Trade between nations is so much different than trade intra-state. The biggest difference is laws and enforceability. "free"-trade is not completely free. Intra-state trade has the benefit of being more civilized (i.e. laws do have weight). Between nations, its the wild, wild, west and there are many externalities to this lawlessness.
I've lived in Shanghai for 9 years. China is still trying to figure out how to make the "middle class" a reality before the general population starts to lose faith. Up to now, this belief has ridden on the great rise in trade. The China government has already set things up to blame the U.S. for what will be a slow 2009. Right or wrong, things are going to get rocky; and the lawlessness and uncivilized externalities?..its only the beginning.
Anyone who traveled to China, Hong Kong, and Taiwan in 1982, as I did, speaking Mandarin (and a little Cantonese and Taiwanese) and interacting with ordinary people, turns into a lifelong fan of free trade. It helped me that I read an abridged version of Adam Smith's The Wealth of Nations after finishing that trip. I agree with the article cited in the opening post that the idea of free trade is in political danger at the moment. Too bad.
From birth to age 18 I spent my entire life in two midwestern farming states, and only visited a few others shortly thereafter. When I was 21 I had the good fortune to take two trips to Japan for work purposes. I didn't spend much time away from work, but I did soak up enough experience to come back with a huge appreciation for the culture.
The notion of trade barriers between US states would be immediately dismissed by almost anyone, yet any argument I've heard or can think of for international trade barriers would fall by the same logic that they would if applied intra-nationally. I hesitate to accuse people of xenophobia, as it's unproductive to do so, but I can say that an ounce of cultural exposure at a relatively young age probably saved me a pound of it in old age.
I'm proud to consider myself a citizen of the world.
Would you support trade unions being allowed to organize internationally? How about international environmental regulation, like the one that overturned California's MTBE ban? Do you think these institutions can be made to work as well in the world as they do inside the US? (Not that they work well inside the US, but they are currently much weaker internationally.)
It sounds like you and netcan are both going the same direction, so I'll address both at the same time.
Personally I'm pretty libertarian. I know this is a volatile viewpoint to hold on reddit (less so but still somewhat here). I try to be pragmatic about it, so my viewpoint isn't 100% soundbite-consistent; things need to be evaluated on a case by case basis.
Welfare: probably not. I think welfare is probably best executed at the state level, much as it is in the US now. The subsidization of some states via others is not addressed by this, and I suspect is largely your point. Certainly within the first world even the meager income of the poor states would be enough to care for their own, perhaps at considerable expense in other aspects. If the issue is "trade embargos or extreme poverty" I'd definitely flex to the (extreme) point that Cuba has, in that they've basically rebuilt their agricultural system from first principles -- it doesn't sound like a walk in the park, but it sounds like they've done well for themselves given their situation.
Unions: abstain. My life experiences are not sufficient to force my opinions about unions on others. My grandfather fed my father from their farmstead in Iowa. As a child food was put on my plate by my father who was either self employed or worked at companies where he could name every employee. I've only ever worked at companies that have healthy meritocracy ecosystems, including my current one where I'm a shareholder. I've never been a shareholder at a unionized company, nor have I ever felt like I've been had by the balls, so to speak, so I can't say how I'd want to be treated in that case.
Ecology/environment: nation trading associations may be useful. Whether the issue at hand is Mediterranean bluefin tuna or hydrocarbon emissions, states/countries financial motivation often collide with worldwide ecological impact. In these cases applying financial pressure looks like the simplest and most direct way to rebalance things. I'm not up on MTBE, but it sounds like a non-financial issue: CA wanted a waiver to go non-oxygenated when ethanol supplies were disrupted. I haven't seen the numbers, but in the absence of numbers I side with California on it: use of non-oxygenated fuel would be seemingly uncommon with the benefit constant and permanent (no MTBE tanks leaking). "Disruption of ethanol supplies" could be considered a financial issue in that they might be under-engineered. Perhaps an association of nations could put financial pressure on a nation that was under-engineering their supplies to ensure that their use of non-oxygenated fuels was minimized.
In summary: I think I may have overstepped the line when I used the word "any" (as is usually the case with that damn word) -- there are certainly valid cases for tempering financial interaction with other entities, particularly when their actions harm you (world eco/enviro being an example). That said, it's important for the health of a capitalist entity that people be able to take the action that best serves them (in the absence of undue harm to others). Furthermore, it's a two-way street, or, a rising tide floats all boats -- China can buy Buicks because Americans can buy T-shirts. To the point of the article, my life is better because of the products I've been able to buy from wherever I choose to, and this holds true regardless of the current state of the economy.
I don't understand why this makes you a lifelong fan of free trade. Those countries are pretty corrupt governmentally, so maybe it makes welfare look bad, but I have to say the companies aren't treating people all that well either.
(I say this as someone who is actually Taiwanese.)
Free trade does not automatically equal good governance - that sort of thing requires cultural and political changes over and above the changes made to accommodate freer trade.
But the rapid economic rise of Taiwan, China and a host of other countries over the past forty years has undoubtedly been due in large part to the reduction in trade barriers and resultant increase in international free trade. It works.
But their living standards didn't go down suddenly, so how does that explain an effect? What changed was trade, which meant the cheap labor was accessible.
And what of the dozens of other countries with exceptionally low living standards but restrictive trade policies which remain poor?
Cheap labour gave these countries an initial competitive advantage in certain forms of manufacturing, but it was trade that allowed them to make use of this and to gradually advance into more sophisticated manufacturing and services.
I've lived in Shanghai for 9 years. China is still trying to figure out how to make the "middle class" a reality before the general population starts to lose faith. Up to now, this belief has ridden on the great rise in trade. The China government has already set things up to blame the U.S. for what will be a slow 2009. Right or wrong, things are going to get rocky; and the lawlessness and uncivilized externalities?..its only the beginning.