28 February 2008
Free Trade Agreements and Employment
Do the nation’s citizens have a right to employment? That the state exists to assure employment is a socialist principle. A free market approach concedes that the state should assure certain civic values, such as public order, health and safety, personal privacy, freedom of religion and speech, habeas corpus, etc. However, it is up to each individual to make his own living.
Labor unions exceed their mandate when they step outside the arena of microeconomics, in which they negotiate on behalf of workers with company management. Both union members and their employers are subject to the laws of the state, including its free trade agreements. They are both free to affect to the new rules established by those agreements through their representatives in Congress and to respond to them by adapting the factors of production that they control—capital and labor. If they are not able to respond adequately to satisfy their respective objectives, they can use the means available to them—their votes at the ballot box and their financial support for election campaigns—to secure changes in those agreements.
The complaint being made in 2008 against NAFTA, however, is not one that can be resolved through the American political process. It assumes that it is the responsibility of the state to obviate measures that cause the loss of jobs, even if those measures may result in improving general welfare. The affected workers may demand adjustment assistance in order to achieve that result. But if NAFTA serves the general welfare, including payment of adjustment assistance, then the American government has fulfilled its duty. It should not prevent change just because it makes it necessary for some segments of society to upset their accustomed routine.
Do the nation’s citizens have a right to employment? That the state exists to assure employment is a socialist principle. A free market approach concedes that the state should assure certain civic values, such as public order, health and safety, personal privacy, freedom of religion and speech, habeas corpus, etc. However, it is up to each individual to make his own living.
Labor unions exceed their mandate when they step outside the arena of microeconomics, in which they negotiate on behalf of workers with company management. Both union members and their employers are subject to the laws of the state, including its free trade agreements. They are both free to affect to the new rules established by those agreements through their representatives in Congress and to respond to them by adapting the factors of production that they control—capital and labor. If they are not able to respond adequately to satisfy their respective objectives, they can use the means available to them—their votes at the ballot box and their financial support for election campaigns—to secure changes in those agreements.
The complaint being made in 2008 against NAFTA, however, is not one that can be resolved through the American political process. It assumes that it is the responsibility of the state to obviate measures that cause the loss of jobs, even if those measures may result in improving general welfare. The affected workers may demand adjustment assistance in order to achieve that result. But if NAFTA serves the general welfare, including payment of adjustment assistance, then the American government has fulfilled its duty. It should not prevent change just because it makes it necessary for some segments of society to upset their accustomed routine.
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