President-elect Donald Trump is right: The Trans-Pacific Partnership (TPP) is a damaging deal and deserves to be killed off.
But he tells a half truth about why the trade accord among a dozen Pacific Rim nations is a bad deal. In Trump’s view, trade agreements like NAFTA have allowed developing countries to “steal” American manufacturing jobs and decimate the well-waged middle class. This is why he says that America should reject the TPP.
But shifting the blame for American joblessness and stagnant incomes obscures the more complex, largely home-grown pressures that led US companies to offshore manufacturing production to low-wage jurisdictions. Promising to tear up certain trade deals and impose tariffs on imports (chiefly from China and Mexico) will do very little if anything to reverse the problem.
Who’s really to blame for America’s manufacturing decline?
So why abandon the TPP?
A better approach to trade
This is why the United States should abandon the TPP – and why Australia should support its abandonment. Abandoning the TPP, and requiring our governments to focus their efforts on trade deals that take a prudent approach to market access and a tough line on rent-seeking - would be beneficial for both our countries.
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