The New Iron Curtain

     Congressional attempts to wall off the Mexican border may be the worst idea since Smoot Hawley. No good can come of it. Its advocates advance it as a security measure and I suppose some people see it in that light but it is really part of a broader popular feeling that the world is encroaching on us and we don’t like it. We don’t like immigrants, we don’t like sending call center jobs to India, and we don’t want Arab companies operating American ports. This whole thing about globalization makes us uncomfortable. We need to get over it. We live on a shrinking planet whether we like it or not. If we manage it right it will produce enormous opportunities for our grand children. Getting it wrong could have catastrophic results.
     A little history is in order. European agricultural production all but ground to a halt during WWI and American farmers rushed into the breach. It can be fairly argued that German attempts to stop shipments to England and France prompted US entry into the war. It wasn’t about the oil. It was about the wheat. European reentry into the commodity markets in the 1920s produced a world wide glut. Smoot Hawley raised tariffs to protect domestic producers, other countries retaliated, and the world sank into The Great Depression. After the next war we reversed course and began a long series of tariff reductions and trade agreements. There were hiccups here and there but the trend was steadily down and the world experienced an explosion of prosperity never before seen. The last thing we should want to do is screw that up.
     My brother sent me a column from a pundit arguing that “Historically, international trade has not been a major source of structural adjustment for American workers.” I’m surprised the guy can spell “historically.” This country was built on trade. Not only was the Depression a product of the Smoot Hawley Act and resulting retaliation; Columbus sailed looking for better access to spices, early Virginia prospered on tobacco sales to Europe, the market for beaver pelts drove westward expansion prior to the French and Indian War, and even the Civil War was as much about protectionist tariffs for Northern industry and the impact on Southern cotton, tobacco, and sugar exports as it was about slavery. Constitutional prohibitions on internal interference with interstate commerce are the most important factors in the emergence of American economic preeminence during the 20th century. Technological innovation has certainly been the story of the industrial revolution but to minimize the impact of trade is outrageous.
     I’m sure I don’t have to remind anyone we are a nation of immigrants too. Our ability to assimilate our newcomers is one of the factors that set us apart from other nations. The degree to which we failed to assimilate blacks and Hispanics is one of the tragedies of the last century. We can and should take reasonable measures to control a flood of immigration but we shouldn’t be trying to stop it altogether. We should be focused on how to help them become productive citizens once they get here. Some of these people come with a work ethic that is nothing short of amazing and that is to the benefit of all. Every year we see stories of Asian high school valedictorians who have maxed the SAT. That is a good thing. We should be holding them up as models for others. We shouldn’t be trying to hold back the tide of globalization either. We should be taking advantage of it, not building walls.