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First to clarify, by "Fair Trade" I mean a trading system in which a certain standards for labor practices and environmental stewardship must be followed. Also implied is a shift in power from currently dominant capital to labor, and a renewed emphasis on social and economic justice in our trade policies. A system based on "Fair Trade" is a noble vision, but it for all of the good it might do it will not help the American worker that much.
First, it will be impossible to put in place a system strong enough to help American workers. Impossible not just because the corporate interests aligned against it too powerful, that we could hope to overcome, but impossible because the governments of China,India, and Mexico as well as smaller developing nations don't want it. Are corporate interests behind this lack of acceptance for "Fair Trade"? Perhaps to a point, but that is not the main driver. In the case of China in particular, corporate interests have nothing to do with it. The Chinese leadership's main priority is to make China the center of world production, and it will not easily accept any barriers that restrict or even slow down this trend.
Of course, the benefits of some type of "Fair Trade" arrangement go beyond just helping the American worker. In particular, the perceived need for environmental standards may be great enough to overcome China's economic nationalism. But the idea that labor and environmental standards can be set high enough so that an American textile worker can produce as cheaply as an Chinese/Indian/Mexican worker is not realistic.
Second, even if American labor and environmental standards were adopted worldwide, this only solves part of the deindustrialization problem; cheap labor is not the only issue for American industry and the American worker. While China captures the most attention, the U.S. actually runs substantial trade deficits with many nations that pay similar wages. The largest deficits (besides China) have been to two nations -- Germany and Japan -- that actually have substantially higher manufacturing wages. To Germany and Japan, America is a cheap labor locale.
It is the loss of industrial capacity and technological competitiveness in manufacturing that is responsible for this part of the problem. Policies that enable our domestic manufacturers to catch up (while also keeping them in line) are necessary to deal with this aspect of America's deindustrialization.
For these reasons, "Fair Trade" is a great ideal for the world, but not a realistic or complete strategy for the American worker and its advocates should recognize as much.
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