Monday, February 18, 2008

Why not Obama

Lots of people like Barack Obama. He’s now the frontrunner for the democratic nomination, and if he does get it, He’ll be hard to beat for McCain. He’s articulate, charismatic and black. This appeals to a lot of people, not just in the U.S. but it seems around the world and here in Sri Lanka. The 20-somethings I meet often are captivated by his persona, excited about his message of “Hope” and “Change” and optimistic about the prospect of an Obama Presidency.

Obama has been celebrated as a Liberal Reagan – the great communicator of the American Left (which btw, is not so ‘left’ compared to say, Sri Lanka). People have written essays claiming he’s a left-libertarian, a Civil-Libertarian, a principled guy, a generation’s hope, yada yada. He has lot of independents supporting him, and even some conservatives. That’s all great. What’s going for Obama is that he’s the new kid on the block, so he doesn’t have a lot of baggage. Couple this with the kind of romance that people have developed for him, it makes people want to cherry-pick facts and project him as whoever they want to. As others have noted, Obama as of now is whatever people want him to be. Infatuation can do that to people.

There was a time not so long ago I was idealistic enough for this kind of blind romance, but those days are gone. This romance is unhealthy, because it stops you from actually examining the issues.

Let’s take foreign policy. Now I oppose the Iraq war, and I agree with the fundamentals of his withdrawal plan. But Obama’s position on the Iraq isn’t necessarily principled as some would like it to be, it’s just populist. His call for a troop withdrawal in Iraq is not coming from a principled non-interventionist position, based on his assessment of ground realities or from a fundamental change in the way U.S. approaches foreign policy, it’s coming from an assessment of voter sentiment.

My biggest beef with Obama of course, is with his economics, I’m not going to talk much about specific U.S. domestic policy issues, but it’s safe to say that Obama offers no “change” from the standard liberal democrat rhetoric, except Obama’s whole game is based on rhetoric.

Where Obama suck is trade, his “fair trade” plan would not only have free-traders worried (that’s basically most economists on the planet – including Obama’s own advisors.) but his “Fair Trade” plan to protect American jobs and Open foreign markets will have Oxfam-type- Do-gooder Fair Traders scratching their heads. Obama wants to talk to Chaves, but wants to renegotiate NAFTA. In other words he wants to talk to their oil-dictator while screwing over the people of Latin America.

Having civil liberties for Americans doesn’t really matter for the rest of us, but trade and foreign policy, those are heavy impact areas. It’s time some of us stop being swept away by Obama speeches and really look into what policies Obama’s advocating. If you agree – if you think protecting American jobs at our cost is a good thing – fine enough. But otherwise, it’s time to stop being in love and grow up.

26 comments:

sittingnut said...

good post
i don't think his trade policy is good for america, world, or sl ( thus me ) . his iraq policy is irresponsible. and most of his domestic policies are usual big government "liberal" stuff

i dont think he will be able to sustain "romance" of his campaign for 9 months. we may even get a "surprise" ( true to course of this election ) within 24 hours in wisconsin, not that i prefer clinton to obama
anyway personally i think he would be easier to beat than clinton for macain ( when you are unknown you can be "defined" and there are lot of material out there for that purpose. and i am sure republicans are quite aware of them ) . clinton on the other hand is already "defined".

Deane said...

Yeah, Dem's trade policy suck ne way(especially these days). for both them and the rest of the world. Obama should sit down with his economic advisers. at least they ( one of them ne way ) seem to make sense.

I don't know if McCain can beat him easier than Hilary, Hilary IS defined and lot of people don't like the definition, including democrats, and certainly independents.

Obama's just too likable, there's enough dislike for Hilary I feel Mc Cain could stand a better chance. The polls also show, Obama having a lead over McCain , where as McCain is just holding out with Clinton .

It's going to be tough for the GOP to win with anybody. If the "surge" continues to work for McCain you never know.

Anonymous said...

hi, shouldn't it be any democrat rather than a republican? I don't know if the americans want to create history with a black president rather than a woman president and hilary at that. Imagine being ruled by two families for nearly 20 years??? That is almost a dynasty! There is not much choice and the best of the lot seems obama. I trust him, somehow.

Deane said...

er.. See at this juncture what's most important for America, they'll have to decide. Republicans have started a needless war, they spy on their own people, and there's torture going on. That's not American.

If I'd have it my way, I'd have Ron Paul. But that was just a pipe dream.

But McCain is the better republican for civil liberties, he opposes torture-like activities used in interrogation (water-boarding, etc.) His position on immigration is closer to Dems than ne other Republican, etc.

But if the economy is important for them i doubt Dems are the best choice for them.. their positions on Trade, Taxes, healthcare reform, social security.. are i think is just bad for america. But they may decide it's good enough, and civil liberties and immediate troop withdrawal from Iraq more beneficial.

But my point was from a rest of the world point of view. and there Trade, Foreign policy are the positions which matter. and on them Dems are just bad on trade, and not that principled on foreign policy either. Obama said he'd go after, Al-qaeda in Pakistan without the permission of Pakistan .. Hillary says all options are open for Iran.. etc.

and the other point was people are simply infatuated with Obama without properly examining his positions. Like.. why do you trust him?

human said...

Yo have said
"..But Obama’s position on the Iraq isn’t necessarily principled as some would like it to be, it’s just populist. .."

But Mr Obama was an early critic of the Iraq war, speaking out against the prospect of war several months before the March 2003 invasion. That's well before it became politically fashionable. And you call that populist?

Deane said...

Yes.

Deane said...

Oh here's another good reason, It's a Gem.
http://www.youtube.com/watch?v=PGeu_4Ekx-o

aadhavan said...

Obama's legislative accomplishments include the lugar-obama act and the govt spending act. keep in mind that two of obama's 3 senate years were in a R dominated senate. obama's illinois senate record is obviously much more impressive.

as for foreign policy, obama would talk without conditions to all leaders but is still willing to use force where necessary- to deal with al qaeda in pakistan and afghanistan for instance. he's against overseeing and managing a civil war in iraq for the next 100 years, which is incidentally McCain's plan.

on healthcare, his plan takes the positions that it's wrong for the government to force people to buy private insurance, while recognizing the need to provide as close to universal healthcare as possible.

on trade, he wants to protect US interests. so what? want to lynch the nigger? trade today is neither fair nor free, so an approach that recognises this imbalance and how it screws over the poor in rich countries and in poor ones is great. obama is not an anti trade lefty though, and does support agreements that don't exploit the poor on both sides while maintaining labour and environmental standards. plus, he's all for cutting subsidies and non tariff barriers. his position on not providing tax breaks to companies that export jobs makes perfect sense, plus it's not a WTO violation either.

oh, obama supports a stimulus package - an idea that even the imf seems to be getting behind, while mccain jokes about his incompetence in economic matters.

in short, obama's proposals are fairly good. his ability to connect with every part of the American polity and his ability to inspire people make him a great candidate. remember, the american pres is constitutionally quite weak - most of these plans and proposals will look very different if and when they reach the legislative stage- and that's where Obama's ability to unite people across the spectrum comes in handy.

it might help if you actually read the guy's proposals without relying on some drunk supporter's inability to answer a questions as proof of the candidate's demerits.

Deane said...

this post wasn't based on the fact that Obama doesnt have legislative accomplishments. that came later, He may have some, but the fact that his campaign supporters can't name them goes a long way in proving that peolpe havent really examined him on issues and on substance rather than rhetoric. Plus it was a funny vid, anyone who doesn't think that has a severe case of the obama-girl syndrome.

On domestic issues, my point was obama doesn't offer much 'change' from the American-liberal orthodoxy. I happen to think their views on social security, healthcare, neither realistic nor particularly desirable for the U.S. but that's a different debate. These including his proposals on immigration, taxes and the economy in general is typically partisan and highly polarizing issues and it's difficult to see how he's going to "reach across the isle" as he says with these on the table, if you think he can charm a bunch of old white republicans, with shallow calls for hope and change, good luck.


On trade, let's stop pretending that labor and environmental standards actually help the world's poor or developing countries. implementing Us type standards on the rest of the world is similar to bush foreign policy.He's all for cutting subsidies?. Last time i checked, he was for ethanol subsidies,etc.. Which even partisan economists like Krugman say, is a bad idea.

I think Dem's anti-NaFTa/freetrade rhetoric, is idiotic. But let's for a moment assume they are right, and it actually does protect U.S. interests. How will that benefit the rest of the world?

When he says he wants to stop tax breaks, he really means he wants to impose an additional tax, and no that doesn't make perfect sense. Most of the job displacement is due to improving tech, (outsourcing, etc.) not the likes of NAFTA.

I do think Obama has decent set of economic advisors, and as i've linked above i doubt they'll join with his pandering to dem-base stuff. He should try actually taking their advice.

I haven't really looked into stimulus plans including the recent bush one, I'll do some reading. Would appreciate a link to the IMF endorsement.

In short, Obama's a standard democrat, he's populist and partisan like the rest of them and his appeal is in oratory and symbolism rather than substance. His ability to unite across party lines, is undemonstrated, he's not-principled on Foreign policy and a bitch on trade for the rest of the world, whichever way you look at it.

Maybe he will moderate when it comes to wooing republicans, we'll have to wait and see.

aadhavan said...

So some Americans support their candidate without knowing their legislative accomplishments. Wow, I really am surprised. I still think I'd find a couple hundred thousand funnier clips on youtube than this one.

On domestic policy, you are correct. His policies are the standard dem positions on these issues. why are you surprised? The dems excite a lot of people in that part of the world purely by virtue of not being Republican. 8 years of Bushups can have that effect on the electorate...

Labour and environmental standards don't help the poor??!! ROFL...that's about the most hilarious thing I've heard this week...youtube surfing notwithstanding...

On NAFTA etc...there's a critical difference between bilaterals without env and labour standards that exploit the poor, and multilaterals that will actually help the poorer countries compete on an equal footing. Bilaterals are bad for the world because a) America is always going to be in a stronger position and therefore exploit poorer partners b)the countries that don't get a bilateral are fucked and c) bilaterals will eat into US domestic support for Doha. So all in all, trade is good, but multilateral agreements that don't exploit countries are good while bilaterals that won't allow for free or fair trade suck. Obama is all for Doha. That means that Obama is willing to cut subsidies etc etc if and when it's apparent to him that trade works for all - which it will if it is free and fair. I think Obama is also they type of internationalist who will be willing to make those big multilateral deals on trade, environment etc, which will be such a welcome change after 8 years of Republican insularity.

All in all, Obama is a classic democrat, has worked together well with Republicans in the past and will probably do the same in the future, will restore civil liberties, will repair American foreign policy, will work for free trade that works for all, will work for universal health care and will usher in a progressive tax reform. Sounds good.

Oh, google IMF and stimulus and there are a couple hundred thousand hits, or more. It wasn't an endorsement of Obama obviously. Hillary, W and Obama all agree in principle on a stimulus package. A foretaste of an Obama presidency?

Deane said...

The guy on youtube was a senator, and in Obama's campaign. If you find funny obama-F'd up stuff, do send. i collect them.

I'm not surprised about him being a standard democrat, my point was he was being projected as someone else and offered no 'change'. Did u actually read the post?

Labor and Env. certainly doesn't help the poor, you find that funny? wow. how may i ask clean air help incomes of poor workers? they are more likely to loose their jobs if a factory had to close, because of 'bad environmental standards'. You have a stronger case with labor, i'll write at length later. a bit tied up for time. let's just say U.S. didnt' have the kind of labor standards when they were at similar stages of development. Plus there is a strong correlation between, rising incomes and better environment and labor standards. The reverse is not true, as in income is the leader not the follower.

"That means that Obama is willing to cut subsidies etc etc if and when it's apparent to him that trade works for all - which it will if it is free and fair."

i see. what a character.

Anyway the post was not offering advice for Americans, just about the fact rest of the world is seduced by him for no real reason. So progressive tax reform (yuk!), socialized medicine,civil liberties, doesn't count. I agree he's good on civil liberties and he's a likable guy.

aadhavan said...

Dude, the guy is a state senator from TEXAS!!! Politicians from Texas are by virtue of that fact- plain stupid. No surprises there. It's the campaigns fault though for putting up a junior state senator from hillbilly land to support one of the more cerebral candidates to contest a pres election in a long time.

Ok, so if you want to pretend that you've never heard of the term sustainable development that's cool. Looking forward to the post on labour standards.

Anyway so I guess you're either ignoring or conceding the point re bilaterals being bad for the rest of the world. You also ignore the benefit that will accrue to the rest of the world when you have an non isolationist, less trigger happy President in the White House.

If you think Obama is fiscally reckless, compare that with the Rethuglicans, who increased spending while cutting taxes for those in the highest income bracket. Or will McCain be dead before he realises that committing to a 100 year war doesn't sit too well with the idea of fiscal conservatism and reduced spending?

Deane said...

oh stop being so bugged about the you-tube vid, it was hilarious. "Name obama's accomplishments.." "ab..um.. u see what he does is, he inspires".. LOL.

bilaterals have a positive net benefit for all parties, it increases your market potential, increases trade volume so it's good for the rest of the world, and i would argue.. the U.S. NAFTA has benefited the U.S.,as well as mexico, n canada. a proper non-election-time analysis would even tell obama that.

Less-trigger happy, yes, if you are Iranian you would be rooting for Hussein obama i suppose. Although Paks wont be all that thrilled.

Yes, the war is in a way the biggest government program, but they had to bring democracy to Iraq you see..

aadhavan said...

ok, so you're a little giggly...point taken

leaving the exploitative nature of a bilateral aside, they do take away the incentive for the US to support and make a multilateral...which means less trade in the long run...countries being left out...and protectionist measures being taken by lots of countries to ensure unfair trade doesn't screw them over...all in all, not good.

ya, don't know about the paks, but obama wants bin laden..i think it had something do with 9/11...not sure

also, this ron paul guy...i like him, but he's hilarious. The bloke thinks NAFTA is a conspiracy to rob the US of its sovereignty and create a pan American union. how? through the construction of a road!!!...bloody funny...you should check it out

aadhavan said...

by the way, I'm a little surprised a free trader would like Paul...he wants the US out of the WTO too...classic bugger

Deane said...

unilateral agreements provide less incentives for a multilateral? now Ron Paul would have been proud of that argument. But i dont think that's really the case, Paul would argue having no WTO,bilateral or trade agreements in general would provide more incentive to go for complete free trade. But that's ignoring reality, while that's ideal, trade agreements are the only way of getting freer trade in reality. What's needed is to move forward kind of like what we seem to be doing with India, first some indo-pak, now looking comprehensive economic partnership, the likes. it also kind of gives adjustment time to people who are hurt by freer trade.

Ron Paul is out there to make a point, he does have his weird positions but they are quite principled, and when you are overly principled.. you end up having fringe positions on some things.

His position on NAFTA,WTO is that isnt free enough, so he cant support for them.. not the most practical but still principled.

You should look more of his stuff on youtube and here. :)

aadhavan said...

Dude, you really need to brush up on your reading. The WTO no less, has frequently expressed concern about the spate of bilaterals that are damaging the chances of a deal being made multilaterally. If I remember right, it was Jagdish Bhagwathi and a number of eminent scholars penned a report on this a couple of years ago for the WTO. If you disagree with the argument, I’m willing to discuss it. But if you’ve never heard of one of the biggest arguments in the public domain about the future of the WTO and express incredulity when someone mentions it, it means you really need to go back to school sonna…

And hey, I can’t get over the irony of someone bitching about Obama’s supporters not having a clue as to his legislative accomplishments when the same person is strangely unschooled on the policies of someone he supports. Machang, Paul is against Nafta because he thinks there’s a conspiracy to merge the US, Canada and Mexico into a single state through the construction of a road. He hates the WTO because of the imposition of rules (which are to force countries to respect free trade agreements they have already made btw) on America, and because he thinks there is some plan to create a world government. It’s strange that I have to be schooling you on the reason Paul rejects NAFTA and the WTO- but sorry sonny boy, it has nothing to do with making trade freer, it has all do with his wacky but cute notion that the WTO and NAFTA are infringing on US sovereignty…ring a bell sahodaraya??? ;-) (pun intended)

Deane said...

From what I've read of Bhagwati, his primary conerns about bilaterals is that it creates a spagatti bowl effect, multiplicy of tarrifs,rules and so on, which creates diversions and detrimental therefore optimal multilateral arragenements, or something similar. don't have research-time now but, i'm pretty sure that's the jist.

I'm no way suggesting that bilaterals are better than having multilateral agreements, but your contention was that having bilaterals take away incentive for U.S. to go for multilateral, I don't think that's practically the case. Also, I don't consider it one of the 'biggest arguments in the public domain' . You are welcome to correct me and give the actual reasons as to why it takes away incentive.

But even if your contention is was true, it's not a compelling enough reason for the U.S. or us really (i meant indo-lanka earlier not indo-pak) to not to go for bilaterals, because there are many more hurdles in the WTO which may or not result in actualizing a multilateral agreement any time soon. FTAs are here to stay, and it's better than not having any freer trade.

But you are being quite an adamant apologist for Obamainsanity on NAFTA, quite frankly i havent heard any of this coming from Obama as to the reasons why he opposes NAFTa, his reasons are simple populist-pandering. I also haven't heard him articulating anything remotely colse to positives of WTO, or the fact that he's "all for doha" like you seem to suggest.any links, n such like to the contrary are welcome

Bhagwati, who has always been a registered democrat and now an Obama backer, recently said he's dead wrong on NAFTA.

On Paul, it's true he has paranoid 'sovereignty concerns' (he wants out of UN for the same reason), but I'm afraid you are the one who needs schooling.

Do read Paul's writings rather Free trade, here's what a casual google search got me
http://www.lewrockwell.com/paul/paul254.html

To suggest that paul rejects FTAs,WTO has nothing to do with the principle of free trade is quite frankly silly, and shows how much you have read about him. His voting record in congress is consistently being anti-subsidy while opposing FTAs on both sovereignty and 'not real free trade' grounds. if you actually read the link above you'll discover paul is for unilaterally reducing tariffs in the US, so for him WTOs/FTAs is not needed for free trade, i happen to endorse that, on principle. although it's not practical in the current geo-political set up.

So please do read more about paul before you claim expertise.

and considering you discovered paul's anti-WTO stance just yesterday, claiming for doctorate on paul studies today is a bit pre-mature don't you think?.. sonny boy. :)

aadhavan said...

playing daft again ah machang? There's a reduced incentive because when America manages to cut bilaterals and trilaterals with all its major trading partners, it has no need to make those deep cuts that Doha for instance would require of it. So America, with its superior bargaining power makes deals with most of its trading partners-which means it really doesn't have to sacrifice anything extra just for the sake of Doha. That means no comprehensive cut on subsidies etc etc which means that Doha becomes impossible to achieve, given that the global South will make no concessions on the big issues unless the North in turn makes those deep cuts. So all in all it leaves you with trading ghettos but less free trade worldwide. And that's not good. BTW what is the bigger public debate than this one over the future of the WTO??

Obviously the cases of SL and India are different because both countries are looking for the global North to open up in order for there to be a reciprocal opening up on this end. So India and SL making a deal doesn't mean it no longer wants a Doha type deal (which will open up the North but also where the collective South is in a stronger bargaining position given the one country-one vote WTO setup)So not all bilaterals in the run up to Dona are bad, but bilaterals that allow the powers that be to make a string of bilaterals that will insulate themselves from the failure of Doha are bad. For Doha to work, the North and the South need to feel the need to do it. Easy bilaterals between the US and smaller partners will make not make it cost beneficial for the US to enter Doha.

on obama and the wto and reasons for opposing nafta, I'm getting bored of asking you to do your own reading so here

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/25/AR2008022500839.html

also, call me silly for believing paul if you must, but i'm just giving you the reasons he gives for opposing nafta and the wto. If he's so pro free trade he will realise that convincing closed countries to open up offers the best way the world will enjoy the benefits of free trade. Unilateral action offers no hope of a world where trade will be freer, since countries will just export to the US and slap tariffs on imports - trade deficit going once, going twice...you get the picture?

Ultimately if Paul is going to think that FTA's and multilaterals undermine sovereignty, you'd have less trade under Paul than you did under Castros Cuba.

Deane said...

ok ok, so FTAs might reduce incentives, but that's a real minor point. The reality of the situation is there are so many FTAs that U.S. has signed and FTAs are a political reality. You can argue similarly lowering tariffs unilaterally in some occasions (like countries often do) also takes away incentive for a multilateral, but this is hardly a convincing case for not having them. it's quite similar in the case of FTAs. The public debate is indeed on tariff cuts, subsidies, labor/env standards, IP, so on. not but not about incentives FTAs would take away as far as i know.

But frankly this is irrelevant because Obama is not making this case, he's not saying lets get rid of NAFTA so we'll have more incentive to go for multilateral, that would be a silly thing to say. Nor is he saying he wants to do away with NAFTA, he wants to renegotiate it and put his democrat-standard env/labor standards which he intends to bring to WTO. He mentions nothing about cutting subsidies so it's difficult to see how he can push for greater compromise at WTO.

Dont make me repeat myself on paul, as i said earlier paul's position on FTAs is based on both sovereignty and 'real free trade' grounds, i've already said this is not practical due to a host of reasons.

But if indeed it is implemented (they get out of WTO, unilateral tariff cuts,) it will increase volumes of trade not decrease it. WTO itself will still have players like the EU. let me get this straight.. here's a guy who wants to cut subsidies, and unilaterally reduce tariffs, that's somehow comparable to castro's cuba? lol.

Also, trade deficits are a silly obsession, it actually means a capital account surplus. if at all it's a problem, its in the way the deficit is created..not in trade deficits itself.. do look this up.

Anonymous said...

very educational guys.

aadhavan said...

Of course FTA's are a political reality. It's also a political reality that these bilaterally signed FTA's are where weaker states and the poor people in richer states get a bad deal because of their lack of bargaining power/lack of political leverage. That's why FTA's not only take away the reasons the US govt will want to do a multilateral, but it also makes trade more slanted and unfair. You really don't contest the incentive point except that to say it's minor? Why?

Also, Obama's not making the icnentive point. He's making the fair trade point, which means that he's more likely to do a WTO(which he supports)than a string of bilaterals (which he has reservations about) I'm telling you that here is a candidate who will better for the rest of the world than candidates who will detrimentally affect the chances of Doha by signing more FTA's.

Ok, I get it. Paul is impractical. But will he increase the volume of trade worldwide? Not a chance. With unilateral cuts, there's just more export to America and much less imports, IP protection etc because other countries don't have to reciprocally open up anymore. They can close up as much as they want because there's no incentive to open up. The EU might want a WTO deal, but the rest of the world won't. I know you have a problem with getting incentives, but let's hope you get this.

The main point is Paul is pushing the paranoid nationalist line in this election really strongly. Anyone who thinks rules based trade violates sovereignty cannot hope for the enforcement of any IP protection either.I think you might want to be a little worried about that. It's just a little loony to go down that line. He's a little slow but cute, people who support him don't get the benefit of the doubt, sorry. If he is not for doing trade deals, there's just going to be less trade in the world although the US will be importing more. That's a bit of a global imbalance that everyone will be worried about.

Deane said...

I already conceded i was probably wrong on the incentives, it's minor because,

a) like i said beforethey are a political reality, there are 100s of FTAs now, and even 10 more is not going to significantly alter incentives, your case might have been stronger some 20 years ago.. or whenever they started having FTAs.

b) the argument is not really relevant in obama's case.

There is nothing to suggest he favors WTO over FTAs, he doesn't want to get rid of NAFTA, only renegotiate it with his 'fair' considerations (of env/labor standards) for which MExico and canada have already asked the Dems to piss off.

He wants to put in these conditions on all trade deals, doesn't want to cut subsidies to sufficient levels and there's nothing to suggest he will get past the stalemate at WTO. nothing.

His anti-nafta rhetoric is COMPLETELY based on pandering to the unions, it's surprising you dont see this. the best you can hope for is it's just rhetoric and he will moderate and listen to his economic advisers when the time comes to woo repubs. But his pledges are going to be difficult to reverse now. his actual arguments against NAFTA are cock (as some of his supporters like bhagwati has pointed out) , the agreement has been a net benefit to everyone.

On Paul, again this is mostly hypothetical but since there is a case for a unilateral tariff cut in any case.

First i hope we are not under the mercantalist fallacy of tariffs are necessarily concessions that we must give up for greater market access in foreign countries. it's clearly not, tariff cuts are beneficial in it's own accord for people of the country.

In the case of Paul, he'd do that and get out of WTO. that still leaves players like EU, who btw is china's main trading partner. so there is still clearly incentive for WTO negotiations to continue, you can argue in fact that it would put extra pressure on the EU to make some concessions.

Also there is nothing to suggest that countries will start pounding on the tariffs, in fact most trade reforms (tariff cuts, such like) have happed unilaterally and not under pressure from trade agreements.

There can also be other dynamics like engaging in reforms they might have stopped as bargaining chips for WTO, benefits of Us not being perceived as an arm-twister and as unilateral tariff cut in the U.S. might have reciprocal effects from developing countries by following the U.S. example along with other competition pressures.

At worst so, there will be no increase in barriers and only access to US would have increased, thus total volume of trade would increase, and arguably it would encourage tariff cuts and increase overall trade by developing countries as well.

aadhavan said...

a)Just because you have a 100 FTA's doesn't mean bilaterals have already taken away the need felt for WTO. The US still feels the need for WTO, so since you've already conceded that in principle FTA's take away the incentives for a big multilateral with deep cuts, it follows that America pursuing more bilaterals and revisiting existing ones can take away existing incentives in the future.

b)Obama doesn't say this. So what? My point is that his trade policy is good for the world. He supports fair trade and the chances of a fair trade agreement being thrashed out are much greater at the WTO than at bilaterals(for reasons I've already alluded to.

On paul, ya, if the US pulls out and with China and the EU already looking forward to doing a big FTA, those three big economies lose any interest in making sacrifices for Doha. That means reduction of trade worldwide and a lost opportunity for opening up trade the world over with one fell swoop. It's the US that keeps lots of countries in the WTO process. You take away that incentive they have for staying in, and they'll opt out easily.

The reason most of these countries will drop out and not reform as you suggest they will is that there are political pressures operating within these countries, like ours, to safeguard domestic industries etc etc. With trade being slanted, electorates don't want to make those short term painful cuts in the hope that trade will in then long term cure all ills. When you create the perception that trade can happen without those short term cuts, you can forget about the cuts being made. Politically it will not happen, in the same way that Paul will not get more than 4% or whatever of the shrinking Republican vote.

You still don't respond the the point that if Paul is going to hallucinate that rules based trade undermines sovereignty, that would render it impossible to enforce any intellectual property protections worldwide. that's not good for innovation is it?

Deane said...

The World Bank estimates that, since the 1980s, about
two-thirds of developing-country trade liberalisation has come about unilaterally.

Now we are just repeating ourselves, but anyway. to summarize..

To respond to your a) My point is a few more it won't significantly alter incentives, as you point even a 100 has still kept enough incentives for a WTO deal.

b) to connect with your a) its obama who wants to revisit the NAFTA and he hasn't said anything about not having bilaterals. his 'fair trade' arrangement, as i keep telling you is to do with env/labor standards, and doesn't include subsidy cuts. The likes of India/Brazil have already opposed this sort of thing. (ever wonder why the intended benficiaries of these 'fair trade' arrangements oppose them?)

Also, most of Obama's protectioniist anti-NAFTA rhetoric is applicable to any trade deal, so it's not just Nafta-specifc. I think he has really mismanged this one in an otherwise superb campaign. The recent leak of his cheif economic advisor's assurance to the canadians that this was all just election stratergy really should sum it up for you.

But if you still insist Obama's trade policy is good for the world, let's agree to disagree. Cos' we are just repeating ourselves here.

As for the Unilateral tariff cuts,

It's World bank who showed most developing-country trade liberlisation (2/3rds - a google search tells me) came unilaterally from their own reforms. In either case with or without WTO, this is something that everyone should encourage. Reciprocal effect of follow-by-example tariff reductions was suggested by Bhagwati.. he had a nice term for it i can't quite recall.

I don't think TRIPS, IP stuff belong in the WTO quite frankly.. any more than Env/Labor standards.

But increasingly people like Lawrence lessing are arguing that patents and unreasonable copyright is reducing innovation. I'm not quite sure in total, but in some cases - definitely.

Anonymous said...

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