Saturday, January 28, 2017

Trump did the world a favor by killing TPP

Lawrence Solomon: Donald Trump did Canada (and millions of others) a huge favour by killing the Trans-Pacific Partnership | Financial Post:

February 26, 2017 - "Trump did the U.S. as well as the rest of the free world a favour in dumping the Trans-Pacific Partnership.... Obama wanted TPP as a legacy issue partly to fetter the free market and partly to establish his 'Asian pivot,' a dubious project involving the abandonment of allies elsewhere in order to bring China to heel....

"Obama ... was merely echoing his 2015 National Security Strategy that affirmed that trade deals are often motivated more by foreign policy considerations than economic benefits.... America’s free trade agreements ... have typically been motivated more by geopolitical than economic considerations, whether to bolster an ally’s economy, as was the case with Israel, or to secure co-operation in the fight against terror, as with the Bahrain, Morocco and Oman FTAs. They serve a foreign policy goal of locking countries into the U.S. sphere of interest.

"They also serve economic goals, allowing them to be sold to the public on their economic merits, and justifiably so. The deregulation, lower tariffs and expanded markets that trade deals usher in generally create more winners than losers. Obama’s TPP version of free trade, though, was different. While it would have delivered the goods by lowering tariffs and vastly expanding markets — TPP would have encompassed countries representing 40 per cent of the globe’s GDP and 33 per cent of world trade — it also would have bound the parties to policies and philosophies anathema to true free-trade regimes.

"'TPP puts American workers first by ... requiring all countries to meet core, enforceable labor standards as stated in the International Labor Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work,' the Obama White House announced upon reaching agreement on the TPP’s terms.... Under TPP, the trade advantages developing countries now offer in the form of lower wages and informal work environments would have been undercut by their need to conform to ILO requirements on minimum wages, hours of work and unionization....

"The economies of developed countries such as Canada, too, would have been undercut by TPP through 'the highest environmental standards of any trade agreement in history,' as the White House announced.... This, along with TPP’s high-sounding provisions to 'promote sustainable development and inclusive economic growth' creates openings to arbitrarily attack resource projects, as Canada has learned to its sorrow through economically senseless restrictions on oilsands and pipeline developments.

"In cancelling TPP, Trump cancelled the TPP’s ability to undermine the free market and the sovereignty of countries representing 40 per cent of the world’s GDP. That’s a blow against the regulatory state and for economic freedom, one no free marketer should lament."

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