Monday, March 14, 2016

Yes the world is benefiting from trade, but US workers are weary holding up superpower vestiges

Paul Krugman writes in his March 11 column on Trade and Tribulation that free trade agreements aren't necessarily the bugaboo that both Trump and Sanders claim. He admits some aren't great, tho, like the latest TTP that Obama is pushing. At the same time more trade and international cooperation has benefited the world and provided foundations for international cooperation on things like the latest climate change agreement.

My own thinking, beyond what he has said, takes me to my childhood in the 1960s when there was some guilt about US being so rich while much of the world was hungry. 6% of population in USA consuming a big chunk of world resources. Now there is more prosperity around the world so the world is becoming fairer.

This is good, in a way, but I can see why people, in USA, are weary of this; like in "superpower fatigue." The world is getting more even and that isn't a problem for the well positioned folks of our elite (like even Krugman himself), but it can be hard on many folks. The problems aren't not necessarily the fault of trade. Much are the fault of poor governance in USA; mostly due to Republican thinking. Vestiges of being a superpower means the cost of defending the "free world" has fallen on our shoulders. We have the biggest military in the world while many of our workers, who pay some of the taxes, can't afford healthcare.

Also trade agreements have not allowed us to import cheaper drugs from overseas the way we are being flooded with other cheap products from overseas. Where's NAFTA when we need it? Instead, we are expected to take on the entire burden of paying for what the pharmaceutical companies say is their need for revenue to do research. Why can't the newly prosperous rest of the world pay for this, or why can't we buy the drugs that they get for cheap?

Also, why do we still have to pay for such huge corporate CEO salaries while other countries, that are almost as rich as us, don't?

Krugman points out one of the problems we face that's often falsely blamed on trade. Our dollar is too high in value making American things, including the cost of living, high in USA. This makes it harder for our workers to compete on the world market. As Krugman said, in this article, "our trade deficits are mainly a result of factors other than trade policy, like a strong dollar buoyed by global capital looking for a safe haven."

Our workers are priced out of the market, but still struggling with the high price of maintaining USA as a superpower. People are getting weary. Better governance could improve this situation.

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