U.S. politicians begin rebuilding protectionist walls

U.S. politicians begin rebuilding protectionist walls

The Right and the Left in the U.S. are harking back to isolationism. Hardly Clinton's vision of a perfect global economy, reports Ed Vulliamy.

WASHINGTON: "Congress refused to bail out the crooks in Indonesia," says John Makin, senior fellow at the American Enterprise Institute. "So why should they bail out the crooks in Korea?"

It sounds cruelly simple, even bone-headed. But Makin's comment not only touches a nerve, it also cuts to the core of an increasingly potent movement wary of the global economy lapping at America's walls, which transcends -- indeed, begins to redefine -- ideology in the U.S.

On the one hand, there is the polemic of industrial protectionists such as Makin, represented in politics by right- wing maverick and two-time presidential candidate Ross Perot. On the other, from the environmentalists comes a volume which last week appeared in almost every bookshop window, on the desks of senators and congressmen and women and is poised to climb the bestsellers' list. The Case Against the Global Economy is published by the Sierra Club, equivalent to the National Trust.

And many in between are wary of subjugation to a globally entwined economy and its latest manifestation around the Pacific Rim. The labor unions are at loggerheads with the greens over global warming at Kyoto, but side by side with both the environmentalists, the Perot camp and their bosses in the automotive trade over the global economy.

Both main parties are in theory devotees of free trade, yet both delivered Bill Clinton a crippling blow this month when they refused to authorize him to negotiate free trade arrangements on a "fast track", without a congressional right to renegotiate and veto.

The Democrats, to Clinton's dismay, chose their ties to the labor movement over those to the White House. The Republicans -- torn between free trade instincts and discomfort with nation- states becoming anachronisms -- chose their parochial powers on Capitol Hill over free trade.

The result was a pause in which the U.S. is staging a national debate over the terms of engagement between Americans and the global economy and about the terms of "internationalism". In the middle of that debate comes the Asian meltdown.

Unlike Japan, the U.S. is in a position to buy the surplus consumer goods spewing out of Asia -- indeed, cheaper imports are needed to prevent the American economy from overheating. But the politicians know that what is good for America is not necessarily good for General Motors or any of the other industries that must compete with Asian imports. They also know what the unions want, what the exchequer can stand, what the environmentalists demand.

The received wisdom is that the U.S. is irrevocably stitched into the global economy and that in a free trade market the strongest wins in the end. "It's the (global) economy, stupid!", to paraphrase Clinton's election catchphrase. So why did "fast track" go down in flames? Why does Clinton have to go to Vancouver as a man to whom Asian leaders must look for salvation, but who might not be able to deliver?

The Case Against the Global Economy is co-edited by Jerry Mander, an advertising executive who made a name by fighting to keep dams out of the Grand Canyon and establishing the Redwood National Park.

His co-editor is Britain's Teddy Goldsmith, author of the Blueprint for Survival and brother of the late Sir James, who writes in the book that to win at international capitalism is "like winning at poker on the Titanic".

Mander attacks the "euphoria" of globalism as being based on "the freedom to deploy, at a global level... large-scale versions of the economic theories, strategies and policies that have proven spectacularly unsuccessful over the past decades, wherever they have been applied".

None of this was on the agenda at Vancouver last week, where Renato Ruggiero, president of the World Trade Organization, warned the U.S.: "An increasingly trade-dependent economy like the U.S. cannot afford to stand on the sidelines. Isolation is no longer an option, least of all for the most powerful economy in the world. Without the U.S., it is difficult to see how the multilateral trading system can go forward."

In the New York Times this week, the influential columnist Thomas Friedman wrote the best guide to date: "It's official. America has a four-party system."

They belong, he says, on the "Friedman matrix of globalization politics, where you locate how you feel about the way in which technology and open markets are combining to integrate the world. At the far right of this line are the integrationists... at the left end are the separatists.

"Locate yourself somewhere on this line between separatists and integrationists. Now draw a line from North to South, through the middle of the globalization line. This is the distribution line. It defines what you believe should go along with globalization to cushion its worst social, economic and environmental impacts.

"At the southern end are the social safety-netters... at the northern end are the 'Let-them-eat-Cakers'... Me, I'm an Integrationist-Social-Safety-Netter. How about you?"

-- The Observer News Service