The Assault on International Trade

The open international trading system that has developed since the end of World War II is under assault at home and abroad, by a fascinating combination of attackers. At home every type of special interest is attempting to stem the tide of imports, especially from the developing nations, while overseas the efforts of private enterprise to participate in the development of poorer countries are being met with a crescendo of attacks and a burst of regulation aimed at the so-called imperialist, greedy, profit-seeking multinational corporations. The efforts of the protectionists at home and of the new breed of regulators abroad undermine the prospects for raising the living standards of the poorer countries of Asia, Africa, and Latin America, while simultaneously reducing the prosperity of the developed nations.

Through most of the twentieth century, the United States has played a leadership role in developing the system of world trade (although it must be said that during the 1930s, the United States was one of the many countries that followed a “beggar-thy-neighbor” trade policy, which contributed substantially to the worldwide Depression). After World War II, America embarked on a program of reciprocal trade agreements. Initially arranged bilaterally, they evolved into the effective multilateral trading system of the postwar years, which broke down many of the historical barriers to world trade. An especially fine example occurred in the 1960s. The acceleration of world trade and economic growth in that decade followed a sharp and mutual reduction in tariff barriers, and it contributed to lower prices for consumers. We continue to reap benefits from the policies initiated in those years.

MW

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Murray L. Weidenbaum

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The open international trading system that has developed since the end of World War II is under assault at home and abroad, by a fascinating combination of attackers. At home every type of special interest is attempting to stem the tide of imports, especially from the developing nations, while overseas the efforts of private enterprise to participate in the development of poorer countries are being met with a crescendo of attacks and a burst of regulation aimed at the so-called imperialist, greedy, profit-seeking multinational corporations. The efforts of the protectionists at home and of the new breed of regulators abroad undermine the prospects for raising the living standards of the poorer countries of Asia, Africa, and Latin America, while simultaneously reducing the prosperity of the developed nations.

Through most of the twentieth century, the United States has played a leadership role in developing the system of world trade (although it must be said that during the 1930s, the United States was one of the many countries that followed a “beggar-thy-neighbor” trade policy, which contributed substantially to the worldwide Depression). After World War II, America embarked on a program of reciprocal trade agreements. Initially arranged bilaterally, they evolved into the effective multilateral trading system of the postwar years, which broke down many of the historical barriers to world trade. An especially fine example occurred in the 1960s. The acceleration of world trade and economic growth in that decade followed a sharp and mutual reduction in tariff barriers, and it contributed to lower prices for consumers. We continue to reap benefits from the policies initiated in those years.