No one is suggesting that the answer to any national economic quagmire is Free Trade Agreements. But can it help? Of course, it can. But the upside of any such globalization initiative will be undermined by any adverse impact in the national economy (GDP), as is the case for a struggling United States economy.
So it’s only a natural reaction for most to lick their wounds and go in “defense mode.”
So it’s only a natural reaction for most to lick their wounds and go in “defense mode.”
President Obama took his fair share of lashing and back lashing for restricting trade with neighboring countries, some of which may provide an opportunity for additional exports, and potentially create more jobs. That is assuming all other economic factors remain the same, but as it is with any aggressive government strategy, if it works, it works well; but if it backfires, God help us all.
Building economic bridges to South Korea, Colombia and Panama is the product of the long-stalled U.S. initiative to increase exports, and take advantage of products made in the US of A. Of course that begs the question, if it was so brilliant an idea, why now?
The short answer is that for a while United States have been busy doing everything else but manufacturing for a global audience. The longer answer is that US politicians have spent eternity debating ideology and political differences, rather than sound economic policies.
The short answer is that for a while United States have been busy doing everything else but manufacturing for a global audience. The longer answer is that US politicians have spent eternity debating ideology and political differences, rather than sound economic policies.
Blame it on the capitalist mindset if you will like, but everyone [and every company] seeks the most opportune strategy to make a buck, and sometimes outsourcing and off-shoring are the best ideas, for a company’s bottom-line at least. Except that an increased margin in a company’s bottom line often translates into high unemployment due to automation of processes, and outsourcing non-essential functions of a company’s activity.
Just in case you needed Economics 101: - A Free Trade Agreements (FTA) is a trade bloc whose member countries have signed a mutual agreement to eliminate tariffs, import quotas, and preferences on most products and services traded between them. Simply put, - eliminate the barriers, or at least make the process smoother to foster trade. With what I know, there is not intent to turn this agreement into an open border initiative and allow the unconditional free flow of human resource that precedes some form of economic integration. That will never happen, if you ask me.
Most people swear that Free Trade Agreements have proved to be one of the best ways to open up foreign markets to U.S. exporters. At first glance, it makes sense and is unmistakably logical. Unless there are some fineprints.
This deal “removes duties on almost two-thirds of American farm exports, and phases out tariffs on more than 95 percent of industrial and consumer exports within five years.”With unemployment hovering near double digits, there were expectations that the US may turn to protectionist strategies to save what’s left in its coffers.
To use a football analogy, this is when a team is tied in an elimination game and instead of protecting the tie score, goes to for a win. Hence my earlier point that, if the FTA works well, that will show a commitment to play hard, and the courage to win. For now, the game is still on, so we live to see.
To use a football analogy, this is when a team is tied in an elimination game and instead of protecting the tie score, goes to for a win. Hence my earlier point that, if the FTA works well, that will show a commitment to play hard, and the courage to win. For now, the game is still on, so we live to see.
There are two sides to this story [no surprise there], so it will be important to track the value added by the FTA in creating jobs, and jump-starting an ailing economy. Maybe this is becomes the blueprint for Angela Merkel and Nicolas Sarkozy, as they too are desperately seeking long-term sustainable economic solutions for the European Union currently on life support.
No one is suggesting that Free Trade Agreements are the panacea for the post-recession economic landscape, but protectionism is hardly an answer at a time when the rest of the world is feeling the same pinch, and struggling to save what time it has left on its side.
