The Vision

Why free trade rocks

"Beware the giant sucking sound!" was the rallying cry of Ross Perot and his erstwhile legion of grassroots supporters. The "giant sucking sound," of course, would be caused by NAFTA, which Perot claimed would cause American jobs to be moved to Mexico, harming America's workers and its economy. Radical environmentalists opposed NAFTA because they feared that Mexico would prove attractive to companies who would pollute to their heart's content, whistling evil tunes and laughing maniacally all the way to the bank. Nine years later, U.S. unemployment is at an all time low, and despite market fluctuations, the economy is still growing. In the meantime, the Canadian economy has grown thanks to trade with U.S., while Mexico is undergoing a political and economic evolution to a first world nation. They have voted in a president from the opposition party for the first time in decades, their economy is growing, and as their economy grows, their concern for the environment is also growing.

Given the remarkable gains to the three nations of the North American Free Trade Agreement, it would only make sense to extend this area to other countries. And, in fact, the US and others are prepared to do just that. Talks are already beginning to form a Free Trade Area of the Americas, which would, as the name says, eliminate trade barriers between all countries in North and South America. Opposing this move are the predictable allies of left-wing activists, who decry the "oppression" of capitalism. From April 19-21, delegates for the FTAA will meet in Quebec. Activists are hoping that this meeting will allow for a repeat of the WTO incidents in Seattle, in which they discovered that if you're a white, left-wing college student, destroying property and instigating violence is a "social protest" in the eyes of the media, not a riot.

The arguments of those who oppose free trade are predictable, tiresome, and have been disproved time and time again. Chief among them are that free trade causes unemployment, free trade hurts the environment, and free trade leads to "oppression" by multi-national corporations.

As mentioned earlier in this article, opponents of NAFTA claimed that NAFTA would cause a tremendous loss of American jobs. Of course, the opposite was true. Unemployment in the U.S. is now lower than it ever has been. In fact, it's lower than many economists thought possible. Moreover, because NAFTA helped to lower the price of many goods, it caused a slight deflationary effect. In other words, since people could obtain many things more cheaply, their effective incomes were higher, even though they didn't necessarily rise in absolute dollars.

Another claim of free trade opponents is that companies will move to countries with lower environmental standards. In the short run, this may be true. However, many multi-national companies have higher internal environmental standards than native countries. Plus, since their economy is growing, concern for the environment grows also. What many people don't understand is that concern for the environment is a luxury that comes from having a strong economy, which provides people with more leisure time. Most developing nations and former communist nations have no cultural concern for the environment. Free trade helps accelerate environmental concern by improving the economy and also by extending the environmental concerns that have become imbedded in US business culture and practice.

The last argument of activists is, of course, that capitalism is "oppressive." However, there isn't a whole lot of evidence to back up this assertion. If history is any guide, then the less capitalist the economy the more oppressive the regime. The Soviet Union, the current regime in China, the Khmer Rouge, Nazi Germany and many other non-capitalist regimes are or were far more brutal and oppressive than any capitalist country. Even the "good" socialist countries have disturbing undercurrents. The Swedish government, for example, is considering a program of eugenics. In the Netherlands, the policy of allowing physician-assisted suicide has led to many questionable deaths and even outright murders. Only a country with a socialist health care scheme can adopt a program of eugenics, and the socialist health care system in the Netherlands makes it easier for doctors to literally get away with murder. And both countries are supporters of the European Union, which recently decided that any criticism of the EU by an citizen in an EU country was illegal. Capitalist nations aren't perfect, but they're certainly better than the alternative.

While the radicals on the left will continue to decry any move toward freer trade, it's obvious that free trade has innumerable benefits. Freer trade improves national economies and the lives of workers, it leads to an increase in environmental awareness, and it leads to the development of more free-market economies, which tend to limit the amount of brutal oppression caused by governments.