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What We're Reading: A Case Against Protectionism

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Learn more about William McKenzie.
William McKenzie
Senior Editorial Advisor
George W. Bush Institute

Agustin Carstens, governor of the Bank of Mexico, discusses the economy in the Financial Times.

Agustin Carstens, governor of the Bank of Mexico, had an important observation in the run up to the meeting of the G-20 in China on September 4 and 5. Carstens made the case against protectionism this way in a Financial Times interview.

“The state of the world, the rate of growth of the world economy is not such that we could afford to limit the growth potential through protectionist measures.”

Indeed. Remember our own economy expanded by annual rate of only 1.1 % in the second quarter of this year. With such anemic growth, what sense does it make to engage in a trade war and restrict the ability of our manufacturers, farmers, and innovators to sell their products abroad? And what sense does it make to risk creating higher prices for our consumers by putting the squeeze on imports into our country?

Carstens also effectively issued a charge to those of us who believe that we should remain engaged in the global economy. He put it this way:

“My own sense is we probably declared victory some years ago in the sense of saying globalisation is here to stay, everyone is happy with it, and then we sort of stopped rooting for it.”

True. Arguments for a cause need to keep being made. In this case, the case is for trading across borders as a way to grow economies, here and abroad. And it needs to keep being made given the pushback to international trade, which, as Carstens notes, is a concerning reality.