The brief letter on free trade in The Times (Aug. 21) by 12 Nobel laureates for economics makes it easier to understand why economics is referred to as the "dismal science."
The laureates assure us that "Free trade will benefit the United States and other countries." That it will benefit other countries there can be no question, particularly those like Japan, which believe in free trade for others but maintain ultra-protectionist barriers themselves.
But how has free trade benefited the United States? The free trade policies have given us a national debt of more than $2 trillion, a budget deficit that is $20 billion over previous estimates, and a trade deficit this year of approximately $170 billion, $60 billion of it with Japan.
Added "benefits" are the unemployment rate of 7% (which does not include those who have given up looking for a job or the "street people").
We are a debtor nation for the first time since 1914, with a foreign debt exceeding impoverished Third World countries. Like them, we are forced to adopt austerity measures like the Gramm-Rudman-Hollings budget law to alleviate the impact of the unprecedented budget deficits.
However, the tremendous deficits show no signs of lessening, which means that in the years to come, we will have one austerity measure after another. What it also means is a constant lowering of our standard of living to try to meet our debt obligations.
No longer will it be necessary for foreign producers to insist on free trade here or for American manufacturers to leave the United States in search of cheap labor. We will have it here and all that goes with it--poverty, poor education, marginal housing, and inadequate social and medical services.
We will also have lost our preferred economic status, which was once the marvel of the world, and which drew immigrants from even the most productive countries of Europe. They no longer come here. They see the industrial blight that is spreading over our country.
Free trade probably does benefit poorer countries. For us it's an unmitigated disaster, economic Nobel laureates to the contrary notwithstanding.
Marina del Rey