Last week, Virginia Gov. Terry McAuliffe tried to assure supporters of the Trans-Pacific Partnership that Hillary Clinton will back the massive trade agreement if she becomes president. The rebuke from Clinton’s campaign chairman came quickly and harshly:
Love Gov. McAuliffe, but he got this one flat wrong. Hillary opposes TPP BEFORE and AFTER the election. Period. Full stop.
— John Podesta (@johnpodesta) July 27, 2016
Donald Trump also opposes the TPP. And while delegates to both party conventions stopped short of denouncing the deal in their new platforms, both documents contain skeptical language about trade.
President Obama signed the TPP, but it has not yet been ratified. A liberal economist has called the TPP “Obama’s Vietnam.” Even though it’s become hugely unpopular, Obama still has to push for ratification to save face. And the deal may still fail in the end.
The agreement won’t go into effect if the U.S. doesn’t ratify it within two years, and at this point, practically speaking there are only two ways that can happen. President Obama and Congress could get it done during the lame-duck session. Or alternatively, Hillary Clinton could win and change her mind after the election. Edward Luce of the Financial Times calls this second scenario “virtually inconceivable,” though as Eamonn Fingleton has explained in these pages, flip-flopping on trade is something that Clinton does, if not well, at least frequently. She helped negotiate the deal, after all.
So what does the treaty do, and what tradeoffs does it pose?
Currently, international trade is governed by a patchwork of agreements, including hundreds of bilateral accords in addition to multilateral agreements like NAFTA. The TPP would override much of this infrastructure for the 12 countries party to it, covering a third of global trade with a single deal. An important signatory is Japan, which would substantially change its trade rules under the agreement. (The estimated benefits to the U.S. tripled when Japan joined.) An important non-signatory is China, trade with which has proven an unexpected threat to American jobs.
Naturally, the TPP will require nations to break down barriers to trade such as tariffs and other restrictions on imports. It also seeks to “harmonize” the ways that different countries structure their economies, including environmental regulations, intellectual-property protections, “state-operated enterprises,” and even corruption laws.
Supporters of the treaty tout a number of potential benefits. Most estimates suggest it could add marginally to America’s economy—somewhere in the general vicinity of 0.5 percent, a small gain because the U.S. already has low trade barriers with most of these countries—and boost exports in industries such as agriculture and manufacturing. If the analysis of the World Bank is to be believed, low-skill wages here will grow 0.4 percent while high-skill wages grow 0.6 percent thanks to the treaty.
The deal could be even better for poorer countries, at least relative to the current size of their economies: low-skill wages in Vietnam are expected to grow 14 percent. The gains could also be greater if the TPP becomes a …read more
Via:: American Conservative
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