Bernie Sanders at a 2015 Washington DC rally against Fast Track proposals for the TPP trade deal. Photo: AFGE (Creative Commons)
What’s changed about attitudes to free trade?
I’ve already blogged once about the Wilton Park conference I attended recently on the subject of the Transatlantic Trade & Investment Partnership (TTIP) in terms of the impact of investor protection on democracy. But one of the hot topics at the conference was more about the impact of democracy on TTIP.
The very next week I arrived in the US for three days of debate on international economics in time to see Donald Trump and Bernie Sanders win the Presidential nomination races in Michigan, where working people – or the middle classes as they’re called in the USA – feel hardest hit by foreign trade.
There couldn’t be a starker illustration of the point that many of us were making at Wilton Park. Although free trade is, according to polls on both sides of the Atlantic, backed by majorities, there is an increasing appreciation that the trade system is not working for working people.
The growth of inequality, the stagnation or decline of real wages, and persistently high unemployment, have disillusioned previously pro-free trade working classes and trade union movements, especially in Germany and the UK. Any benefits from increasing trade – such as it is from modern trade agreements – is just not trickling down. As the Specials put it in Ghost Town thirty-odd years ago, “the people getting angry!”
Those polls demonstrating that free trade still has the support of majorities (actually no longer in Austria and the Czech Republic) are telling an out of date story, although it’s probably true that ‘trade’ is still popular. But no one, especially the elites who drive the negotiations, should be under the illusion that modern-day trade agreements are about trade. And while people may still back free trade, that doesn’t mean unfettered, deregulated free trade.
So in Michigan, white voters backed the least pro-trade agreement candidates in the Republican and Democratic primaries (although there the debate is mostly about the Trans-Pacific Partnership, a deal already done but yet to be ratified.) And similarly, parties of the left and right who oppose TTIP are growing in popularity in Europe – such as the Greens who were key beneficiaries in this weekend’s German regional elections.
What’s happened to public attitudes to free trade agreements is that, just as those agreements have stopped being about trade and become agreements about investment and regulation, the public has realised it’s not ordinary people who benefit any more. They “can’t go on no more,” as the Specials put it.