Are US elite re-evaluating free trade?

Is a new paradigm percolating among the United States' academic elite?

There are tentative signs that economists may finally be re-evaluating the benefits of free trade. The intellectual arguments in favor of free trade have always been extremely weak, and the "consensus" has largely been sustained by a complex interplay of group think, incentives generated by narrow interest groups, the failure of contemporary economists to study economic history, and relatedly, the mathematization of the discipline, that has pushed it into more abstract, and frequently obtuse theoretical formulations.

In the August 29, 2012 edition of the New York Times, Edward Alden, a fellow at the prestigious Council on Foreign Relations points to growing economic research that suggests "globalization" has been a major factor driving real income decline in the United States. I put "globalization" in quotations, because it is commonly used as a lazy stand-in for two concrete policy choices that have gone largely unexamined: (1) maintaining a "strong" overvalued US dollar; and (2) maintaining a federal tax system that relies overwhelmingly on income and pay roll taxes (+90% of federal government revenue) rather than adopting a mixed Chinese-style system of taxation that shifts a considerable share of the tax burden onto imports (more than 20% of Chinese central government revenue comes from a variety of import taxes).

Countries that heavily tax imports and maintain undervalued currencies (making their manufacturing exports artificially hyper-competitive) have enjoyed steadily rising median incomes and full employment.

While the hegemony of "free trade" remains in place, there are hopeful signs that the intellectual grounds may be shifting. It is not clear if this shift will happen in time to save what is left of the US industrial base, and the middle and working classes who depend on it.