The NYT Argues For Class Biased Trade Agreements

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The NYT feels very strongly that Congress must approve further trade measures that put downward pressure on the wages of workers without college degrees. It made this case in an editorial promoting new "free trade" agreements today. At one point it presents the finding of a study from the Peter G. Peterson Institute for International Economics that eliminating all remaining barriers to trade will add $500 billion a year (@ 3.8 percent) to GDP. Serious people might ask how the Peter G. Peterson Institute determined the remaining barriers to trade. Did it consider the patent monopolies on prescription drugs, which cost consumers hundreds of billions a year, a barrier to trade? Did it consider the copyright protection that obstructs the free transfer of music, movies, software and other material over the web a barrier to trade? How about all the restrictions that make it so much more difficult to hire a foreign doctor, lawyer or economist than to buy a foreign made car or shirt? Did the Peter G. Peterson Institute view such restrictions as barriers to trade? The answer to all these question is "no." The Peter G. Peterson Institute has no interest in reducing or eliminating trade barriers that have the effect of shifting income upwards. The Peter G. Peterson Institute, and apparently also the NYT, only wants to eliminate the trade barriers that might benefit less educated workers. And, because they have so much influence in the media, they get to call this "free trade."

--Dean Baker

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