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Trump mangling trade debate, missing point

Donald Trump’s campaign has supplied a windfall to cable “news” networks and peddlers of jingoistic tchotchkes. But the billionaire’s run for the GOP presidential nomination has benefited an unlikely group: left-wing economic populists.

In the 21st century, liberalism has concentrated an inordinate amount of its time and energy on cultural affairs, lifestyle choices and consumer products. Same-sex marriage as a civil right, feminist finger-wagging over an allegedly inadequate number of females in the science-and-technology fields, the evils of pesticides, an impending weather cataclysm. Moonbat Nation’s agenda is largely set by the concerns of affluent — and frequently, quite silly — professionals.

But the issues that excite women’s studies professors and Hollywood nincompoops have limited appeal to lunch-pail leftists. Labor bosses and the lobbyists, activists, and think tanks they fund recognize that. As the union-backed Economic Policy Institute recently noted, “people without a college degree (which includes those without a high school degree, with a high school degree, some college education, and an associates’ degrees) make up the majority of the labor force in every state.” It’s a cohort that has, sadly, proven susceptible to Trump’s economic illiteracy.

Here’s the narrative: Decades ago, free-trade ideologues forged an unholy alliance with “Benedict Arnold CEOs.” So manufacturing, the foundation of America’s middle class, was shipped abroad, never to return. The growth of pay and benefits for average workers flatlined. The American Dream hit the pause button. The college-educated, ensconced in comfortable gigs, profited from globalization, while the typical household got stuck in neutral. China and Mexico aren’t trading partners; they’re enemies of Joe Sixpack and Jane Diet Coke.

It’s a morality play that stacks myth atop myth. Protectionists’ first error is to blame “cheap foreign labor” for a declining number of manufacturing jobs. The nation’s factory employment peaked at 19.6 million, in June 1979 — long before the passage of NAFTA and China’s entry into the World Trade Organization. As Tufts University’s Daniel W. Drezner noted in a 2015 piece for The Washington Post, “while a small fraction of American manufacturing jobs migrated overseas … a far greater fraction of manufacturing jobs simply disappeared and are not coming back. The far bigger driver of these job losses is the creative destruction that comes from technological innovation and productivity increases.”

And while Trump and his frenemies on the left don’t care to look, manufacturing employment, for the first time since the 1990s, is rising. The turnaround came six years ago, even though the value of imports from China rose by over a third between 2010 and 2015. Low-cost hydrocarbons deserve credit for the jobs, but foreign direct investment is another contributor. German, Canadian, Israeli, French, Japanese, Swiss, Brazilian, and Italian firms are coming to America. More and more, it’s Chinese and Indian enterprises that are setting up operations. Many of the products being made are exported.

“Protectionists,” economist Donald J. Boudreaux quipped, “are world champions at looking at only half the argument.” In an editorial that’s sure to be ignored by Trump, the Chicago Tribune recently explained that the “world constitutes an enormous, eager market for the best American products and services — from Boeing airplanes and Illinois soybeans to the skyscraper designs of Chicago architects. In return … we buy stuff. All of which is less expensive than it otherwise would be (toys from China, clothes from Bangladesh) or highly specialized (BMWs from Germany, bananas from Ecuador). Each country focuses on what it does best. The result is that everyone gains.”

As for manufacturing’s impact on compensation, the data are clear. An economy dominated by factories isn’t the only path to wealth. Americans have gotten richer as assembly lines have provided a declining share of total U.S. employment. A 2011 analysis by economists Richard V. Burkhauser, Jeff Larrimore, and Kosali I. Simon found “substantial gains” between 1979 and 2007, after adjusting for household size, welfare payments, and taxes — specifically, 36.7 percent growth in median income. The finance, IT, logistics, entertainment, sales, education, and healthcare industries aren’t destroying the middle class. And few workers in the sectors are eager to transfer to the factory floor.

Riding a noxious wave of anti-globalization nonsense, The Donald is within striking distance of the GOP’s presidential nod. But long after the malignancy that is Trump’s candidacy fades from unpleasant memory, the left’s self-appointed sentinels of “working families” will wail over planetary capitalism’s contribution to “wage stagnation” and “the death of the middle class.”

Protectionist propaganda never takes a holiday. Neither should a spirited, unapologetic defense of free trade.

Former Nevadan D. Dowd Muska (www.dowdmuska.com) writes about government, economics, and technology. He lives in Corrales, New Mexico. Follow him on Twitter @DowdMuska.

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