Can he terminate protectionism?
It seemed like California Gov. Arnold Schwarzenegger didn’t have guts, despite his super-macho screen image. Yesterday, however, he wrote to members of the California Congressional Delegation, the country’s most powerful delegation in terms of the key leadership positions they hold, where he urged them to restore the pilot Mexican trucking program to avert trade retaliation.
Schwarzenegger pointed out how Congress’ termination of the program will hurt the economy and jobs, particularly in California:
. . . we must not allow safety to serve as a smokescreen for protectionist measures that cause more economic harm at a time when this country already has serious challenges to overcome. . . . The termination of the pilot program has not made U.S. roads safer, but it has hurt the economy of California and the nation as a whole.
Beyond my concerns related to this particular episode, I am troubled by the disturbing signals it sends to our most valued trading partners. In times of economic distress, the one sure way to worsen the plight of American workers is to retreat behind arbitrary and disingenuous protectionist walls. Now is precisely the time for Congress to further open markets to American products rather than raising additional barriers to trade.
See earlier posts on Mexican trucking here, here, and here. Will Democratic leaders stand up to the Teamsters on this issue? Don’t count on it — too many are indebted to the unions for their 2008 win.