YouSaid · the spoken record

Doug Irwin

lines on the record: 63
first: 2017-11-29
most recent: 2017-11-29
sittings or episodes: 1
sources: podcast

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“This is something I've actually wanted to investigate in more detail. So certainly my gut reaction, and I think there's a lot of evidence for it, is that they are related. Certainly, when you read the memoirs of statesmen in the mid-20th century, they definitely saw that. Cordell Hall being the leading example, who's the U.S. Secretary of State from 1933 until 1944 or 45. And he wasn't alone. A lot of economists, Jacob Viner and others, also saw that connection because when you had their trade protectionism or imperialism closing off of markets, it led to sort of the scramble for Africa or something like that. Instead of trading these resources freely, you had territorial acquisition as being sort of the counterbalancing of that. Now, what's interesting is just as economists have done a lot of empirical work on the benefits and costs of trade, political scientists have done a lot of work on this. And the empirical work is not quite up, I think, to the standards of what economists have done in terms of the economics.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, once again, I sort of take the world as sort of evolving and want to analyze what's driving this. And even if you sort of say, okay, any future trade agreement, we have no ISDS, they're already sort of embedded in the system in these bilateral, known as BITs, bilateral investment treaties. So they're going to crop up one way or another. And once again, as I mentioned, this is not something that the nefarious United States is foisting upon unsuspecting other countries. Other countries sometimes want this as a way of saying, look, you maybe don't trust our judicial regime, but we'll do this as a way of promoting investment. And once again, with Canada and the EU, no one doesn't trust their judicial regimes, but still somehow those two countries very progressive wanted ISDS in their agreement.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Oh, that's a great question. So it depends a lot on the particular country. Australia is already a pretty open market. You know, Vietnam could be a big winner in the sense of getting a little bit more market access, but also liberalizing their own tariffs and quotas that they'd be forced to do, so their own unilateral, but their liberalization within the context of a TPP is good for them. And to the extent that they sort of institutionalize this as a trade regime, may attract even more foreign investment. And certainly when we've seen when Mexico and other countries reach a lot of foreign trade agreements, they can become export platforms and attract investment.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, personally, I wouldn't want them in. They sort of distract from, I think, what is the main purpose of these trade agreements, which is to reduce trade barriers and regulatory barriers. So I'm not particularly happy that they're in there. But I do think, on the other side, sort of the progressive left, if you will, there's a lot of ISDS horror stories about how it undermines democracy. It's a terrible thing, and the U.S. is foistening this on the international system, and other countries don't want it. But in fact, it turns out a lot of developing countries insist that this is in. Mexico just recently asked for this in, I believe, in a new agreement with the EU or Canada. I can't recall where I read it. The reason why developing countries want it is because it's a way of ensuring that they can sort of commit themselves to treating foreign investors fairly. And they want to attract foreign investment, and they maybe don't necessarily want ISDS, but they're willing to go in for it. They ask for it because it's a commitment device. Let's say I was reading also Canada and the EU. I think their recent CETA, their agreement, that also has ISDS. And once again, so it's not sort of something U.S. was.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Unfortunately, yes. So tariff levels have been beaten down. Obviously, they're not zero. There's still scope to reduce those. There are many parts of the world that still have relatively high tariffs. But if you look at sort of the big trade agreements, the U.S., well, Trans-Pacific Partnership was this. If the U.S. and the EU ever reach a trade agreement, there's going to be a lot of regulatory provisions. And once again, I share also your view that if this could go either way, one of the things that at least U.S. trade negotiators say is that there's a lot of regulatory protectionism out there. And this is a way of not necessarily even setting standards, but ensuring that there's a mechanism to ensure that other governments are not tweaking their standards to favor domestic firms or to serve some special interest. So, yes, it could lead to more regulations. It could lead to standards that maybe developing countries can't adhere to. So it has that sort of downside, but it also could sort of not clear the decks of regulation, but prevent regulatory protectionism, which that's a possibility as well.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there might no, in the sense that I don't think you want to trade intervention per se as a job creation mechanism. So if you want to guarantee jobs for people, that would be one approach. But you don't have to link it to the trade sector per se. In fact, there's sort of a theme through all of your little exceptions that you're throwing at me, which I enjoy very much. The case for free trade has never been the case for laissez-faire. So there may be cases for intervention either over. Certain tourist sites, or you need a certain industry or a sector for national security, these don't necessitate an intervention in trade. You don't need tariffs, quotas, export subsidies, things of that sort. There are other domestic policies that can more efficiently and more directly address the situation you're trying to deal with.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Question that's on my list of places to go, so I haven't measured that myself, but I would think that they're getting quite wealthy as a result of this, whether they've gone too far. I don't know, and whether it's taxing of their infrastructure.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“The appropriate policy response would be taxation, so you want to tax the foreign visitors. You wouldn't want to exclude them. You wouldn't want to set quotas. But if you set an appropriate tax, it applies both to domestic and foreign citizens, so it's not protectionist per se. It's just accounting for the externality of degradation of overuse or something like that.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“And that's not just an argument there. Canada, too, has cultural exceptions built into the U.S. Canada free trade agreement and NAFTA and things of that sort. Actually, I'm surprised you're asking me that because you've written about the cultural diversity that you get with openness and free trade and that if you limit ability of domestic consumers to watch foreign movies and taste foreign food and import foreign art, you're losing something as a result of that. So I'm not sure many countries could become this sort of net exporter of cultural products the way South Korea has.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you could do the calculation and actually see whether it might possibly pay off. But they've used very high import quotas, raised the price to consumers. They're holding back the overall economy because they're devoting a lot of labor and land to this relatively unproductive sector of the economy. So if they're willing to, it's sort of a societal choice in some sense. If they want to sacrifice X percent of national income for 50 or 100 years for this, what I would think would be a relatively low probability event, who's to say that they've made a wrong choice.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, well, I go back to Adam Smith, the master, who said that defense is more important than opulence. So certainly economists have always recognized that there might be an exception to the doctrine of free trade in the case of helping out domestic industries that are essential for national defense. So then the question becomes, if that's really a security worry, what's the best way to promoting agriculture? First of all, is rice protection really going to help them out if there's some sort of major conflagration? Probably not.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“If you look at all those once again late 19th century, they're major exporters, largely of commodities, but they did very well that way. Obviously, you know that Argentina is one of the richest countries in the world in the late 19th century. And it really wasn't until they adopted more import substitution policies after World War I that they began to fall behind. Yes, you can build up your manufacturing sector, but if it's a low productivity sector or it's not going to be very dynamic, it's not going to enhance national income.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, not really true. If you look at why the U.S. economy performed very well, particularly relative to Britain or Germany or other countries, Steve Broadbury has shown that a lot of the overtaking of Britain in terms of per capita income was in terms of the service sector. So the service sector was expanding rapidly. It had very high productivity growth rates. And we usually don't think as that being affected by the tariff per se. So that's one reason. We had also very high productivity growth rates in agriculture. So I've done some counterfactual simulations. If you remove the tariff, how much resources would we take out of manufacturing and put into services or agriculture is actually pretty small and it just wouldn't have, you know, it doesn't account for the success we had during this period.”
2017-11-29 · Conversations with Tyler · Doug Irwin on US Trade Policy · IDENTIFIED FROM THE TRANSCRIPT · source