Conservative protectionism?

IN A SPIRITED appearance on the Brinkley show on December 8, Pat Buchanan defended what George Will called his flirting with protectionism."

BUCHANAN: Why do you say that, George?

WILL: Well, because you talk about how we can't have American low-paying jobs going across the border to Mexico.

BUCHANAN: I mean, why do you say "an American conservative"? You know who the three strongest opponents of the Trade Expansion Act of Jack Kennedy were in 1962? Barry Goldwater, J. Strom Thurmond, and the senator from Connecticut called Prescott Bush.

Comments: It is true that Senator Goldwater opposed the bill that became law and permitted the President flexible authority over tariff levels. But it is also true that this attitude was a hangover from the Republican Party that gave us the Smoot-Hawley Act, in the opinion of some scholars a major factor in bringing on the great Depression.

Mr. Buchanan went on:

My view with regard to Mexico is this: It is insane to raise the U.S. minimum wage to $4.35 an hour, and then tell a small businessman whose head you just put under water, "If you go to Mexico, you can hire for $1 an hour." What you have to do, George, you got to take off the burdens of taxes, of regulations off American business and American industry, and then the United States can start to compete.

Mr. Buchanan is incorrect in suggesting that the conservative tradition endorses high tariffs. Adam Smith's first claim to attention was as an opponent of tariffs. One can't find a single member of the Chicago or Austrian schools who believes in a high tariff; and if there is a member of the Mt. Pelerin Society who believes in tariffs, he is hiding that heresy. We refer Mr. Buchanan to two paragraphs published as recently as June 24 by NR's Ed Rubenstein:

"Perhaps the best way to gauge an FTA's [Free Trade Agreement's] likely impact is to look at areas where free trade between the two nations already exists. Under the border plan or maquiladora program introduced in 1965, U.S.-made components were shipped duty-free to U.S.-owned subsidiaries in Mexico, where they are assembled and re-exported, also duty free, back to the United States. Since 1986, the number of Mexicans employed in the plants had doubled to 460,000. The maquiladoras now provide about one-fifth of all manufacturing jobs in Mexico.

"The big draw for U.S. companies is cheap labor: a $12-an-hour job in the U.S., burdened with Social Security taxes and health benefits, can be done for between $1.50 and $2 an hour in Mexico. Some low-skilled U.S. workers have undoubtedly been displaced ... But by allowing American business to cut costs, the southern migration has saved 100,000 jobs in directly export-related industries, and created perhaps twice as many jobs in industries like warehousing, real estate, and transportation."

And Mr. Buchanan should read forward from 1962 to the 1964 Republican Party platform, on which Barry Goldwater ran for President. It called for "returning the consumer to the driver's seat as the chief regulator and chief beneficiary of a free economy, by resisting excessive concentration of power, whether public or private." Yes, it also warned against "irreparable injuries to any domestic industries by disruptive surges of imports," but nowhere in this long document was there a call for fixed tariffs.

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