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Symptom, Not Cause

November 24, 1985

Reading Earl F. Cheit's Viewpoint, "Protectionist Movement Loses Steam" (Nov. 3), I get the false sense of a "hope springs eternal--protectionism is dead, long live free trade!"

I have three points regarding his comments: One, as he pointed out, the Reagan Administration finally appears to have a policy. However, Cheit fails to note that high protectionist pressures are what spurred on this reluctant, belated and yet to be proven effective policy.

Praising the Administration for its work is premature and does not give credit to other well-articulated positions expressed in the present protectionist legislation.

Two, Cheit says: "The new program has shifted attention away from protectionism to issues of reciprocity and fairness." In fact, reciprocity and fairness are part of the solution suggested by the very industries that seek protection. They are one of the means to an end of an open managed trading system.

Finally, Cheit says: "In the meantime, the Administration has signaled its desire for an open trading system by negotiating bilateral free trade agreements." This appears to be a curious contradiction. Bilateralism is the opposite of multilateralism, the very basis of the General Agreement on Tariffs and Trade. A number of observers have pointed out that the potential trend toward bilateralism is one of the more grave trade relations developments.

So it is not clear to me that the bugaboo of protectionism is dead and gone. The personality of the capable U.S. Trade Representative Clayton Yeutter does not by itself make a policy work. What does make it work better is a policy based on the acceptance of protectionism as a legitimate symptom of economic change, not a disease that plagues idealist notions about how the world should be.

ROBERT S. SPICH

Visiting Assistant Professor

of Management, UCLA

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