Democrats Fail to Learn from Past Mistakes, Want One More Shot at Protectionism

Douglas Irwin, an economist at Dartmouth University, wrote the following in the New York Times last month:

When the United States imposed the Smoot-Hawley Tariff in 1930, it helped set off a worldwide movement toward higher tariffs. When everyone tried to restrict imports, the combined effect was a deeper global economic slump. It took decades to undo the accumulated trade restrictions of that period. Let’s not make the same mistake again.

(Hat tip:  Cafe Hayek)

He is talking about protectionist measures passed by House Democrats in the so-called stimulus bill.  The measure, Irwin writes, “…requires that preference be given to domestic steel producers in building contracts and other spending. The House bill also requires that the uniforms and other textiles used by the Transportation Security Administration be produced in the United States, and the Senate may broaden such provisions to include many other products.”

Do the Democrats even study history or economics?  This is one of the things, as shown above, that worsened the Great Depression.

And the hypocrisy is bold.  How often have we heard the Dems preach about the “Big Oil,” yet here they are bowing before the lobbyists for “Big Steel.” 

Cato@Liberty writes:

it is absolutely stunning—even to those who have watched this industry impose its will over U.S. trade policy at great expense to other industries time and time again—that nobody in Congress has blown a whistle on this outrageous scheme. The incredibly profitable U.S. steel industry (which has fallen on harder times in the past several months like everyone else), consists of fewer than 100,000 workers. It is the ONLY beneficiary of this hair-brained provision that will undermine any incentive the industry has to remain efficient, and promises to spark reprisals and crush export sales for industries that employ millions of workers. That doesn’t strike me as a recipe for U.S. job growth.

The rest of the world has taken note of the measure also.  Canada is not happy about it.  Neither is Australia’s Prime Minister Kevin Rudd, who called the measure a “spear to the heart.”

The Jawa Report notes India and China’s opposition to the rider, and the European Union is talking trade war:

The EU threatened to retaliate if the US Congress went ahead with sweeping measures in its $800 billion (£554 billion) stimulus plan to restrict spending to American goods and services.

Gordon Brown was caught in the crossfire as John Bruton, the EU Ambassador to Washington, said that “history has shown us” where the closing of markets leads — a clear reference to the Depression of the 1930s, triggered by US protectionist laws.

The article continues, stating Obama “gave a strong signal that he would remove the most provocative passages from the Bill.”  That’s interesting, considering he can’t do that.  He has no authority to remove single items from bills.  Only Congress can do that.  The line-item veto is unconstitutional.

The left’s inability to learn from the past is profound.  This is another example of their insanity, i.e. trying the same thing again and again and expecting different results.   It goes lockstep with their love affair with collectivism, which has proven time and time again to result only in death and tyranny.

Photo Credit:

• Tony the Misfit