Paul Krugman says:
Free trade is supposed to be about a principle: nondiscrimination between domestic and foreign goods.
If only it were so simple. Certainly everyone would agree that non-discrimination betweeen domestic and foreign goods (and services) is a crucial part of free trade. But there are a number of other conceptions of free trade floating around out there (many of which overlap), including:
-- free movement of goods, services, labor and capital
-- domestic laws and regulations should not burden trade too much
-- freedom from arbitrary and unreasonable domestic laws and regulations
-- international harmonization of laws and regulations to eliminate trade barriers
-- international regulation of policy areas that affect trade
All of these conceptions appear in free trade agreements to some degree (which, in my view, is a big reason that these agreements are more controversial today than they were in the past).
As for the specific subject of Krugman's post, which was French President Sarkozy's call for a carbon tax on imports, I think this proposal could be re-framed and re-structured as a non-discriminatory tax on all high carbon products, making it both more effective and less controversial to free traders. As the current import tax proposal stands, it seems very possible that it could violate even Krugman's narrow conception of free trade.
