The TRUTH About Free Trade and Restrictive Trade

Written by William Pauwels on March 15, 2016

People who are hurt by free trade tend to be better organized than people who benefit from free trade.

For example, Carrier’s (air conditioning) relocation to Mexico produces highly visible complaints from 1400 highly paid, displaced employees, their unions, the local media, and affected politicians.

On the other hand, lower-cost Carrier Air Conditioners will benefit hundreds of thousands of people the world over, including in the USA. 

If one compares the average standard of living of free trade nations over the past 30 years, with high tariff nations, one will observe a gigantic difference in the quality of life and the availability of affordable products.  One need look no further than Cuba with its Communistically controlled economy.

Economist the world over have pretty much agreed that the benefits of free trade exceed the benefits of government controlled restrictive trade. 

At the same time, however, free trade often has undesirable effects on specific groups and organizations – e.g., Carrier’s 1400 employees.  Clearly, those adversely affected by free trade must be provided with a temporary pathway to alternative sustenance and employment.  Needless to say that can be extremely challenging and costly for the prospering, free-trade-benefiting economy.

Fair trade and new business formation are, obviously, ideal solutions to the negative impacts of free trade.  New business formation would be greatly enhanced if government would get out of the way, i.e., reduced taxation, less regulations, loser-pay frivolous business lawsuits, elimination of interstate trade barriers, less social engineering, etc.  Also, foreign nations that restrict the importation and sale of American goods and services into their countries should be inhibited in their economic activities in the USA. 

During this election season, it is important to elect economically literate candidates who will do what is economically appropriate – and who can communicate the appropriateness of sound economic strategies to their constituencies and the media. 

In God we must trust . . . but we must always do our part – to secure and promote the truth and a better way – to protect our freedom, interests and prosperity – and to defend our competitive, free-market, constitutional, free-enterprise system – and our Judeo-Christian American-Way and Prosperity Machine.     


Share if you agree there is more to the Free Trade/Fair Trade argument than is being discussed.

William Pauwels
William A. Pauwels, Sr. was born in Jackson Michigan to a Belgian, immigrant, entrepreneurial family. Bill is a graduate of the University of Notre Dame and served in executive and/or leadership positions at Thomson Industries, Inc., Dow Corning, Loctite and Sherwin-Williams. He is currently CIO of Pauwels Private Investment Practice. He's been commenting on matters political/economic/philosophical since 1980.