| > It works for so many other countries It even worked for the United States. Protectionism was a major component of our policy approach toward industrialization. Protectionism as a mechanism for supporting the development of domestic capabilities is, historically, a well-justified policy position. And if you look to highly protectionist economies today, you'll find mostly developing economies. > Why not? 1. Most importantly, protectionism as a mechanism for inflating wages and/or spurring job growth in an already developed economy isn't nearly as well-tested an approach as examples of protectionism in America's past. Historic examples of US protectionism had the end goal of boosting domestic labor productivity. Modern protectionism risks doing exactly the opposite. 2. The diffuse benefits of free trade must be weighed against the more localized costs of free trade. It's a difficult calculus, but it shouldn't be ignored. Cheap stuff at Walmart and Amazon benefits a whole ton of people. Perhaps more importantly, access to foreign markets and capital creates a lot of jobs and wealth domstically. A lot of Americans are employed doing high-paying, high-quality work that is exported globally. (Including a lot of software engineers.) 3. The benefits to labor may be short lived if automation wipes out a lot of manufacturing jobs. In which case we've traded access to foreign markets and capital for maybe 10 years of jobs and a false sense of non-urgency in job re-training. |
I don't see any reason todays America would be any different.