Neo-liberalism and the TPP

by skerr on December 11, 2015 - 10:38am


While neoliberalism definitely has it’s benefits for nations, such as economic expansion based around the focus on private businesses and how we measure economic success, it also has it’s disadvantages, especially for those not in the top percentage of wealth. Practices such as subsidies can help to decrease the price of a global good, it can also harm the profits of farmers living in nations without subsidies, because without the help from their government, they cannot compete with the global economy, and will be undersold by farmers who can afford to price their goods cheaper due to subsidies from their government. Neoliberal free trade is overall a net positive, but only in the case of a perfect world, without a perfect global economy that has global regulations and the same laws. Without the world running perfectly without any issue and without agreement on human rights issues, neoliberalism will have winners, and losers. Unfortunately in the vast majority of cases, those who “win” will be few and far between, and will often already be the most wealthy, while the losers will be farmers, and generally those in the lower class. Neoliberal free trade is only a net positive for already successful nations, and only impedes the success of struggling nations. Struggling and less well off nations need tariffs and limited free trade because with competition from powerful nations, the smaller industries have no chance to match the prices of nations that have enough extra wealth the sell at a lower price point. In our current world, the gap between rich and poor is huge and globally the separation of wealth is insane, with some whole nations only making as much as a single person in the US. Free trade is a great thing, but it doesn’t work practically for nations that are not in a good economic position, it promotes the exploitation of nations with less wealth/looser regulations by more powerful nations. As things stand now, more powerful nations, such as the US, take advantage of looser regulations for workers in China and other Asian countries to get cheaper labor and therefore be able to make a larger profit/sell their goods for a lower price point than other companies that have workers who are paid better.

Comments

Hello, I'm Koki, a student of KUIS.
When I read your paper, I though you understood the current condition in the world. I picked the sentences from your paper; "Free trade is a great thing, but it doesn’t work practically for nations that are not in a good economic position, ~". I think "free trade" is good and important for each country which takes part in TPP because they can support or help each other about each weakness. However, as you wrote, the trading system will be a big problem for Asia, especially I think Japan. We, Japan will have a problem related to deflation, so I hope Japanese government will do their best in order to solve it for us. Thank you.

Thanks for replying to my writing, I had no idea of the deflation issues in Japan, I will definitely spend some time reading about it.

Thank you for your writing. I agree with your opinion. I just researched Japanese TPP problems, but I learned other countries problems and what is free tread. I did not know them. I want to learn and research more about Trans Pacific Partnership. 12 countries have already taken part in TPP, in order to make good relationship and tread.

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