Am I Too Soft on Obama's Tire Tariff?

by Noam Scheiber | September 22, 2009

I've gotten a handful of e-mails from wonks and fellow journalists today protesting (graciously, of course) my piece on Obama and protectionism. They almost all make some variation of the point that, whatever you think of Obama's tire tariff (and most concede it was disappointing but not egregious), he still loses out in the comparison to George W. Bush, whom, they say, evinced more free trade passion even as he was slapping tariffs on steel. Dan Drezner--so far as I can tell, the only one of my correspondents who's blogged his response--sums it up thus:

Hmmm........ no, not buying the equivalence between Bush and Obama here.  First, to repeat, just because something is legal doesn't mean it's good policy. 

Second, as Phil Levy pointed out, the Bush administration specifically declined to apply these tariffs when he was president.  So there is some different between the two administrations' perspectives on trade.

Third, if Scheiber is correct that this is merely "a small gesture on behalf of American workers," then I'd be fine.  But I'm curious about his faith in that assertion.  All the political signs point to a lot of gestures in the protectionist direction.  Each of them, by themselves, is Lilliputian in their effects -- but the cumulative effect can be to keep the Gulliver of freer trade under lock and key.

I was probably a little too casual about the comparison in the piece, so here's what I'd say: Yes, if you abstract from the political context and look only at what each president was doing at the time they imposed their respective tariffs, Bush was clearly doing more to promote free trade. He was fighting for fast-track authority and pitching the Free Trade Area of the Americas, while Obama had only acted defensively--fending off potentially greater protectionism, like the original "buy American" provision of the stimulus.

But obviously the political context looms incredibly large here. Simply put, it's incredibly difficult to defend, much less expand, free trade in the middle of a deep recession. And this is the deepest since the 1930s. In that context, the best you can probably do is beat back the worst protectionist excesses and live to fight another day. 

Which is to say, you can't just make a straight-forward point-by-point comparison between Bush and Obama. The question is, what would a pro-trade president do in the current political context? My point is that it's far from clear he or she would behave any differently from Obama. (Particularly if that pro-trade president were a Democrat and, therefore, heavily dependent on trade-skeptical voters, as one of my colleagues points out.) Or, put another way, I'd say Obama's behavior thus far, in light of the political circumstances, has been perfectly consistent with his having pro-trade views.* Certainly, if Bush felt the need to impose a much more costly tariff in an environment that was much more hospitable to trade, it's not at all clear he would have behaved much differently in Obama's place (again, with the caveat that his political coalition probably gave him more breathing room on the issue--though even he needed a lot of blue-collar votes to win).

The problem with the pieces I criticized is that they pretty much ignored these considerations. They looked at a set of facts that were at best  indeterminate and used them to condemn Obama in the harshest terms. Which makes it hard to believe that the condemnation wasn't motivated by his partisan affiliation.

*Now one could ask how much it gets you for a president to be personally warm to free trade if his political coalition forces him to act like a protectionist more often than you'd like. My feeling is that it matters quite a bit, since, once the political environment changes and pushing trade liberalization is no longer completely self-defeating, he's likely to spend some capital on it. (Though he's obviously not going to commit political suicide...)

More broadly, I'm not sure Obama's coalition is sending him the substantively wrong signal. I don't think anyone wants to see a round of trade wars break out. And we should continue to liberalize going forward. But it hardly seems unfair to conclude that the last 10-15 years of globalization (and our government's general embrace of it) have had enough wrenching side effects (some of them perhaps avoidable) to merit some recalibration.

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