Trump trade policy isolates US as world moves on without it
The United States has a trade problem; we buy more goods than we sell to foreign nations. President Trump contends that our trading partners treat us “unfairly.” This is a misperception of the problem. The issue is not that our trading partners treat the U.S. unfairly, they just treat other countries better.
They do so through a network of so-called free-trade agreements (FTAs). That term disguises the actual effect of the FTAs, which has little to do with free trade. They should be called “preferential-trade agreements.”
Through these agreements, the parties offer each other tariff levels lower than those charged to parties outside of the agreement. Most of these agreements also deal with non-tariff barriers, establish mutual-recognition agreements for regulated products and establish procedures for conflict resolution.
The World Trade Organization (WTO), which sets the general trade rules, has tallied 447 bilateral and regional trade agreements. The United States is party to only 20 of these agreements. In other words, we do business in a world with an expansive preferential-trade network from which we are excluded.
As other countries enter into more of these agreements, we are more isolated. Unfortunately, President Trump’s new tariffs, combined with the threat of additional tariffs, have prompted a surge of new trade deals that exclude the United States. Since he took office, 17 new preferential-trade agreements have been registered with the WTO.
The newest preferential-trade agreement is between the EU and Japan. It creates a trade zone that, once it is ratified, will cover 30 percent of world trade by value. In truth, the deal has been in the works for years, but new U.S. protectionist trade policies prodded negotiators to move quickly.
The pact will provide some relief to Japan and the EU in the event the U.S. places tariffs on automobiles and other goods and services. It’s also another blow to U.S. farmers, who had hoped to increase exports to Japan and Europe to compensate for lost sales to China.
http://thehill.com/opinion/finance/401559-trump-trade-policy-leaves-us-isolated-as-world-moves-on-without-it
Just a stable genius. He sure reeks from the smell of horse shit.
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