November 07, 2006

Return Of Economic Nationalism

By Patrick J. Buchanan 

"Well, the American people have spoken, and in his own good time, Franklin will tell us what they have said."

So one wag explained the Democratic landslide that buried the Hoover Republicans in 1932. The country was voting against three years of Depression and the president and party it held responsible.

But what was it voting for? FDR supplied the answer: a New Deal.

All week, politicians and pundits will be putting their spin on the election returns, but there is a more certain way to know what Americans are voting for, and voting against. Which issues, in the tight races, did the candidates campaign on, and what issues did they consciously seek to avoid?

Among the more dramatic events of this election year was one that has been little debated: The return of the trade-and-jobs issue, front and center, to American politics.

Note: Almost no embattled Republican could be found taking the Bush line that NAFTA, or CAFTA with Central America, or MFN for China, or globalization was good for America and a reason he or she should be re-elected. But in Ohio, Pennsylvania and Michigan, attacks on free trade were central elements of Democratic strategy.

"Protectionist Stance Is Gaining Clout," ran a headline inside The Wall Street Journal election eve. "Democrats Benefit by Fighting Free Trade, and Next Congress Could Face Changing Tide."

The Journal focused on Iowa's 1st District, an open seat given up by GOP veteran Jim Nussle, who was running for governor. As the Journal related,

"Bidding for a seat held by a free-trade Republican for nearly two decades, Democrat Bruce Braley had gained an edge by taking the opposite view: bashing globalization. ...

"Mr. Braley has made opposition to the Bush administration free-trade agenda a centerpiece of his campaign. He has run ads blaming the state's job losses on Bush's 'unfair trade deals.'"

Sherrod Brown, the Democratic challenger to Ohio's GOP Sen. Mike DeWine, also launched assaults on globalization and made the Bush trade deals a central feature of his campaign.

With the 2006 election, America appears to have reached the tipping point on free trade, as it has on immigration and military intervention to promote democracy. Anxiety, and fear of jobs lost to India and China, seems a more powerful emotion than gratitude for the inexpensive goods at Wal-Mart. The bribe Corporate America has offered Working America—a cornucopia of consumer goods in return for surrendering U.S. sovereignty, economic security and industrial primacy—is being rejected.

What is ahead is not difficult to predict.

The Doha Round of global trade negotiations is dead. Even if Bush cuts a deal with Europe, it could not pass the new Congress. In mid-2007, when Bush asks for renewal of his fast-track authority—presidential power to negotiate trade deals, while cutting Congress out of any role save a yes-or-no vote—it will be amended drastically or batted down handily.

But if the free-trade era is over, what will succeed it?

A new era of economic nationalism. The new Congress will demand restoration of its traditional power to help in shaping trade policy. When the U.S. trade deficit for 2006 comes in this February, it will hit $800 billion, pouring more fuel on the fire.

Even before Tuesday, wrote the Journal, "the Republican-controlled Congress (had) already showed its sensitivity ... helping derail a deal by Arab-owned Dubai Ports World to purchase the commercial operation at five U.S. ports and approving millions of dollars to build a wall to stem the tide of illegal immigrants from Mexico."

A rising spirit of nationalism is evident everywhere in this election, not simply in the economic realm. Americans are weary of sacrificing their soldier-sons for Iraqi democracy. They are weary of shelling out foreign aid to regimes that endlessly hector America at the United Nations. They are tired of sacrificing the interests of American workers on the altar of an abstraction called the Global Economy. They are fed up with allies long on advice and short on assistance.

Other leaders in other lands look out for what they think is best for their nations and people. Abstractions such as globalism and free trade take a back seat when national interests are involved.

China and Japan manipulate their currencies and tax polices to promote exports, cut imports and run trade surpluses at America's expense. Europeans protect their farms and farmers. Gulf Arabs and OPEC nations run an oil cartel to keep prices high and siphon off the wealth of the West. Russians have decided to look out for Mother Russia first and erect a natural gas cartel to rival OPEC. In Latin America, the Bush's Free Trade Association of the Americas is dead.

We are entered upon a new era, a nationalist era, and it will not be long before the voices of that era begin to be heard.