I’ve long been a fan of the economist Alan Blinder, he of the hard head, soft heart (a great book, absolutely crying for an update, Alan!). In fact, Alan co-authored an important paper for our Full Employment Project on the policy lessons from the Great Recession.
So I was a bit blind(er)-sided by his WSJ oped this AM, 5 Big Truths About Trade, given that some of his truths are not true at all.
It’s essential to get this right as the populist campaign has elevated this trade debate in ways that can be used or misused. The latter would lead to protectionism, walls, and damaging tariffs like those touted by Trump. Alan’s right, for example, not to conflate trade agreements with trade, a theme I’ve tried to trumpet loudly in these parts.
But it also misuses the moment to argue, as Alan does, that the problem is simply that some workers are displaced and, if we only do more to help them, we’ll otherwise be fine. What this view ignores is the damage done to our and other economies through economically large and persistent trade imbalances. Alan’s “truth” #3 maintains trade imbalances “are inevitable and mostly uninteresting.”
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