As I detailed last week, the neoliberal era that the Reagan presidency ushered in and has held until the past few years is disintegrating. The idea that the “invisible hand of the free market,” putting profits over people and turning America over to our billionaires and corporate monopolies will solve all our problems, is now largely seen as a disaster.
Neoliberal tax-cuts-for-the-rich policies have driven America into massive debt, widespread poverty and unprecedented inequality; neoliberal “free trade” policies have shipped 60,000 factories and tens of millions of American jobs overseas; and neoliberal “privatization” of everything from our military to electric utilities to the Medicare Advantage Scam are widely seen by voters as boondoggles that only benefit the corporate class.
Of these three pillars of neoliberalism that are all now in trouble, however, “free trade” is the most explosive. And, thanks to Donald Trump’s openly attacking that system and revealing its failures, the GOP is figuring that out.
If the Democratic Party doesn’t get with the program, it’s a virtual certainty the White House will go to the Republican candidate in 2024.
By way of example, consider how Josh Hawley, one of the most serious of the 2024 GOP frontrunners, is carefully laying the groundwork for his candidacy. He totally gets this.
He’s keeping Trump close but not too close (see: “Glen Youngkin’s strategy”); has published what’s actually a thoughtful (albeit partisan) book about how Big Tech is invading our privacy just to make a buck; and is all-in on rightwing lies about Critical Race Theory, masks, and Covid immunizations.
But his real punch — the thing that could win Hawley a national election with particularly heavy support in the South and Rustbelt Midwest — is his rejection of so-called “free trade.”
A few weeks ago, Hawley published an op-ed in The New York Times about how it’s time to end the neoliberal “free trade” policy that has gutted the American working class in the 40 years since Reagan began this madness.
In that, Hawley is echoing the rhetoric that helped Trump win much of the Midwest in 2016.
And Trump, for his part, was just echoing criticisms of “free trade” that have been the bread-and-butter of progressive Democrats like Bernie Sanders, Mark Pocan and Sherrod Brown for three decades.
Hawley opens his op-ed with a obligatory swipe at Biden, but then turns, mid-sentence, to the real meat of his article.
“[T]he problems have been brewing for decades,” Hawley acknowledges without mentioning that they began with Reagan renegotiating the General Agreement on Tariffs and Trade (GATT) to set up the WTO, and then starting the negotiations for NAFTA that were concluded by his VP, George HW Bush.
As the Heritage Foundation proudly proclaimed in 1993 after President Bill Clinton signed the agreement Reagan and Bush had negotiated: “The North American Free Trade Agreement: Ronald Reagan’s Vision Realized.”
“Now,” Hawley writes in the next sentence, turning his back on The Gipper, “we must change course. We can rebuild what made this nation great in the first place by making things in America again.”
Of course, Hawley is right. Alexander Hamilton created America’s trade policies in 1791 with his “Report on Manufactures” that established his “American Plan,” and they built us into the most powerful and wealthy nation on earth over the next 190 years.
Reagan, taking advice from Milton Friedman and his neoliberal Mont Pelerin buddies, decided it would be better for the GOP if they could destroy American labor unions (that funded Democratic politicians) by shipping manufacturing jobs to countries where people were paid $1 an hour and there were few environmental regulations.
And it worked: Reagan’s embrace of neoliberal trade, labor, and tax policies gutted the American working class and destroyed most of this country’s union movement.
But now the chickens have come home to roost, as Hawley points out in his Times op-ed.
“Whether it be personal protective equipment, pharmaceutical drugs or semiconductors,” he writes, “the coronavirus pandemic has exposed a hard truth: The United States — the strongest country in the world — cannot produce an adequate supply of the critical goods it needs.”
And the most painful part of this is that Hawley is right. We can’t even build a missile, jet plane or aircraft carrier without parts from China and other countries that may, at some point, decide it’s in their national interest to withhold those items from us.
Hawley’s embrace of Hamilton’s “American Plan” and rejection of the Reagan/Bush/Clinton neoliberal “free trade” policy is particularly grating for progressives, who’ve opposed that ideology since Clinton first embraced it in 1992.
In 2010 I wrote a book about how Democrats could win the upcoming midterm and presidential elections by taking on 11 core issues, the first being a repudiation of so-called “free trade.” The book was titled: Rebooting the American Dream: 11 Ways to Rebuild Our Country.
Senator Bernie Sanders read part of it on the floor of the Senate during his famous 2010 filibuster and printed 99 copies of a “Dear colleague: read this book!” cover letter that we distributed to every single US senator along with a copy of the book.
But Bill Clinton had signed NAFTA into law and thus there was (and still is) a strong neoliberal presence in the Democratic Party, so the anti-free trade voices have been marginalized since 1992, leaving a huge hole for Hawley and like-minded populist Republicans to step into.
“The failure of the nation’s productive capacity to keep up with its needs was not inevitable,” Hawley writes. “It was a choice. Over the last 30 years, experts and politicians in Washington from both parties helped build a global economic system that prioritized the free flow of capital over the wages of American workers, and the free flow of goods over the resiliency of our nation’s supply chains.
“We liberalized and expanded trade relations with China under the delusion that it could be influenced into becoming a peace-loving democracy.”
And, indeed, Hawley describes exactly what happened.
When Thomas Friedman wrote his book selling free trade, The Lexus and the Olive Tree: Understanding Globalization, we at least had a robust discussion of its impact, and a debate over the tradeoff between the cost of the loss of manufacturing here and the possible benefits of the rise of a middle class in China.
Neoliberals proclaimed worldwide supply chain integration would end war for all time, as Friedman put forward his “MacDonald’s Theory” that no two nations with a MacDonald’s had ever gone to war. President Clinton assured us that high-paying tech jobs would more than replace manufacturing as the foundation of a 21st century American middle class.
Today, although both have been shown to be terrible mistakes (at best), that discussion is largely verboten in the Democratic Party.
Thus, Hawley continues:
“The consequences of these bad policies have been disastrous. They’ve created trade patterns that have helped multinational corporations boost their profits by exploiting cheap labor abroad and offshoring America’s industrial commons and the capabilities of its manufacturing sector.
“As a result, thousands of factories have shuttered, millions of jobs have been shipped overseas and the economic security of the United States is now more vulnerable to unpredictable crises like global pandemics, and America is dangerously dependent on the productive capacity of China, our chief adversary.
“These policies were sold to us as a path to greater wealth, but they’ve made us weaker and more vulnerable.”
Hawley’s op-ed is the most serious opening shot of the 2024 presidential election.
While Democrats are scrambling to explain that no public school in America is teaching Critical Race Theory, Republicans who are committed to winning back power are already three steps ahead, laying down their markers for the next presidential election.
Hawley and most fascist-leaning, Trump-humping Republicans get it that neoliberalism is dead for the American electorate and populism reigns again after a 40-year hiatus. It was, after all, Donald Trump himself who helped kill neoliberalism in the 2015 primaries and is the chief promoter of a fascist form of populism in America.
Hawley knows that trashing — and ultimately ending — so-called “free trade” is the future path to winning elections and holding power.
If Democrats continue to ignore the American working class’ increasing hatred of neoliberal policies — particularly so-called “free trade” — they’ll get buried by it in 3 years.
It’s time to wake the hell up.
Originally posted at The Hartmann Report