The House Ways and Means Committee held a hearing last Tuesday with two trade topics: the WTO Appellate Body and NAFTA 2.0.  The first half of the hearing was devoted to the Appellate Body, including both support for the U.S. government’s longstanding concerns over the flaws with the dispute settlement system, as well as a…

As of today, the WTO Appellate Body will be, at least temporarily, no more. The Trump Administration has strangled it by refusing to agree to appoint new members. This can be seen as an extension, albeit an extreme one, of positions taken in prior Administrations, including the Obama Administration.  This blog explains various ways the…

The World Trade Organization’s dispute system was once lauded as an important advancement in trade law enforcement. Now it appears that the system’s legal backbone has been broken. If the dispute system cannot be salvaged from the current crisis, it’s worth asking: what do we lose? Answering that question means putting politics aside an taking…

If you are struggling to understand the rise of economic populism in the United States, and the resulting chasm between populists and elites, then Matt Stoller’s new book Goliath will enlighten you. Goliath is focused on antitrust, but it tells a much broader story of the way the intelligentsia has been led, through a combination…

The hang-up over the new NAFTA comes down to labor enforcement.  This should be of no surprise to anyone who’s been paying attention. The United States has, for years, expressed concern over the historical alliance between Mexican government officials and business – including U.S. business – to frustrate labor rights. To be clear, suppressing labor…

The conventional wisdom on trade, which typically emanates from K Street, is generally long on being conventional, and short on being wise. Today’s version is the meme that Democratic demands on NAFTA 2.0 are just politickin’ to deny Trump a victory. How about a few facts, and then we can reevaluate that line of thinking.…

The express shippers responded to the last blog, on the de minimis loophole.  Out of respect for the time and effort they put into responding, the comments are, with the shippers’ permission, set out below.  In addition, the National Council of Textile Organizations sent this letter to Customs in regards to de minimis. The shippers’…

We’ve talked about one loophole in NAFTA called “de minimis.”  In addition to rules of origin that already allow a certain amount of content originating from outside the region, the original NAFTA contains a loophole that allows an extra 7% on top of it.  The Trump Administration, in a position completely at odds with its China…

The recent furor over the NBA, South Park, and the long arm of the Chinese Communist Party is giving the average American a much better understanding of Chinese government authoritarianism in action. Until now, the discussion about the relationship between China and the United States had been dominated by pearl-clutching over how much more dog…

The following is an executive summary of a paper submitted to the Institute for Corporate Governance and Finance Conference A New Deal for a New Century: Making Our Economy Work for All.  Papers for the conference, including the full version of the summary below, can be found here.   Too often, the debate over trade devolves into tribalist…

Typically, trade agreement marketers rely on gains to GDP to explain why the agreements are worth doing. (Of course, in 2016 the U.S. International Trade Commission concluded that all these bilateral and regional trade agreements combined added a mere .2% per year to GDP.) Herein lies the conundrum: the existing NAFTA already provides duty-free treatment among…

On June 6, Inside Cybersecurity had a webinar of government and American industry voices to discuss Huawei, 5G, and cybersecurity.  The panelists’ main concern is the myriad ways hostile actors, including state actors, can exploit supply chains to engage in nefarious activities. Huawei, which has a prominent position in the race to 5G thanks to Chinese government…

Who said the following: many . . . have focused in particular on enforcement of labor and environmental provisions    . . . .   I am pleased that we obtained strong provisions in those areas, and I agree that they should be fully and effectively enforced so that our companies can compete based on…

In the last blog, we talked about the SOE chapter. It lays out some interesting rules on anticompetitive behavior; but those rules only apply to state-owned enterprises.  If the goal is to discipline state capitalism, that chapter won’t do it. But because it has such detailed rules on anticompetitive behavior, it is worth comparing to…

Much has been made of the TPP and NAFTA chapters on state-owned enterprises (SOEs).  They are supposed to be forward-looking provisions that will put a dent in state capitalism.  But the premise is wrong, and so the response is wrong. The premise of the argument is that state capitalism is executed through SOEs.  In some…

According to Politico, a “coalition of free-market advocacy, business and nonprofit groups is urging the leaders of the Senate Finance Committee to press forward on new legislation curbing the president’s tariff authority.” Ah, the siren song of the free market.  But does anyone really think the global trading system is characterized by “free” markets?  A…

Donald Trump campaigned in part on the flaws in the auto rules of the Trans-Pacific Partnership. Much of his renegotiation of NAFTA has focused on tightening up those rules.  As this paper explains, he can rightly claim some credit for strengthening them. But there are nevertheless questions about whether those rules will work the way…

One of the goals of this blog has been to facilitate an understanding of the backlash against the global trading system.  That system is characterized by a broad set of rules that are complex — opaque, even — with which few are familiar, even many of those staunchly defending the status quo.  An improved understanding…

Although the Trump Administration is no friend of environmental groups, the current U.S. Trade Representative has, as we have noted before, enforced environmental provisions under the U.S-Peru trade agreement.  In that context, it is not as surprising as it might otherwise be that the NAFTA 2.0 environmental chapter contains new, positive provisions. However, on the whole,…

To those outside the trade world, it might seem like a foregone conclusion that the Trump Administration’s renegotiation of NAFTA would contain provisions hostile to, rather than supportive of, organized labor.  However, trade has been the anomaly in this Administration.  As we have pointed out before, the President has consistently borrowed Democratic talking points on…