Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.
September 23, 2013 at 10:51 AM
The most definitive data yet are available to answer the question as to whether the Korea-U.S. Free Trade Agreement would increase American exports to South Korea. That, after all, is how the deal was sold by the Obama administration to fast-track it through Congress. And the answer, sadly, is no. Imports have risen, exports have declined and the trade deficit responsible for so many job losses keeps widening. According to Census data, the trade deficit with Seoul is nearly $16.6 billion compared with $13.1 billion in 2011.
The KORUS agreement went into force on March 15 of this year, so perhaps it’s too soon to tell. But since then, South Korean exports have surged while American exports have fallen. These managed-trade agreements always fail to live up to their promises. Last year, the United States had a $61.6 billion trade deficit with Mexico. In 1993, the Clinton administration said that NAFTA would create an additional 200,000 jobs here. But according to a 2011 report by the Economic Policy Institute, it had cost 693,000 American jobs.
This is highly relevant as the administration pushes for the Trans-Pacific Partnership, a far-reaching trade agreement with eight other nations. While there will be winners and losers domestically, it will almost certainly fail to live up to the hype and the losers will be in the majority.
April 12, 2013 at 10:13 AM
North Korea has been the crazy aunt in the attic of southeast Asia for so long that it’s easy to ignore its latest string of threats, which are now backed by nuclear weapons. After the Iraq debacle, a war sold on phony intel, it’s also easy to be skeptical of intelligence that shows the north further ahead on its weapons program than analysts had thought.
I’ve written about the geopolitical consequences of complacency elsewhere. There, my question was: What if the smart people are wrong, and North Korea, whether driven by recklessness, ideology or fear that it will never be stronger than at this moment, when China might be drawn in on its side, actually starts a war? What if North Korea is the Serbia of 1914? From the economic perspective, the danger from the north is not merely a wider war, but one happening in the middle of the world’s workshop.
It will all blow over, right?
Read on for the best links of the week and the haiku:
This Week’s Links:
He who makes the rules | Washington Monthly
China: The superpower that is polluting the world | Foreign Affairs
What’s behind Wal-Mart accounting | Naked Capitalism
Climate change: The moral choices | MIT Technology Review
How to save the European Union | George Soros
Who makes up the working poor in America? | WSJ Real Time Economics
The real reason corporate tax reform is going nowhere fast | Washington Post
Today’s Econ Haiku:
PC sales plummet
Microsoft’s the next GM?
Won’t be OK here