Public Support for Trade Policy

For much of the last two generations the benefits of international trade had been an article of faith for both Americans and Europeans. The shared belief that protectionism deepened the Great Depression and that trade liberalization rebuilt Europe after World War II motivated Americans to lead successive multilateral initiatives that dramatically lowered tariffs, resulting in an explosion in global commerce. And such faith inspired Europeans to create and then to deepen their Common Market, now the world’s largest economy. But the intense competition fueled by growing trade, especially after the entrance of China into the world market, had contributed to wage stagnation, rising income inequality, slow growth and joblessness that had eroded public trust in further globalization. In Europe a strong social safety net had helped allay some of these economic doubts and fears. America’s relatively less robust income support and retraining opportunities might have amplified them. This policy paper examines the attitudes of Europeans and Americans toward international trade.