Friday, May 24, 2002
Right on the issue, wrong on the history: Paul Krugman comes out, a month delayed, against President Bush's decision to slap tariffs on imported steel.
Krugman says that the president's decision was made for political gain and is anti-free trade -- and he's right.
But Krugman's recounting of history glosses over one important fact -- everybody does it.
The Reagan administration, despite its free-trade rhetoric, was quite willing to protect industries for political gain; the most notable example was the "voluntary" restraint on Japanese car exports. Still, it was a firm rule that trade interventions had to be "GATT-legal" ? that is, they couldn't violate the General Agreement on Tariffs and Trade. (The GATT has since been incorporated into the rules of the World Trade Organization.) And that scrupulousness continued up to the end of the Clinton years. Everyone understood that there were certain things that you didn't do, no matter how convenient they might be in terms of short-term political advantage.
In those days, in other words, responsible people ran our international economic policy.
I won't address what did or didn't happen during the Reagan years. The pre-Web days of the '80s are difficult to research late at night solely using Internet sources. However, Krugman's claim that Clinton stuck to the strict letter of U.S. trade agreements throughout his 8-year term is false.
The most obvious, most recent and most well-known case was the Clinton administration's refusal to allow Mexican trucks into the U.S., as was required by NAFTA.
A NAFTA arbitration panel may have finally broken the transport logjam at the US-Mexican border. The panel found that Washington's blanket ban on Mexican trucks moving farther north than the immediate border area violated the 1993 free-trade pact.
That's no surprise. Under the agreement, Mexicans were supposed to have access to border-state highways by 1995, and to all US roadways by 2000. Two things kept that from happening: concerns about the safety of Mexican trucks and drivers, and political opposition from the Teamsters Union (which fears job losses) and some advocacy groups.
Those factors kept the truck ban firmly in place during the Clinton administration.
That ban has since been lifted -- by President Bush and Congress.
Krugman could be an excellent columnist if his views weren't so clouded by his excessively partisan tilt. He makes good points, but often excuses Democrats' failures, while amplifying the perceived faults of Republicans.