Readers write about how President-elect Obama can solve America's trade problems, and why President Bush will leave a positive legacy in India.
How Obama can fix America's trade problems
In regard to the Jan. 13 editorial, "A trade fix for Obama's stimulus": This editorial assumes that international commerce is a win-win situation. In reality, it is a competition to secure markets that support domestic jobs and growth. With $700 billion in annual trade deficits, we are losing this contest. Foreign nations use a wide variety of import barriers, subsidies, currency manipulation, and patriotic sentiment to gain their surpluses.
Governments are correct to shield their national firms during downturns. The firms that survive will then benefit from economic recovery. Even the "free trade" Bush administration finally figured this out in regard to the American auto industry, long battered by subsidized foreign rivals.
Unfortunately, President Bush did not realize this in regard to his stimulus packages. Too large a portion of his tax cuts was spent on imports, leading Business Week to say in April 2003, "The fiscal and monetary stimulus of the past two years has helped global producers as much as US companies." The recovery from the mild 2000 recession was thus very slow.
President-elect Obama has said he wants to create jobs that cannot be outsourced. This will require a change in trade policy. In a world of rivals, free trade is irresponsible by definition.
I find it hard to believe that NAFTA is still being touted as part of the solution to America's current economic crisis. President Clinton's support of NAFTA and deregulation of the banking industry was the bane of his presidency, and helped George W. Bush to run this country, in his own words, "like a CEO." And run it, he did, straight into the ground.
If we hope to save our democratic republic, and the future of the US dollar, we must encourage President-elect Obama to keep his word about reforming NAFTA.