Obama called for a variety of restrictions on international trade: energy independence, tax penalties for companies that move jobs overseas, tax subsidies for companies doing domestic manufacturing, and aggressively pursuing trade cases against China. Regardless of the wisdom of these policies — and I've argued myself that domestic manufacturers probably should get a tax break — they amount to a dramatic inward turn by the president.
This isn't going unnoticed.
Here is Slate's Matt Yglesias:
Through a long stretch of the speech the president went all-in on a confused mercantalist vision. That's what I wrote my column about, and it was really bad. Misguided policy ideas supported by faulty logic. I think Gene Sperling must have been on vacation when they drafted the speech or something. Smart progressive ideas about mitigating the problems with globalization were nowhere to be seen and instead we got protectionism for uncompetetive tire-makers.
"I was disappointed, and even a bit surprised, that the president adopted the xenophobic approach to outsourcing and international trade," Harvard's Greg Mankiw wrote on his blog.
Of course, it will not go unnoticed abroad either. As a result of numerous crises, we're already seeing a wave of inward-turning across the globe. Italian banks reportedly only lend to Italian banks.
Nationalism is on the rise across Europe, both in the periphery states tired of being bossed around and the core states tired of being asked to open their pocketbooks. Last night, President Obama joined the chorus that has just begun to sing the praises of "me first" economics.
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