[T]ariffs are not the only trade policy used by countries. Countries also implement quotas, import licenses, voluntary export restraints, export taxes, export subsidies, government procurement policies, domestic content rules, and much more. In addition, there are a variety of domestic regulations which, for large economies at least, can and do have an impact on trade flows. None of these regulations, restrictions or impediments to trade, affecting both imports and exports, would be captured using any of the average tariff measures. Nevertheless these non-tariff barriers can have a much greater effect upon trade flows than tariffs themselves.
I agree with everything you wrote and your quote from the article as well. Questioning the low tariff regime that we’ve put in place since the 1950’s doesn’t mean that a person supports government regulations or anti-competitive measures beyond straight tariffs. I think that the theory of “free trade” has not been borne out with actual experience. We’ve lost ground relative to our economic competitors, not gained it, since we dropped our tariffs. So did Great Britain.
I think the “disconnect” between theory and reality is that economic theory looks at GDP, GNP, income, utility, all those absolute measures and ignores RELATIVE power. If you have 2 actors (A & B) who are geopolitical competitors and free trade makes everyone richer, but helps B twice as much as A, then if you care about relative power and live in A you would rationally be opposed to completely free trade. You would care if you didn’t trust that B, once they were more powerful than A, would continue to be fair and free. Say using the USA and China for example, once China is stronger militarily than we are, will we truly be better off?
More in line with the standard thinking, a key part of free trade theory is that the money you save on goods from other lands will go to more productive uses than buying inferior domestic goods, so you are better off with free trade. But what happens when you have such a messed up system that capital goes to a speculative bubble instead, or meaningless overconsumption through debt?
I also think that economic theory focuses on dollar measures — money — and when a system crashes it is only things (land, machinery, commodities) and people (skills) that really matter. All the paper chits people have built up through trade don’t matter except to the extent they are backed by real things or rights to real ongoing enterprises. You sell GM to the Chinese for 10 billion dollars and lets say it is a great deal for you, the seller. Then the 10 billion dollars lose all value through hyperinflation or lack of willingness to accept dollars. The Chinese still have the enterprise and you have . . . worthless dollars.