Theory vs. Reality: 
The Free Trade Debate

Column by Senator Trent Lott   Filed 5/5/05

At Nissan’s Canton, Mississippi, automobile plant, President Bush this week touted his Social Security plan.  Regardless of what you think about the ongoing Social Security debate, we all agree that the best retirement security is a good job, so the President’s choice of venue for his remarks was important.  Mississippi’s best social security plan is to keep good, Nissan-style jobs coming here.  We can do this by continuing to encourage free and fair trade and by resisting extreme positions which ignore either the free or the fair part of trade.

Those who say American jobs suffer because of free trade are wrong.  Conversely, those who believe in total free trade, with no safeguards to ensure fairness nor tax incentives to attract new jobs, are just as wrong.  Both philosophies represent theoretical extremes.  As we have seen in Mississippi, real world results lie in the middle, with a healthy balance of tax incentives to spawn job growth and, when necessary, even tariffs to protect existing jobs and ensure fairness.

President Bush’s visit with Nissan’s Mississippi workers demonstrates that our state is doing things right.  Manufacturing in America is not dead, but is ever changing and moving forward.  With tax incentives and a pro-business attitude from government, Mississippi won Nissan as well as a host of new, high-tech manufacturing jobs, including investments by foreign manufacturers.  From steel to auto and aircraft production, Mississippi now is a player, and we want to remain one.

Rather than lamenting the closure of old textile factories and picture frame plants, we must continue to look toward the future.  After all, which job provides the better living and the better retirement – working in a textile plant or in an automobile or aircraft factory?  The answer is clear.  In addition to Nissan, Rolls-Royce, Eurocopter, BAE Systems, Northrop Grumman and Lockheed Martin are just a few of the international companies recently investing in Mississippi, providing jobs here with which workers can actually make a good living and a good retirement.

As the son of a union member, I’ll admit that free trade is an issue with which I’ve struggled.  I don’t like to see any job lost nor any plant close or move away.  Yet, the evidence is clear, as the world changes, free and fair trade practices, coupled with a healthy dose of business incentives from government, are the only means to attract today’s jobs.  That’s why Nissan came to our state and why businesses will follow.  For example, this week Airbus, the European aircraft and aerospace firm, announced that Mississippi is one of only four finalist sites competing for the company’s next large aircraft manufacturing facility.

The key word here is “fair.”  All free trade must be verified to indeed be fair and backed up by corrective action if violations of fairness arise.  That’s why I led the fight to slap punitive trade tariffs on some Southeast Asian seafood imports, as well as on some Canadian soft lumber imports.  In those cases, the trade wasn’t fair.  Their products were subsidized or given unfair advantages against Mississippi producers, and we took action to level the playing field.

After the excitement surrounding the President’s Mississippi visit to Nissan has subsided, you’ll likely hear some thoughtful analysis from people with an eye on the future and a good grasp of the modern economy.  They’ll matter of factly discuss changes in our manufacturing economy by acknowledging opportunities afforded us by foreign companies which, though headquartered in Tokyo, London or Stuttgart, employ American workers to assemble and design their products.  Remember that every Nissan built in Canton also was engineered by Americans, for Americans.

You’ll hear, too, from two theorists.  One is a total free trader who doesn’t think about fairness.  He believes government hasn’t the slightest role in the market, and he decries Mississippi’s tax incentives for attracting jobs.  He’s never darkened the door of a plant and doesn’t seem to worry about a level playing field for skilled American workers.  Meanwhile, the other theorist basically is an anti-business extremist who sees free trade as a threat to the old order when unions ruled every worker, when cars were made only in Detroit, steel only in Pittsburgh, planes only in Seattle, and when Mississippians were relegated to growing crops or making socks.

Since neither of these theorists has to worry about the next check, they can afford to dabble in old theories while the rest of us look for real answers.  Looking ahead to a greater economic future, we measure results with the new jobs that free and fair trade have brought to Mississippi, and in what opportunities it can yet bring.