Failed Expectations of U.S. Trade Policy: Lessons for Change

Source: Robert Cassidy, Economic Policy Institute, EPI Issues Forum, January 27, 2009

[Audio, written remarks, and recommended reading below]

Once touted as a magic elixir that would lift the world’s economies and create opportunity for American workers, free trade was embraced by U.S. leaders from both parties who entered into a succession of agreements that lowered tariffs while protecting corporate interests.

China’s entry into the World Trade Organization in 2000 accelerated the changes wrought by this new approach and exposed its fundamental flaws. The benefits were skewed toward the already-affluent, while working families shouldered the burden of free trade’s considerable downside: millions of lost jobs, stagnating or falling wages, and U.S. products increasingly disadvantaged in the world marketplace.

Now at a time of broad political change, the existing trade regime is being questioned by a growing number of economists and political thinkers. Notable among them is the former top Clinton administration official for China trade, Robert Cassidy, who is now speaking out against the signature trade agreement he helped to negotiate, which paved the way for China’s accession to the WTO.

This forum featured a conversation with Cassidy about where we are, how we got there, and what the new administration should do differently to correct the errors of the past two decades and redefine a new, better approach to global trade.

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