No more false choices. . . .

. . . is the title of a perceptive op-ed article in today’s New York Times by two of Senator Obama’s economic advisors. They debunk three widely held “false choices” facing the economy, and then propose alternatives to the either/or categorization. One important polarizing dichotomy they target is “free trade versus protectionism.”

The article’s special significance is that it is written by Robert E. Rubin, a former U.S. treasury secretary who is currently a Citigroup executive, and Jared Bernstein, a senior economist at the Economic Policy Institute. The two express agreement on trade as follows:

“With respect to trade, the choice is not trade liberalization versus protectionism. Instead, as trade expands, we must recognize that protecting workers is not protectionism. We must better prepare our people to compete effectively and help those who are hurt by trade—not just displaced workers, but those who find their incomes lowered through global competition. This means investing more of the benefits of trade in offsetting these losses, through more effective safety nets, including universal health care and pension coverage.”

But the two economists then go on to disagree on a key issue:

“Beyond that, while we share a commitment to helping workers deal with our new global challenges, one of us (Mr. Bernstein) would advocate provisions in trade agreements that are intended to protect workers, both here and abroad, and the other [Mr. Rubin] would have considerable skepticism about the likely effectiveness of those provisions for our workers.”

In other words, since we are facing “new global challenges” in international trade, Bernstein advocates addressing them domestically and globally. Rubin, even while recognizing new global challenges, advocates addressing them only domestically, with better U.S. safety nets.

Two apparently different approaches. Can either work effectively?

The domestic approach, concentrating on U.S. measures alone, could work if U.S. legislation were globalized, truly globalized. That would mean adding a worker-friendly dimension to a wide set of U.S. laws. Tax laws, for example, would provide incentives for businesses to invest in the United States instead of abroad. Tariffs would be raised to cover more than the cost of building and maintaining our sea and airports, but also some of the cost of new safety nets. Corporate laws would be revised to make U.S.-based multinationals accountable for their treatment of workers in foreign countries, both those on their own payroll and those on the payrolls of contractors of the multinationals.

Rubin is right to be skeptical about labor provisions added to trade agreements, if he has in mind the provisions in existing agreements and the limited provisions adopted so far (as in the Peruvian free trade agreement). But Bernstein seems to favor a broader approach, one that would “protect workers, both here and abroad.”

To be serious about meeting the new global challenges facing workers here and abroad, it is pitifully inadequate to improve only the labor chapter of a trade agreement. The whole trade agreement, every single chapter of it, must be analyzed from a brand new perspective, one sharply different from the prevailing paradigm among negotiators.

At present, all trade agreements, including overall accords on the scope of trade agreements, are dominated by negotiators who have this objective uppermost in mind: How can we protect the rights and interests of business and business organizations in the global economy? The resulting document, whether bilateral, regional, plurilateral, or multilaternal in reach, is then judged by that one-sided standard.

That standard needs to be balanced by another: How can we also protect the rights and interests of workers and their organizations in the global economy? To its great shame, the World Trade Organization, like its predecessor bureaucracy, has steadfastly refused to put that question on its agenda. Worse, the WTO’s bosses, the political leaders of the world’s nations, are complicit in that shameful taboo.

Let me propose an addition to the list of economics false choices. The issue of what approach to take under the new global challenges is not global versus national. The most effective approach is to work at both.


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Media Blind Spot: Public's Trade Concerns

“For each item I name, please tell me how important it will be in your vote for president this year.” Pollsters for the Washington Post and ABC News put that request to a national sample of registered voters, and went on to name 17 “items.” Foreign trade (or a synonym, such as globalization) was not among the 17 topics.

I found that strange. The article reporting the poll results on the front page of the July 16 Post also ignored the topic. The second headline over the article said: “Economy Remains the Top Concern.” Indeed, 92% of the respondents rated “the economy” as either extremely important or very important.

In a story on its political blog, Caucus, a day earlier, July 15, the New York Times reported the results of its own poll, this one co-sponsored with CBS News. Its July 15 story, headed “Iraq Still a Dividing Line,” did not cover a question the pollsters asked of registered voters, “What do you think is the most important problem facing the country today?” The answers, available on the Times Website, ranked “economy” as the most important. Again foreign trade or an equivalent term was not on the list of choices, 24 in all, presented to voters. {The Times drew on the same poll findings for a front-page political story on July 16 devoted to the Obama candidacy and the racial divide.)

These four media giants -- The New York Times, the Washington Post, CBS News, and ABC News – have a heavy influence on the news agenda of other media, small and large, across the nation. Therefore, they have a special responsibility to report public opinion fully and accurately, especially on issues that may affect the outcome of a historic election.

On the face of it, the Post and the Times failed to do so in these two polls. Why?

The designers of these two polls may have lumped the public’s concerns about trade into the broad “economy” category. If so, that is careless, at best. The media themselves don’t cover free trade as part of their reporting on (say) “The #1 issue – the economy,” as the CNN series on this theme is called. (According to a new CNN poll, 51 percent of Americans consider foreign trade "a threat to the economy.")

By email and phone, I asked the Post and Times to explain the omission. I suggested the possibility that free trade might have been lumped into the economy category. No response.

David Sirotta, author of The Uprising: An Authorized Tour of the Populist Revolt Scaring Wall Street and Washington, describes the fair trade movement as “one of the most encouraging transpartisan developments of the last few years” – a movement “ignored by the media (and, frankly, much of the blogosphere).”

No such blindspot here. But what explains the media’s?


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Hooked on the Presidency

Looking over the field of men anxious to run for President at the beginning of 1976, James Reston wrote in his New York column: “Once hooked on the Presidency, it is an appetite more addictive than dope.” In “Who’s Hooked?” an op-ed piece that the Times did not print, I diagnosed the media as suffering from the very same addiction.

“Although it is true, as Reston says, that the appetite for the Presidency ‘consumes men as physical as George Wallace of Alabama and as intellectual and promising as Gene McCarthy of Minnesota,’” I wrote, “it also consumes news reporters and dominates their output.”

I marveled at the volumes written and spoken in speculation about election outcomes months before the ballots were printed. Laid end to end, those words “would reach far into outer space, and several times around Mars, where they would have about as much meaning as they have here,” I wrote.

I marveled, too, at the armies of reporters and photographers following Presidential aspirants everywhere. “Partial demobilization of this entourage need not put reporters on unemployment compensation rolls,” I wrote. “They could find productive employment writing about problems – gut problems – that concern people.”

Obviously, that 1976 critique of mine, which I found while cleaning out some old files, holds true for the media today. Why this obsession with the Presidency?

Well, it is, after all, the most powerful job in the United States and the world. Okay, but this is a democracy. The excessive focus on the President adds to that power, and it crowds out other voices.

Just listen to the claims that Presidential candidates make. “Just elect me, and I’ll solve ______[fill in the current problems].” Nonsense, of course. Thank God and the constitution, the President is not all-powerful. Yet through obsessive attention to the Presidency, the media pays little attention to the other power centers that share in national decision-making on matters small and large.

Take trade policy. It is one of the most important issues being debated by John McCain and Barrack Obama. Yet the media generally covers it only superficially, and sometimes sensationally.


Even the late Tim Russert, for all his knowledge of the political scene, was weak in bringing much enlightenment to a complex issue like trade. In fact, he was probably at his weakest in the March debate between Hillary Clinton and Barrack Obama.

He introduced a series of questions on NAFTA not by quoting what Clinton or Barrack had said, but what Al Gore had said back in 1993: “If you don’t like NAFTA and what’s done, we can get out of it in six months.” He then asked: “Will the U.S. President say we are out of NAFTA in six months.”

Russert reformulated the question twice for Clinton (once because he was not satisfied with Clinton’s qualified No) and then once for Obama, to which Obama replied: “I will make sure that we renegotiate, in the same way that Senator Clinton talked about, [using] the hammer of a potential opt-out as leverage to ensure that we actually get labor and environmental standards that are enforced….”

(For details, check my March 6 posting “The ‘Opting Out” NAFTA Distraction,” based on the actual transcript.)

Although Russert got his point “buttoned” up to his satisfaction, the hurried exchange did more to confuse than to enlighten the public on NAFTA. That’s par for the course in the media when dealing with trade issues.


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Hooked on Free Trade Religion

Then there’s the print media’s addiction to the present system of “free trade.” The worst offender of all, in my view, is the New York Times. Liberalization of trade is a sacred component of its liberal faith, promulgated throughout the paper, not only on the editorial pages but in the business section and in the weekly Magazine. Dissenters seldom get any space, not even in the news pages.

Also, facts embarrassing to the policy line get buried or ignored. In a national poll conducted in mid-June, 56 percent of voters surveyed said that NAFTA needs to be renegotiated. Even 49 percent of Republicans agree, according to a June 18 release by an independent polling organization, Rasmussen Reports. The story appeared on Fox News, but not in the New York Times.

On June 8 the New York Times Magazine ran its latest defense of free trade, “This Global Show Must Go On” by Tyler Cowen, professor of economics at George Mason University. Among other things, Cowen criticizes a proposed “’timeout’ from globalization” when the actual proposal is for a timeout in trade negotiations (there already is a de facto timeout, and world trade is actually accelerating, as Cowen acknowledges).

Another economist, Dani Rodrik, has written an economic response to Cowen in an article, “Globalization anxiety as mass hysteria?” on his Weblog. Here’s his first sentence:

“Those who are puzzled by globalization anxiety and attribute it to collective irrationality (see Tyler Cowen’s piece in the NYT) overlook a fundamental aspect of markets – their ‘embeddedness’.”

Read the full text here. Enjoy.

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