A small step for men, a giant leap for world trade

Patrick Young
Patrick L Young is CEO of niche crowdfunding platform HanzaTrade and an advisor to fund managers throughout the world. Born in Ireland, he is an active investor in the “New Europe” amongst other emerging markets and is an active Co Founder of grassroots startup group "Mission ToRun." Home Page: http://patricklyoung.net Twitter: @FrontierFinance
A small step for men, a giant leap for world trade
An EU/US Free Trade Pact heralds an opportunity to boost the entire world economy.

For those who are always keen to jeer at the notion of globalisation, I have 2 words: Pasta, and, Potatoes. Both massive imports which the anti-free trade crowd couldn’t live without and presumably given their mantra despising globalisation they would support being repatriated to their origins in China and America respectively.

However, in one sense the anti globalisation crowd may soon find themselves in a curious alliance with smaller businesses if the EU and the Obama Administration’s controlling tendencies are exercised in the upcoming negotiations.

Make no mistake, a Free Trade Pact between anybody is a great thing. A Free Trade Pact between the better part of 1 billion pretty wealthy consumers is so fantastic that it is a damning indictment of everybody concerned nobody got around to it earlier. Moreover, both parties have a huge incentive to get a deal done. The EU has a failing currency zone on the cusp of mass bankruptcy and a horrible unemployment problem. Meanwhile, in the USA, the liberal hero of the hour has, oh hold on...been abandoned by supporters as he is apparently intent on using digital technology for all manner of nefarious means.

The EU needs a deal because it is crumbling economically while Obama needs a deal because his legacy is currently nada. Moreover, if there is anything the Democrats can get past the GOP in Congress then surely it is free trade: a topic close to every tea partier’s heart?

Free trade agreements are at their very core, pretty simple: you meet, you agree to remove tariffs on each other’s goods and services and you can be celebrating the breakthrough by lunchtime. Of course, that doesn’t work for Obamaland and it certainly doesn’t work for the EU: both are heavily influenced by big corporates who will seek competitive advantage in creating complex rules. Hence, anti-globalists will be aligned with small business in holding their breath for fear that the Free Trade Pact is merely another level of complex regulatory bureaucracy strangling small enterprise.

U.S. President Barack Obama walks with Britain's Prime Minister David Cameron during the G8 summit at the Lough Erne golf resort in Enniskillen, Northern Ireland June 18, 2013 (Reuters / Suzanne Plunkett)

The people entrusted with delivering freedom have somewhat shaky credentials. Hopefully the Mittelstand will help sway the German view towards pure open markets. Championing the Pact, is the mediocre British PM, David Cameron, whose ‘centre right’ coalition looks confused on capitalism. If Cameron can bring forth free trade across the Atlantic then he can achieve a trade with global growth areas like the Anglosphere Commonwealth and USA as opposed to being shackled to a failing dystopian EU bureaucracy.

Cat herding is not dissimilar to encouraging controlled socialist economies like France into a world of free trade. Muscular French multinationals support free trade while the sensationally unpopular President Hollande maintains the ridiculous French cultural exception rule: aka a state subsidy for Cannes winning movies with lengthy lesbian scenes. Dear President Hollande, I am reliably informed the free market has a hugely prosperous sector that can produce very similar material, leaving me confused as to what makes this culturally exceptional.

Italy and Spain also have great exporters but massive unions protect their public privileges to the detriment of the nation. That will make a deal difficult. Nevertheless with enormous unemployment, even union hypocrites may be challenged to blindly defend narrow interests when Free Trade can easily generate 2 million jobs and 100 billion of economic benefit?

Negotiations will involve lots of bickering and much ineffective regulation. Hopefully the US will kill Europe’s insane proposals to impose transaction taxes and destroy pensioners’ assets for instance. Meanwhile the EU could advise the US on how to facilitate inter-state trade..

t is to all nations credit that post the Lehmans melt-down, protectionism was very muted: hence the world avoided depression. Nonetheless, with the Chinese economy slowing and Germany perhaps already in recession, urgent action is required. Anything which helps oil the wheels services, trade and industry will make the people more prosperous and ultimately help bankrupt governments recover money into the tax coffers - even outside the EU/US. Here’s hoping that the motley crew of politicians and bureaucrats negotiating this Free Trade Agreement can deliver the deal - and preferably soon. The unemployed of Spain and elsewhere don’t have 2 years to wait...

There is everything to gain and nothing to lose.

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.