"Commentary"-What Good Can Grow Out Of Free Trade & Labor
Monday, August 20, 2007SUSIE GHARIB: In tonight's commentary, balancing free trade with U.S. labor market policies. Here's Glenn Hubbard, dean of the Columbia graduate school of business and former chairman of the White House Council of Economic Advisers.
GLENN HUBBARD, GRADUATE SCHOOL OF BUSINESS, COLUMBIA UNIV.: Congressional leaders say they care about economic growth abroad as long as it doesn't cost American jobs. OK, but what are the implications for growth and politics in Latin America, where our national security and economic interests come together? Tough trade talk by the Congress feeds Hugo Chavez' anti-U.S. rhetoric. And this protectionism flies in the face of Democratic presidents' support of free trade, from President Kennedy's Alliance for Progress to President Clinton's NAFTA. And the Bush administration's support for free trade has sometimes sidestepped legitimate public concerns about U.S. labor markets and job prospects.
There is a better way. We need to aggressively fund personal reemployment accounts. These are funds for individual training assistance to workers likely to be unemployed for significant periods of time and would be an important reform of our antiquated labor market policies. This progressive policy is consistent with free trade. Trade remains a big win for the U.S. economy, with gains for consumers and benefits to our productivity. But it's also vital for our Latin American allies. Putting free trade on hold -- as the Congress is now doing -- weakens our Latin American allies and strengthens the lure of Chaveznomics. And it's unnecessary. Better labor market policies at home are the answer, not protectionism. I'm Glenn Hubbard.
