An Article from Politico on the intertwined NAFTA and TPP
Posted by Terrence Isert, March 7, 2017
Help or hindrance? At ProMicro Consulting, I’ve thinking a lot about the recent national discussions around trade deals and the popular conception that free trade hurts American manufacturing workers and jobs A recent arti. is recent article in Politico juxtaposes criticisms and advantages of the recently rejected TPP as a pathway to a better NAFTA. Much has been made of the manufacturing job losses totaling 5 million since 2000. However, manufacturing have seen a recent uptick of 800,000 jobs in the period of 2010 to 2014. This number is significant in that some economists have quantified this amount as the number of manufacturing jobs shipped to our trading partners, particularly Mexico.
The story of free trade and jobs runs deeper than that however.
The economics of these trade deals are tricky and in this case interwoven more with trade deficits, the Great Recession, the pace of manufacturing outputs and politics in the US. According to the US Census, the trade deficit alone ballooned since 2000 (30.2B, March) to 2017 (48.3B, January figures) according to the at least indirectly affecting industries such as manufacturing. NAFTA was always manufacturing and agriculture-heavy in its focus, the former losing 5 million jobs since 2000(see EPI article) although a modest rebound of 800,000 jobs has occurred since 2010. By comparison the TPP was focused more heavily on service industries where the US has a large trade surplus even with Mexico. The new trade deal under TPP was designed to address some of the labor-protection issues, open up access to new markets (dairy industry in Canada) and insert environmental measures missing from NAFTA.
What is clear is that the US missed an opportunity to update a trade deal with its North American partners to improve its trading relationships benefiting more American workers and an opportunity for broader and deeper access to new and existing Asian markets. Those deals may be harder to strike unilaterally and now less favorable to US jobs and its economy.
When it comes to rejuvenating an urban community, expert opinions will often cite a variety of political, social and economic ills that range from the need for education reforms, infrastructure investments, improved racial equality and political reforms among many critical leverage points. Adding citing lighting is not something that leapst to mind. however Detroit has accomplished a milestone on its way to its goal of urban revitalization by doing just that. Read more about the city of Detroit’s latest success here.
The idea that poor people and their families can save anything meaningful seems as ludicrous as the assumption by Muhammed Yunus in 1976 (Price of Dream) that small amounts of credit could help build poor families start businesses in Bangladesh. Jeff Ashe and Kyla Neilan’s In Their Own Hands demonstrates both. In fact, the poor can do so effectively, on their own and with little to no outside help – a departure from the approach of the microfinance movement. When NGOs train participants and then “get out of their way” — these rural and urban groups perform best. Women and men in each group manage themselves and their money more effectively than constant NGO-interaction or supervision. The savings group movement enables not only the poor but the very poor to do what they could not do before: save first, then borrow from each other and continue the process over and over again without help from the outside.
Mr. Ashe’s chronicles his own personal journey from the Peace Corps volunteer forming solidarity groups in Guatemala to microfinance practitioner in Boston. He admits his own misgivings with the micro-lending movement (see this 2007 SSIR article here) and its microfinance institution-building efforts in the 1990s. He poignantly tells of his own sartorial discovery of these groups thriving in Nepal and his own efforts afterwards to launch them in some of the harshest climatic, economic and political environments across Africa and Latin America.
The novel is a compelling read for anyone interested in exploring a poverty-reduction model that is easily scalable, highly-efficient, low-cost to implement and teaches people and their communities to help themselves by putting the power of choice in their own hands.