Opposition to the Trans-Pacific Partnership (TPP), a proposed free-trade agreement between the U.S. and 11 other Pacific nations, is one of the few key policies Donald Trump and Hillary Clinton agree on. And the candidates have considerable congressional backing, as members of both parties increasingly rail against trade pacts.
Yet despite the bleak prospects for passage, President Obama has recently let Congress know that before he leaves office he will push for approval. Obama’s determination isn’t about his legacy, as some critics contend, but about America’s future prosperity in a globalized economy and a geopolitical landscape tested by a rising China. America’s Asian allies are looking to the U.S. for a tangible result of the administration’s “pivot” to Asia, and generally regard the TPP as not just an economic but security link at a time of provocative territorial claims by Beijing. Backing away from the TPP — and by extension regional allies — could send just the wrong signal as maritime disputes indeed threaten global stability.
Nearly 95 percent of the world’s customers lie beyond U.S. shores, and U.S. businesses should be able to sell to them in a lower-tariff environment. U.S. consumers benefit from lower-priced global goods, too. There have been and will be economic disruptions from free-trade agreements, but related legislation is designed to help mitigate these effects.
Economic globalization will happen regardless of the fate of the TPP. Obama is right that it’s likely that China — which is not party to the TPP — will fill the void if America balks. If so, it’s highly unlikely that a Chinese-led effort would have anywhere near the environmental, labor, intellectual property and other protections the TPP seeks to address. And spiking it doesn’t necessarily mean that U.S.-based multinational firms would maintain manufacturing in the U.S. In fact, many might seek to expand or locate in nations like Mexico that are party to several free-trade agreements in order to lower tariffs.
The stakes are high in Minnesota. The Department of Employment and Economic Development says state firms exported $20 billion in manufactured, mining and agricultural products last year, sending them to more than 200 countries. With that in mind, Minnesota’s congressional delegation should carefully consider the economic, diplomatic and security consequences of America abdicating its global leadership role.