July 30th, 1998
IN recent years numerous writers have predicted that the global spread of capitalism will render the notion of economic nationalism obsolete. Yet in American politics globalization may be inducing the opposite effect. Although the American left has traditionally been wary of nationalism, over the past few years an array of progressive organizations, from the AFL-CIO to Ralph Nader’s Public Citizen, have charged that globalization is costing America jobs and eroding national health, safety, and environmental laws. At the same time, a network of groups on the normally pro-free-market right, from Republicans for the National Interest (a coalition of voters) to the Manufacturing Policy Project (a think tank headed by H. Ross Perot’s former running mate, Pat Choate), now view free trade as a dire threat to American sovereignty. Last year these groups helped to persuade a bipartisan alliance to block President Bill Clinton’s bid for so-called fast-track authority on trade legislation. Considering that this nationalist thunder struck in the midst of rapid economic growth, one wonders if a larger storm is on the way.
Patrick J. Buchanan is one of the few American politicians who can legitimately claim to have seen all this coming — and to have played a role in bringing it about. Twice in recent years the pugnacious pundit and former aide to Presidents Richard Nixon and Ronald Reagan has descended from his throne on Crossfire, donned a populist cape, and launched a bid for the Republican nomination on an openly protectionist platform, excoriating both parties for subjecting American workers to the crushing blows of international competition. Buchanan’s new book, The Great Betrayal: How American Sovereignty and Social Justice Are Being Sacrificed to the Gods of the Global Economy, reads like a campaign manifesto for the year 2000, and opens a window onto Buchananism — and the conservative backlash against free trade — as never before.
What the book exposes will hearten both Buchanan’s supporters and his critics, and for the same reason. Supporters — especially blue-collar workers who have lost their jobs to free trade — will thrill to Buchanan’s fist-pumping populism: volleys of accusations hurled at the “transnational elites” whom Buchanan blames for nearly every contemporary social ill (inequality, disappearing jobs, “broken homes, uprooted families, vanished dreams, delinquency, vandalism, crime,” you name it). Critics — including most politicians and the great majority of academic economists — will point to Buchanan’s overheated claims as proof that like most opponents of free trade, he is a knee-jerk protectionist who simply fails to grasp the complexities of the issue.
In style and cadence The Great Betrayal indeed brings to mind the Populist jeremiads that Richard Hofstadter so ably dissected in his 1955 classic, The Age of Reform. Hofstadter noted the Populist tendency to substitute apocalyptic, moralizing rhetoric for substantive argument, and to propose solutions to a world gone wrong that were breathtakingly simplistic. The Great Betrayal shows these traits, which will unfortunately make it easy to dismiss — unfortunately because, despite the deep flaws in Buchanan’s arguments, the contradictions and upheavals of unregulated global capitalism are real. Buchanan’s solutions to these problems — stiff tariffs and sharp restrictions on immigration — may not be the answer, but to ignore the problems altogether, as many free-traders have done, is to invite precisely the protectionist backlash that globalization’s champions fear.
OF these problems, none is more significant and potentially divisive than globalization’s impact on U.S. jobs and wages. In part one of The Great Betrayal, Buchanan attempts to show that free trade is turning America into “two nations”: an elite of professionals “prospering beyond their dreams,” and a mass of workers suffering “middle-class anxiety, downsized hopes, and vanished dreams.” The book opens with Buchanan touring Acadia Parish, Louisiana, in the heart of Catholic Cajun country, where a Fruit of the Loom plant recently closed, while the company opened two new factories in Mexico. “Who killed that plant?” Buchanan asks, pointing a finger at “both parties.” To illustrate the need for tariffs, he provides a chart showing that since the early 1970s, as America’s duties on imports have fallen, workers’ average weekly earnings have plummeted, creating an entire nation of Acadias.
It is a sign of how profoundly free trade is reshaping our politics that Buchanan, himself a former free-trader and a longtime opponent of organized labor, speaks so openly in these pages about America’s class divide, quoting the AFL-CIO leader John Sweeney as though Sweeney were an ally. This is especially striking because back in the late 1960s Buchanan penned speeches for the Nixon Administration that explicitly sought to focus middle-class resentment on culture rather than class, inveighing against the elites of the liberal media well before Dan Quayle did. (The strategy culminated in the Republican Party’s courtship of the so-called Reagan Democrats — blue-collar voters who identified with the Republicans on such issues as race and abortion.) As the former Republican strategist Kevin Phillips has observed, rising insecurity among America’s shrinking middle class has broken up the old marriage of economic and social conservatism, leading anxious workers to search for an alternative to the two major parties, both of which increasingly favor big business and free trade. Buchanan, like Ross Perot and Richard Gephardt, clearly aims to capture this vote, even if it means stitching together strange new alliances. The old Nixonian “Middle American coalition,” he concedes, is shattered: “Within both parties, nationalists are now in rancorous conflict with the globalists.”
But is Buchanan’s picture of a nation of Acadias accurate? Few mainstream economists think so, and Buchanan does little to address their counterclaims. In the 1996 best seller Pop Internationalism, for example, the trade theorist Paul Krugman, of the Massachusetts Institute of Technology, notes that for all the hype about globalization, imports (other than oil) from low-wage countries in 1990 constituted a mere 2.8 percent of America’s economic activity. Technology, not trade, is a chief cause of U.S. wage stagnation, Krugman argues, and imposing tariffs would merely raise prices and foster inefficiency.
This is a serious — though not unassailable — argument, yet Buchanan chooses not even to address it. Instead of dismissing economists as “cloistered academics peddling pet theories,” he might have done more than simply mention in a footnote the work of those economists who echo his concerns. Edward Leamer, for example, a trade theorist at the University of California at Los Angeles, disputes Krugman’s focus on the volume of imports from low-wage countries, arguing that as the world economy integrates, a single global market begins to set the same price for all jobs at a particular skill level, causing a sharp drop in American workers’ wages even when trade volume is low (in neoclassical theory this is called factor-price equalization). In a series of technical papers on the North American Free Trade Agreement, Leamer has argued that a commitment to free trade could lower the annual wages of unskilled U.S. workers by as much as a thousand dollars. The Harvard economist Dani Rodrik, meanwhile, argues in his new book, Has Globalization Gone Too Far?, that economists have severely understated globalization’s capacity to undermine the postwar social bargain between workers and employers.
Politically as well as intellectually, such findings are becoming increasingly difficult to dismiss. The Clinton Administration is still reeling from having oversold the virtues of NAFTA, which it claimed would create hundreds of thousands of U.S. jobs without threatening labor or environmental standards. Tellingly, the former Labor Secretary Robert Reich, who supported NAFTA while in office, has recently issued a call for a “new nationalism” that would compensate U.S. workers who lose their jobs to free trade, and would incorporate social safeguards into future trade accords (both Leamer and Rodrik support this approach). Buchanan proposes a very different “new nationalism”: 15 percent tariffs on all European goods and even higher rates on products made in developing nations. This seems reckless — vast disruption and higher prices would almost certainly follow. But if the global economy remains unregulated, the appeal of this new protectionism will doubtless grow.
BUCHANAN’S other chief concern about globalization is the threat it poses to national culture and sovereignty, which suggests that for all his newfound interest in class, the core of his politics remains culture. “Tear down the border posts!” he proclaims of the free-trade Pandora’s Box. “Throw open America’s doors to all who wish to shop here, sell here, move here, live here. Nationality means nothing.” Like a number of other right-wing nationalists, including the syndicated columnist Samuel Francis and the paleoconservative Thomas Fleming (the editor of the magazine Chronicles), Buchanan views the end of the Cold War as an opportunity to revive the spirit of America First! nationalism that many Republicans embraced half a century ago. During the Cold War, Buchanan championed the internationalism of Henry Kissinger and the “rollback” of communism. Today he calls for an end to foreign aid and hails the “populist-nationalist coalition… fixing to dynamite Henry Kissinger’s new world order right off the rails.”
Echoing the social critic Christopher Lasch, Buchanan excoriates multinational corporations that exhibit no loyalty to community or flag. To him, globalization invites the horrifying prospect of turning nations into undifferentiated shopping malls — “A nation sells its soul for a cornucopia of foreign goods.” Politically, he envisions a world in which “nameless, faceless, foreign bureaucrats” at the Geneva-based World Trade Organization are empowered to overturn American laws regarding such things as food safety (although, ironically, Buchanan rarely advocates regulating big business at home). “The people of a nation,” he insists, “are a moral community who must share values higher than economic interest.”
Buchanan is right that free-traders have traditionally exalted consumption as a virtually sacred activity, and have glossed over globalization’s capacity to erase local cultures and disrupt national norms and values — a theme that pervades Benjamin Barber’s insightful book Jihad vs. McWorld (which grew out of his March, 1992, Atlantic article of the same name). But, as Barber points out, the flip side of pride in local culture is a penchant for resorting to extreme and sometimes exclusionary forms of tribalism.
Buchanan must be careful on this score. If he intends to lead something larger than a right-wing fringe movement, he must convince centrists and progressives that he is not merely an American version of Jean-Marie Le Pen, the French right-wing nationalist whose crude attacks on Arab immigrants have raised the specter of a resurgent neofascism. Buchanan insists that his own “enlightened nationalism” is “not a nationalism that wishes to denigrate or dominate others.” Notably absent from The Great Betrayal are the inflammatory assertions that peppered Buchanan’s 1988 autobiography, Right From the Beginning (for example, “promiscuous sodomy — unnatural, unsanitary sexual relations between males… is the cause of AIDS”). Buchanan often strikes a tone of distinct moderation, vowing to create a “humane economy” for “black and white, Hispanic and Asian, immigrant and native-born.” At the same time, however, he cannot resist complimenting California’s stand on Proposition 187, which eliminated all public benefits to illegal immigrants. Elsewhere he hints of Mexico’s alleged plans for “La Reconquista” of the southwestern United States, and vows to stop the “annual invasions of millions of illegal aliens” by stationing troops along the U.S.-Mexican border.
To be sure, not all forms of nationalism are ugly and exclusionary. To prove this point, Buchanan takes his readers on a two-century tour of American history. This is a wise move, since today’s free-traders do often ignore the lessons of the past — as James Fallows argued convincingly in these pages several years ago (“How the World Works,” December, 1993, Atlantic), and as numerous other critics of free trade, from Michael Lind to Alfred Eckes (the economic historian who headed the U.S. International Trade Commission in the 1980s), have said. Few neoclassical economists, these critics have asserted, are willing to face the fact that America, like Great Britain, Germany, and Japan, emerged as a great industrial power through protectionism, not free trade.
Buchanan reiterates this point, but his search for a usable past is marred by a tendency to propagandize. For example, he dismisses free-trade theorists like David Ricardo and John Stuart Mill on the grounds that they weren’t Americans. He blames free trade for virtually everything, from the Civil War to the post-Second World War breakup of the traditional American family. Moreover, although Buchanan correctly asserts that the Smoot-Hawley tariff of 1930 did not, as free-traders often claim, cause the Great Depression (the devastating market crash came several months before Smoot-Hawley), he glosses over the fact that protectionism has historically fueled the rise of trade wars and autarchic nationalism, as events of the 1930s attest.
Ultimately, though, the question that hangs over Buchanan’s use of the past is whether it is relevant to the present. Buchanan wants a world in which “all cars sold in the USA” are “made in the USA,” and he dismisses those “who say there is no turning back” to an earlier age. Yet as he himself notes, fully a third of world trade today consists of transfers between subsidiaries of the same multinational corporations, which suggests a level of global integration that would be difficult if not impossible to undo. Furthermore, the technological changes that have given rise to globalization cannot be erased. Thus it is hard to believe that America’s withdrawal from the World Trade Organization and erection of tariff walls would usher in a golden age. In fact, a number of writers, from the Business Week columnist Robert Kuttner to the populist author William Greider, argue persuasively that globalization’s problems require global, not national, solutions. Nations could, for example, insist that the World Trade Organization define child labor, prison labor, and the chronic abuse of workers as “unfair trade.” Although these writers echo Buchanan’s belief that nations have a right to protect their interests against the social consequences of unregulated trade, they advocate that countries work together, not in isolation, to address these problems.
Despite its one-sided arguments and hyperbolic claims, The Great Betrayal ought to stir discussion of such alternatives to the free-market internationalist status quo. Contrary to the best hopes of its advocates, the status quo has not extinguished the flames of nationalism but may actually be feeding them. If more of Buchanan’s critics don’t realize this soon, they may, ironically, end up leaving the stage to Buchanan himself.