BARCELONA - For decades, political debate in Europe between conservatives and the left focused largely on economic institutions and policies. In this bi-polar system, the parties differed on the nuances of economic policy, but broadly agreed on democratic values, the European project, and the need to adapt to and manage globalization, rather than reject it wholesale. But, with the growing success of appeals to identity and renewed ethnic or religious nationalism, that is changing. Are the ghosts of the early and mid-twentieth century returning?
Yes, Nike, a company that grew to be worth billions by outsourcing jobs to overseas sweatshops, a company that sets up P.O.-box subsidiaries in tax havens to avoid paying U.S. taxes, a company that uses threats to extort tax breaks from its "home" state. Is this really the sort of company Obama wants to use as the face of what the TPP will bring?
The current trade regime is not just a matter of the U.S. exporting manufacturing jobs to China and importing cheaper consumer goods. We are also dramatically increasing the volume of pollution associated with our consumption, so much that a significant part of U.S. pollution is now generated in China in the production of goods for U.S. consumers.
FRANKFURT -- The central weakness of democratic systems also contributes to the problem: The quest for votes favors the extension of social benefits and discourages unpopular measures that would put the economy on a more sustainable footing. As the German economist Herbert Giersch once put it, what is politically expedient is rarely economically beneficial.