the national interest

Bernie Sanders’s Case Against Free Trade Is More Ignorant Than Donald Trump’s

Bernie Sanders Delivers Speech In New York City
Bernie Sanders: "The one percent of the one percent of the ninety-nine-percent controls just one percent... wait, I've lost the thread."

People tend to find new events as confirmation of their previous beliefs, so it’s no surprise that Bernie Sanders sees the Brexit vote as more evidence for the urgency of his agenda. What it shows, he argues in an op-ed in today’s New York Times, is that free trade is failing, and that the white working-class backlash in developed countries should be harnessed toward social-democratic policies like his, rather than ugly nativist ones like Donald Trump’s. But Sanders also argues that free trade is bad for the entire world. “Let’s be clear,” he writes. “The global economy is not working for the majority of people in our country and the world.” In fact, this is not clear at all.

There is a strong case that increasing global trade has a flattening effect on wages between workers in rich countries and poor ones. Free trade has transferred manufacturing jobs from the industrialized world to the developing world. The losers from this arrangement are the working class in rich countries, as Branko Milanovic has showed:

The argument for restricting this trade rests on protecting the interests of the working class in rich countries at the expense of the global poor who are taking their jobs. In an interview last summer, Ezra Klein pushed Sanders into more or less conceding that his trade plans would look out for American workers at the expense of poor workers overseas. “I think what we need to be doing as a global economy is making sure that people in poor countries have decent-paying jobs, have education, have health care, have nutrition for their people,” Sanders replied, when asked how he would balance the two. “That is a moral responsibility, but you don’t do that, as some would suggest, by lowering the standard of American workers, which has already gone down very significantly.

In his op-ed today, Sanders does not make the straightforward case that American trade policy should look out for American workers first and the rest of the world second. Instead, he argues that global trade is making the entire world poorer:

[I]t’s not just the British who are suffering. That increasingly globalized economy, established and maintained by the world’s economic elite, is failing people everywhere. Incredibly, the wealthiest 62 people on this planet own as much wealth as the bottom half of the world’s population — around 3.6 billion people. The top 1 percent now owns more wealth than the whole of the bottom 99 percent. The very, very rich enjoy unimaginable luxury while billions of people endure abject poverty, unemployment, and inadequate health care, education, housing and drinking water.

This is just wrong. The global rate of deep poverty is falling rapidly. Last year it dropped to below 10 percent for the first time in human history:

The gains among the global poor can be traced directly to increased trade. To the extent that there is an economic base for the Trump/Leave appeal, it is a zero-sum struggle between the working class in the United States or Great Britain and poor workers in Asia and Africa. But this dynamic is too awkward for Sanders to grapple with.

Sanders argues that the correct response to the system that is allegedly failing rich and poor countries alike is “real change,” stripped of nativist sentiments: “we do not need change based on the demagogy, bigotry and anti-immigrant sentiment that punctuated so much of the Leave campaign’s rhetoric — and is central to Donald J. Trump’s message.” But Trump’s message, for all its demagoguery and racism, is at least connected to a factually coherent analysis of how trade works, as Annie Lowrey points out. Trump is arguing that trade deals have helped foreign countries and screwed American workers. He’s straightforward about his intention to screw over foreign countries.

Sanders, on the other hand, wants to pretend that a policy that screws over the global poor can be undertaken not only without overt bigotry, but that it will also benefit the global poor themselves. Between the two, Trump’s case is the more realistic one.

Bernie’s Case Against Trade Dumber Than Trump’s