>“Fair Trade or Free Trade” and Enterprise Architecture

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What is the way ahead for free trade—further globalization and lost jobs for U.S. workers or isolationism and protectionism?

Fortune Magazine, 4 February 2008 reports that “economic anxiety has inspired a backlash against free trade…in the great game of global trade, Americans are increasingly feeling like the losers.”

How did we get to this advanced state of global trade?

Americans led the works in building a roadmap for global commerce during the 1990’s” with the North American Free Trade Agreement (NAFTA) “linking the U.S., Canada, and Mexico to create the world’s largest trade bloc.”

Why are Americans reeling from free trade?

68% of those surveyed say America’s trading partners are benefiting the most from free trade, not the U.S. The sense of victimhood is changing America’s attitude about doing business with the world. We are a nation crawling into a fetal position, cramped by fear. That America has lost control of its destiny in a fiercely competitive global economy. The fear is mostly about jobs lost overseas and wages capped by foreign competition. But it is also fueled by lead-painted toys from China and border-hopping workers from Mexico, by the housing and credit crisis at home, and by the residue of vulnerability left by 9/11 and the wars that followed.”

We are turning inward. Especially now, as the U.S. economy sputters…median household income in 2006, at $48,201 was barely ahead of where it was eight years earlier. So the prospect of a recession has made the anxious middle class even more so.”

“Most analysts agree that the underlying reason for public anxiety over globalization is the visibility of factory closings and the stagnation of income.

What is the result of the backlash against free trade?

“Today, nearly two-thirds of Americans are willing to pay higher prices to keep down foreign competition.”

With the upcoming presidential election, “the Democratic mantra is now, ‘fair trade, not free trade.’”

“Most Democratic leaders insist they don’t want to, nor believe they can, halt the global flow of commerce. Where they hope to connect with voters is by promising to strengthen the safety net.” This includes special training programs, tax incentives for companies to relocate to where workers have lost jobs, and expanding unemployment benefits.

I agree that we cannot retrench into isolationism, although a little protectionism sounds about right and fair. We need to architect our nation’s role in global trade, so that we are not running huge trade deficits, losing valuable jobs to overseas workers, and buying shoddy products from overseas.

Enterprise architecture is about identifying the baseline and setting a target and transition plan. Well the current baseline, as outlined, is ruinous for the U.S. economy. The target is clearly a more strategic trade policy that protects our vital economic industries, interests, and workers. And the transition plan is to establish the laws and policies to change our wayward direction and quickly.

Finally, businesses must look beyond the quarterly financial statements and daily stock prices of their companies and instead establish longer-term targets that focus on retaining strategic assets and know-how at home here in the U.S., rather than trade it away for a quick buck on the quarterly income statement.