Japan's finance minister last week dismissed a proposal from the United States to pursue a bilateral trade agreement with Japan, in favor of the Trans-Pacific Partnership that the Trump administration has abandoned.
Taro Aso, also Japan's deputy prime minister, told reporters that Tokyo believes the Trans-Pacific Partnership (TPP) agreement, the 12-nation pact rejected by the Trump administration, is better for both the U.S. and Japan because it allows members to offset concessions and advantages among countries.
"There will be no one we can turn to make up for what we give up for the U.S.," Aso told reporters, as reported by the Wall Street Journal. "That means the terms that the U.S. gets will be also less generous."
Trump usually favors his instinct over informed consensus, which can be dangerous in a complex world.
Meanwhile, the editor of the Economist, the influential British chronicler of global economics and politics, said the U.S. will pay tremendous "opportunity costs" in this step away from global engagement.
"This [TPP] was an economic agreement with [U.S.] geopolitical goals to tie those economies more in the U.S. orbit," said Zanny Minton Beddoes in an interview after a speech last week to several hundred business people at the Hendrickson Forum at St. Mary's University in Minneapolis. "Those countries have to make decisions, and China is asserting itself [as the leader]."
Meanwhile, Trump, who once called global climate change a Chinese conspiracy, has threatened to pull out of the landmark 2015 Paris climate change agreement. China, facing horrible pollution in its industrial centers, now plans to lead in growth of clean energy. Conservation, wind and solar also are proven job-and-economic contributors. Even energy giant ExxonMobil, once led by Secretary of State Rex Tillerson, has acknowledged the need to adapt to climate change and urged the Trump administration to remain in the Paris framework.
"The entire [Paris] endeavor is not going off the rails," Beddoes said. "But the U.S. will not shape it."
Conversely, Trump, after consideration, eased off a campaign pledge to ditch the North American Free Trade Agreement (NAFTA). Beddoes finds Trump careening between "Dark Trump" and "Trump Lite."
Dark Trump continues his isolationist, my-way-or-highway play to his base supporters with immigration crackdowns, trade wars with China, Mexico and Canada, threats and bluster. If that's the case, the U.S. will not benefit from big trade deals, and its influence will wane on global issues.
Beddoes also is encouraged somewhat by the emergence of "Trump Lite," which she views as "latter-day Ronald Reagan." At times, Trump seems to favor foreign policy realists over right-wing ideologues, as Reagan did. And Trump has flipped many of his campaign pledges. He's been less threatening toward partners in the North Atlantic Treaty Organization, for example, now that he's met some and learned a little.
"Trump Lite camp is ascendant right now," Beddoes said, predicting correctly that Trump would try to improve and not abandon NAFTA.
"CEOs complain about the number of regulations that even predate President Obama," she said. "To the degree some sensible reduction happens, that's a good thing. But the clamp down on immigrants will make economic growth harder. About 5 percent of the U.S. workforce is undocumented."
And business generally wants immigration reform, as Reagan achieved with Democrats 30 years ago.
Will Trump squander time and money trying to revive a coal industry that has been declining for decades amid automation, pollution, miner diseases, and undercut by cheaper, cleaner wind, solar and natural gas? Will Trump run his office like a campaign instead of focusing on the big challenges such as the yawning wealth gap between the rich and declining middle-and-working class he claimed as his constituency?
Beddoes argues that can only be restored by continued tax-and-education reform that prepares former coal workers and the like for an economy driven by technology, cleaner energy and smart-labor jobs that pay living wages. And tax reform that slows the income concentration among the top 2 percent to levels unprecedented since the 1920s due to deregulation, and the preferential treatment of capital over labor.
In short, she said, protectionism, anti-immigration sentiment and waxing for early times when America really wasn't greater than today in many ways is not a prescription for a healthy economy or country.
Thrivent has found a way for everday folks to get a piece of the private equity market
