International Trade

The Presidential Candidates on Trade

There was an article in the WSJ yesterday by David Ranson about the presidential candidates’ stated positions on trade, both Democrat and Republican. It is worth a look. He concludes that McCain seems most consistently free trade oriented. However, one comment McCain made in a recent debate was a little troubling; namely pointing out that Romney’s work at Bain & Assoc. resulted in lost jobs. Jobs will always be lost when markets are free to adjust to changing demands …. and consumers demands are always changing. It would be great if politicians would stop using every job loss as a reason to criticize others or an excuse to do something about it.

About

Steve Suranovic received his B.S. in mathematics from the University of Illinois at Urbana/Champaign and his M.S. and Ph.D. in economics from Cornell University. He has been a faculty member at the George Washington University since 1988. He has served several terms as the current Director of the International Trade and Investment Policy M.A. program at the Elliott School of International Affairs.

4 Comments

  • By virtue of the fact that GW is the most expensive college, my first priority is to my students, whose final grades have just been posted. As to your suggestion, I think its a bad idea to “require” this kind of info. However, it may make sense for colleges, on their own initiative, to provide such information. For example I direct the International Trade and Investment Policy (ITIP) program at the Elliott School. As an aid for students who consider applying we have posted a list of recent < HREF="http://www.gwu.edu/~elliott/academicprograms/ma/itip/careers.cfm" REL="nofollow">job placements for ITIP graduates<>. This is not quite the detailed analysis you suggest but it is difficult to obtain that kind of info. Alternatively, in the internet age it is not difficult to quickly obtain starting wage info for different college majors. Try googling “< HREF="http://www.google.com/search?q=starting+salary+college+majors&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a" REL="nofollow">starting salary college majors<>” The info is out there if anyone wishes to look for it. Also, in today’s rapidly changing world, it may be unwise to rely too much on past info. Next year’s labor demands may be different than the demands of 5 years ago. Thus, it is probably best for people to become maximally flexible. For example, knowledge of statistical analysis is likely to be helpful in many different sectors. Combining a knowledge of statistics with economics, or psychology, or engineering, can provide someone with a specialty while at the same time building in flexibility in case job demands change somewhat.

  • By virtue of the fact, George Washington University is the most expensive college in the world, doesn’t my above suggestion warrant at least a brief response?

  • I have been reading your blog for a while and now realize that you, very simply, will not countenance any whining about structural unemployment if the cause is due to foreign competition, no matter what form it takes;i.e., child labor, pollution, etc. But, I’m still confused, as I’ve written previously, to the lack of derived demand for fast track education that should naturally occur due to the shift in our labor competitiveness caused by foreign competition and the resultant structural unemployment. So, I have a suggestion.Colleges should be required to show return on investment analysis to every potential student(customer) pertaining to all major fields offered by the college. Sort of like how restaurants are being required to show calorie counts on their menu items.This would be a very valuable tool to all potential students(customers) and would keep competing colleges on their toes as to their “menu” selection. After all, armed with this information, students(customers) would be foolish to devote their monetary and psychic resources to a field of study offering poor return on investment and colleges would be remiss to offer them.Stuctural unemployment would be rendered statistically useless in the short term becauses colleges could not compete if they offered courses that didn’t offer vibrant career opportunities. Everybody wins!My question to you is…Why isn’t this happening?

  • You think that was troubling? Hillary wants to freeze interest rates for 5 years – at least that is what she said in a debate.By the time election day rolls around and there is recognition that we’re in a recession, the focus will shift to jobs, economic growth, and similar money issues. This will bring the Lou Dobbs folks out of the wood work. We will start hearing about the evils of free trade, tales of metal containers filled with jobs being sent to India, and objection to illegal immigration – not on the grounds of it being illegal, but on the grounds of it “stealing” jobs. Maybe Ross Perot will be pulled back from obscurity and go back on Larry King to tell us about the giant sucking sound.That is when anyone with even a basic understanding of the relationship between supply and demand will begin to rip his or her hair out. Get ready for a political season that will be more painful than most in recent history.

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