It is remarkable the extent to which discussions of free trade begin by reflecting back on an extraordinary moment in human history — the almost generation-long apex of American economic hegemony when the United States was the only great industrial power left unscathed by World War II. While Germany, France, and Japan rebuilt economies from the ruin of war, Britain lost its empire, and the vast human potential of India and China was largely untapped, American industry ruled the day. Union jobs paid well and sons could follow their fathers into the local plant and earn enough money to raise a family. And while America wasn’t immune to the business cycle, for a decade or two after the war its manufacturing prowess was unmatched.
This hegemony could never last. The great industrial powers weren’t going to remain rubble forever. China wasn’t going to remain a poor, agrarian society forever. Neither was India. And when they revived, Germans and Japanese and Chinese were going to be just as ambitious as Americans. Moreover, the American industrial hegemony was going to face internal competition. In the immediate postwar era, the American South was the land time forgot — disproportionately agrarian and crippled by Jim Crow. It would not remain an economic backwater.
Compounding the inevitable challenges, we tend to forget how much America squandered its advantages — how we gave other countries a competitive edge through our own failures. Take the car industry. By the 1970s, the Big Three automakers were making terrible cars. Poorly designed by white-collar workers, shoddily manufactured by blue-collar workers, they were failing the American people at an unacceptable rate.
I’m old enough to remember those cars. How could I forget? I remember my dad buying a brand-new Dodge that stalled whenever it rained. The upholstery literally fell off the roof of our Chevrolet. A Ford somehow leaked antifreeze onto our feet. And it’s no wonder: In many plants, the culture was completely broken. Here’s how one researcher, Jeffrey Liker, described the environment in a General Motors plant in Fremont, Calif.:
One of the expressions was, you can buy anything you want in the GM plant in Fremont. If you want sex, if you want drugs, if you want alcohol, it’s there. During breaks, during lunch time, if you want to gamble illegally — any illegal activity was available for the asking within that plant.
The high-paying job for life produces perverse incentives:
Because the workers were stuck there, because they could not find anything close to that level of job, and pay, and benefits, at their level of education and skill. So they were trapped there. And they also felt like, we have a job for life, and the union will always protect us. So we’re stuck here, and it’s long term, and then all these illegal things crop up so we can entertain ourselves while we’re stuck here.
Does that sound like the good old days? Car manufacturers — management and labor — were failing, and Americans paid the price.
Then along came Honda and Toyota. For American families, an inexpensive car that runs, reliably, for sometimes 200,000 miles or more is an enormous economic and psychological blessing. There’s no need to worry about breakdowns. The family budget isn’t strained by expensive repairs. Free trade helped American families. Competition proved healthy for the vast majority of Americans. American cars are better. Foreign cars are better, and many “foreign” vehicles are now American-made. Indeed, the list of the top seven most “American-made” cars (parts and assembly) includes two Toyotas and a Honda. The Toyota Camry tops the list.
#share#To hear the rhetoric, “trade deals” are now a top reason for national stagnation. Populists see free trade as a scam perpetuated on the American people for the sake of the elite’s stock options and private jets. It’s all the “donor class” foisting oppression and misery on America.
This is nonsense. America has largely embraced free trade not for the sake of the few but because it has benefited the many. Families benefit from less expensive goods. We enjoy affordable access to technology unthinkable ten short years ago, with even poor families owning smartphones and televisions that couldn’t be bought for any sum of money even last decade. By virtually every measure of material progress, we have access to more for less than ever before — so much so that our primary national spiritual challenges include consumerism and materialism.
America has largely embraced free trade not for the sake of the few but because it has benefited the many.
When you hear Donald Trump claim that he can magically negotiate “winning” trade deals with China or Japan, here’s what it means in the real world: more expensive goods at home as tariffs drive up prices, and less opportunity for exports abroad as trading partners retaliate with import restrictions of their own. We won’t see textile mills spring open across the land — we’ll just pay more for shirts and socks.
That’s not to say that there’s nothing that can be done for workers displaced by the changing economy. For one thing, we can and should control our borders and restrict immigration levels to prevent an uncontrolled influx of low-skill workers from flooding already-strained labor markets. We can stop the Trump practice of giving away American jobs to foreign workers by limiting legal immigration. We can work to repair broken public-education systems that graduate students unprepared for global competition — and that’s hardly a comprehensive or exhaustive list.
But we cannot turn back the clock. The glory days of American manufacturing were but a blip on the historical radar screen, the product of unique conditions that — we pray — will never exist again. Who wants to see the rest of the world in ruins?
Critically, we cannot forget that change can be painful. People suffer, and it is our responsibility as fellow citizens to help however we can. But it is also the responsibility of the American worker to adapt and adjust — as he’s always done before.
Americans are not victims. Americans compete. And the day we surrender our competitive spirit is the day we give in to national decline.