- Believers in capitalism should wholly support the administration for once.
- Dropping trade barriers improves opportunities for U.S. manufacturers.
- The puzzle is why the Obama administration seems to understand the benefits of free markets so well abroad, but cannot understand it at home.
Leaks about negotiations over the Trans-Pacific trade partnership, which would knit the U.S. and major Asian economies into a free-trade area, are ironic: The Pacific seems to be the only place where the Obama administration believes in the free-market. The documents leaked today come from an unnamed foreign government unhappy with U.S. negotiating positions. Believers in capitalism should wholly support the administration for once. The White House is pressing to allow corporations to challenge protectionist laws, to give greater protections to intellectual property, and to allow consumers to freely make decisions to buy medical drugs.
Liberals at places like The Huffington Post, of course, see this all as a corporate giveaway. But that is because liberals in the media think of the free market itself as some devious form of corporate welfare, rather than the greatest engine for the betterment of the human condition in mankind’s history. With these regulations, the Obama administration is doing everyone a favor. Dropping trade barriers improves opportunities for U.S. manufacturers, of which about one-third depend on either exports or imports. It is good for American workers, who receive higher pay in trade-dependent industries. But it also benefits consumers in the U.S., who will pay lower prices for imported goods and it will force U.S. companies to be more competitive. It is even good for foreign consumers, who will benefit from the lowering of protectionist trade barriers.
The puzzle is why the Obama administration seems to understand the benefits of free markets so well abroad, but cannot understand it at home. If there was ever a real-life lesson about the blessings of capitalism, it is in Asia, where the move to free markets has moved about 600 million out of poverty and added countries like Japan, Korea, Taiwan, and Singapore into the rank of economic powers. The Obama administration recognizes this truth and is pushing for even more free trade in Asia. But at home, it continues to press an agenda of government economic intervention, over-regulation, and centralized control of industry (see Obamacare, the bailouts, and Dodd-Frank). The strange result is that even while the administration strangles the “animal spirits” that made the U.S. economy the envy of the world in the 20th Century, it is ensuring that they will flourish in Asia in the 21st.