Larry Summers on TPP
By David Henderson
Tyler Cowen writes:
Larry Summers on TPP makes perfect sense. I haven’t seen anything on the anti- side coming close to this level of analysis, and in a short column at that.
So I went to read Summers’s “perfectly sensible” column. Here are the first two paragraphs of Summers’s piece, which, presumably, makes them two of the most important paragraphs:
The Senate’s rejection of President Woodrow Wilson’s commitment of the United States to the League of Nations was the greatest setback to U.S. global leadership of the last century. While not remotely as consequential, the votes in the House last week that, unless revisited, would doom the Trans-Pacific Partnership send the same kind of negative signal regarding the willingness of the United States to take responsibility for the global system at a critical time.
The repudiation of the TPP would neuter the U.S. presidency for the next 19 months. It would reinforce global concerns that the vicissitudes of domestic politics are increasingly rendering the United States a less reliable ally. Coming on top of the American failure to either stop or join the Asian Infrastructure Investment Bank, it would signal a lack of U.S. commitment to Asia at a time when China is flexing its muscles. It would leave the grand strategy of rebalancing U.S. foreign policy toward Asia with no meaningful nonmilitary component. And it would strengthen the hands of companies overseas at the expense of U.S. firms. Ultimately, having a world in which U.S. companies systematically lose ground to foreign rivals would not work out to the advantage of American workers.
As it happens, I am mildly in favor of TPP. But if I totally believed what Summers says above, I would move to neutrality or even opposition to TPP.
Here’s the sentence in the above that would do the most to move me in that direction:
It would reinforce global concerns that the vicissitudes of domestic politics are increasingly rendering the United States a less reliable ally.
It’s no secret that Larry wants the U.S. government to play a dominant role in the world and I don’t. At my talk in Zurich last week, I was introduced to a man whose bank was essentially shut down by the U.S. Department of Justice. I would want to know the details, of course, but my prior view, absent details, is that when a government of one country pressures the government of another country to shut down a bank, that’s likely to be a bad thing, not a good thing.
If the U.S. government is a “less reliable ally,” that could be a good thing.
BTW, this next does not merit a whole blog post on a site called Econlog, but, while discussing Tyler Cowen’s views, let me say that I don’t get his view on Steph Curry. It’s specifically his line: “I am a big fan of Stephen Curry, but in fact his family tale is ultimately a sobering one.” My wife and I have been faithful Golden State Warriors fans and are having a wonderful time this year. My favorite comment from the play-by-play announcer is “Curry, for three.” Curry’s play has made the game more exciting. Here’s a 6 foot 3 inch player whom Charles Barkley used to call “a midget,” who, with his 3-point shooting and, less noticed, his reverse layups, has managed to offset the advantage of height. That has made the game more exciting. And, if Curry, as I fear, will ultimately play for the Charlotte Hornets, I will still love his play even as I continue to be a Warriors fan.