Thursday, November 11, 2010

Obama, South Korea, and Free Trade

Good for Barack Obama to be continuing to push for a free trade agreement with South Korea and committing to drastically increase America's exports.  The last thing we want to do is start throwing up barriers to international trade.  During the early days of the Great Depression, nations desperate to protect jobs at home threw up trade barriers, ending what The End of Globalization: Lessons from the Great Depression called the first age of globalization and making the whole situation much worse.

And we all know what happened after that.

However, Obama and Congress should make sure that any free trade agreement with South Korea enables truly free trade.  The Ford Motor Company, which didn't need governmental largesse to get themselves out of trouble when things got bad, has sounded the alarm about some of the shenanigans South Korea pulls to keep foreign cars out.

American consumers will benefit from having more automotive choices available to them regardless of whether the free trade agreement enables South Korea's government to continue meddling with foreign automotive imports, but more American cars being exported means more jobs in America, which will help get the economic engine of our country running at full clip again.

The article about how the current US-SK FTA "locks in" the one-way automobile trade doesn't do that great a job proving South Korea's government engages in shenanigans to keep foreign cars out, but the article about trade barriers describes them in chronological detail. 

Some of the stuff like auditing the taxes of those who buy foreign cars strikes me as repressive and undermining the rule of law.  If South Korean cars are truly competitive with foreign cars--and considering how many we buy in the U.S., I'm pretty sure they are--the South Korean government need not indulge in petty goonery to discourage its citizens from buying American cars.

1 comment:

  1. Amen! However I'm pretty sure the First Globalization ended with the start of World War I not with the tariffs after the Great Depression started.