Trade Begets More Trade …. Yes, But More is Needed.

Panama Canal 2

 

     Fred Smith, CEO of FedEx, in an outstanding piece in today’s Wall Street Journal gives a ringing repudiation of  today’s trade critics. He reviews the history of world trade and global commerce from the Great Depression to today’s absurd Presidential primaries. Here are some of his highlights.
  • President Roosevelt and his Secretary of State Cordell Hull vision was that liberalized global trade would lead to greater peaceful relations and international cooperation.
  • Technological progress in telecommunications and transportation revolutionized global trade in the 1960s and 1970s.
  • The GATT/WTO trade rounds liberalized trade through multiple trade rounds. While they did not cover sea trade or aviation historical developments occurred in those sectors including containerization and ‘Open Skies.’
  • Deregulation and other developments (such as Open Skies) made for fantastic explosion of international travel that fed into even greater international trade and investment.
  • The growth of computing power and informational technology have transformed much of trade and created entirely new forms of electronic commerce.
  • There is an innate desire to travel and trade.
  • History shows trade made easy begets more trade, more jobs and more prosperity.
     I would add that the harshness of globalization spawns harsh criticism. But better trade enforcement and upgraded trade adjustment assistance can help address many legitimate concerns. Other policies favoring innovation, skills training and sensible tax policies are part of the remedy. The remedy does not include populist inspired protectionism. But trade does beget more trade. That’s good for all of us.

 

….. “How Trade Made America Great.” Wall Street Journal (March 26, 2016).
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About Stuart Malawer

Distinguished Service Professor of Law & International Trade at George Mason University (School of Public Policy).
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