The Modern Agreement of Amity and Commerce: Toward a New Model for Trade Agreements
The Open Society Foundation has published a white paper on a new model for trade agreements. As OSF explains: Around the world, the process of economic globalization is under fire for serving the needs of corporate elites rather than ordinary citizens. But it is important to recall that trade does not have to aggravate inequality.…
FTA Fever: Taiwan Edition
Geopolitical strife? Let’s do a trade agreement! The latest version of this strategy involves Taiwan. China is a geopolitical concern; Taiwan is an ally; ergo, the United States should do a trade agreement with Taiwan, because it will reinforce economic relations between the two. Which two, though, is the question. Taiwan and the United States? Nope.…
U.S. Trade and Development Policy
The House Ways and Means Trade Subcommittee had a hearing on September 10, 2020 to discuss U.S. trade preference programs, including the Caribbean Basin Trade Partnership Act, which expires at the end of the month. My testimony focused on ways to reform these preference programs so that they more directly address the goal of promoting…
How to Make Trade Work for Workers At Home and Abroad
As the Trump Administration has recognized, trade involves a larger question consuming most countries: what kind of policy can make “it possible for most citizens, including those without college educations, to access the middle class through stable, well-paying jobs”? Trickle-Down Trade The Administration, however, can’t achieve this goal, because its trade policy is but an…
TPP Doesn't Address the China Problem. But With These Four Changes, It Might
COVID-19 is exposing what many of us have known for a long time: our fealty to efficiency has left us dependent on a hostile authoritarian power for the supply of essentials, like medicines and medical equipment. TPP has been marketed for years as the antidote to the Chinese Communist Party’s mercantilist view of the world…
What is the purpose of an FTA?
The question seems almost facile in a day and age when so many countries have so many trade agreements. But COVID-19 is leading to us to focus on aspects of globalization that have long been ignored. So let’s reevaluate the basics – like the purpose of these agreements. The Foreign Policy View The foreign policy…
The Uncertainty of Certainty
Trade agreements are supposed to be permanent because certainty promotes stability. Or so the thinking has been for the past few decades. The reaction when a sunset clause was included in the new NAFTA was almost uniformly one of horror: the instability of such a thing! The effects on investment! Trade flows! Peace! Prosperity! It’s…
Connecting the Dots: The Appellate Body, NAFTA, and Labor
The House Ways and Means Committee held a hearing last Tuesday with two trade topics: the WTO Appellate Body and NAFTA 2.0. The first half of the hearing was devoted to the Appellate Body, including both support for the U.S. government’s longstanding concerns over the flaws with the dispute settlement system, as well as a…
The De Minimis Loophole
We’ve talked about one loophole in NAFTA called “de minimis.” In addition to rules of origin that already allow a certain amount of content originating from outside the region, the original NAFTA contains a loophole that allows an extra 7% on top of it. The Trump Administration, in a position completely at odds with its China…
Is Freedom a Deadweight Loss?
The recent furor over the NBA, South Park, and the long arm of the Chinese Communist Party is giving the average American a much better understanding of Chinese government authoritarianism in action. Until now, the discussion about the relationship between China and the United States had been dominated by pearl-clutching over how much more dog…
Questions about NAFTA 2.0's Auto Rules - and China
Donald Trump campaigned in part on the flaws in the auto rules of the Trans-Pacific Partnership. Much of his renegotiation of NAFTA has focused on tightening up those rules. As this paper explains, he can rightly claim some credit for strengthening them. But there are nevertheless questions about whether those rules will work the way…
Thoughts on Trade, Agriculture, and Competition - Election Edition
According to a recent poll, a novice politician, J.D. Scholten, is giving long-standing incumbent Steve King a run for his money in Iowa, trailing King by one percentage point. How is he doing it? One of the issues Scholten is raising is the effect of corporate concentration on farmers. Senator Cory Booker joined Scholten at an…
Getting Rid of the "Sophie's Choice" Between American Agriculture and American Manufacturing
As the Trump Administration continues to borrow the Democratic message that globalization has left American manufacturing workers behind, some of our trade partners have chosen to retaliate by targeting American agricultural workers. As we rightly focus on whether our farmers will be hurt, however, it is important to recall the degree to which our trade agreements…
Issue Analysis: The CAR Critique of the Proposed NAFTA Auto Rules
Last month the Center for Automotive Research produced a briefing paper on the proposed changes to the NAFTA rules of origin. An evaluation of that briefing paper can be found here.
Is the Trump Administration Looking at Rules of Origin in KORUS?
Earlier this month Politico reminded us that, in the talks with the Koreans about KORUS, the Trump Administration is not following the procedures set out under Trade Promotion Authority. The theory is that the Administration doesn’t plan to change U.S. law, no Congressional vote is required, and thus TPA isn’t applicable. So far so good. …