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Home Publications Blogs Beat the Press Post Wrongly Calls William Daley a "Free-Trade Stalwart"

Post Wrongly Calls William Daley a "Free-Trade Stalwart"

Tuesday, 04 January 2011 06:16

The Post used this term in a piece reporting that the J.P. Morgan executive may become President Obama's next chief of staff. In fact, NAFTA, which Daley helped push through Congress, and other trade deals that he has supported included many protectionist provisions, most importantly increasing intellectual property protections. These deals also did little or nothing to free up trade in highly paid professional services like those provided by doctors and lawyers.

The trade deals supported by Daley were primarily about subjecting manufacturing workers to increased competition with low-paid workers in the developing world, thereby driving down their wages. They had little to do with free trade.

Comments (8)Add Comment
written by Benedict@Large, January 04, 2011 5:38
Perhaps we might just say that "free trade" had little to do with free trade?
written by Ron Alley, January 04, 2011 6:36
The "free trade" agreements cannot be view in isolation from other federal government actions. Together, federal policies not only permit US corporations arbitrage labor, but actually encourage and subsidize such action. Corporations can apportion profit between foreign manufacturing operations and domestic sales pretty much as they find advantageous. Foreign profits can be kept offshore and taxes avoided or indefinitely deferred. Environmental regulation can be avoided. Provisions penalizing payment of bribes in international operations go unenforced. Both the Right Wing and the Left Wing of the Corporate Party have vigorously supported the broad range of incentives encouraging labor arbitrage. The Washington Post, the Times and the mainstream media generally pretend that this state of affairs does not exist.
written by izzatzo, January 04, 2011 6:47
From the WaPo article, this quote:
Daley, 62, is a political heavyweight who would command immediate respect from the Washington establishment.

However Daley, whose name comes from Day Trader, a famous free trade occupation, will also command respect from labor as well, by requiring that employed workers compete in bidding auctions with unemployed workers until everyone is employed - since the problem isn't demand, just overpriced employees from the supply side.

Economists predicted this would lead to economic recovery, noting it's about time that like NAFTA, free trade competition was introduced domestically to erode the huge economic rent earned by labor, which held up prices so high it caused the deep jobless recession.
The economic rent of labor?
written by Benedict@Large, January 04, 2011 7:30
The economic rent of labor? That has got to be one of the most rediculous statements about economics I've ever run into. Perhaps izzatso could define this for us so Marx can stop screaming from his grave?

I hope they pay you a lot for spamming this site, izzatso, because I would hate to think that you carry rich folks water for free. That would be so unfair, and besides, they can afford it.
nationalism is scary....
written by pete, January 04, 2011 10:40
This nationalist thinking, that U.S. workers somehow deserve higher wages while Mexicans and Thais and Malays and Philipinos and whoever are condemned to live on subsistent farms is pure nationalist junk. The fact is that there is scarce global capital, and it takes a while to produce more capital. Capital/labor ratios are simply way out of balance globally, and there are simply only two ways to rectify that..either the capital goes to where it is scarce (globally, to the south or china), or the labor comes to where it is scarce (globally, to the north). All economists would have to agree that an optimal global allocation of capital/labor will increase global output. Indeed global output is skyrocketing. I would prefer a freer labor market, but that probably won't happen, so we are stuck with a freer movement of capital in response to lower tariffs/barriers as the second best solution. Sorry, them's the facts from the dismal science. Barriers to trade are evil nationalist inefficiencies which protect special interests. Nationalism causes war.
written by Calgacus, January 05, 2011 12:25
Benedict@Large - Think Izzatso might, just might, be a satirist.

But pete and callejohan (see his long comment athttp://www.cepr.net/index.php/...are-costs are giving Izzatso pretty stiff competition. To paraphrase Lily Tomlin, it's hard for satire to keep up with what people really say & believe.
written by izzatzo, January 05, 2011 8:40
As Roseanne Roseannadanna would say, the amount of scarce capital flowing from the USA to China was EEEEEEEENSY! TEEEEEEEENSY! WEEEEEEEENSY! compared to the amount flowing in the opposite direction which apparently wasn't scarce at all ... what's that? ... under free markets capital only flows from developed countries to undeveloped ones? ... never mind ... .
capital rising faster in China in U.S....but of course if flows every which way
written by pete, January 05, 2011 12:33
Silly notion.

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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.