by Christopher Burk, Director of Debate at the University of Texas at Dallas
Resolved: Free trade should be valued above protectionism.
In today’s globalized world, trade is an integral part of most every country’s economy. According to the World Trade Organization (WTO), in 2008, $19.5 trillion dollars worth of merchandise and commercial services were traded. Many support the expansion of free trade and seek to reduce trade barriers such as quotas, tariffs, and domestic subsidies. Proponents of free trade often argue that trade leads to economic growth and a high quality of living. However, others warn of the dangers of free trade and advocate for protectionism which typically takes the form of tariffs and subsidies. A tariff is a tax levied on an imported good in order to make that good relatively more expensive than a domestically produced good to protect that industry. A subsidy is another form of protectionism in which the government gives special tax breaks or credits in order to support a company or industry competing against foreign companies. The motivations for protectionism are varied, but most are aimed at helping domestically produced goods flourish by making it more expensive, harder or impossible to buy foreign imports of the same or similar products.
Currently, nearly every country practices some form of protectionism. Milton Friedman explained that tariffs are the “rule” for the currently global economy. He said, “The only major exceptions are nearly a century of free trade in Great Britain after the repeal of the Corn Laws in 1846, thirty years of free trade in Japan after the Meiji Restoration, and free trade in Hong Kong under British rule.” So, while the amount of protectionism may vary from country to country, it is accepted that virtually country practices some form of protectionism.
Value Criterion Discussion
The value you choose for this resolution will probably be different from any other that you have encountered thus far this season. Many debaters use justice as their default value but will be unable to do so on this topic. It will be too difficult to adequately defend “justice” as your value for this topic.
Instead, focus on values such as societal welfare, freedom and government legitimacy. Societal welfare serves either side well. It simply enforces the idea that either type of trade policy will be better for society. Government legitimacy can support either side as well. Freedom is obviously better suited for free trade, and basic arguments for this value can be morphed to fit the global scale of this resolution.
Other values that focus on societal good, progress, and can be applied globally will also work. Be creative, but make sure that your value can be applied easily, without having to waste too much time explaining the connection between your value and the resolution. One reminder that bears emphasis is that the affirmative cannot value “free trade” and the negative cannot value “protectionism.” Values are meant to be overarching goods that both sides have the capability of reaching. If the affirmative values “free trade,” it would be impossible for the negative to achieve that value. This eliminates clash in the round. For more on understanding values read our paper “Understanding the Value Criterion” here: http://debate-central.ncpathinktank.org/research/understanding-the-value-criterion
The criterion should be very specific to your case. For instance, if you are arguing that free trade is beneficial because the principle of comparative advantage allows the world economy to flourish, then your criterion might be simply “the principle of comparative advantage.” Alternatively, if you argue that free trade is good because it increases competition, then your criterion might be “increase in global competition.” On the other hand, if you are arguing the protectionism is good because it allows countries to preference other countries that treat workers fairly, your criterion could be “the protection of human rights.”
Criteria can be detailed and varied. Especially for this resolution, please ignore the lists of “common criteria” that you have stashed somewhere in your debate rom. These will most likely not be helpful, and will prevent you from developing a strong criterion. As always, when in doubt, you can email your case or questions to us and we will review them and give you feedback!
Affirmative
There are many arguments available to affirmative debaters.
First, free trade generates economic growth. International trade benefits the world economy as a whole. It allows people, regions and nations to specialize in the production of what they do best, to enjoy the economies of large-scale production and to buy more cheaply those things that others do best. We explore why below.
Comparative Advantage. One way that trade contributes to an increase in economic output is through comparative advantage, which creates more value with the same resources. The Heritage Foundation explains comparative advantage by describing a situation in which one person can only use the goods which he or she produced. Obviously the person would produce some goods well and others poorly. Alternatively, that person could spend his or her time producing the one good he or she produces best and then sell it for a profit to others. The person could use the profit to buy goods from others that produce other goods best and at the lowest cost. This would arguably increase quality of living by allowing people to produce the best goods at the lowest prices.
The Heritage Foundation explains further: “It simply makes sense for each person to work at what he or she does best and to buy the rest. As a nation, the United States exports in order to purchase imports that other nations produce more skillfully and cheaply. Therefore, the fewer barriers erected against trade with other nations, the more access people will have to the best, least expensive goods and services in the world ‘supermarket.'” (You can find more here: http://www.heritage.org/research/reports/2004/05/why-america-needs-to-support-free-trade )
If a country were to instead place tariffs on goods that other countries produced cheaper to increase the chance that goods produced domestically were bought, they would be forcing their citizens to buy products for a more expensive price, and perhaps products that aren’t as good.
Competition. Free trade increases competition between different firms in different countries. This in turn stimulates a real cost reduction for producers when they compete with other producers, which increases economic efficiency. This works because it shocks lazy firms into a serious search for ways to reduce real costs. When they are protected by ample tariff and nontariff barriers, firms tend to pursue a comfortable way of life. Competition from the world marketplace can shock owners and managers, making them work harder to reduce real costs than they would under the umbrella of protection.
Rather than fearing competition as many protectionist advocates do, affirmatives can argue that competition through free trade benefits all by promoting innovation and efficiency. By spurring countries and companies to innovate to create better products and produce them in less costly ways, economic competition fuels the innovation needed to increase economic growth and wealth. For more on this topic read NCPA publication “Trade and Economic Growth I” here: http://www.ncpathinktank.org/pub/ba552 and “Trade and Economic Growth II” here: http://www.ncpathinktank.org/pub/ba553.
Economists Jeffery Sachs and Andrew Warner examined trade policies of 117 countries over 20 years and found a strong, positive correlation between free trade and growth. In fact, growth was three to six times higher in open economies than in closed ones. Free trade has been behind the booming growth and reduction in poverty in numerous developing countries. Affirmatives can argue that free trades empowers poor people with greater opportunities to create wealth and support their families, free trade and open markets disperse economic power and increase the living standards of all.
In 2000, the WTO found that the poor benefit greatly from trade liberalization reporting that, “Trade liberalization is generally a strongly positive contributor to poverty alleviation-it allows people to exploit their productive potential, assists economic growth, curtails arbitrary policy interventions and helps to insulate against shocks.”[i]
Steven Horowitz agrees that developing countries can be lifted from poverty through free trade. He believes that they can use comparative advantage to do so. He says: “For many Third World countries, their comparative advantage is the cheapness of their labor and the availability of some natural resources. For Western firms, this presents an opportunity for profit by reducing labor and resource costs. When Western firms open up shop in the Third World, they bring capital to those places. This creates jobs for citizen there and provides the West with cheaper goods. It is the classic mutual benefit of all exchange: the developing country gets jobs; the home country gets cheaper goods.”[ii]
Protectionism in the form of farm subsidies can be devastating to developing countries in Africa because farming accounts for nearly 70 percent of total employment and is the main source of income for the majority of Africans living in poverty. For example, more than 10 million Africans depend directly on cotton production. Since the 1990s, world cotton prices have fallen by half, much of which is due to U.S. farm subsidies, according to the International Cotton Advisory Committee. Their estimates suggest that world cotton prices would rise by 26 percent if the United States repealed cotton subsidies. This amounts to an increase of over $300 million per year in income for African cotton farmers.
Second, the affirmative can make the claim that free trade decreases the likelihood of war and increases peace. In 1748, Baron de Montesquieu wrote that “Peace is the natural effect of trade. Two nations who differ with each other become reciprocally dependent; for if one has an interest in buying, the other has an interest in selling; and thus their union is founded on their mutual necessities.”
This can be a powerful affirmative argument. If the United States is dependent on, say, China for trade, we may be deterred from starting a war with China because, in the end, we need the goods they give us more than we need to blow them up. Likewise, if China is dependent on the money we give them for the things they provide, they will be less likely to take extreme action in the case of a disagreement.
Donald J. Boudreaux says that if free trade “promotes peace, then protectionism – a retreat from open trade – raises the chances of war.” He provides several empirical examples to support this including two major studies on the relation between trade and peace.
The first is a study done by Solomon Polachek, an economist at the State University of New York at Binghamton and co-author Carlos Seiglie of Rutgers University. They find “overwhelming evidence that trade reduces conflict.” They find the same for foreign investment: the greater foreigners invest in the United States or the more Americans invest abroad, the lower the chances of war between those countries and the United States. Professors Polachek and Seiglie conclude that, “The policy implication of our finding is that further international cooperation in reducing barriers to both trade and capital flows can promote a more peaceful world.”
The second is a study by Columbia University political scientist Erik Gartzke. Gartzke places countries on an economic-freedom index from 1 to 10 (1 is very unfree and 10 is very free). He then compares them to military conflicts from 1816 to 2000. He found that countries that countries with scores of 2 or less are 14 times more likely to be involved in military conflict than those countries that rank at 8 or higher. Gartzke concluded that, “When measures of both economic freedom and democracy are included in a statistical study, economic freedom is about 50 times more effective than democracy in diminishing violent conflict.”[iii]
Beyond economics, free trade has important moral and democratic implications. Affirmatives can argue that by its very nature, free trade limits the power of the centralized state and gives more freedom and autonomy to the individual. Protectionism, the Cato Institute writes, “is a form of stealing.” Free trade on the other hand gives to each person control over what is his or her own. Affirmatives can claim that this allows people to fulfill their creative and productive potential. Moving beyond the individual, free trade fosters relationships and exchange that goes beyond economics. Not only material goods are exchanged, but also people, ideas, technology, religion, and friendship are fostered. Even John Keynes was of the opinion that free trade could promote world peace by fostering interdependent relationships among nations. Free trade also has an important influence on the spread of democratic values. By promoting the rule of law necessary for international trade transactions, free trade actually promotes democratic values of decentralized economic power, individual sovereignty and freedom. Rule of law brought about by honest and open free trade reduces the influence of corruption and bribery. Free trade reduces the incentives for corruption by promoting economic growth and improving wages and standards of living. Additionally, the ideas of democracy and individual liberty are disseminated through trade as borders are open to not only goods but also to information, ideas, and values.
Negative
Negative debaters can make numerous arguments on this topic.
First, the negative can argue that allowing comparative advantage to flourish without constraints can lead to national security problems. Specialization, while it can be beneficial, also has some important and dangerous consequences if free trade is promoted in the entire economy. Negatives can note that some industries are of a unique and vital national interest and protecting them allows for economic diversity and security for the public good. Proponents of protectionism often cite the agricultural and heavy industrial sectors such as steel as vital economic sectors for security. The United States, for instance, might stop farming and instead import all food from a couple countries. What happens if we go to war with one or both of those countries?
In addition to being a vital industry, agriculture has important cultural significance. A country may want to maintain a domestic food supply for the sake of security as well as preserving agricultural interests and farmer’s lifestyles. Agriculture also has a unique exposure to price fluctuations as environmental factors can have major impacts on prices. As vital interest, agricultural products are often shielded from foreign competition. In the European Union, for example, agricultural subsidies compose over 47 percent of the EU’s budget.
Another vital industry is heavy industry such as the production of steel and coal. In the event of war, it is vital for a country to have the ability to produce steel and other resources for military manufacturing. If a country did not protect this vital industry and other countries produced the steel needed, it would be at the whim of other countries in a matter of vital national security. For these reasons, negatives can argue that protecting vital industries is justified.
Second, negatives can argue that it is necessary to protect the economies of developing countries. The WTO promotes policies that allow countries to give preference to underdeveloped countries to encourage the growth of their economy. Negatives can argue that giving these countries preference over larger countries allows them to compete in the global market.
A study done by the USDA’s Economic Research Service found that these preference provisions are helpful to developing countries. The study says: “Many countries rely heavily on these programs, as indicated by the sizable share of their exports that receive preferences. In 2002, more than 50 percent of agricultural exports of 21 countries entered the U.S. market under preferential programs.
The figure was even higher for the EU, where preferences covered over half of the agricultural exports from 49 countries.”[iv]
Next, the negative can point out that protectionist policies can be used to encourage good behavior. Many opponents of free trade argue that free trade creates a “wild west” world in which countries continually attempt to undercut each other at the expense of labor. Negatives can argue that free trade promoted by the WTO establishes a “race to the bottom” in wages by pitting workers against each other across the globe. Rather than promoting internationally recognized labor standards, free trade undercuts wages and labor standards in pursuit of cheaper and more efficient labor. Low wages and minimal standards serve as a magnet for global investment as companies and firms seek to minimize labor costs in order to maximize profit margins. This argument, proponents maintain, can also be applied to environmental standards as companies are most attracted to those countries with minimal environmental standards. This also reduces the cost of business and can lead to higher profit margins sought by companies operating in a free trade world. These serious consequences of free trade on both labor and the environment are powerful arguments for the negative.[v]
Finally, the need to protect newly emerging industries is the basis for the infant industry argument against free trade. This argument maintains that in order to grow and compete in the future, new industries need temporary protection from foreign competition. A critical need, this protectionism allows those industries to establish themselves in the key beginning stages shielded from foreign competition from established firms. Protection gives these industries and companies a chance to progress and develop a completive advantage in the future. Negatives can argue that if this protection is not given, new industries will never develop in a country as they are killed off by mature foreign competitors before they are even given a chance to take root. Protection in the form of tariffs for competitors or tax credits for companies would allow the government to establish and grow industries which would benefit the public good such as technology, solar, and green industries which have the potential to create millions of jobs. For emerging countries, this form of infant industry protection would allow less developed countries to start their own industries which can eventually compete on the global market alongside industries from developed countries.
[i] “Free trade helps reduce poverty, says new WTO secretariat study,” World Trade Organization, June 13, 2000. http://www.wto.org/english/news_e/pres00_e/pr181_e.htm
[ii] “Free trade and the climb out of poverty,” Steven Horowitz. http://www.fee.org/pdf/the-freeman/horwitz0305.pdf
[iii] “Want world peace? Support free trade.” Donald J. Boudreaux, The Christian Science Monitor. Nov. 20, 2006. http://www.csmonitor.com/2006/1120/p09s02-coop.html
[iv] “Agricultural Trade Preferences and the Developing Countries,” USDA Economic Research Service. http://www.ers.usda.gov/publications/err6/err6.pdf
[v] “EU gives developing countries duty-free access with GSP+,” Europa. Dec. 9, 2008. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/08/1918&format=HTML&aged=1&language=EN&guiLanguage=e