.
It probably benefited Wall Street...that is why the establishment on both sides are for these trade deals, it fills their pockets. But the middle class gets squeezed it is their jobs that leave. It the middle class that get told "that is just how it works, companies get big and leave but new companie always take their place" It is a bunch of BS.
Only the big Corps. that sent their business south for lower costs, included labor cost, American workers got screwed bigtime.
It is a strongly-accepted principle (with mathematical proofs and everything) in economics that trade is better than not having trade, and anything which restricts trade ultimately makes people poorer.
We can simplify this by considering a single economic transaction. Let's say Fred is a plumber and Joe is a apple grower. Fred is hungry and Joe has a leaky faucet. Clearly, both people benefit if Fred trades his plumbing expertise for some of Joe's apples. The same is true if Lower Elbonia has snozzberries to trade for Freedonia's widgets (assuming there is demand for such things).
There are two major complicating factors which make the simple "Trade = Good" construction of economic textboosk.
1) Not all trade transactions benefit both sides equally and not all possible tradeable commodities are equally valuable. For example, if Elbonia makes cars and Freedonia grows snozzberries, the ability to make cars can quickly lead to developments in being able to make trucks, airplanes, household applicances, refrigeration equipment, electronics, locomotives, etc. Meanwhile, the ability to grow snozzberrries will likely lead to...more snozzberry growing. If all Freedonia does is grow snozzberries, eventually Elbonia's economy and standard of living will so outstrip Freedonia that Elbonia will be a rich powerful country and Freedonia will be...a snozzberry republic.
National governments are largely aware of the above and, throughout most of history, have tried to act in national self-interest to avoid becoming snozzberry republics. Not all have done so successfully.
2) It is inherent to the nation-state system that it is much easier to move capital (basically goods, money, and intellectual property) than it is to move labor. Carrier Corp. recently closed a manufacturing plant in Indiana and moved it to Mexico (not because they had to, but because labor is cheaper in Mexico). Even if the skilled experienced Carrier workers wanted to move to Mexico to follow their jobs, they would have great difficulty doing so (both practically and legally).
Hence, what so-called "free trade" has largely become in the modern world is more accurately described as "labor arbitrage." Trans-national companies move their capital to whichever nation-state offers them the best combination of low wages, lax safety/environmental regulations, and/or subsidies. Said companies then export their wares to higher-wage countries where, hopefully, there is still enough people with money to purchase the production.
There are "winners" and "losers" in the above scenario. If it works, clearly the trans-national corporation wins (it makes higher profits than by staying in a high-wage country). Some workers in the low-wage country also win, as jobs provided by trans-national companies are usually (but not always, cf. Foxconn) better than what their local economy can provide. People who still have money in high-wage countries also "win" because they get lots of cheap stuff to buy at Wal-Mart.
If the economy is expanding so rapidly that displaced high-wage workers rapidly find new employment, or there is a very robust system of economic transfer payments to ensure the greater wealth generated by "free trade" is shared by the losers under the scheme, then everything is peachy. Everyone wins.
But, of course, that's not what has happened. Thanks to automation, financialization, longer life expectancy, and so forth, demand for labor is much much less than the available supply, and we don't (at least in the United States) have robust economic transfer payments to "spread the wealth around." So while economists can still argue "free trade agreements" have produced net economic gain, the distribution of those gains is extremely uneven.
Since nothing has fundamentally changed between the passage of NAFTA and the current proposed TPP (except the trends favoring capital/trans-national corporations have become even more advantageous), I don't see the TPP producing any better results than NAFTA did.
That depends on one's definition of 'the USA' Rosie. Most normal folk would identify that with the people, their welfare, industriousness, happiness and health, potential and possibilities.
Unfortunately, politics and economics doesn't work like that. Anyone could construct a case that both are and will be very good for the USA, but one would have to be selective in examples used and perspective adopted.
A very simplified version may go like this: trade deals such as these enable services and money for goods to produce more profit, by reducing barriers to trade and reducing artificially imposed complications which increase timescales and reduce profit. Hence, more profit. More profit = more money, more jobs, more R&D, etc.
Personally, I would add that it should produce more taxes too, but if your most successful businesses aren't paying what they should via a network of legal, semi-legal and thoroughly illegal means, that sort of stuffs that idea up a bit.
I would also add that (usually buried in the small print) are rather nasty clauses - one of which, in the case of NAFTA, has seen Canada (of all places) become one of the most sued nations on earth and the payment of $millions from Canada to (mostly US) businesses. I would stake my life that the US consumer has seen barely a fraction of a % of this money and that it has gone and will continue to go to majority shareholders, lawyers and CEOs.
Hope this link helps! :)
https://www.theguardian.com/commentisfree/2016/may/04/ttip-tpp-trade-deals-secrecy-greenpeace-leak
Wow! Many mahalos for this comprehensive, thoughtful, informative and very help analysis OS. As you often remind me..."it's complilcated"! :) Happy Thursday! :)
The link helps a great deal MrWitch. Thank you for it and your thoughtful and helpful reply. Boy oh boy
there is always some other thing going on somewhere buried from sight that makes what appears on the surface to be okay not okay at all. Oy vey! :(
Hello Rosie:
I'm a pretty smart guy.. I'm EVEN in business.. But, I don't know diddly about trade agreements. As a businessman, seems to me trade just happens.. You don't need agreements for it. The only thing "agreements" do is LIMIT trade..
excon
