Free trade not exactly helping the Rust Belt
As the Republican establishment's policy pillars crumble, the cause is becoming crystal-clear. The members are simply out of touch with reality.
The Guardian's article on Ben Stein, former speechwriter for Richard Nixon and Gerald Ford, provides evidence of this in spades. According to Stein, "[f]ree trade is one of the main sources of economic growth." Except that all of American economic history tells the opposite story.
His views on Hillary Clinton would place him in an uncomfortable position among actual conservatives: "Mrs Clinton, I think, would do a fine job. I don't worry about her in terms of regulation at all."
And there are some claims by Mr. Stein that suggest he is not up to date with regards to the United States economy. When asked to "[i]magine Trump is elected president and he starts enforcing some of the policies he has mentioned," regarding the state of the economy, Stein replies:
It would get much worse. In terms, it would be a disaster. Trade is very important. The US economy is roughly 15% trade dependent – very roughly 15%. The question of the day: would his gains in fossil fuel deregulation offset the losses in trade? I doubt it. It's very, very important that he get educated about the benefits of free trade.
Yeah, that would be a "very roughly" indeed. The last time the U.S. economy was "roughly 15% trade dependent" was, ironically, 40 years ago, during the Ford administration. The current value of trade as a percentage of GDP is 30%.
Under Nixon and Ford, trade increased dramatically from 10% to 16% of GDP, and the economy was in stagnation. Under Reagan, trade declined from 20% to 19% of GDP, and the economy boomed. Reagan's rate of growth in real per capita GDP was 50% faster than Nixon's/Ford's.
Continuing on debunking the economic claims of the anti-Trump pundits, Benjamin Wallace-Wells at The New Yorker claims that the Rust Belt's economy is just dandy:
And yet in Michigan – in most of the Midwest, really – the economy is doing O.K. Michigan, Wisconsin, Minnesota, and Iowa all have unemployment rates well below the national average of five per cent, and Ohio and Indiana are just a touch higher than average, at 5.2 per cent.
Just imagine how simple life would be if the only economic indicator of interest were the unemployment rate, and that individuals didn't care about how much they earned so long as they had a job. Wait – isn't that a good definition of communism? Full employment for everyone in abject poverty. So now we find out what the establishment has been modeling its globalization economic policies after, just as critical thinking conservatives suspected all along (hint: think Agenda 21).
Then again, nobody should seriously believe the official unemployment data. The actual rate of unemployment is much higher.
But in terms of where Rust Belt wages have been headed in recent years, the story is a disaster.
The real median household incomes in all six states are currently below their 1999/2000 peaks, and in every state but Iowa, the decline over the past 15 years has been dramatic. Some are essentially unchanged since 1984, and Indiana's and Ohio's are, in fact, lower now than they were when Reagan won re-election.
Nothing to see here. Move along, and keep telling yourself that free trade is just fabulous.