Topic: Trade and Immigration

How Will the Transatlantic Trade and Investment Partnership Affect U.S. Jobs?

Today’s Cato Online Forum essay comes from economist Laura Baughman, who laments the typical methodological approaches to estimating relationships between trade agreements and jobs, pointing out how those approaches seem to be used to validate a priori positions, either pro- or anti-trade, rather than reveal best estimates.  While economists are better at estimating the relationships between trade agreements and output or between trade agreements and trade flows, Baughman explains that if the likely impact of on jobs is sought, there is a more objective approach to take.  And the results of that method suggest that “it will be hard to argue that [TTIP] will not be a job ‘winner’ for the United States.”

Read it. Provide feedback.  And sign up for the Cato TTIP conference on October 12.


Forethought on Rules of Origin and Regulatory Coherence Essential to TTIP’s Success

Today’s Cato Online Forum essay takes a look under the hood – or, rather, describes what should be under the hood – of a Transatlantic Trade and Investment Partnership deal, if it is to succeed at minimizing trade diversion and spreading its benefits to third countries. In her essay, Inu Barbee explains why today’s globalized value chains necessitate smart rules of origin and inclusive regulatory standards in the TTIP. Read it. Comment. And register to see and hear more at Cato’s TTIP conference on October 12.

Geopolitical Dimensions of the Transatlantic Trade and Investment Partnership

Four of the participants in next month’s Cato conference have written essays pertaining to the geopolitics surrounding TTIP.  Today, we publish two of those essays in our Online Forum.

First, in this piece, Phil Levy of the Chicago Council on Global Affairs and Northwestern University’s Kellogg School of Management notes the interrelatedness of economic and security interests in the TTIP and writes that “A successful TTIP would have a number of salutary effects on the geopolitical scene. The necessary corollary is that a failed TTIP effort could be costly…”

Second, in this piece, while acknowledging that “TTIP can be a valuable geopolitical tool for the United States,” Peter Rashish of Transnational Strategy Group LLC, also cautions that “policymakers need to weigh carefully how far trade policy should go in promoting U.S. foreign policy objectives.”

Your comments are welcome.

Aiming to Set New Global Trade Rules

Today’s essay for Cato’s Online Forum on the Transatlantic Trade and Investment Partnership comes from Berkeley Political Science Professor Vinod K. Aggarwal, who explains the growing popularity of trade liberalization outside the WTO, and discusses how third countries might react to a TTIP agreement between the United States and European Union.

This essay and this forum are associated with an upcoming TTIP conference at Cato on October 12.

Pope Francis on Immigration

Pope Francis asked all Catholics to pray for those “who seek a home where they can live without fear” but went further by actually praising those who help refugees.  In arguing for the admission of more Syrian refugees, he said the goal should be “to give them a concrete hope, and not just to tell them: ‘Have courage, be patient!’”  No doubt the Pope would go further than many of us in arguing for welfare for refugees even though merely getting the governments of the way to stop hurting refugees is enough, but his full-throated support for granting them refuge is commendable.

Protecting Scotch the Wrong Way in Africa

The African Intellectual Property Organization (OAPI) has reportedly accepted the registration of “Scotch” as a geographical indication for whisky “made in Scotland from water, cereals and yeast, and matured for at least three years.”  It’s unclear what if any commercial consequences this move will have considering that the 17 West African countries of the OAPI are not major consumers of Scotch.  However, it does have significant importance as a step forward in the attempt to use GI protection to secure excessive privileges for Old World producers in foreign markets.

Perhaps the word “Scotch” does indeed refer only to whisky made in Scotland.  The Scottish producers of scotch certainly think so.  In no uncertain terms, the spokesperson of the Scotch Whisky Association says that GI registration will protect consumers from “fakes.” 

But the purpose of GI protection is generally not to fight against fakes (fraud is already illegal everywhere) but to prevent the use of place names as generic descriptions of products.  Scottish producers want to make sure that no where on earth are consumers allowed to think that “Scotch” simply means whisky made according to the methods historically used in Scotland. 

Consider the example of Champagne.   To some, champagne is a word that means bubbly white wine.  To others, it is a name for wine made near Epernay, France according to traditional methods.  French champagne producers have been fighting long and hard to claw back the word and prohibit its use as a generic term.

But there are many, many geographic words that are used as generic descriptors.  Consider Belgian waffles, French fries, Philly cheesesteak, or even Valencia oranges.  Despite being the names of places, these words tell you what the product is like, not where it came from.  

There are two big policy questions surrounding GIs: (1) whether a geographic term deserves protection and (2) what actions are prohibited once a GI is protected.  Let’s consider the second question for now.

The Economics, Geopolitics, and Architecture of the Transatlantic Trade and Investment Partnership: A Cato Online Forum

In mid-2013, the Transatlantic Trade and Investment Partnership negotiations were launched to great fanfare with a pledge from its architects to conclude a deal within one year on a “single tank of gas.” Nearly two and a half years and 10 negotiating rounds later, a final TTIP deal is nowhere in sight. Well, if there is anything that trade policy observers should know by now to be an ironclad law of physics, it’s that deadlines for concluding negotiations are never respected.

Concluding trade agreements can be a long and arduous process, especially if the United States or the European Union is a party to the negotiations.  So when the United States and the European Union (who are used to dictating the terms of trade deals to smaller economies) are both party to a negotiation, it probably makes sense to budget in a little extra time for refueling – and perhaps even a new set of tires.

With that in mind, on October 12 the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies will host a conference titled: Will the Transatlantic Trade and Investment Partnership Live Up to Its Promise? Featuring 30-35 international trade and investment policy experts from academia, think tanks, business, and government, the conference will examine the economics, geopolitics, and architecture of the TTIP during a full day of panel presentations, interviews, and debates. The program is open to the public and you are encouraged to attend.

Among the many questions that will be raised during the conference are:

  • What are the prospects for reaching a comprehensive trade and investment deal between the United States and the European Union?
  • What exactly is under negotiation, and what is the strategy for advancing those negotiations?
  • Would it make sense to exclude sacred-cow issues that will only bog down the negotiations?
  • Is it wise to continue pursuing a single comprehensive deal for all issues on the table, or is it better to aim for a sequence of smaller agreements?
  • Should a deal include other closely integrated countries, such as Canada, Mexico, and Turkey?
  • How will TTIP affect the multilateral trading system, relations with the BRICS countries, and prospects for developing countries?
  • Where are the biggest potential gains for U.S. and European businesses?  For consumers and taxpayers?
  • What are the major domestic political impediments?