Thursday’s bombshell announcement by the Trump administration that it will slap steep tariffs on imports of steel and aluminum products from Canada, Mexico and the EU has triggered waves of recrimination and counter-tariffs, and set the Western world on a dangerous path to protectionism unlike any seen in decades.
Politicians, economists and even union leaders in both Canada and the U.S. have blasted Donald Trump for targeting America’s closest allies with a trade war. So far, however, Trump has shown little interest in listening.
Maybe he just hasn’t heard the right voice of common sense yet. Enter Ronald Reagan, who Trump likes to compare his unlikely presidency to.
In 1988, in his Thanksgiving radio address to the American people, Reagan took up the subject of the recent Canadian election. The federal campaign that year was fought largely over one issue—the Canada-U.S. free-trade agreement, with the Progressive Conservatives under Brian Mulroney urging voters to embrace closer economic ties to the U.S., while John Turner’s Liberals and Ed Broadbent’s NDP campaigned against the deal as “selling out Canada.”
In the wake of Trump’s latest direct assault on America’s closest trading partners, Reagan’s 1988 speech has resurfaced on social media. In it, Reagan praised Canadians for rejecting protectionism, and made a spirited defence for open trade at a time when it was under attack by populist politicians and “demagogues who are ready to declare a trade war against our friends.”
Here’s an excerpt from Ronald Reagan’s radio address about free trade:
This week, as we prepared for Thanksgiving, Canada held an important election, and I’m pleased to again send my congratulations to Prime Minister Mulroney. One of the important issues in the Canadian election was trade. And like our own citizens earlier this month, our neighbors have sent a strong message, rejecting protectionism and reaffirming that more trade, not less, is the wave of the future.
Over the past 200 years, not only has the argument against tariffs and trade barriers won nearly universal agreement among economists but it has also proven itself in the real world, where we have seen free-trading nations prosper while protectionist countries fall behind.
America’s most recent experiment with protectionism was a disaster for the working men and women of this country. When Congress passed the Smoot-Hawley tariff in 1930, we were told that it would protect America from foreign competition and save jobs in this country—the same line we hear today. The actual result was the Great Depression, the worst economic catastrophe in our history; one out of four Americans were thrown out of work. Two years later, when I cast my first ballot for President, I voted for Franklin Delano Roosevelt, who opposed protectionism and called for the repeal of that disastrous tariff.
Ever since that time, the American people have stayed true to our heritage by rejecting the siren song of protectionism.
Part of the difficulty in accepting the good news about trade is in our words. We too often talk about trade while using the vocabulary of war. In war, for one side to win, the other must lose. But commerce is not warfare. Trade is an economic alliance that benefits both countries. There are no losers, only winners. And trade helps strengthen the free world.
Yet today protectionism is being used by some American politicians as a cheap form of nationalism, a fig leaf for those unwilling to maintain America’s military strength and who lack the resolve to stand up to real enemies—countries that would use violence against us or our allies. Our peaceful trading partners are not our enemies; they are our allies. We should beware of the demagogues who are ready to declare a trade war against our friends—weakening our economy, our national security, and the entire free world—all while cynically waving the American flag. The expansion of the international economy is not a foreign invasion; it is an American triumph, one we worked hard to achieve, and something central to our vision of a peaceful and prosperous world of freedom.