...[Trade Liberalization] has had exactly the effect that trade theory predicts. It has lowered the wages of less-educated workers relative to workers with college degrees and especially workers with advance degrees. We can reverse this upward redistribution by adopting trade policies that subject the most highly educated workers to the same sort of international competition that textile workers and autoworkers now face....
The big winners in this story are the workers who manage to keep themselves protected from international competition. As a result of recent trade and immigration policy, these highly paid professionals can buy low cost furniture, cars, and clothes. They can also have their homes renovated and their gardens maintained at low prices. They can even get cheap nannies for their kids.
But the key to the success of these highly paid workers is maintaining their own protection from international competition. There are long list of professional and immigration barriers that protect doctors, lawyers, and even economists and journalists from the same sort of international competition faced by textile workers and dishwashers.
There is a basic truth here: it is quite easy to be in favor of "competition," "free markets" and "capitalism" as long as its happening to somebody else, but when it happens to us, we suddenly become concerned about "fairness."
But Baker is mistaken on his trade theory (despite his Michigan PhD!). The Stolper-Samuelson theory, part of standard neoclassical trade theory, says that trade increases the returns to the "abundant" factor of production. If the US is abundant in skilled labor (i.e. compared to other countries we have a higher ratio of skilled labor to other factors like unskilled labor, land and capital) the theory predicts exactly that skilled labor will gain; no selective protection from trade is necessary.
And as for economists: while the immigration system certainly creates unconscionable hassles, we are competing in a global labor market (at least, those of us without tenure are!). Roughly 70% of the doctorates in economics awarded in the US (where most of the world's best programs reside) go to non-Americans, many of whom take jobs at American colleges and universities.