And the real impact of trade policy is...
(Photo courtesy of Foreign Affairs, Sept./Oct. 2017 Cover)
Few can contest that this has been the wackiest Presidential election cycle in at least the last hundred years. Our collective frustrations over the trivia dominating our elections cycle is well founded. Democracy cannot function well when the public is left unexposed to meaningful debate about the pressing issues facing us. For voters to do their job of choosing well between contenders, the least they can expect is substantive discussion about policy choices instead of tweets, denunciations, name-calling, and character attacks. As someone vitally interested in foreign policy, I had hoped that the pressing foreign policy issues of the day. This has proven to be quite naïve. The American public is ready for such dialogue even if the campaigns are not. It used to be said that the public would want such debate over domestic issues but not over foreign policy. This election cycle makes that piece of wisdom fall apart as well. Consider the Trans Pacific Partnership (TPP), and past and future trade agreements in general. A decade ago, these issues would have been considered too boring for most voters. Yet both the Trump and Sanders campaigns have so completely denounced both the TPP and NAFTA, that ending these deals has become a rallying cry on both the left and the right (at least the populist right). Rallying cry is one thing; having a meaningful discussion in front of the public about trade-offs, objectives, and consequences is something that is necessary for the democratic process to work well. Rather than arguing about who can make the better deal (or, to have no deal at all), we need a full blown discussion to try to answer some crucial questions if we are going to move forward as a nation in a globalized economy. I have some of these questions. I don’t pretend to know the correct answers, but I would love to have had the campaigns answer them. Now that the campaign season is finally over, we still need, more than ever, to try to answer them:
From an American vantage point, what do we expect to gain from the TPP and what do we expect to lose? Is it, as some would argue that this package is to benefit some corporations and industries over the vast majority of us whose lives would get worse as more jobs dry up in the U.S.? I’ve looked at the agreement numerous times and I don’t find the job drain that the worst case scenario mongers predict. Maybe I’m wrong, but I would like to see some evidence rather than more empty slogans.
Is this a deal about trade and economics or is it primarily a political deal, designed to enhance our influence in the Asia-Pacific region? In September The Economist predicted that the entire package after implementation would, at best, add one percent to our GDP over an entire decade. Not much of an impact. On the other hand, we, and not China would write the rules about economic relationships, property rights, labor standards and environmental protection, and internet freedom for the region. Equally important, it would help underscore our leadership and alliance relationships in the region and create additional balance against continued Chinese attempts to dominate the South China Sea.
If the political benefits are important to us, and if there are negative impacts on our workers, where will those impacts be, and what can we do to compensate people who could be caught in these negative consequences?
Finally, can we not, with some precision, figure out the consequences of previous trade deals? It is undeniable that there has been very substantial economic harm done to a sizeable percent of American blue collar workers over the last two decades. It is also undeniable that NAFTA never quite worked the way we were told it would work: not for us, not for Mexico, and probably not for Canada. But is it NAFTA and/or Chinese accession to the WTO that caused the economic harm to our workers? Are these the principle causes of growing inequality and the destruction of the American dream for millions? Don’t we deserve that discussion and debate…not with rhetoric but armed with real information about cause and effect? Alternative explanations exist: the decline of unions and collective bargaining, the growing automation in manufacturing, the shift from a manufacturing to a service economy unattended by job retraining for those most likely to be hurt by economic transition; an unwillingness to address economic inequality through tax policies.
Before we move forward or backwards on trade relationships and trade policy, we deserve to know the answers to these questions. Sadly, they were not forthcoming in this election. Perhaps before the next election? Does anyone believe that will happen?