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Free trade can survive, but not if we insist on free migration

A Mitsui O.S.K. Lines Ltd. (MOL) container ship,

A Mitsui O.S.K. Lines Ltd. (MOL) container ship, background, sits berthed at a shipping terminal in Tokyo, Japan, on Monday, Oct. 31, 2016. Credit: Bloomberg / Kiyoshi Ota

Around the world, globalization is supposedly under attack.

From Brexit in Britain, to Donald Trump in the United States, we’re told we’re facing a rebellion against it. Yes, it’s a rebellion. But what’s driving it isn’t free trade in goods. It’s free trade in people.

After 1945, with the United States in the lead, the industrialized world entered the first modern era of globalization. The United States created its dominant institutions – from the gold standard of the Bretton Wood system to the tariff-cutting General Agreement on Tariffs and Trade (GATT).

That order endured for about 25 years. But in the early 1970s, it bent, and almost broke.

GATT had done a lot of good work promoting free trade, and the West had to adjust to the results. Above all, bad U.S. policies and the dollars Arab nations earned by selling oil destroyed the gold standard.

It took the West 15 years to rebuild the globalized order, which was crowned by victory in the Cold War in 1989. Today, we are as far away from that victory as the early 1970s were from 1945. Of course our order is feeling the strain: We’ve been riding on Ronald Reagan’s coattails for a generation.

There’s nothing magic about that nearly 30-year interval. But it’s about the length of a working lifetime, and it’s as long as we can expect a generational consensus to endure. It’s also as long as we can expect institutions, in a rapidly changing world, to keep being relevant to increasingly new problems.

Our new problems are simple. Since the Asian financial crisis in the late 1990s, we’ve become addicted to low interest rates, and other gimmicks, to keep the economy on an even keel. Simultaneously, we’ve piled on new rules, supposedly to make it fairer.

We now value stability over growth – and when that stability is threatened, as in 2009, we do things to salvage it that damage our ability to grow. As a result, the world has come to rely on the emerging world, especially China, for much of its growth.

But China is no more immune to the problems of debt than we are. As growth slows everywhere, including in China, that stability – which we have had to struggle ever harder to maintain – feels more like stasis away from the prosperous, self-satisfied, insular coasts.

And then there’s free trade in people.

This wasn’t part of the post-war wave of globalization. Now, it’s liberal dogma. The free movement of people is one of the European Union’s four freedoms. In 2013, Hillary Clinton called – behind closed doors – for “a hemispheric common market, with open trade and open borders.” Democrats are so opposed to the term “illegal immigration” that it doesn’t appear in their party platform.

Yet recent political shocks have centered on migration. Immigration from Eastern Europe made the EU a vital political issue in Britain. Refugees from Syria are reshaping European politics. Involvement with so-called immigration reform badly damaged Jeb Bush’s chances in the 2016 presidential election. And, of course, there’s the Trump wall.

I’m proud that, like almost all Americans, I’m the descendant of immigrants. But perhaps we shouldn’t cram open borders – and the multiculturalist ideology behind them – down the public’s throat. Maybe people would be OK with free trade if we emphasized growth a bit more, and migration a bit less.

Free movement for people is inherently more controversial than free movement for goods. Goods don’t speak foreign languages. Goods don’t have to be assimilated into a new culture. Goods don’t win self-interested applause from an urban elite who want to hire nannies. Maybe we’d be wiser not to rush things when it comes to people.

The globalized order of the 1970s was rebuilt because it bent before it broke. Today, the West isn’t rebelling against globalization. It’s rebelling against a multiculturalist vision of it.

If we continue to insist on this vision, today’s globalized order will not be allowed to bend. And if it cannot bend, it will break.

Ted R. Bromund is a senior research fellow in The Heritage Foundation's Thatcher Center for Freedom.


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