FedEx’s Smith defends trade, blasts Trump’s protectionist rhetoric
While FedEx founder and chairman, Fred Smith, generally supported the direction President-elect Donald Trump is taking with his pledges to improve the nation’s infrastructure and reduce the national debt, he was deeply critical of Trump’s repeated statements against global trade during his campaign and called for the new President to drop his protectionist rhetoric.
During a mid-December speech at a forum sponsored by the National Council on Competitiveness (NCCF), Smith called for the industry to convince the President-elect to adopt a pro-trade stance and to reduce his tendency to talk about building trade barriers to isolate the United States from the rest of the world.
“History shows that people have always wanted to travel and trade,” Smith told the audience. “Today that desire is stronger than ever. With our constantly growing digital economy, almost anyone with a mobile phone can reach new markets in nanoseconds, funneling tremendous digital connectivity into more buying power, more economic growth, and a higher standard of living.”
Based on the 40-year history of FedEx, and for much of the 20th century, Smith said that “centrally planned, government-directed economies don’t work. They can’t sustain growth; they can’t respond quickly to changing market conditions. They innovate more slowly and don’t attract much foreign investment.”
FedEx, he said, is at “the nexus of global trade,” moving 12 million shipments per day to 220 countries and territories. “We see the value of trade every day,” he said. “In fact, the largest customs clearance port of entry in the U.S. is the Memphis airport, where our FedEx Superhub is located.”
Citing several cases in Venezuela, Brazil and Argentina — and also some legislation from the U.S., such as the 1930 Smoot-Hawley Act — Smith said “protectionism doesn’t work,” and that “history has shown repeatedly that free-market economies create human opportunity.”
He also said the General Agreement on Trade and Tariffs (GATT), the post-war treaty that sought to reduce tariffs and other trade barriers, “was a decisive factor in the post-war growth of the United States, which became the richest country in the world. U.S. trade policy was also a major factor in the recovery of Japan, Germany and other devastated countries.”
Smith said that Trump’s vilification of other trade deals, such as the North American Free Trade Agreement (NAFTA) and the Trans-Pacific Partnership (TPP), is wrong-headed, as they help bind the economies of the member parties together into symbiotic relationships. Rather than pull out of these agreements, he said, the Trump administration should focus on tweaking aspects to improve them in light of today’s e-commerce-driven economy.
“Trade has made America great, and expanding trade has been a bi-partisan pursuit for over 80 years,” Smith concluded. “The failure to continue to do so would be a severe mistake with enormous consequences for America and the world.”
To see the entirety of Smith’s speech to the NCCF, please see the story here, at our sister publication, Cargo Facts.
