Every night, he rails against “corporate greed,” “so-called free
trade,” and rapacious businesses that export “American jobs to
cheap overseas labor markets.” Deadly serious, he warns of
high-unemployment despite two years of positive job growth and a
paltry 5.0% unemployment rate. He tells his viewers there will be
hell to pay for trade deficits that are “literally choking our
economic growth” as our gross domestic product grows in earnest.
No, this certainly isn’t your father’s Lou Dobbs.
To chronicle the new Lou, the Media Research Center’s Free
Market Project studied 69 news reports on free trade and
outsourcing from CNN’s “Lou Dobbs Tonight” on the 86 broadcasts
from March 1 to June 30, 2005. While Dobbs’s viewers won’t be
surprised by the study’s findings, true journalists would be
appalled.
On free trade, Dobbs doesn’t simply think outside the box; he
pretends the box doesn’t even exist. Ninety-four percent (65 out of
69) of the stories were not only anti-free trade, but rife with
factual inaccuracies and misstatements. His bias ignored basic
economic principles and left his audience sorely misinformed about
a cornerstone of the free market system.
Dobbs relentlessly hammered trade negotiations like the Central
American Free Trade Agreement (CAFTA) and misrepresented the impact
of its counterpart, the North American Free Trade Agreement
(NAFTA). He devoted 33% of his free trade stories to criticizing
CAFTA and the supposed cabal of business interests supporting it
without ever giving the other side.
In a March 1 story, Dobbs mused that CAFTA was met with
skepticism by lawmakers who “are now wary from NAFTA and our
exploding trade deficits.” Reporter Lisa Sylvester stated,
“Lawmakers can point to a 10-year record on NAFTA, the North
American Free Trade Agreement. Hundreds of thousands of jobs lost,
and a record $618 billion trade deficit.” Ernest Baynard of
Americans for Fair Trade, a group mobilized solely to oppose CAFTA,
then claimed “NAFTA has a very negative legacy, and a history of
failed promises.”
The numbers show that that isn’t the case. Research from the
Heritage Foundation reveals that during the first 10 years after
NAFTA was implemented, the economy created some 18 million new
jobs, grew by 38%, and increased exports to our neighbors while
bolstering manufacturing output.
His incendiary attacks on trade deficits shouldn’t be taken
seriously, either. A January 2005 Cato Institute study found the
economy grew the most when the deficit was “rapidly worsening.”
Likewise, the economy grew the least as the trade deficit
“improved.” But all of that was lost on Dobbs, who fanatically toed
the line against economic reality.
Dobbs also droned on about the outsourcing bogeyman. In 97% of
the stories studied, Dobbs lambasted companies that send jobs to
“cheap overseas labor markets.” He ignored the fact that free trade
brings jobs insourced from foreign companies to the United States.
He even used insourcing to criticize free trade by citing the news
of an Airbus factory coming into the United States.
Dobbs led into a June 22 Lisa Sylvester report by announcing
that “Europe’s largest defense contractor today said it plans to
build a new factory for its Airbus unit in Mobile, Alabama. Airbus
hopes the plant will help it win a multibillion-dollar contract to
build refueling tankers for the U.S. Air Force. Airbus also hopes
that its new friends in Congress will help it win that contract.”
Sylvester remarked, “The new Airbus Alabama factory will create
1,000 new jobs. But if Airbus ultimately gets the tanker contract,
an estimated 20,000 jobs could leave the United States.”
Dobbs then cynically called Sen. Richard Shelby (R-Ala.), “the
Senator from Airbus” because of his role in brokering the deal.
According to a report by the Kansas City branch of the Federal
Reserve Bank, outsourced jobs amount to some 0.1% of total
employment. Also, the Organization for International Investment
notes foreign companies have sent 5.4 million jobs to the United
States. These jobs pay 31% more than the average salary at U.S.
companies. In a Sept. 17, 2004 article for National Review
Online, Jerry Bowyer used a simple graph to compare outsourced
jobs during the first quarter of 2004 to average quarterly job
growth. At the present rate, he calculated that “America will lose
all of its jobs in a little more than… 7,000 years.”
The beauty of free trade is that it benefits everyone. This is
important to remember when appraising the merits of trade, for it’s
not a game of winners and losers but a win-win relationship. Free
trade reduces poverty, promotes stability, and will create new
opportunities for the U.S. economy. Whether it will keep Lou Dobbs
unbiased is another issue.
