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What Should Replace It and Why

by Ian Fletcher

Pub Date: Jan. 22nd, 2010
ISBN: 978-0578053325

An economist and adjunct fellow at the U.S. Business and Industry Council argues that continuing a program of unregulated free trade is bad for America and proposes a solution that will benefit the U.S. economy in the long term.

Employing a typical economist’s rationality in this methodical and nonpartisan book, Fletcher takes to task the commonly held assumption that free trade is an inherently and inarguably good system for America, as well as the notion that challenges to this assumption are reactionary and mercantilist. Citing massive trade deficits—the fact that America imports much more than it exports—he argues that American primacy is waning as the dollar becomes less valuable. Fletcher undertakes a systematic approach to debunking free trade, beginning with clear-eyed explanations of free trade as it currently stands and the negative consequences it increasingly has on America. He devotes much of the book to his opposition’s arguments, deconstructing them so as to give free-trade detractors cogent rebuttals on the subject (a particularly favored whipping boy is the idea of comparative advantage). However, he saves the real intellectual wrath for the economists who either actively or tacitly support free trade. While politicians and powerful corporations do hold some sway, it will always be theories that dictate trade policy. Fletcher is of the opinion that any theory that supports free trade is the result of unrealistic assumptions about how trade works in today’s world as well as antiquated ideas about perfectly sound economies. His reasoned answer as to how trade should operate in America comprises the book’s third section. In short, he favors what is called a natural strategic tariff, one that is simple in implementation (he offers a 30 percent rate) but complex in effect, as different industries would be inherently more sensitive to a tariff. Such a system would promote some manufacturing to move back to America (indeed, the industries that would be affected are the very ones Americans want back on their shores) while leaving untouched other goods that the country would still happily import.

An articulate and conscientious critique of free trade that should be read by anyone with serious interest in the subject.