Yesterday, Paul Krugman posted an article on his blog about why the economic crisis didn’t result in more calls for protectionism: tariffs and the like. He proposes a few ideas but decides it is all about our trade agreements. I think he’s wrong.
It may well be the fact that there are institutional barriers against protectionist policies. For example, if we start putting import taxes on all products, the World Trade Organization will go after us. But that isn’t the same as why no one even talked about trying to protect our local industries. For that, I think there are two issues: helplessness and elite media control.
In my discussions with people from all over geographically and economically, what I get is a strong resignation that nothing can be done. Everyone is just hoping that they can hold on until things improve. But even there, they think they have no control over improving things or what that improved situation might look like. They do generally feel that although things will be a little better for them, it will be enormously better for the elite class. From 35 years of stagnant wages, they’ve developed a kind of learned helplessness. Just like with dogs, they know that regardless of what they do, they are going to be shocked.
The second issue is related to this: it is part of the cause of these feelings of helplessness. Have you seen the major media coverage of efforts to end tax cuts to companies for sending jobs overseas? Most likely, you haven’t. There has been very little coverage of it. It is being blocked in Congress, primarily by Republicans but also by Democrats. And it isn’t that workers are not interested; they are. The major media are just not interested in this issue or any other issue that focuses on the needs of workers. You can hardly watch a news broadcast that doesn’t mention what the stock market did that day. Does that have any relevance to the average viewer? Nope. But it has lots of relevance to the elite reporters and owners of the news sources.
Krugman understands this, of course. Last week he wrote a column about how we have become a country “of the 1 percent, by the 1 percent, for the 1 percent.” And they don’t want protection of jobs in America, because their profits come from all over the world. And that’s why we haven’t heard calls for protectionism.
Personally, I think that protectionism in general is a bad idea. It is often a very good idea when trying to get new industries off the ground. But wholesale, it just ends up hurting all of the countries. My point is not that we should have implemented protectionism, but just that it is natural for it to be discussed. And it wasn’t. And that is indicative of the fact that we really don’t live in a democracy anymore.