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John Hood: Trade views are partisan, too

By John Hood

RALEIGH — Even as the number of voters who identify themselves as unaffiliated rises at the expense of the Republican and (especially) Democratic shares of the electorate, partisan polarization remains a strong force in our politics.

How can that be? When John Doe and Jane Smith identify as unaffiliated, that doesn’t necessarily mean they are “moderate” or “swing voters.” John may be so left-wing that he finds it uncomfortable to register as a Democrat, and yet votes for Democratic candidates almost all the time. Jane may be a libertarian who agrees with Republicans on economics, disagrees with them on other matters, and yet votes GOP almost all the time because, in her mind, economic issues are the most pressing — or the most likely to produce legislative action.

One clear sign of partisan polarization is what scholars call a “conformity effect.” When voters don’t have personal experience or knowledge of a particular issue, they often adopt the position of the person who leads their party or faction at the time.

Views about trade policy serve as a good example of the conformity-effect whipsaw. During the George W. Bush administration, Republican voters were more likely than Democrats to say they saw international trade as an opportunity rather than a threat, according to a series of Gallup surveys. By the end of Barack Obama’s first term in office, the trend lines had switched — Democrats were far more optimistic about trade than Republicans were.

Similarly, polls by the Pew Research Center found that during the Bush years, Republicans were more supportive of free-trade agreements than Democrats were. The opposite was true during the Obama years, with GOP support taking a sharp downward plunge in 2016 as Donald Trump, a longtime critic of free trade, secured the Republican nomination for president.

Here in North Carolina, political disputes about trade have a rich history. During the 19th century and early 20th century, the national Democratic Party usually championed low tariffs and freer trade while the rival party, first the Whigs and later the Republicans, usually favored protectionism. But in North Carolina, where Democrats were almost always firmly in charge, there were robust pro- and anti-trade factions within the majority party.

As the two parties began to realign after World War II, newly successful Republicans representing manufacturing-heavy counties often leaned towards protection. Newly successful Republicans in cities and suburbs often leaned the other way.

But, again, signals from the top of the ticket mattered a lot. While Ronald Reagan’s administration did sometimes resort to protectionist policies — virtually all administrations do, regrettably — Reagan’s rhetoric about the virtues of voluntary exchange and free markets had a marked effect on the attitudes of GOP-leaning politicians and voters. In the past year, Trump’s rhetoric has propelled them in the opposite direction.

As a policy matter, I think the empirical evidence is overwhelming that free trade is superior to protectionism. While reducing trade barriers dislocates some workers in some industries in the short run, the net effect is to raise the average standard of living, by reducing the cost and increasing the quality of the goods we consume, as well as to create new jobs in other industries that either export abroad or deliver services that can’t effectively be imported.

According to a new study by the Peterson Institute for International Economics, the expansion of trade since 1950 had made America’s economy two trillion dollars larger than it would otherwise have been, and boosted our average living standards by more than $18,000 per household.

Even as conformity effects have shifted partisan allegiances back and forth, most North Carolinians recognize and value the benefits of trade. In the latest poll by Elon University, 62 percent of voters said North Carolina’s involvement in the global economy was “a good thing because it provides the state with new markets and opportunities for growth,” while only 25 percent said it was “a bad thing because it lowers wages and costs jobs.”

North Carolina’s future will be built on freer markets, not more constrained ones.

John Hood is chairman of the John Locke Foundation and appears on the talk show “NC SPIN.”



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