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An Economic Witch Hunt

This country is no stranger to witch hunts. Salem had the real deal back in the 17th century, and we've seen political witch hunts since then. Now we're witnessing the emergence of an economic witch hunt. The "witch," in this case, is trade. In his WaPo column today Robert Samuelson relates the scary tale of how, in an effort to find the culprit for manufacturing job losses, congressional Dems have pointed the finger at trade agreements. To punish these witches, House Speaker Nancy Pelosi has ordered the equivalent of a witch burning -- she killed the president's Trade Promotion Authority, thereby stopping the Colombian trade agreement in its tracks. As Samuelson points out, the Colombian trade agreement was a good deal: Their products enter America duty free while U.S. exports to Colombia face stiff tariffs.

But witch hunts are never rational. Four million manufacturing jobs have been lost since '98, and rather than take measures to make American companies more competitive, Congress is looking for scapegoats. Never mind that U.S. manufacturing output rose 22 percent over the last decade, even as it was shedding those jobs. Or that U.S. manufacturing exports (i.e., trade) were up 11 percent last year, keeping the economy afloat. Or that we have no trade agreement with China, the one country whose low-cost products actually have had an effect on manufacturing jobs.

The most important thing to understand about witch hunts is that they always end badly. With Speaker Pelosi's ending of TPA, it looks like this one will be no different than any other.


Posted 04-16-2008 8:58 AM by Stephen Gold
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