It's definitely worth a read, but I feel like Blustein is making the perfect the enemy of the good. The points about the WTO are well taken, but the most vital issue now (and probably for the next decade) isn't whether PTAs are better or worse than multilateral bodies. The more relevant question is if, given the growing resistance to trade in the US and the world's failure to complete Doha, is having a PTA in place generally worse than not having one? He seems to think so, but I don't think he makes a strong case.
Friday, October 24, 2008
Paul Blustein, the author of a great book about the Argentine economic crash, has an intriguing and unconventional take on trade in this summer's World Policy Journal (I'm taking a long time to catch up on my summer book-buying spree in Gringolandia). Blustein is an advocate of trade, but he opposes free trade agreements (which he calls PTAs) and those whom he calls knee-jerk free traders. The gist of his argument is that PTAs are far inferior to multilateral trade bodies, and that they are no longer necessary, because tariffs do not pose the barrier to trade that they did a generation ago, regardless of the agreements in place. He also says that PTAs are so vigorously pursued because they give politicians a nice shiny hook on which to hang their hat, but the long-term benefit doesn't measure up to the immediate excitement.