The Cost of Trade With China

The economist Dani Rodrik likes to tell the story of the time he sent a draft of his 1997 book, Has Globalization Gone Too Far?, to a “well known and outspoken economist” for review:

He told me he had no quarrel with my economics, but that I should not be “providing ammunition to the barbarians”—that is, I should not give comfort to all those protectionists who stand ready to hijack any argument that seems to provide intellectual respectability to their positions.`

The economist in question was Paul Krugman, as Rodrik quietly revealed in the footnotes of a later book. The irony, of course, is that Krugman went on to coin the sarcastic epithet “Very Serious People” to describe precisely this tendency of elites to argue in bad faith. Deficits and inflation aren’t always bad, for example, but Very Serious People resist deviating from hawkish views lest spendthrift politicians run free. The late-1990s Krugman was evidently himself a Very Serious Person who understood economic globalization to be, while not costless, far too important to risk confusing the public with subtlety.

Maybe Krugman had a point. Rodrik’s book was published only a few years after the deadly, NAFTA-inspired peasant rebellion in south west Mexico, and a few years before the hysterical WTO protests in Seattle. And today, animus against globalization and free trade has found its way into the Oval Office, where at various points NAFTA and the World Trade Organization have come close to being smashed in much the same way Seattle black bloc rioters smashed Starbucks windows in 1999…

Read the rest at TheBulwark.com