World leaders decried protectionism during last weekend’s G20 Summit. The official summit declaration announced a, “ strong commitment to resist protectionism.” Canada’s trade minister, Peter Van Loan, said, “ Pockets of protectionism are hurting the global recovery.” While these comments are welcome news; the question is will Obama follow through with the tough talk? The ideal answer: yes! The probable answer: no!
History has shown that countries that practice free trade are more prosperous and peaceful. What history has also shown is that Obama’s record on free trade is horrible at best. Take the Jones Act for example. The act essentially bars foreign ships from entering American ports by requiring goods to be transported in U.S. vessels and operated by American citizens. Waiving the act would do wonders for the oil cleanup and for the American economy as well. However, Obama has predictably pandered to special interest groups who benefit from the act’s existence, and has continued to enforce the legislation. (Further examples of his trade record can be found here and here.)
Free trade is conducive to international commerce and would help end the current economic downturn. If Obama continues his protectionist streak, America can expect lower export levels, higher unemployment rates, and higher prices in general. Trade barriers are costs imposed on consumers by the state that effectively lower real income. The poor are the hardest hit by these policies.
While recent developments concerning the Korean Free Trade Agreement are hopeful, it is wise to be skeptical of the Obama Administration’s commitment to uphold the G20 declaration. The public must continue to pressure the President into enacting non-protectionist policies for the sake of the economy. As President Hu Jintao of China says, "We must take concrete actions to reject all forms of protectionism, and unequivocally advocate and support free trade.” It’s a sad day when the leader of a Communist country seems to understand free trade better than the current U.S. President.