The Trumpbeat of inequality
Nobel laureate Joe Stiglitz writes:
Where the trade agreements failed, it was not because the US was outsmarted by its trading partners; it was because the US trade agenda was shaped by corporate interests….
We need to rewrite the rules of the economy once again, this time to ensure that ordinary citizens benefit. Politicians in the US and elsewhere who ignore this lesson will be held accountable. Change entails risk. But the Trump phenomenon – and more than a few similar political developments in Europe – has revealed the far greater risks entailed by failing to heed this message: societies divided, democracies undermined, and economies weakened.
Read more here.
What’s in a trade agreement?
These days trade agreements are not just about imports and exports. They’re also about undermining the power of governments to protect public health and the environment by regulating corporate behavior – via provisions slipped into trade agreements in the guise of “Investor-State Dispute Settlement” (I.S.D.S.), as James Surowiecki explains in the New Yorker:
In the old days, aggrieved American investors would call on the Navy to protect their interests—thus the phrase “gunboat diplomacy.” How much better that now they just call their lawyers.
But these days signing such agreements is risky for countries. I.S.D.S. lawsuits used to be rare, but they’re becoming a growth industry. Nearly a hundred have been filed in the past two years, as against some five hundred in the quarter century before that. Investor protection, previously a sideshow in corporate law, is now a regular part of law-school curricula. “We’ve also seen an expansion in the types of claims that have been brought,” Lise Johnson, the head of investment law and policy at the Columbia Center on Sustainable Investment, told me. I.S.D.S. was originally meant to protect investors against seizure of their assets by foreign governments. Now I.S.D.S. lawsuits go after things like cancelled licenses, unapproved permits, and unwelcome regulations.
To learn more about what’s in a trade agreement, read his story here. For more, see blog entries on TripleCrisis here.
Trade deficit or budget deficit: which should worry us?
We hear a lot these days about the U.S. government’s budget deficit. But what we ought to be talking about is the country’s trade deficit, write Jared Bernstein and Dean Baker:
Running a trade deficit means that income generated in the United States is being spent elsewhere. In that situation, labor demand — jobs to produce imported goods — shifts from here to there.
Read their op-ed piece here.
