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Home Publications Blogs Beat the Press NPR Flunks Trade Reporting, Again

NPR Flunks Trade Reporting, Again

Thursday, 10 February 2011 05:35

President Obama pledged to double exports in five years. This one should have lead to raucous laughter across the country, because it is just silly policy. As every economist knows, exports do not create jobs, net exports (the difference between exports and imports) creates jobs. If exports by themselves created jobs, then we could create millions of jobs by importing trillions of dollars of goods from Mexico, Canada and elsewhere and then exporting them back over the border again.

Unfortunately, NPR chose not to make this point in discussing President Obama's trade target on Morning Edition. Instead, it treated the doubling of exports as a serious and important economic goal. It also repeatedly referred to "free trade" and "free trade agreements."

The Obama administration is not promoting free trade or free trade agreements. Its trade agenda does little or nothing to remove the barriers to trade in highly paid professional services, like physicians' services or legal services. It also increases protectionist barriers for copyrights and patents.

Promoters of these pacts like to call them "free-trade" agreements because it sounds better than selective protectionism, just as President Reagan dubbed the MX missile the "Peacekeeper." However, it would have been inappropriate for the media to call the MX missile the "Peacekeeper" (it didn't), and it is inappropriate to refer to these trade deals as "free-trade" agreements. 

Comments (7)Add Comment
What exactly is in trade agreements that make them not free?
written by Robert Baillie, February 10, 2011 6:54
Dean, it would be helpful if you could list some of the provisions of things like the Korea trade agreement that make them not "free" trade agreements. I've heard, for example, that the Korea agreement contains NAFTA Chapter 11-like provisions.
Exports are an Absolute Advantage - not Comparative Advantage
written by izzatzo, February 10, 2011 7:26
Any economist knows that doubling exports as a trade target under the Obama-Immelt Competitiveness Plan is due to absolute advantage - not comparative advantage - because the opportunity cost of trade is zero.

For example, the opportunity cost of GE exporting generators to India is essentially zero because it uses unemployed resources as Whose Your Nanny Baker has noted many times to justify deficit stimulus spending, which would crowd out such exports in a deep recession.

Only socialists like Baker advocate Comparative Advantage based on Communist Competition, such as for imported health care. Real capitalists understand that Absolute Advantage is what drives successful trade under Capitalist Competition that keeps the dollar strong.

Stupid Liberals.
written by Malik, February 10, 2011 8:00
I was expecting a serious discussion of economic policy, instead I find some hippie-bs about "free trade isn't free!"

I mean seriously, "OMG, NPR and Obama didn't say NET exports?!" You suck. You really really suck.

Sometimes it's really painful to be a liberal.
and "strategic defense initiative" sounds more benign than star wars
written by frankenduf, February 10, 2011 8:27
the trade numbers have long been distorted by 'globalization'- if an engine is built in mexico, a carburator built in china, etc, all shipped to atlanta, and the car is assembled here, what is the net?!
written by fuller schmidt, February 10, 2011 10:28
It is overlooked how accurate "1984" was in terms of Ronald Reagan. And, Malik, you've got to get over the grudge against hippies; so they got the attractive women - so what?
Yeah, Malik....
written by diesel, February 10, 2011 7:36
If there weren't lies issued by the Ministry of Propaganda about "free" trade then Dean wouldn't have to spend time debunking them. Control the terms of the debate and you've won the argument.

What's that got to do with hippies? And yes, we did attract our share of fine-looking babes. And Dean, did you ever go to the Whiffletree restaurant when you were a student in Ann Arbor?
free trade in the U.S.
written by pete, February 11, 2011 10:50
Free trade is what we have within the U.S. Unlitareral examples are like Hong Kong...completely open, no reciprocation necessary. Prosperous. Could do it here, with little disruption...there is no need to agree with another country. Right to work states like TX, under attack by the Obama admin. is similar to what Dean would do to trade agreements...essentially, wipe out the gains from trade by imposing U.S. labor laws etc. on other folks and making them hugely litigious like the U.S.

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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.