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Richard Nixon on Free Trade

President of the U.S., 1968-1974


China's MFN trade status key to US Pushing positive change

If we remain in China, we can play a critical role in helping the private economy gradually eclipse the state sector. In this respect, the most counterproductive thing we could do would be to revoke China's most-favored-nation trade status. A revocation of MFN status would devastate Hong Kong, a conduit for over 70% of China's exports. If we want to have an impact on the changes occurring in China, we should not pull the plug on trade. Increasing economic progress will bring progress on human rights.
Source: Seize the Moment, by Richard Nixon, p.174-177 , Jan 15, 1992

Push Japan on trade, but no retaliatory protectionism

The US-Japanese relationship can only be saved if both sides make concessions. We should reverse the trend toward retaliatory protectionism because trade barriers always backfire by triggering ever-escalating countermeasures. Broad-based trade retaliation leads to economic isolation. We should pursue carrot-and-stick policies vis-a-vis Japan in coordination with our European allies at the GATT talks and at the annual economic summits. Only as a last resort should we employ selective retaliation if the Japanese refuse to abandon clear and identifiable unfair trade practices.

Meanwhile, Japan must reduce its tariff and nontariff trade barriers. We should insist on structural reforms in the Japanese economic system that will eliminate monopolistic and anticompetitive practices of individual firms and cartels. If the Japanese want access to our markets, we must have access to theirs.

Source: Seize the Moment, by Richard Nixon, p.160-161 , Jan 15, 1992

Tariffs are just another entitlement that saps incentive

We hear claims that by virtue of living in the US, a person is "entitled" not only to subsistence amounts of food, clothing, and health care, but to more and more of the amenities of life as well. It is not just the poor who seek these entitlements. Farmers who demand a guaranteed price for their crops, steelmakers who demand tariffs to protect their market share, and dozens of other special interests all seek a guaranteed place at the federal trough.

People are entitled to an opportunity to earn the good things in life. They are not entitled to receive them from the earnings of others. It is up to them to ensure that what they bring to the market equals in value what they want to get out of it. It saps incentive, builds resentment, and leads eventually to a corrosive sense of alienation and failure among those who are lured by its siren song into thinking that the nation owes them the good life without effort on their part.

Source: Seize the Moment, by Richard Nixon, p.290 , Jan 15, 1992

1985: Reduce Japan's non-tariff barriers

As Japan became the dominant regional economic power and global economic superpower, its leaders became more confident and more assertive.

Prime Minister Yasuhiro Nakasone exemplified this trend. When I met with him in 1985, we discussed the need to reverse the trend toward protectionism in the US and to reduce the non-tariff barriers discriminating against foreign goods in Japan. Unlike most previous Japanese prime ministers, Nakasone was looking beyond bilateral issues to Japan's role on the world stage. He conceded that Japan needed to spend more on defense, though he stressed this would have to be done in ways that would not alarm neighboring countries.

Source: In The Arena, by Richard Nixon, p. 57 , Apr 1, 1991

Competition with Japan but no economic warfare

Spirited economic competition between the US and Japan is one thing. But it must not be permitted to degenerate into economic warfare. Enhancing the shared responsibility of the US and Japan to cooperate in protecting and extending peace, freedom, and prosperity in Asia and the developing world will go a long way toward reducing the nationalist recriminations that politicians in both the US and Japan hurl across the Pacific from time to time.
Source: In The Arena, by Richard Nixon, p. 59 , Nov 30, 1978

Trade creates jobs for America's workers in world markets

Historically, our superior technology, and high productivity have made it possible for American workers to be the highest paid in the world by far, and yet for our goods still to compete in world markets. Now we face a new situation. As other nations move rapidly forward in technology, the answer to the new competition is not to build a wall around America, but rather to remain competitive by improving our own technology still further and by increasing productivity in American industry.

Our new monetary and trade agreements will make it possible for American goods to compete fairly in the world's markets--but they still must compete. The new technology program will put to use the skills of many highly trained Americans, skills that might otherwise be wasted. It will also meet the growing technological challenge from abroad, and it will thus help to create new industries, as well as creating more jobs for America's workers in producing for the world's markets.

Source: Pres. Nixon's 1972 State of the Union message to Congress , Jan 20, 1972

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George W. Bush(R,2001-2009)
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Jimmy Carter(D,1977-1981)
Gerald Ford(R,1974-1977)
Richard Nixon(R,1969-1974)
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Page last updated: Mar 16, 2014