{"id":6395,"date":"2018-07-01T08:20:22","date_gmt":"2018-07-01T02:50:22","guid":{"rendered":"http:\/\/calamur.org\/gargi\/?p=6395"},"modified":"2019-04-20T16:34:42","modified_gmt":"2019-04-20T16:34:42","slug":"cnbc-tv18-protectionism-making-sense-of-trumps-tirades-on-trade","status":"publish","type":"post","link":"https:\/\/calamur.org\/gargi\/2018\/07\/01\/cnbc-tv18-protectionism-making-sense-of-trumps-tirades-on-trade\/","title":{"rendered":"CNBC TV18 : Protectionism &#8211; Making sense of Trump\u2019s tirades on trade"},"content":{"rendered":"<p>I write for CNBC TV 18 on the gates of Protectionism that seem to be shutting on world trade<\/p>\n<p>The instinct towards protectionism is not new. It has been a part of economic history since the beginning of trade.\u00a0 In 75 CE, the Roman author and active citizen complained about the trade between the Roman Empire and India.<\/p>\n<p>He\u00a0<a href=\"https:\/\/www.amazon.in\/World-Tamil-Merchant-Pioneers-International-ebook\/dp\/B06XYPCFN8\/ref=tmm_kin_swatch_0?_encoding=UTF8&amp;qid=&amp;sr=\"><strong>observed<\/strong><\/a>\u00a0that there was \u2018no year in which India does not drain our Empire of at least fifty-five million sesterces\u2019.<\/p>\n<p>Up to 55 million sesterces were the Roman trade deficit with India. There probably were discussions of limiting trade with India (quotas), or imposing a tax on them (Tariff). But Roman merchants had access to Indian markets too. Therefore quotas and tariffs at one end would be mean a reciprocal action at the other end.<\/p>\n<p>Throughout history, while there are tales of closed markets, the predominant story is that of trade between kingdoms, and then trade between nations. There have been difficulties in trade \u2013 primarily caused by economic depression, or war, but since the end of the second world war in 1945, the predominant move has been to increase trade ties between nations and reduce tariffs and quotas.<\/p>\n<p>The Global Agreement on Tariffs and Trade (GATT) was born out of the ashes of the second world war, and it had one goal \u2013 to increase trade between nations. The idea behind it was simple, the more nations are intertwined in trade, the more likely each country to be invested in peace.<\/p>\n<p>GATT transformed into the World Trade Organisation, the trade in services began, and the world became more interlinked.\u00a0<a href=\"https:\/\/www.wto.org\/english\/thewto_e\/whatis_e\/tif_e\/org6_e.htm\"><strong>Today 164 nations<\/strong><\/a>\u00a0trade together, under the watchful eye of the WTO. It seems that profits and prosperity trumped protectionism and war.<\/p>\n<p>However, all this has changed in the last few years since Trump became the President on the United States. Elected on a promise to put up the barriers to protect American jobs, Trump has been delivering, gradually dismantling multilateral agreements on trade, by simply refusing to play by the rules of international trade.<\/p>\n<p>The first agreement that Trump tore up was the Transpacific Partnership (TPP) that would have opened trade between 12 countries, that control 40% of the world\u2019s GDP. He has had the North American Free Trade Agreement (NAFTA) in his crosshairs, and he has no qualms about imposing tariffs on goods from other nations, citing national interest as the criteria. Recently the Americans imposed a 25% tariff on steel and a 10% tariff on aluminium.<\/p>\n<p>Most impacted by this are the Canadians, EU, Mexico and China. Battle lines are clearly drawn. In April, the world almost came to the brink of a trade war, when the\u00a0<a href=\"https:\/\/piie.com\/research\/piie-charts\/how-china-retaliating-us-national-security-tariffs-steel-and-aluminum\"><strong>Chinese imposed tariffs on 128 American goods<\/strong><\/a>; and Mexico followed suit by imposing tariffs on almost $3 billion worth of American goods. Massive backroom manoeuvring averted the war, with China agreeing to import more to reduce their $375 billion surplus with the Americans.<\/p>\n<p>India is not immune from the Trump tirade on trade. He has accused the Indian government of imposing 100% tariffs on multiple product lines including the Harley Davidson motorcycle. Already hurt by the tariffs on steel and aluminium, India has approached the WTO to resolve this issue.<\/p>\n<p>India and other countries believe that the United States is running roughshod on the rule book on trade, upending existing systems of rules, and throwing the world into chaotic waters. While India may not have the economic weight of a China to threaten retaliation, in a world defined by a show of strength, it is unclear what other option India has. Kowtowing to Trump\u2019s demands are not the solution.<\/p>\n<p>The Trump approach to trade seems quite like that of an injured bull in a China shop. Things are going to get broken. He believes the whole world is out robbing the \u201cAmerican Piggybank\u201d and it has to stop, even it if means the end of trade. This pronouncement is from the G7 meeting that took place a few days ago in Canada. His refusal to sign the joint statement was put out on twitter.<\/p>\n<p>The problem with the new American Approach to international trade is \u201cmy way or the highway\u201d. It is exacerbated by the fact that international treaties that would otherwise stand the change of government are no longer inviolate \u2013 they can be upended and thrown out.<\/p>\n<p>The problem with the Trump approach is that he does not seem to understand that the Americans were the prime architects of the current world economic order. It was done primarily to help their businesses gain access to our markets. The problem is that America has lost its way in the world order.<\/p>\n<p>But Trump does not seem to want to see this, nor does he seem to want to move it through a rule-based system to some sort of consensus. While agreements fall apart, and trade wars look imminent, it seems likely that the rest of the world has to come to some form of agreement without the participation of the Americans. Trade is too important to be left at the mercy of tantrum tirades.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>I write for CNBC TV 18 on the gates of Protectionism that seem to be shutting on world trade The instinct towards protectionism is not new. It has been a part of economic history since the beginning of trade.\u00a0 In 75 CE,&#8230;<\/p>\n","protected":false},"author":1,"featured_media":7419,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[10,15,25],"tags":[1308,1709],"class_list":["post-6395","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles-in-msm","category-economics","category-international","tag-protectionism","tag-world-trade"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>CNBC TV18 : Protectionism - Making sense of Trump\u2019s tirades on trade - A PoV<\/title>\n<meta name=\"description\" content=\"Protectionism is back, and Donald Trump seems to be the prime mover of the trend.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/calamur.org\/gargi\/2018\/07\/01\/cnbc-tv18-protectionism-making-sense-of-trumps-tirades-on-trade\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CNBC TV18 : Protectionism - Making sense of Trump\u2019s tirades on trade - A PoV\" \/>\n<meta property=\"og:description\" content=\"Protectionism is back, and Donald Trump seems to be the prime mover of the trend.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/calamur.org\/gargi\/2018\/07\/01\/cnbc-tv18-protectionism-making-sense-of-trumps-tirades-on-trade\/\" \/>\n<meta property=\"og:site_name\" content=\"A PoV\" \/>\n<meta property=\"article:published_time\" content=\"2018-07-01T02:50:22+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-04-20T16:34:42+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/i0.wp.com\/calamur.org\/gargi\/wp-content\/uploads\/2019\/04\/Tariffs-Trump-Biz-936632100.jpg?fit=2400%2C1800&ssl=1\" \/>\n\t<meta property=\"og:image:width\" content=\"2400\" \/>\n\t<meta property=\"og:image:height\" content=\"1800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"calamur\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@calamur\" \/>\n<meta name=\"twitter:site\" content=\"@calamur\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"calamur\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/calamur.org\\\/gargi\\\/2018\\\/07\\\/01\\\/cnbc-tv18-protectionism-making-sense-of-trumps-tirades-on-trade\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/calamur.org\\\/gargi\\\/2018\\\/07\\\/01\\\/cnbc-tv18-protectionism-making-sense-of-trumps-tirades-on-trade\\\/\"},\"author\":{\"name\":\"calamur\",\"@id\":\"https:\\\/\\\/calamur.org\\\/gargi\\\/#\\\/schema\\\/person\\\/60c3e7f79ef3b4745dac9f8dc29d3938\"},\"headline\":\"CNBC TV18 : Protectionism &#8211; 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