Public Opinion on Trade, or Why Mark Penn Had to Go
Mark Penn’s departure from the Clinton campaign — after a friendly meeting with Colombian representatives to discuss promoting a trade agreement that Clinton opposes — provides a motivation to examine American opinion about trade. Doing so reveals the barriers that trade agreements face.
Public skepticism about free trade is rampant and hardly new. In his book on American attitudes toward foreign policy, Ole Holsti notes that in a series of Gallup polls in 1993, an average of only 38% of respondents favored NAFTA. More recently, Bryan Caplan finds that the public is, on average, likely to believe that trade agreements cost jobs or, at best, make no difference in job creation or loss. Many similar findings are here. The public’s attitude contrasts sharply with those of economists and other elites, who tend to support trade agreements (see again Holsti and Caplan, as well as the piece by Daniel Drezner that I discussed last week).
The contours of mass attitudes are even more interesting. In the 2006 Cooperative Congressional Election Study, respondents were asked this question:
This year Congress also debated a new free trade agreement that reduces barriers to trade between the U.S. and countries in Central America. Some politicians argue that the agreement allows America to better compete in the global economy and would create more stable democracies in Central America. Other politicians argue that it helps businesses to move jobs abroad where labor is cheaper and does not protect American producers. What do you think? If you were faced with this decision, would you vote for or against the trade agreement?
Only 27% supported the agreement, 46% were opposed, and 27% did not know.
Notably, this is one of the few issues in American politics where you will not find a significant partisan cleavage. 51% of Democrats opposed CAFTA (vs. 22% support), as did 41% of Republicans (vs. 36% support). Independents mirrored Democrats.
Better predictors of attitudes are education and income. Those with less than a 4-year degree tended to oppose CAFTA (50% vs. 24%), but those with at least a 4-year degree were evenly split (39% vs. 39%). Support also increases with income, although only among the wealthiest respondents (those making $150K or more) was there even bare majority support for CAFTA.
In his new book A Splendid Exchange: How Trade Shaped the World, William Bernstein writes:
The world’s increasing dependency on the continuous flow of trade has made us both prosperous and vulnerable.
It’s clear that the public agrees with the latter but not the former.
Comments
The income and education correlates with opinion on these trade agreements should not be surprising: These agreements put low-wage workers in competition with low-wage workers in other countries. If these agreements instead reduced the barriers to entry for high-wage workers (e.g. doctors, economists, and pharmaceutical products/medical devices) then the rich/highly educated would oppose them and the poor/less educated would support them. (Lowering barriers on high-wage workers/products should lower the price for these products/services low-wage workers consume.)
The question, as always, is: ``free'' trade for whom?
If Congress were to convene a meeting of Indian medical doctors (in India) and ask them how Congress can write a free trade agreement that would reduce the barriers to entry for these doctors, would the rich/highly educated members of the AMA support such legislation?
Posted by: J. Wright | April 8, 2008 10:53 AM
John,
The evidence you cite, as is almost always the case, deals with trade policy, not trade itself. There are not many people, perhaps none at all, who oppose trade.
Posted by: David Kaib | April 8, 2008 11:30 AM
Trade invokes change, which can be frightening. As America moves from a self confident nation, embracing individual risk and achievement, to a nanny state, using government to eliminate risk and push political correctness above all else, this opinion shift is inevitable. Trade is also a great issue for demagogues, who use fear of outsiders as a political weapon so seeing it spike in a long election cycle is also to be expected. Hillary Clinton's craven, and disingenuous, denunciation of NAFTA is a great example of this.
Posted by: Robert L. | April 8, 2008 12:50 PM
J. Wright: your thoughts strike me as worthy of an empirical test.
David, there is a lot of concern with trade itself, apart from trade policy. See this link:
http://www.pollingreport.com/trade.htm
One sample finding from a 2007 LAT/Bloomberg poll: 44% believe that "free international trade" has hurt the economy, while only 27% believe that it's helped.
Posted by: John Sides | April 8, 2008 01:51 PM
Yes, it's the "for whom?" that's the issue. Naomi Klein documented many recent historical cases of Central American economies torn apart when barriers were broken down. Multinationals would invest and the government officials would comply in drastically inflating the prices of goods. When a bailout was needed, IMF and World Bank would step with exorbitant terms. It's just a really corrupt operation, and the public was fed lies about everyone benefitting and prospering, when in fact only an elite few did.
Posted by: Dee | April 8, 2008 03:16 PM
David:
Your comments about the relationship between a social safety net and free trade are interesting. I submit that the opposite may be true: the dislocations of a global economy increasingly require guarantees of income and health insurance for those whose jobs have been destroyed in the process.
Paradoxically, the remarkably similar social-welfare policies of both Senators Obama and Clinton may be in the long run more conducive to American support of free trade than those of Senator McCain, who would throw to the wolves those thrown out of work by foreign competition.
Bill
Posted by: William Bernstein | April 8, 2008 08:06 PM
Seems to me that to test this, we'd need at least two trade agreements, each with different (and unambiguous) distributional consequences, but both with high saliency and wide public knowledge (don't know that Colombia or S. Korea bi-laterals would do). Then we'd need opinion data on each of these agreements where respondents' demographic (income, education) and employment sector are collected as well
I'm not an expert on these agreements. Does this data exist?
Posted by: J. Wright | April 8, 2008 10:03 PM