Wednesday, October 29, 2008

Attacking all vs. some protectionists

Professor Greg Mankiw ran a column from India yesterday pointing out that Senator McCain has been more consistently in favor of free trade than Senator Obama. He then challenges his “economist friends who are working for Obama… to defend his positions on ethanol subsidies, tariffs on Chinese goods, the Byrd amendment, etc.” As most economists agree with Professor Mankiw, not Senator Obama, on these issues, it is a fair challenge.

When he was the Bush administration’s chief economist, Mankiw was a consistent fighter for free trade. At the same time, over the last 8 years President Bush has supported a vast array of protectionist policies. Since Mankiw left what has arguably been the most protectionist presidential administration of either party in recent decades, I have found no critiques of Bush administration protectionism. In contrast, his blog reprinted a Wall St. Journal column from the 2006 Congressional election attacking Democrats as protectionists.

Economists typically argue for lowering any country's trade barriers, without requiring a symmetric lowering by trading partners. That endorsement of asymmetry does not hold within a country - there is no general result in political economy that says you will get freer trade by attacking only the other party's protectionists while giving your own party's protectionists a free pass. I would be surprised if an Obama administration were to be more protectionist than the one Mankiw worked for.


Don Pedro said...

Very good points.

Putting aside the question of whether Obama is "protectionist", I think that for a voter who's main issue is getting more trade agreements passed, they should definitely vote for Obama.

If McCain is elected, you'll have a president who favors anything called a "free trade agreement" and a Democratic Congress that will be skeptical as a whole and disinclined to give McCain a victory on anything.

If Obama is elected, it's very possible that he will negotiate changes to the Colombian and South Korean agreements and get them passed. This is not going to happen in the first two years of his presidency, when he'll be preoccupied with so much else, but it could well happen later on.

Steve Roth said...

>the most protectionist presidential administration of either party in recent decades

Hey! You can't just leave that lying on the table. Give us some support for that! We'll use it.

Anonymous said...

So Mankiw's a hypocrite, like everybody else in politics. But the relevant question isn't whether Obama would be more protectionist than Bush but whether he'd be more protectionist than McCain; the editorial Mankiw posted makes a reasonable case that he would be.