This morning, New York Times columnist Nicholas Kristof launched a full-throated—and empty-headed—defense of free trade. Along the way he praised President Bush and attacked Senators Clinton and Obama.
Their offense? The pair of presidential hopefuls engaged in “cowboy diplomacy” by co-sponsoring legislation that targets China for manipulating the value of its currency (he was referring to the bipartisan Baucus-Grassley-Schumer-Graham bill). The proposed legislation, in Kristof’s view, will antagonize the Chinese, politicize trade disputes, and betray President Clinton’s “outstanding legacy on economic issues.”
Outstanding legacy? There may be many magnificent aspects of Bill Clinton’s economic policies, but his strategy for dealing with the mercantilists in Beijing is not one of them. It was he, after all, who decided that China should be permitted to join the World Trade Organization without first reforming its currency regime. The Chinese, once admitted to the global trading body, pegged the renminbi and from July 2005 on have maintained a managed float. As a result, Middle Kingdom manufacturers have obtained an enormous price advantage, which has translated into outsized Chinese trade surpluses against the United States.
These surpluses have, in turn, cost Americans jobs, undermined our manufacturing base, and de-legitimized free trade. President Clinton engaged China before it was willing to embrace the notion of the mutuality of international commerce, and President Bush, for his part, has failed to hold China accountable for predatory trade and currency policies.
These policies, apparently, do not bother Kristof. In his view, it’s fine for the Chinese to pursue one-sided trade strategies and violate the obligations they undertook in joining the WTO. Only Americans, apparently, deserve condemnation on Planet Kristof.