Is free trade in danger? It appears to be. The political landscape has changed in the US and the new administration is talking tough about China and its currency policies. Although it appears they are already backing off some now that they are actually in office, there were promises made during the election that will need to be addressed.
The Doha round collapsed and there are few signs there is a positive next step for the WTO. Will governments respond to the current economic problems by erecting the trade barriers that certainly contributed to the great depression? I hope we are all smarter than that.
The collapse of the government in Iceland is an interesting situation. As citizens of other countries protest their economic plight and blame their governments, will these governments respond by attacking the tenets of free trade? Lets hope not.
I don't have the answers, but I do firmly believe that free trade is a great benefit overall. I firmly believe the opposite of free trade causes great problems.
Recently the Obama administration has been talking about transforming the economy to compete in new areas and ways. Focusing on innovation and new industries is the way the US can continue to be successful. Focusing on what others do better or less expensively will only distract us from what we excel at. Dominating green energy and pollution control, like we did the introduction of the computer and the internet, are just two examples of what can help bring the next great period of prosperity for our country.
At OPSA we are involved in green energy projects and look forward to doing more.
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