I, T-Shirt: a T-shirt's journey unravels the costs of protectionism.

• Author: Howley, Kerry
• Position: The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power, and Politics of World Trade - Book Review

The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power, and Politics of World Trade, by Pietra Rivoli, Hoboken, N.J.: John Wiley & Sons, 254 pages, $29.95

DAYS AFTER terrorist attacks destroyed the World Trade Center, U.S. President George W. Bush and Pakistani President Pervez Musharraf were negotiating the price of Pakistan's solidarity. As downtown New York smoldered, Musharraf accepted billions in grants and other forms of aid, but his most fervent request was for relief from U.S. tariffs on textiles. In return for his cooperation in the war on terror, Musharraf wanted free trade in T-shirts. Bush said he would do what he could, and the two countries plunged into negotiations. The result was a Byzantine trade agreement that seemed a convoluted response to Musharraf's request. For those who know the game, though, the response was easy to summarize: It was no.

How did a bunch of Pakistani T-shirts get mixed up in a hunt for terrorists? If cotton and national security seem an unlikely mix, consider the enormous impact the U.S. cotton and textile industries have had on American history: fueling the industrial revolution, driving the civil war, foiling a host of free trade deals. Today textiles might seem an anomaly in a high-tech service economy, struggling to hold on as the winds of trade blow elsewhere. Yet centuries after factory workers first started stitching shirts in New England, the most protected industries in American history are brazen enough to dictate U.S. foreign policy in Pakistan.

Agricultural protectionism is not news, but even by the generous standards of American farm subsidies, cotton handouts are something special. Per acre, cotton farmers are treated to subsidies five to 10 times as high as those for corn, soybeans, and wheat. The Crop Disaster Program reimburses farmers for the ravages of bad weather; farm loan programs offer credit to those who can't obtain it elsewhere; "trade and aid" programs guarantee exporters against customer default. Despite all that, prices for U.S. cotton are often higher than global prices--so tax dollars pay textile mills in North Carolina to buy cotton from Texas. In that way, cotton feeds into a new level of state-supported industry: textile factories buffeted by a complex system of quotas and subsidies.

It's easy to list the ways in which U.S. cotton and textile policies are intensely stupid. They jack up prices, muck up foreign policy, and keep us all looking a little more J.C. Penney than Bergdorf Goodman. What's harder is to explain is why no one much cares, or at least cares enough to change a sorry state of affairs that has persisted for centuries. In The Travels...