Whatever you think about the major-party candidates for president this year, the fact is that their positions to date on trade are not good for Louisiana.
Now, with the world facing the possibility of “Brexit,” Britain exiting the European Union, the potential disruptions for trade flows and the poor prospects for expanding international commerce ought to concern Louisiana leaders.
The Brexit vote is next week, and recent polls have shown the “leave” side gaining ground.
“The UK leaving the European Union would mean substantial upheaval for global markets, financial firms, and businesses that would likely leave London,” analysts from The Brookings Institution wrote recently. “Markets like certainty, and they do not want nor expect this kind of change.”
Aaron Klein and D.J. Nordquist listed all the reasons Prime Minister David Cameron and other British leaders oppose the proposition — fears for the value of pounds sterling, a drop in domestic productivity and potential disruption of international commerce.
The problems also have brought together the Bank of England and the U.S. Federal Reserve system, with both central banks worried about a “leave” result.
“Our economy does not need additional global headwinds,” the Brookings analysts wrote. “Global weakness and financial market uncertainty is not the recipe for stronger economic growth. A change like a Brexit could have ripple effects on us.”
Indeed it could, and Louisiana — at the heart of the U.S. economy in both energy markets and in shipping via the Mississippi River — is a state with significant interests in expanding trade.
At least in Britain, the most responsible leaders are sticking together in opposition to the “leave” vote, although Cameron is mightily to blame for bowing to political pressure to hold the election in the first place.
In the United States, both Donald Trump and Hillary Clinton are banging the drums against trade deals, despite the vast benefits that global trade has for our economy in general and Louisiana’s ports, factories and farms specifically.
Louisiana recently has seen a huge inflow of capital investment from abroad, mostly for petrochemical manufacturing. If the flow of the products made by those facilities is disrupted by politics, where is future investment going to come from?
We’ve already seen a beneficial trade agreement, the Trans-Pacific Partnership, languish on Capitol Hill because of politics. Not only should it be approved, but United States and the European Union should be working toward a similar smoothing out of trade barriers over the Atlantic Ocean basin.
All that may be made more difficult if the voters of Britain decide they don’t want to stay in the EU, but U.S. politics will be at least partly to blame if our economy’s growth slows in this new era.