Mitra op-ed on Trump's anti-globalisation agenda in WFR
By Devashish Mitra
Re-published from The World Financial Review | April 5, 2017
Why Trump’s Anti-Globalisation Agenda is Bad for America
Globalisation, in all its forms, is under siege from the Trump administration. Importantly and unfortunately, last week’s G-20 financial leaders’ meeting ended without its usual commitment to promote free trade or resist protectionism. On inauguration day itself, the new administration announced that they were pulling out of the Trans-Pacific Partnership and would be renegotiating the North American Free Trade Agreement. Setting aside for the moment that globalisation has lifted over a billion people out of poverty all over the world, making it safer and more secure, here is why anti-globalisation policies are actually bad for America.
The US-led multilateral process of getting rid of trade barriers, initiated after World War II, was motivated, to a large extent, by the terrible interwar experience with escalating worldwide protectionism. This “beggar-thy-neighbour” protectionism, used by several countries on each other, played a significant role in converting a regular recession into the Great Depression. This important lesson, that the rest of the world does not remain passive to any country’s protectionism, has been forgotten while interpreting the recent evidence showing US wage and job losses from trade with Mexico and especially China. Besides, the recent studies don’t take into account the possible increase in automation from restricting trade, as if it is good enough to bring jobs home for American robots
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