Abandoning TPP...
There has been a lot of talk lately about President Trump's abandonment of TPP, and it has people around the world questioning what this means for global economies. Is the TPP really helping the American economy? Could a "better deal", as Mr. Trump's administration says, really be negotiated? Will the U.S. have difficulty renegotiating trade agreements due to mistrust from other countries? We can only speculate how this will affect the economy. The article below, written by Shin Jang-Sup, a professor at the National University of Singapore and former adviser to South Korea's finance minister, weighs in on some of these exact questions and gives us an insight to the pros and cons of our current administration's decision to abandon the TPP.
http://www.straitstimes.com/opinion/the-pros-and-cons-of-us-withdrawal-from-tpp
- Nicole
I like how the article sates that global growth was better under the old GATT system. Even though it had it's own inherent flaws. This article shows the true difference in how Americans view themselves versus how the rest of the world sees us. This is what was discussed in the last chapter about making assumptions of other cultures based on what we consider the "norm".
ReplyDeleteHi Scott,
DeleteI really like your comment regarding how Americans view themselves versus the rest of the world. I think there is a huge difference in the views and many times this causes problems that otherwise wouldn't be.
Thank you for your comment.
I found the article did not push much in to substantive reality. When you look at what he spoke about GATT being the basis of the TPP and other agreements but did not break down what the actual consequences of leaving the TPP would be. They are pretty theoretical as no one knows for sure if a better deal can be had or if we could even negotiate it. Walking away from the TPP may be a good thing, and in the end may bite us in the ass. Trump is a businessman but he is not an economist. He is reasonably sharp about business but he has had enough failed ventures that his word should be taken as absolute. He is making decisions on topics that I personally do not believe he has taken the proper time to asses. He has pulled out of the TPP without any specific reason and without an alternative.
ReplyDeleteHi Anthony,
DeleteThe actual consequences of leaving the TPP have a very theoretical basis to them. As a country, we may not feel the impact for many years, or we may start feeling them right away this year. Without going too much into politics, I agree that Trump is a businessman and not an economist. I hope that the decisions he makes regarding our economy have been thoroughly ran by a qualified economist.
Thank you for your comment.
I agree with your assessment about the president. He needs to fully understand these agreements before he decides to change things.
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ReplyDeleteWhile few of us know what may come of the decisions, I suspect that we'll not see much major change here in the US. The other 11 TPP countries may fare differently, however. Frankly I think business folks and economists can behave similarly as long as they are not choosing to single out trade negotiations through a divide-and-conquer mentality. I suspect that President Trump prefers to handle each relationship behind closed doors in order to keep plenty of trade 'ammo' in his back pockets. The question is whether one actually NEEDS trade 'ammo' if the larger partnership has worked out (at taxpayer expense over 8-12 years) a satisfactory deal between all nations involved?
ReplyDeleteIn all honesty, I don't follow politics much. That being said, from what I have seen or come across, I agree that President Trump prefers to handle each relationship behind closed doors with flexible individual terms. I'm not sure that this is the best way to handle trade and situations with other nations...
DeleteThe important point by Professor Shin Jang-Sup in the article you posted is that no, the individual deals will not be based on any level of trust on the part of the non-US side of any partnership. There are few trading partners who feel they can trust a deal where the clear motivation, as stated by the US president, is a 'better deal' for the US.
ReplyDelete