Krugman Gets Informed, Changes His Tune On TPP

from the it's-not-about-free-trade dept

What the T.P.P. would do, however, is increase the ability of certain corporations to assert control over intellectual property. Again, think drug patents and movie rights.



Is this a good thing from a global point of view? Doubtful. The kind of property rights we’re talking about here can alternatively be described as legal monopolies. True, temporary monopolies are, in fact, how we reward new ideas; but arguing that we need even more monopolization is very dubious — and has nothing at all to do with classical arguments for free trade.



Now, the corporations benefiting from enhanced control over intellectual property would often be American. But this doesn’t mean that the T.P.P. is in our national interest. What’s good for Big Pharma is by no means always good for America.

So what I wonder is why the president is pushing the T.P.P. at all. The economic case is weak, at best, and his own party doesn’t like it. Why waste time and political capital on this project?



My guess is that we’re looking at a combination of Beltway conventional wisdom — Very Serious People always support entitlement cuts and trade deals — and officials caught in a 1990s time warp, still living in the days when New Democrats tried to prove that they weren’t old-style liberals by going all in for globalization. Whatever the motivations, however, the push for T.P.P. seems almost weirdly out of touch with both economic and political reality.

Late last year, we were dismayed by a Paul Krugman opinion piece in the NY Times in which he judged the TPP based on how it might impact free trade, saying he didn't understand why people were so upset about it. After lots of people called him out on that, including other economists who highlighted that the problems of TPP have little to do with "free trade" but with exporting questionable regulations and giving up corporate sovereignty, Krugman admitted to knowing little of the details and promising to spend more time reviewing them.He's now done so and put forth a revised opinion on the TPP , in which he more or less admits that it's not a very good agreement. He doesn't think it's horrible, just like he didn't think it was wonderful before. He basically shifted from lukewarm support to lukewarm disapproval of it. However, at least he now recognizes that it's not about trade, but about helping out a few big companies:He then wonders why the Obama administration is so gung ho on the deal, and thinks they've been sold a bill of goods, believing the bill must be good because it has been labeled as a free trade agreement, with no one bothering to really think through the details.While I think Krugman underplays the potential downsides of a TPP agreement, at the very least his assessment this time actually involved taking the time to look at what's actually happening. His initial assessment was much more like what he now accuses TPP supporters of doing: just taking conventional Beltway wisdom, combined with a 1990s time warp.

Filed Under: economics, free trade, paul krugman, tpp, trade agreement