Notes # 20 reading

Notes # 20 reading - A New Deal for Globalization Kenneth...

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A New Deal for Globalization Kenneth F. Scheve and Matthew J. Slaughter A. WAGES FALLING, PROTECTIONISM RISING 1. New feature of the U.S. economy: real income growth has been extremely distorted, with relatively few high earners doing well while incomes for most workers have stagnated or, fallen. 2. Inequality in the United States is greater today than at any time since the 1920s. 3. U.S. policy is becoming more protectionists because the public is becoming more protectionists, and this shift in attitudes is a result of stagnant or falling incomes. 4. Given that globalization delivers tremendous benefits to the U.S. economy as a whole, the rise in protectionism brings many economic dangers. 5. The best way to avert the rise in protectionism is by instituting a New Deal for globalization—one that links engagement with the world economy to a substantial redistribution of income. 6. In the United States, that would mean adopting a fundamentally more progressive federal tax system. B. RISING PROTECTIONISM U.S. economic policy is becoming more protectionists. 1. Trade. Anti-China trade legislation Imposed new tariffs on Chinese exports Barriers to inward foreign direct investment are also rising Congress passed bills to tighten scrutiny even further 2. Key U.S. trading partners are becoming increasingly averse to foreign investment 3. International trade and investment have spurred productivity growth, the foundation of rising average living standards. 4. Central to this success has been the introduction of market forces freer trade and investment can also enhance other foreign policy goals. 5. Three explanations for why protectionism is on the rise in the United States that are not true a. A narrow set of industries, such as agriculture and apparel manufacturing, have been harmed by freer trade and have lobbied hard to turn lawmakers against liberalization. b.
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This note was uploaded on 11/29/2010 for the course IR 109 taught by Professor Heinz during the Spring '10 term at Rochester.

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Notes # 20 reading - A New Deal for Globalization Kenneth...

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