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Free Trade

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jimotis4heisman

jimotis4heisman

Banned
thread meant for generic discussion of free trade-topics not limited to nafta, doha round, out sourcing etc.

The End of Free Trade? - WSJ.com

The End of Free Trade?
July 31, 2008; Page A14

The demise of the Doha trade round is another blow to the struggling world economy, and there's plenty of blame to go around. But the crucial question going forward is whether this is merely a temporary setback, or if it marks the end of the post-World War II free-trade era that has done so much to spread prosperity.
We tend by nature and history toward optimism, but no one should sugar-coat Doha's collapse. For the first time since the multilateral trading rounds began after World War II, a trade expansion effort has ended in failure. Trade negotiations are never perfect, but for half a century the trend has been toward freer trade and more open markets. This has opened vast new opportunities for global business, spreading competition and innovation that have helped to raise living standards across the globe.
In 1990, trade represented about 40% of world GDP, according to the World Bank. By 2004, trade exceeded 55% of world GDP, and the global economy had expanded by 50%. The five fastest-growing countries from 1990 to 2004 were Albania, Bosnia and Herzegovina, China, Ireland and Vietnam, and all of them had annual double-digit increases in trade. Meanwhile, the countries that traded the least -- Iran, many African countries -- have stagnated.

continued...
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The Election Choice: Trade - WSJ.com

The U.S. hasn't elected a genuinely protectionist president since Herbert Hoover, and for most of the last 80 years a rough bipartisan consensus has held that free trade is in the American national interest. The erosion of that consensus is reflected in the gulf between John McCain and Barack Obama on trade, which is probably the widest division at the presidential level since the 1920s.
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discussion on
columbia/south korea
nafta
agriculture/doha
displaced workers
 
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This is just a temporary swing of the pendulum. We go through periods of
restrictions/economic issues/politics. Then the pendulum swings back. We are a small world now with quick trade routes. A world economy.
 
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The demise of the Doha trade round is another blow to the struggling world economy, and there's plenty of blame to go around. But the crucial question going forward is whether this is merely a temporary setback, or if it marks the end of the post-World War II free-trade era that has done so much to spread prosperity.

We tend by nature and history toward optimism, but no one should sugar-coat Doha's collapse. For the first time since the multilateral trading rounds began after World War II, a trade expansion effort has ended in failure. Trade negotiations are never perfect, but for half a century the trend has been toward freer trade and more open markets. This has opened vast new opportunities for global business, spreading competition and innovation that have helped to raise living standards across the globe.

In 1990, trade represented about 40% of world GDP, according to the World Bank. By 2004, trade exceeded 55% of world GDP, and the global economy had expanded by 50%. The five fastest-growing countries from 1990 to 2004 were Albania, Bosnia and Herzegovina, China, Ireland and Vietnam, and all of them had annual double-digit increases in trade. Meanwhile, the countries that traded the least -- Iran, many African countries -- have stagnated.
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Well, the last sentence said it all for me. I guess I missed that sub-Saharan Africa has had stagnant growth in recent years. That's why these cranes are standing everywhere you look! :slappy:

I suppose I should admit that Africa has been dramatically affected by the crisis in America and Europe. In fact, most have downgraded their GDP percapita growth projections from 8-10% down to 4-5%. Stagnation?

From the US government (link):
The central challenge facing African economies is to reduce poverty through higher levels of economic growth. Long term, broad-based economic growth is essential for Africa to increase incomes and reach its potential to become a significant trade and investment partner in the world economy. Sub-Saharan Africa experienced strong economic growth rates in the latter half of the 1990s and in the past five years, 19 Africa countries grew at two percent per year or more. But these growth rates must be sustained and accelerated in order to have a significant impact on poverty and increase living standards. Furthermore, the increase in HIV/AIDS infection rates is taking its toll on Africa's workforce and has become a serious threat to Africa's economic well being.
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Then, all hell broke loose (and remember this is measurement of formal economy growth, not the informal economy, link) going to more than 5% across the region the last five years and exceeding 8% in many.

Officials of the International Monetary Fund say countries in sub-Saharan Africa averaged strong growth of more than five percent from 2004 to 2005, and they expect similar gains in 2006. Much of the growth is in oil-producing countries. But IMF officials say many other African countries are improving their economic policies.
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(Watching Oden being interviewed on TV. Small world.)

The failure of the Doha Round is not something that emerging markets are worried about. Most of the products being sold in the coming decade will be in emerging markets. Technological advancement is rapidly catching the US.

Personally, I think that Obama is right to combat job flight, not only with incentives for firms that keep jobs in the US but with increased support for education for people who will enter national service. There is still time to recapture the education advantage of the 1960s, but it will take a sustained national effort. Remember one in ten Indians with a college degree is the same as more than a third of Americans with a college degree.

Where I think the discussion is going wrong is the emphasis of "jobs lost" when those jobs would be lost to a local firm in China or India or other emerging markets. Moving half your jobs overseas to save your firm, means saving half your jobs.

In many industries, Americans can overcome the wage and distance disadvantage in a global economy, but time is running out and a national campaign is needed.

In my opinion, the thing that the next president must not do is to try to limit free trade. It is a strategy that will backfire.
 
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Where I think the discussion is going wrong is the emphasis of "jobs lost" when those jobs would be lost to a local firm in China or India or other emerging markets. Moving half your jobs overseas to save your firm, means saving half your jobs.

i've never heard it phrased like that before. good point.
 
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Free Trade is a lie. There has and will never be Free Trade from government influence. China is the prime culprit of government influencing trade. We are at economic war with China, Russia and Iran. A war that isn't or will be fought with regular armies. How do we win? We take away how these countries make most of their income.
We become energy independent.
 
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Taosman;1312849; said:
Free Trade is a lie. There has and will never be Free Trade from government influence. China is the prime culprit of government influencing trade. We are at economic war with China, Russia and Iran. A war that isn't or will be fought with regular armies. How do we win? We take away how these countries make most of their income.
We become energy independent.
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China gets no net revenue from energy.
 
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Taosman;1312849; said:
Free Trade is a lie. There has and will never be Free Trade from government influence. China is the prime culprit of government influencing trade. We are at economic war with China, Russia and Iran. A war that isn't or will be fought with regular armies. How do we win? We take away how these countries make most of their income.
We become energy independent.
Click to expand...

Is this Nancy Pelosi speaking?
 
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True. China does not get revenue from oil. But, it's oil demand makes it a global player in energy markets and politics. And China is buying our debt and therefore has great influence. We are selling our debt to China to buy oil from the middle east.

Into Africa: China's Grab for Influence and Oil
by Peter Brookes
Heritage Lecture #1006

Delivered on February 9, 2007
Amid festering concerns about China's burgeoning global power, Beijing has firmly set its sights on expanding its influence in Africa. In a throwback to the Maoist revolutionary days of the 1960s and 1970s and the Cold War, Beijing has once again identified the African continent as an area of strategic interest.
But this time, the People's Republic of China (PRC) is not interested in exporting international communism. It is international trade, economics, and political influence that have got Beijing's rapt attention. The jury is still out about whether China's strong engagement in Africa is a good or a bad thing. Some have praised Chinese involvement in Africa, while others have called it "neo-colonialism." There is no doubt that it is a subject of intense discussion in Washington, D.C.​

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