Withdrawal from Trans-Pacific Partnership shifts U.S. role in world economy

[HonestJohn]

https://www.washingtonpost.com/business/economy/withdrawal-from-trans-pacific-partnership-shifts-us-role-in-world-economy/2017/01/23/05720df6-e1a6-11e6-a453-19ec4b3d09ba_story.html?utm_term=.73fdb1bf61f8

By Ylan Q. Mui
January 23 at 8:02 PM

President Trump’s cancellation Monday of an agreement for a sweeping trade deal with Asia began recasting America’s role in the global economy, leaving an opening for other countries to flex their muscles.

Trump’s executive order formally ending the United States’ participation in the Trans-Pacific Partnership was a largely symbolic move intended to signal that his tough talk on trade during the campaign will carry over to his new administration. The action came as China and other emerging economies are seeking to increase their leverage in global affairs, seizing on America’s turn inward.

Mexico’s President Enrique Peña Nieto declared Monday that his country hopes to bolster trade with other nations and limit its reliance on the United States. Chinese state media derided Western democracy as having “reached its limits”; President Xi Jinping had touted Beijing’s commitment to globalization during his first appearance at the annual gathering of the world’s economic elite last week in Davos, Switzerland.

“This abrupt action so early in the Trump administration puts the world on notice that all of America’s traditional economic and political alliances are now open to reassessment and renegotiation,” said Eswar Prasad, a professor of trade policy at Cornell University. “This could have an adverse long-run impact on the ability of the U.S. to maintain its influence and leadership in world economic and political affairs.”

The TPP was one of President Barack Obama’s signature efforts, part of a broader strategy to increase American clout in Asia and provide a check on China’s economic and military ambitions. The deal with 11 other nations along the Pacific Rim covered a wide swath of goods, granting U.S. cattle ranchers better access to Japan and lowering tariffs on apparel imported from Vietnam. Congress granted Obama “fast-track” authority to negotiate the agreement in 2015, but political sentiment quickly shifted, and the deal fell apart without making it to Capitol Hill for approval.

ump’s election effectively guaranteed its demise. Monday’s executive order made it official.

Pulling out of the deal “raises fundamental questions about American reliability,” said Richard Haass, president of the Council on Foreign Relations. “It leaves our allies and trading partners in the lurch. It does create strategic opportunities for China.”

Those include Beijing’s own regional trade agreement, which it is pursuing with 15 other Asian countries, including Japan. An analysis by White House economists under Obama found that a deal between just China and Japan could jeopardize $5 billion in U.S. exports and millions of American jobs. Proponents of the TPP have also pointed to recent reports of Beijing’s weapons buildup on islands in the South China Sea as evidence of the country’s emboldened posture.

(more at link)

[Frank Cannon]

Oh no. The two economic basket cases of China and Mexico, who have nothing to offer anyone but dirt cheap labor, are going to cut their own trade deals. Good luck with that. The world is pretty well done with buying cheap garbage from China and no one in Mexico has two pesetas to rub together to buy anyone's stuff.

[Wingnut]

If Obama negotiated it you just know he did not put our best interests 1st.  Congress gave him permission to "Fast Track" it and he f'd that up too.   Glad he is sooo gone.

[HonestJohn]

We've just handed China the keys to the world. 

Consider that as of 2014, 38.8% of the world's economy was centered in Asia.  That figure is also likely to grow significantly as their growth rates are still very high.  And China has, on the table, a free trade agreement to open all the nations of Asia to each other.  Nations that want such a thing, as evidenced by how they wished to be part of the now defunct TPP.  The only issue was that these countries wanted to be part of an American-led free-trade agreement. 

But as America is now out of the game, the only other player *IS* China.  And these countries still want a free-trade agreement throughout the region.  So they will tack onto China's coat-tails.  (They already started with the AIIB.)

And this will pull on Australia, Europe, and South America.  Even now, we can see this trend with how BMW debuts their new cars at Chinese auto shows before they do so at American ones.  And that was *BEFORE* this opportunity for China.

---

So, I'll have to seriously think about heading out to east Asia for employment if Trump continues to match deeds to his words.  For the prospects of jobs, growth, and increasing quality of life are going to be increasingly found in Asia, not here in America.

Fortunately, those job offers are starting to come in. 

A Malaysian think tank already reached out.  I don't know if I really want it, though.  But a starting salary of $85,000 in Kuala Lumpur with three weeks time off, free medical care, free plane ticket back to the states for vacations, and the think tank paying for any phone/tablet/computer I want...

...it's not that bad.  (that all increases after the third year)

Specially considering the cost of living in Kuala Lumpur.  (hint, you'll live like you're making about $220,000 stateside)

https://www.expatistan.com/cost-of-living/comparison/washington-d-c/kuala-lumpur?currency=USD

[The_Reader_David]

Stopped clock phenomenon here:  The TPP was not a free trade agreement, but a basket of give-aways to large incumbents in the market at the expense of smaller players, including provisions like SOPA on steroids, which would have been cemented with the force of treaty.  Killing it is one of the few upsides I saw to Trump being elected besides rapprochement with Russia.  (The other upsides -- a conservative pick for the Scalia opening and the non-enactment of Hillary's policies would have been there had any of the GOP candidates beaten Hillary -- these are the two good things I saw in Trump's policy positions that were peculiar to him.)

[HonestJohn]

Oh no. The two economic basket cases of China and Mexico, who have nothing to offer anyone but dirt cheap labor, are going to cut their own trade deals. Good luck with that. The world is pretty well done with buying cheap garbage from China and no one in Mexico has two pesetas to rub together to buy anyone's stuff.

If you think China is an economic basket case, I have a bridge in the Sahara you might be interested in buying.

I might add that your attitude about the country is the same attitude Europeans had about America prior to WWII.

[Wingnut]

---

So, I'll have to seriously think about heading out to east Asia for employment if Trump continues to match deeds to his words.  For the prospects of jobs, growth, and increasing quality of life are going to be increasingly found in Asia, not here in America.

I hear good things about those interwebz "Go Fund Me" type sites if you need help raising funds.

[HonestJohn]

I hear good things about those interwebz "Go Fund Me" type sites if you need help raising funds.

Nahh, that think tank would also pay for the move.

BTW: another good reason to get out now:

http://www.gopbriefingroom.com/index.php/topic,245196.0.html

This is the sort of #$%^ that you actually see in places like North Korea.

Like the "Great Leader Comrade Kim Jong-Il Started Work at the Central Committee of the Worker's Party of Korea" day celebrated on 19 June.

[Weird Tolkienish Figure]

Populist idiocy will be the death of us all. It's failed everywhere it's tried and will fail here too.


We'll see in 4 years who is right.

[dfwgator]

Populist idiocy will be the death of us all. It's failed everywhere it's tried and will fail here too.


We'll see in 4 years who is right.

What's "populist" about getting rid of a bad trade deal.......the TPP sure as Hell isn't "Free Trade."

[Frank Cannon]

We've just handed China the keys to the world. 

So what if they don't know how to drive.

China is running deficits of 250% of GDP, they are sitting on a housing collapse, the number of corporate bankruptcies is spiraling out of control, they squandered so much money on worthless infrastructure that they now have massive ghost cities that were built on some of their better farming land, that farmland confiscation dislocated tons of agricultural workers who now are on the verge of revolt, they have polluted their air and water so bad that it is killing poeple and the world is buying so little of their garbage anymore that Hanjin collapsed into bankruptcy.

So explain to me again how the Chinamen are going to take over the world?

[Frank Cannon]

Populist idiocy will be the death of us all. It's failed everywhere it's tried and will fail here too.


We'll see in 4 years who is right.

Well then why don't you argue some of the great features in TTP that would boost the US economy if you are so brilliant? I'm sure you have all the details of the treaty at your fingertips being such a supporter of it that you should be able to shut me down pronto.

[Chosen Daughter]

I applaud the move.  Not worried about China.    If they want to get together with Mexico and create jobs for their own people more power to them.  It would be nice if Mexico and China realize that American jobs are going to stay here.  Hopefully it will be Americans filling them also.

[InHeavenThereIsNoBeer]

Specially considering the cost of living in Kuala Lumpur.  (hint, you'll live like you're making about $220,000 stateside)

https://www.expatistan.com/cost-of-living/comparison/washington-d-c/kuala-lumpur?currency=USD

I worked in KL from time to time about 15 years ago.  I figured that if you had about $250,000 US saved up, you could comfortably retire there.  First time I went was for a week (M-F).  I took out the equivalent of $100 US from an ATM at the airport.  That seemed like a decent start, and I could always take out more once I understood the local economy.  My local coworkers laughed at me.  I paid for everyone at every meail.  I spent a couple hours in taxis.  I returned to Sing with money left over from that initial $100.

[InHeavenThereIsNoBeer]

So what if they don't know how to drive.

China is running deficits of 250% of GDP, they are sitting on a housing collapse, the number of corporate bankruptcies is spiraling out of control, they squandered so much money on worthless infrastructure that they now have massive ghost cities that were built on some of their better farming land, that farmland confiscation dislocated tons of agricultural workers who now are on the verge of revolt, they have polluted their air and water so bad that it is killing poeple and the world is buying so little of their garbage anymore that Hanjin collapsed into bankruptcy.

So explain to me again how the Chinamen are going to take over the world?

While I agree that China is more of a spit storm than most understand, I have to ask:  Did you mean a debt to GDP ratio of 250%?  Even 0 with the help of the turtle and boner couldn't achieve double digit deficit to GDP.

[DB]

While I agree that China is more of a spit storm than most understand, I have to ask:  Did you mean a debt to GDP ratio of 250%?  Even 0 with the help of the turtle and boner couldn't achieve double digit deficit to GDP.

Who knows what China's debt to GDP is. It is whatever they say it is. There is zero transparency there.

[Frank Cannon]

While I agree that China is more of a spit storm than most understand, I have to ask:  Did you mean a debt to GDP ratio of 250%?  Even 0 with the help of the turtle and boner couldn't achieve double digit deficit to GDP.

Sorry. You are right that the 250% figure was wrong. It is now 280%. I apologize for the inaccuracy.

http://www.forbes.com/forbes/welcome/?toURL=http://www.forbes.com/sites/kenrapoza/2015/05/09/chinas-total-debt-load-now-over-280-of-gdp/&refURL=https://www.google.com/&referrer=https://www.google.com/

[Wingnut]

Sorry. You are right that the 250% figure was wrong. It is now 280%. I apologize for the inaccuracy.

http://www.forbes.com/forbes/welcome/?toURL=http://www.forbes.com/sites/kenrapoza/2015/05/09/chinas-total-debt-load-now-over-280-of-gdp/&refURL=https://www.google.com/&referrer=https://www.google.com/

You're slipping Frank!   ^-^

[InHeavenThereIsNoBeer]

Sorry. You are right that the 250% figure was wrong. It is now 280%. I apologize for the inaccuracy.

http://www.forbes.com/forbes/welcome/?toURL=http://www.forbes.com/sites/kenrapoza/2015/05/09/chinas-total-debt-load-now-over-280-of-gdp/&refURL=https://www.google.com/&referrer=https://www.google.com/

220, 221, whatever it takes.

I was referring to debt vs deficit.  250/280% debt to GDP is deadly.  250/280% deficit to GDP is deadly like right bloody NOW.

[Frank Cannon]

220, 221, whatever it takes.

I was referring to debt vs deficit.  250/280% debt to GDP is deadly.  250/280% deficit to GDP is deadly like right bloody NOW.

Not if you are running a Communist country and think you control everything. There's currency manipulation, cooking the books, news blackouts, killing the occasional CEO for bankrupting the company. As long as they can keep their citizens from revolting, they can carry on the charade for a while.

[kevindavis007]

What's "populist" about getting rid of a bad trade deal.......the TPP sure as Hell isn't "Free Trade."

Accordingto whom

[Cripplecreek]

If Obama negotiated it you just know he did not put our best interests 1st.  Congress gave him permission to "Fast Track" it and he f'd that up too.   Glad he is sooo gone.

So how many support restricting Donald Trump?

Mike Lee (R-UT) introduced the Global Trade Accountability Act Friday, a bill that would subject all Executive Branch trade actions (including raising tariffs) to congressional approval.


http://www.lee.senate.gov/public/index.cfm?p=press-releases&id=8DA8C6CF-3413-4D60-9985-3CB8CAE83157

[Rivergirl]

American businesses will only be allowed to sell to other American businesses.
We'll all get rich.............or bankrupt.
The bully speaks with forked tongue and we are going to get nothing but spit.

[kevindavis007]

American businesses will only be allowed to sell to other American businesses.
We'll all get rich.............or bankrupt.
The bully speaks with forked tongue and we are going to get nothing but spit.

I think the American business should be allowed to any business regardless where they are from..

[Weird Tolkienish Figure]

Well then why don't you argue some of the great features in TTP that would boost the US economy if you are so brilliant? I'm sure you have all the details of the treaty at your fingertips being such a supporter of it that you should be able to shut me down pronto.

And likewise you could name some of the drawbacks? Or is it just "DUH CHINA BAD" with you?


The general assault on trade as a job killer is ignorant. Automation is killing most jobs, not offshoring. Trade also provides a substantial part of our GDP, beyond imports and exports. That's why a trade war would be a net job killer.