Making Economic Sense Chapter 88: Is There Life After Nafta?
Making
Economic Sense
by Murray Rothbard
(Contents
by Publication Date)
Chapter 88
Is There Life After Nafta?
The great historian Charles A. Beard used to talk
about the vital gulf between
"appearance" and "reality" that pervades our politics and our political
system. Rarely has that
gulf been as striking and as revealing as in the bitter and intense
struggle over Nafta. On the
surface, Nafta dealt with a few puny tariffs covering a small fraction
of American trade. So why
the fuss and feathers? Why did the Clinton administration pull out all
the stops,
throwing caution to the winds by openly and shamelessly buying
Congressional votes? And why
the coming together of the entire Establishment: Democrats,
Republicans, Big Business, Big
Finance, Big Media, ex-Presidents and Secretaries of State, including
the ubiquitous Henry
Kissinger, and the last but surely not least, Big Economists and Nobel
Laureates? What was
going on here?
Perhaps the most shocking performance was that of
America's self-styled free-market
economists, periodicals, and think-tanks. Surely it would have been
legitimate for them to say, in
response to those of us who denounced Nafta from a free-trade
perspective: "Your concerns are
legitimate, but taken all in all, we think that Nafta cuts more in
favor of free trade than against."
Surely that would be the behavior one would expect from one free-market
economist to a
colleague who differed on the issue. But with only one or two
exceptions, this was not the
response of the Nafta forces.
From the time when Lew Rockwell first laid out the
free-market case against Nafta in the
Los Angeles Times (10/19/92), the reaction
has been hysteria. Consider what happened when the
excellent analysts of the Competitive Enterprise Institute, Jim Sheehan
and Matt Hoffman,
proved in meticulous detail that Nafta was a statist mockery of free
trade. Instead of being
persuaded, or considering their views soberly, other and larger
free-market think-tanks inside the
Beltway played vicious hardball, suitable for a political brawl rather
than for a discussion of
ideas. They put tremendous pressure on CEI, not only to suppress the
Sheehan-Hoffman Report,
but also to fire its authors. Fortunately, Fred Smith, head of CEI,
firmly resisted these pressures.
So what was the frenzy all about, from Clinton and
Kissinger down to Beltway
think-tanks? It was indeed not about trade, certainly not about "free"
trade. As the Clinton
administration and their Republican auxiliaries stressed as the vote
went down to the wire, the
fight was about foreign policy, about the globalist policy that the
United States has been pursuing
since Woodrow Wilson, and certainly since World War II. It was about
the Establishment-Keynesian dream of a New World Order. Nafta was a
vital step down the road to that order.
Politically, such an order means a United States
totally committed to a form of world
government, in which US/UN "police" forces dominate the world, and
impose institutions to our
liking around the globe. Economically, it means a global system devoted
not to free trade but to
managed, cartelized trade and production, the economy to be governed by
an oligarchic ruling
coalition of Big Government, Big Business, and Big Intellectuals/Big
Media. On the vital
currency front the New World Order is slated to fulfill the Keynesian
dream: of a World Reserve
Bank issuing world paper money ad lib, to make
sure that all countries can inflate and enjoy easy
money together, with no country's currency inflating more than the
others, and thereby suffering
declines in exchange rates or outflow of a reserve currency.
Internationally coordinated fiat
money inflation is the Keynesian goal.
As for the shibboleths about "free trade," the
"freedom" is strictly Orwellian. The
Establishment's concept of "free" trade, since World War II, is exports
subsidized by the
taxpayers. The idea is to privilege American exports, either by foreign
aid or by the international
inflation which will pour more buying power into the hands of
foreigners who will purchase
American products. The U.S. business Establishment is willing to accept
imports only as a
bargaining chip to pressure foreigners into buying American exports.
Within American business, the war over Nafta was a
war between exporters, and the
bankers who finance them, as against business firms that suffer from
import competition. It was a
contest which the domestic-oriented firms and their union supporters
were doomed to lose, since
their arguments, by denouncing competition and "loss of jobs," were
clearly both special
pleading and economically ignorant. As a result, the exporters and
their financiers came across as
wise statesmen, and their opponents appeared as both dumb and
narrow-minded.
The truth is that the exporters were simply more
sophisticated and better con artists; for
one thing, they had in their camp the articulate economists and
self-proclaimed champions of the
free market. Well, the exporters and their bankers have, and have had
for decades, the money and
the power. And, unfortunately, in this world, if they have the money
and the power, all too often
the Big Intellectuals
and Economists and Free-Market Champions will follow in their
wake.
The good news, on the other hand, is that Nafta is
only the beginning of the struggle. The
New World Order is a Utopian project. Not only is it statist and
cartelist and opposed to genuine
free trade and free enterprise; it cuts against the interests and the
freedom of the broad mass of
the people. Furthermore, it also cuts against the rising and rampant
nationalisms that have been reawakened throughout the world upon the
collapse of Communism and the Soviet Empire. The
broad public in the U.S. and in other nations, coupled with renascent
nationalisms, could well be
enough to put the boots to the New World Order. All that is needed are
intellectuals and leaders
courageous enough to tell the truth.
The truth can make us free; and the panic of the
entire Establishment in the weeks before
Nafta shows that they know what they will be up
against once the public is on to their game.
Previous Page * Next Page