House Majority Leader Eric Cantor’s heave-ho this week still has heads shaking, eyes glazed, and fists pumping throughout American politics, economic policy, and finance – depending on your leanings. One big question so far ignored in the reams and gigabits of post-mortems so far offered: Will the Virginia Republican’s resounding primary defeat at the hands of an obscure, poorly-funded newcomer herald any changes in the U.S. trade policies that for so long have offshored so many of family-wage manufacturing jobs and so much valuable production and innovation capacity?
Logic says “Yes.” Despite desperate spinning to the contrary by the political and economic policy establishment, upset victor Dave Brat unmistakably focused much of his campaign on opposition to current immigration reform efforts. Even more encouragingly for anyone who wants a healthier U.S. economy, Brat slammed not only the legally troublesome aspects of an amnesty proposal that actually rewards law-breaking, and the national security challenges that get multiplied by excessively porous borders. He also warned about immigration reform’s threat to America’s economy from the new flood of super-cheap and poorly skilled workers about to wash over the U.S. labor force both from within (the current illegal population) and from abroad (the tens of millions of foreigners who will be tempted to cross the border by whatever means by the likelihood of future amnesties).
For more evidence on Brat’s platform, see this excellent post by Mark Krikorian of the Center for Immigration Studies: http://www.nationalreview.com/corner/380260/fight-immigration-power-mark-krikorian
Brat’s worries about the wage-cutting impact of this immense increase in labor supply and the resulting betrayal of native-born workers are especially striking given his background as a diehard free-market academic economist. Most of this breed on and off the campus views open borders as crucial expressions and engines of economic liberty. After all, if goods and capital and technology already cross borders so freely, why not people? And how could government interference with migration possibly benefit growth and employment and living standards anywhere?
Brat has responded by portraying today’s immigration reform blueprint as a model of political cronyism – government paying off businesses and other moneyed interests that have lobbied hard and lavishly for an endless supply of cheap labor at the expense of Main Street Americans who lack such access. Moreover, he’s emphasized that even lower wages would further cripple an economy already woefully short of adequate income-earning opportunities – and thus still overly reliant on debt-creation for most of the growth it can still generate.
Variations of all of these non-economic and economic anti-amnesty arguments are true in spades for offshoring-friendly trade deals – including the cronyism point that resonates so strongly in conservative circles these days. What could be more shameful than giant corporations that keep seeking and receiving favors from government, yet that, thanks to all jobs, factories and labs they’ve sent overseas, can now reap all the profits from selling to the lucrative U.S. market while avoiding so many of the costs of its upkeep (i.e., taxes)?
Indeed, current U.S. trade policy – which is trying to worsen these problems by seeking two big new deals with European and Pacific Rim countries – jeopardizes any number of other key non-economic conservative objectives. For example, it keeps enriching and strengthening a China that’s acting ever more aggressively in its vast Asia-Pacific neighborhood and whose still overwhelmingly state-controlled economy grows ever more influential globally. And by undermining living standards at home, Washington’s approach to trade will undoubtedly further feed Americans’ already strong appetite for more Big Government to stay afloat financially.
So far, however, there’s no sign that Brat is any more interested in taking on U.S. trade policy that most other Republican populists and/or Tea Partyers. I keep struggling to understand this disconnect, and am eager to hear your explanations and ideas for overcoming it. I’m more convinced than ever, though, that as long as conservative populists keep ignoring – and even supporting – trade deals and related policies that keep hammering America’s workers and productive economy, the revolution they seek will fall far short of its most important goals.