- The Washington Times - Wednesday, March 29, 2006

Free-trade aficionados fear the recent Dubai port fiasco was more than just another random slap at globalization. Some believe it represents a tipping point, evidence that lawmakers with votes now share sentiments once only held by protesters on stilts. As one veteran business lobbyist told me darkly, “I think they’d pass Smoot-Hawley if it came up for a vote today.”

That degree of fatalism has some merit. But proponents of open trade can also help staunch a protectionist surge by first taking a look at themselves. How businesses engender loyalty, hope and security among their most important investment — human capital — is now more than ever due to the political and economic changes in the last several years.

As the late M. Scott Peck, author of “The Road Less Traveled,” once said, most problems of the human mind are “over determined” — meaning personal maladies have more than one cause. Problems with free trade in the body politic are also multifaceted.

Partisan polarization is one cause. Most agree the long tradition of bipartisanship on international trade in Congress sagged in the past decade, but more recently it’s nearly collapsed. The crumbling coalition was on display in last year’s debate on the Central American Free Trade Agreement, which passed with only 15 Democratic votes. Unfortunately, who asks for votes in an age of polarization makes a difference. The difference between George W. Bush soliciting Democrats for free trade vs. Bill Clinton doing it is dramatic. One business lobbyist told me a Democratic president could probably boost the numbers of trade liberalization supporters in the House by 60-70 votes without breaking a sweat.

Cultural factors in a post-September 11 world are another factor. Writing last week in the New York Times, Andrew Kohut of the Pew Research Center notes Americans are less worried about foreign investment in the United States today compared to the 1980s, but other factors now creep into the mix. The recent controversy about Dubai has more to do with fear of terrorism than worries about trade liberalization, Mr. Kohut says. He’s right. Heaping foreign investments, port security and possible links to terrorism on the embers of an upcoming election, a bipartisan reaction can quickly ignite and burn out of control.

Major media outlets also contribute to trade liberalization’s setbacks. “This is a war of anecdotes,” one Democratic consultant with close ties to organized labor told me. “And right now the only stories out there are about the problems caused by free trade.”

But this imbalance stems from the dominant media narrative, which emphasizes fear and insecurity concerning job loss and outsourcing. Very few news reports emphasize the benefits of a robust world economy and a liberalized trading system. Good news usually doesn’t sell and wins even fewer Pulitzers.

Can anything turn this tide? Maybe. But it probably begins with corporate America recognizing these new realities and adopting a differentapproach. “Business acts like a football team trying the same play over and over again. Their opposition knows what’s coming,” the consultant with labor ties told me. The road to recovery begins with acknowledging there’s a problem.

Every business leader in America knows the international economy has changed dramatically in the past decade. But do they also understand how the new world order has contributed to the fears, anxieties and insecurities of their workforce? Of course many do and feel the drumbeat of concern at an intuitive level. But how many have taken systematic steps to ameliorate these worries, and build employee loyalty and understanding about how robust international trade helps these workers and their families? An honest assessment would lead most corporate leaders to conclude their efforts are a bit anemic here. “American businesses consistently shoot themselves in the foot,” the Democratic consultant told me. “They are their own worst enemy” when it comes to building trust, hope and security among their own workforce.

Changing American attitudes about international trade and foreign investment will not happen quickly and requires a multifaceted approach. American businesses that benefit from international trade must communicate how their employees depend on and profit from the freedoms and opportunities of an expanding global trading system. Corporations should also take more aggressive steps to address the fears and anxieties the new economic order creates among their employees.

Without a new degree of empathy, compassion and communication, we will lurch closer to a dangerous tipping point resulting in economic isolationism and less business growth.

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