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Home Publications Blogs Beat the Press Bruce Reed, New Biden Adviser, Did Not Encourage Free Trade

Bruce Reed, New Biden Adviser, Did Not Encourage Free Trade

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Saturday, 15 January 2011 09:08

The Washington Post wrongly asserted that Bruce Reed, who will be Vice President Joe Biden's chief of staff: "encouraged free trade and deficit reduction during the economic boom years of the 1990s."

This is not true. Reed, along with Gene Sperling and William Daley, the other recent Obama picks mentioned in the article, pushed for trade agreements that had the effect of putting manufacturing workers in more direct competition with low-paid workers in Mexico and other developing countries. Such deals had the predicted and actual effect of lowering the wages of manufacturing workers and non-college educated workers more generally.

None of these people have been associated with a larger free trade agenda, which would include efforts to eliminate the professional and licensing barriers that protect highly educated professionals like doctors and lawyers from foreign competition. And all three have been supportive of the protectionist portions of recent trade deals that increase the strength of copyright and patent protections. For these reasons, it is totally inaccurate to describe Reed, as well as the other Obama officials, as supporters of "free trade." 

Comments (4)Add Comment
...
written by fuller schmidt, January 15, 2011 9:44
It always bears repeating.
it never ends
written by Michael Radosevich, January 15, 2011 10:43
The idea that "free trade" is what Clinton's team promoted in the 1990s is one of those never-ending lies. I expect to see it in 50 years, if I live that long.

Thanks for doing your part in exposing the fallacies behind such an argument. And then again today the NY Times published, almost verbatim, another piece by another of Pete Peterson's minions which yet again gets the argument exactly backwards on the trade deficit. Peterson wants to have a "strong" dollar, which of course would just worsen the trade deficit. I think it was on the Economix part of the Times website.
Dogs may needed licenses. Docs don't.
written by JBG, January 15, 2011 11:25
"...professional and licensing barriers that protect highly educated professionals like doctors and lawyers from foreign competition"

The [far] more important effect of such barriers is to protect doctors and lawyers [etc] from domestic competition. If my baby has an ear infection, being able to have her looked at for free in Toronto isn't really much help.
Perfect as Enemy of the Good: Some Free Trade Better Than None
written by izzatzo, January 15, 2011 2:52
... pushed for trade agreements that had the effect of putting manufacturing workers in more direct competition with low-paid workers in Mexico and other developing countries ...


What exactly does Whose Your Nanny Baker regard as free trade if not this? Why must this free trade depend on other free trade like that for the professional class and intellectual property rights?

At least it's a start. Consumers obviously benefit from lower prices driven by intra-corporate competition with themselves across borders. It's not like they're the global price takers they claim to be, just keeping the difference for themselves.

If that were the case, it would be an act of income redistribution rather than an improvement in economic efficiency from trade. But that's not what's happening is it.

It's not like an Obama compromise that takes three steps back in order to gain two steps forward is it. Not at all. These are true Pareto Improvements from trade that make some better off and no one worse off with cost and price reductions.

Let it be Whose Your Nanny. Free trade has to start somewhere before it gets to the professional servies and property rights. Let Bruce Reed finish what he started under the Infant Industry Protected Class Act.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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