Can someone explain to me why NAFTA and TPP are bad?

[steppinthrax]

According to the debate Trump talked about how bad TPP and NAFTA were. I did some light research on these agreements and it seemed the overall was opening up trade which boosted American as well as foreign country economies greatly.

I do see mention for Ross Perot and Bernnie Sanders about jobs leaving the US, where countries setup shop in Mexico to avoid cost. What's the Trump's rational for saying it was one of the worse agreements in American History etc...

 

[theeedude]

They are only bad to folks who feel entitled to the good life, not because of their productivity or education, but because they were born in America.

 

[steppinthrax]

That was the "jist" I got when reading info about TPP, NAFTA. Really the only people hurt are those blue colar workers who only can obtain factory jobs. Jobs that only need little training and some muscle. Of course this makes up 90% of Trump's base. The white uneducated and blue collar

 

[dullard]

Trade has winners and losers. Overall, trade has FAR more winners than losers. It is hard for the winners to pinpoint that they are earning a bit more money and their goods are a bit cheaper. Thus the winners are relatively quiet. But, the losers are really hurt badly. Certain locations have been hit extremely hard with no jobs to replace them. So of course the losers speak out, it is obvious to them that they are the losers and can pinpoint the problem. They are squeaky wheels that are the loudest.

We shouldn't be persuaded only by the squeaky wheels while ignoring everyone else. But most people are.

Proper trade deals will put in protections to minimize the number of losers. They should also put in place ways to tax SOME of the gains to the winners and redistribute that to offset the losers. Done right, with proper offsets, there are basically no losers and there are many winners. Unfortunately, these protections and redistributions are highly discouraged by certain political parties and often get eroded or never negotiated in the first place.

Many people are against NAFTA--blaming job losses on it. Despite the common complaints, US manufacturing isn't down in the dumps. In reality, most of the losers are losers due to automation. For every 10 manufacturing jobs lost, maybe only 1 was due to NAFTA. But all 10 get blamed on NAFTA. Our manufacturing actually is doing quite well. We are manufacturing quite a lot, but we have robots doing much of the labor. And NAFTA had nothing to do with that.

The TPP is just given a bad rap. There is hardly anything in there to complain about because it really isn't a trade deal. It is a deal to spread US values throughout the Pacific. But, it is often mistakenly described as a trade deal (by politicians and the media) and thus it gets lumped in with NAFTA. About the best one could do is to argue that it further cements in NAFTA. Thus, if you are against NAFTA, the TPP makes it harder to get rid of NAFTA.

 

[woolfe9998]

According to the debate Trump talked about how bad TPP and NAFTA were. I did some light research on these agreements and it seemed the overall was opening up trade which boosted American as well as foreign country economies greatly.

I do see mention for Ross Perot and Bernnie Sanders about jobs leaving the US, where countries setup shop in Mexico to avoid cost. What's the Trump's rational for saying it was one of the worse agreements in American History etc...

You'll hear about the theory of why a trade deal would cost jobs, or why it would create jobs. The theories are well known. Empirical proof of what has actually occured as a result of these trade deals is something almost never cited by either side. Here is Politifact's discussion of the studies done on the impact of NAFTA:

http://www.politifact.com/truth-o-m...bernie-s/sanders-overshoots-nafta-job-losses/

Summary:

Sanders said that NAFTA, which Clinton used to support, cost the U.S. economy 800,000 jobs. There is a report from a left-leaning policy group that reached that conclusion. On the other hand, many other nonpartisan reports found that the trade deal produced neither significant job losses nor job gains. This is a result of competing economic models and the challenges of teasing out the effects of NAFTA from everything else that has taken place in the economy.

 

[sunzt]

No one ever thought to take care of those that would lose their jobs due to increased free trade. That's the primary reason they get a bad rap.

 

[realibrad]

Snip...

Intended or not, your post makes it sound as if trade just shifts the benefit from one group to another. Trade benefits the overall population. It is not a zero sum game which is the main problem people have. They assume there is X amount of money to go around so free trade means it gets spread out instead of one group getting it.

Here is the definition of free trade, and its important.
international trade left to its natural course without tariffs, quotas, or other restrictions.

The reason people don't like free trade is that they do not understand how paying less for something can spread wealth. If a US farmer gets paid $1 per lb of corn, and a Mexican farmer sells his corn for $0.5 per lb, then the Mexican farmer makes less. That means the US farmer has to cut the price of his corn if he wants to compete. That means to make the same annual income he has to sell twice as much for the same thing. What people then demand is a $0.5 tariff on Mexican corn, making it cost $1 per lb, but the Mexican farmer still gets $0.5 per lb typically. Sometimes the tariffs are spread around, but not always.

When we do free trade agreements like NAFTA, we reduce or eliminate these types of things. The reason why we lose jobs typically, is that its cheaper to produce many things in cheaper countries. A company would much rather pay someone less to do the same work, so they move their production to those cheaper countries.

So, when people see the total number of manufacturing jobs go down, and see places like China gain manufacturing jobs, they assume that free trade is the reason. The reality is not so simple.

Someone who used to make say 50k a year back in the day adjusted for inflation doing a factory job, and then gets laid off looks to be caused by free trade. The reality is that labor costs do not exist in a vacuum. More efficient production and new technologies means that there was already pressure on labor costs. Many people want to "get back our jobs" but the reality is that they are obsolete. But how can that be if there are manufacturing jobs in China?

The reason poor countries like China and India have those jobs, is because labor is so cheap. If a US worker makes $15 per hour, and you can pay a person in China $1 per 12 hr day, then it seems pretty simple. The reality is that many times robots could do the same work for $2 per day. Even if we raised the wages of people in China to $15 per hour, we would not get those jobs back, because those jobs are for history.

There is lots more, but that is the main reasons for these two.

 

[dullard]

Intended or not, your post makes it sound as if trade just shifts the benefit from one group to another. Trade benefits the overall population.

I wasn't intending to make it sound like trade just hurt some and benefitted some. Yes, all people get cheaper goods with trade. And, you are correct if a farmer can only make it profitably for $1/pound here where a farmer can profitably make it for a $0.50/pound elsewhere, the farmer's job here is obsolete. It is just a matter of time, free trade or not, until that farmer loses his job.

The other thing to remember about trade is that it only happens when BOTH sides think it is a good idea. On the whole, they are correct and the trade helps both countries. Otherwise, that particular trade won't occur at all--tariffs or not.

 

[ivwshane]

The biggest negative with the TPP would be the rise in drug prices in countries outside of the US that currently don't enforce or recognize IP rights. Its an unintended consequences of which I haven't heard a good solution to.


Most people who talk about trade have no idea what the fuck they are talking about so it's super easy to spin it and manipulate people to push their agenda.


Trade deals can be good because they can help raise standards of living for countries who essentially are used for what almost amounts to slave labor. They can also be good for the environment in that they often include some sort of environmental protections.

 

[theeedude]

No one ever thought to take care of those that would lose their jobs due to increased free trade. That's the primary reason they get a bad rap.

Because those people are often also for small government and don't want to be taken care of. They just want to rage.

 

[ivwshane]

Because those people are often also for small government and don't want to be taken care of. They just want to rage.

Oh they want to be taken care of, they just want only them or people like them to be taken care of only. That's why they are for smaller government. They want just enough government to only be able to address their needs.

 

[realibrad]

Because those people are often also for small government and don't want to be taken care of. They just want to rage.

Union workers are known for wanting small government?

 

[bshole]

According to the debate Trump talked about how bad TPP and NAFTA were. I did some light research on these agreements and it seemed the overall was opening up trade which boosted American as well as foreign country economies greatly.

I do see mention for Ross Perot and Bernnie Sanders about jobs leaving the US, where countries setup shop in Mexico to avoid cost. What's the Trump's rational for saying it was one of the worse agreements in American History etc...

It has the potential to extend drug patents into the decades. It will absolutely ravage the poor and retried in America. Really disgusting piece of work made to be a payoff to the most lucrative industry in America - Big Pharma. We the people have very little influence on our government anymore. It is a wholly owned subsidiary of a few thousand ultra wealthy individuals. The system is utterly corrupt at this point. They get America talking about the side issues while they slip in nefarious SOPs to the ultra powerful with EVERY piece of legislation.

 

[Brainonska511]

It has the potential to extend drug patents into the decades. It will absolutely ravage the poor and retried in America. Really disgusting piece of work made to be a payoff to the most lucrative industry in America - Big Pharma. We the people have very little influence on our government anymore. It is a wholly owned subsidiary of a few thousand ultra wealthy individuals. The system is utterly corrupt at this point. They get America talking about the side issues while they slip in nefarious SOPs to the ultra powerful with EVERY piece of legislation.

Extend drug patents into decades? Do tell. You do realize that patents don't last decades in the US and that drugs often have to be patented long before they end up on the market. Plus, as many drugs are made in the US, it seems prudent that we'd want to protect our intellectual property. Do you hold any index funds? Look at some of the top companies in those funds - pharmaceuticals. You'll pay one way or another, either on the back end by allowing other countries to rip our companies off and having reduced earnings on your investments or on the other side when it comes to paying for medicines.

Despite your claims, under the TPP, the pharmaceutical industry didn't get all they want. Take for example a relatively new class of drugs known as biologics (i.e. antibody-based drugs like Humira). They are protected in the US for 12 years. Yet that protection is somewhat limited. It only protects the company's data so that biosimilar companies (aka, competitors) would have to generate their own data for regulatory approval before the 12 year mark. After the 12 year mark, biosimilars can win more rapid approval by conducting limited clinical trials and showing that their product is more or less the same as the brand name drug (same biophysical characteristics, same efficacy, etc...). The TPP will lower this 12 year barrier to 5-8 years (I forget what the exact number was). Regardless, biosimilars will not be the boon to the consumer like generics were in the small molecule space, since biologics have a high cost of manufacture and substantial quality control costs thanks to the way they are produced (so you'd be looking at maybe a ~30% discount compared to the brand name product).

As for drug companies having a stranglehold on America and the FDA at the expense of people, I'm just not seeing it. Just look at the recent muscular dystrophy drug that was approved - patients lobbied for it and the FDA approved it over the objections of its scientific review board. (On a side note, I think this sets a dangerous precedent: an erosion of science-based regulatory approval.)

Anyway, if you don't like drug patents and what not, what's your solution? Drug companies (encompassing the small startups to the large multinationals) spend billions of dollars annually on research and development. How do you propose they recoup their investments? How should drugs be developed instead of as it is under the current system?

 

[Fanatical Meat]

Can someone explain a full page of text from the TPP? Explain means exactly what its effect will be.

This is the main reason I don't support it

This whole trade discussion is silly we don't need anything more than you trade fair with me, I'll trade fair with you.

 

[MongGrel]

That was the "jist" I got when reading info about TPP, NAFTA. Really the only people hurt are those blue colar workers who only can obtain factory jobs. Jobs that only need little training and some muscle. Of course this makes up 90% of Trump's base. The white uneducated and blue collar

Your back it appears.

And I despise you.

There are many high end skilled trades workers that make the things people put on paper/files and cannot actually make themselves.

Or improve on them in the process.

 

[UglyCasanova]

That was the "jist" I got when reading info about TPP, NAFTA. Really the only people hurt are those blue colar workers who only can obtain factory jobs. Jobs that only need little training and some muscle. Of course this makes up 90% of Trump's base. The white uneducated and blue collar

Those are the certainly the types of jobs to go but don't get too cocky. Trump supporters aren't the only ones to hold low skilled jobs and keep in mind as well high skilled jobs will be the next to go as other nations develop. Free trade does increase the economic wellbeing of the participating countries if it is truely free trade and if each side has comparative advantages. And yes things do get cheaper. But the pain of that isn't just felt by redneck Trump supporters, be sure to keep that in mind.

 

[theeedude]

Those are the certainly the types of jobs to go but don't get too cocky. Trump supporters aren't the only ones to hold low skilled jobs and keep in mind as well high skilled jobs will be the next to go as other nations develop. Free trade does increase the economic wellbeing of the participating countries if it is truely free trade and if each side has comparative advantages. And yes things do get cheaper. But the pain of that isn't just felt by redneck Trump supporters, be sure to keep that in mind.

High skill jobs are already going to cheaper countries and yet, Silicon Valley is bursting at the seams, despite being insanely expensive. Right now, the name of the game is automation, and how to capture wealth currently being spent on non-creative labor. Not just manual labor, mind you. Things like loan approvals are being done by AI. I would also not recommend going into radiology, because imaging and recognition are easy to automate. Or translation, it's just not going to be a good career option. Some manual labor like construction, plumbing, etc, won't be significantly automated soon, because there are too many variables. Or consumer facing tasks. So it is complicated, but there is a ton of money to be made just automating the jobs that can already be automated, so companies are OK spending money on tech talent to do so.

 

[UglyCasanova]

High skill jobs are already going to cheaper countries and yet, Silicon Valley is bursting at the seams, despite being insanely expensive. Right now, the name of the game is automation, and how to capture wealth currently being spent on non-creative labor. Not just manual labor, mind you. Things like loan approvals are being done by AI. I would also not recommend going into radiology, because imaging and recognition are easy to automate. Or translation, it's just not going to be a good career option. Some manual labor like construction, plumbing, etc, won't be significantly automated soon, because there are too many variables. Or consumer facing tasks. So it is complicated, but there is a ton of money to be made just automating the jobs that can already be automated, so companies are OK spending money on tech talent to do so.

I'm definitely in agreement with automation being a bigger issue as far as where the jobs are going. The mid to high skilled jobs are going to be automated (at least to a degree) sooner rather than later imo. The technology is there, all that's preventing it now is investment and time. If the economics make sense it's inevitable, and much of the time the economics do make sense. This is compounded by the push for higher minimum wage, it just puts more weight behind the economic forces already at work.

I work in mortgage banking and the automated loan approvals are certainly being used, but that theoretically should work in conjunction with a real life breathing underwriter. Unfortunately the industry is going in the direction of more and more of these AUS's and it can lead to loans that dont make sense (humans do too though) or borrowers that have trouble getting a loan because the lender can't get an Approve/Eligible in DU. I've seen a lot of change over the last 7 or 8 years (length of time I've been in mortgage banking), some good some bad. Anywho that was definitely off on a tangent.

 

[MagnusTheBrewer]

TPP and Nafta have all of the deficiencies of the European Union and none of the benefits. There are no protections from members enacting tariffs on products purchased from the US. Our products will be unable to compete with local products.

 

[theeedude]

I'm definitely in agreement with automation being a bigger issue as far as where the jobs are going. The mid to high skilled jobs are going to be automated (at least to a degree) sooner rather than later imo. The technology is there, all that's preventing it now is investment and time. If the economics make sense it's inevitable, and much of the time the economics do make sense. This is compounded by the push for higher minimum wage, it just puts more weight behind the economic forces already at work.

I work in mortgage banking and the automated loan approvals are certainly being used, but that theoretically should work in conjunction with a real life breathing underwriter. Unfortunately the industry is going in the direction of more and more of these AUS's and it can lead to loans that dont make sense (humans do too though) or borrowers that have trouble getting a loan because the lender can't get an Approve/Eligible in DU. I've seen a lot of change over the last 7 or 8 years (length of time I've been in mortgage banking), some good some bad. Anywho that was definitely off on a tangent.

High tech workers definitely not exempt, since AI eliminates the need for someone to meticulously program a computer to perform certain tasks, and instead lets computer program itself. So programming as percent of value add is going to go down in favor of artificial intelligence. But at this point, there is opportunity to grow the software value pie much bigger than programming as share of the pie is going to shrink, simply because there are now so many more things that can be done by computers, courtesy of Moore's law and other ingenuity.
Minimum wage issue is not very significant, because there is a natural minimum wage for humans, at which point someone can't afford to eat and obtain shelter and medicine. Even if workers agreed to accept that effectively biological cost of maintenance as their wage, it's only a matter of a couple years before computers bridge the gap between the current minimum wage and that wage.
To make humans attractive as labor, the government would have to tax automation and/or subsidize labor, including things like picking up the medical insurance cost.

 

[Puffnstuff]

NAFTA was supposed to enable free trade between the U.S., CA and MX. It was also supposed to require that employers in the zone comply with employment laws. What it has done is allow for social dumping in MX which is in full swing as American companies shift production like what Ford is doing with their small car production sending all of those jobs south of the border.

Hillary is right when democrats call for an exit tax to discourage domestic companies from relocating to foreign countries so they can pay lower wages, benefits and not have to comply with any regulatory agencies. This is known as social dumping when a company relocates to a country where they can produce goods cheaper at the expense of the workers and the local population. The price of the goods sold will not be any less but the cost to produce them will decrease which increases their profits and shareholders returns.

 

[bshole]

Extend drug patents into decades? Do tell. You do realize that patents don't last decades in the US and that drugs often have to be patented long before they end up on the market. Plus, as many drugs are made in the US, it seems prudent that we'd want to protect our intellectual property. Do you hold any index funds? Look at some of the top companies in those funds - pharmaceuticals. You'll pay one way or another, either on the back end by allowing other countries to rip our companies off and having reduced earnings on your investments or on the other side when it comes to paying for medicines.

Despite your claims, under the TPP, the pharmaceutical industry didn't get all they want. Take for example a relatively new class of drugs known as biologics (i.e. antibody-based drugs like Humira). They are protected in the US for 12 years. Yet that protection is somewhat limited. It only protects the company's data so that biosimilar companies (aka, competitors) would have to generate their own data for regulatory approval before the 12 year mark. After the 12 year mark, biosimilars can win more rapid approval by conducting limited clinical trials and showing that their product is more or less the same as the brand name drug (same biophysical characteristics, same efficacy, etc...). The TPP will lower this 12 year barrier to 5-8 years (I forget what the exact number was). Regardless, biosimilars will not be the boon to the consumer like generics were in the small molecule space, since biologics have a high cost of manufacture and substantial quality control costs thanks to the way they are produced (so you'd be looking at maybe a ~30% discount compared to the brand name product).

As for drug companies having a stranglehold on America and the FDA at the expense of people, I'm just not seeing it. Just look at the recent muscular dystrophy drug that was approved - patients lobbied for it and the FDA approved it over the objections of its scientific review board. (On a side note, I think this sets a dangerous precedent: an erosion of science-based regulatory approval.)

Anyway, if you don't like drug patents and what not, what's your solution? Drug companies (encompassing the small startups to the large multinationals) spend billions of dollars annually on research and development. How do you propose they recoup their investments? How should drugs be developed instead of as it is under the current system?

Yea it looks like some of the more onerous shit has been stripped since I last looked. It still is crap and something I would expect any good conservative to support. It is inexplicable to me see liberals supporting this. It is openly and brazenly a handout to the elites at the expense of the masses.

Of course, the US Congress may fail to enact the TPP in a vote expected next year, which would likely unravel the whole project. Ironically, because support from Democrats is already minimal, the treaty’s death may not come at the hands of its critics, but rather supporters, such as the influential senator Orrin Hatch of Utah, who feels the final version does not protect drug companies enough.

Even supporters of the pact in America concede that it will result inlow-skilled manufacturing jobs leaving the US for other countries. Though US negotiators included worker protections in the treaty, including the right to unionize, the wage gap between the US and, say, Vietnam or Peru, is just too large for many manufacturers to ignore.

But that sacrifice will be balanced out by benefits to US service industries, particularly those that make their money off intellectual property. When it comes to tech companies or Hollywood films, the higher prices these protections bring can be onerous to consumers, but arguably a lot more so when they involve prices not for entertainment but for health and medicines.