglasses directly from China for $8 each (with free postage). The exact same ones I saw advertised for $120 in Australia. They are top quality sunglasses; really good lens optics, polarized, and light but strong. Over a whole economy that represents a massive increase in buying power (wealth) for customers of the Chinese.

    Because the Chinese government has kept its currency at such a low value the Chinese people who produce all these exported goods are getting shafted by their own government at the expense of the factory owners, bankers and officials. It’s the Chinese version of quantitative easing.

    • dance…dancetotheradio

      It’s not just the currency.
      The pyramids were built with slave labour.
      The World Trade Center was built and rebuilt with free labour.
      I’ve not heard of a tribe of New Yorkers wandering in the desert for forty years afterwards.

  • Brett_McS

    South East Asian countries (Thailand, Vietnam, Malaysia etc) are starting to provide very stiff competition to the Chinese in the low-cost world.

    And do not be fooled: These are not sweat-shops with rows of peasants slaving away while sitting on dirt floors, these are sophisticated factories with state of the art automation and machinery.

  • I believe I said this a million times but no one listened.

  • simus1

    What doesn’t make any sense is the US refusal to bring in a combined fed/state VAT sales tax like all other first world countries have. Then you dump the fed manufacturers sales tax which is on only US made products. That way you have fed sales tax revenue from imports as well.