New York Times published, “On the Wrong Side of Globalism,” by Joseph Stiglitz who declares that international trade agreements cause more harm than good and are a threat to the majority of Americans. He primarily attacks the Trans-Pacific Partnership (TPP), a trade agreement that joins 12 nations (possibly 14 to date) together to increase trade worldwide with which America is currently negotiating with the original signatories of the TPP to gain membership. Stiglitz main argument is a condemnation of the TPP trade agreements because he believes that the United States’ participation in this accord will create a high level of inequality in the United States. This “inequality” is facilitated by the TPP agreement in that it is seeking to lower barriers to trade (high regulations on international business activity). Stiglitz believes that deregulation will benefit wealthy people and large corporations at the expense of everyone else. This will look like an increase in the outsourcing of jobs to foreign nations and damage being done to environment. He criticizes the deregulation because he believes it will result in “a race to the bottom.”
Stiglitz’s entire article is garbage, but let’s focus on a few things before going into the subject of deregulation. First, income equality is not the goal of Capitalism to begin with. The supposed “harm” Stiglitz says will result from expanding international trade is really just a world metamorphosis that in his point of view, does more harm than good. I disagree with this point as well, first starting with the idea that these international trade agreements will only benefit wealthy people and corporations. A reduction in trade barriers will enable international firms to do business more freely, spend less money on legalities and finding loopholes, generate more profit and then hire more people. Thus, while lower skilled jobs are being outsourced, high skill level jobs are being created to keep up with constantly growing international business demands. The claim that this benefit is at the expense of the “99%” is false because specialization drives prices down for everyone and thus more people are able to afford products that were once considered luxury. The result of this is an increase in living standards. Stiglitz also argues that the TPP agreements will cause a, “race to the bottom,” meaning that less regulation will destroy the environment but other evidence suggests that corporations are less inclined to harm their habitat because it is very costly to relocate to other, less damaged environments. Also, most companies realize that damaging the environment in which they are operating is like killing the goose that laid the golden egg and thus, this argument would only apply to companies foolish enough to kill the goose. A global wasteland is unlikely because there is greater transparency now more than ever in business practices. As trade continues to drive prices down, even the lowliest people on the globe can act as watchdogs armed with the cell phones, blogs and the internet which, I might add, they are able to afford due to specialization and trade.