How NAFTA and China killed jobs in chart form

I really enjoyed this long read from Brad Delong at Vox on the decline of manufacturing jobs in the U.S.  Nonetheless, it was a little long and I love how Drum pithily declares he can summarize the whole thing in a single chart.  He’s not far off:


You might want to show that to somebody next they rail against NAFTA.  That said, there’s also some good cross-national comparison that Drum nicely summarizes:

Very roughly speaking, DeLong’s argument is this: everyone agrees that Germany is the poster child for an advanced economy with a great manufacturing policy. And yet, their manufacturing employment has steadily declined for the past half century too, just like ours. So if this has happened to Germany, there’s not much of a case for suggesting that the US has done anything especially wrong over the past 50 years. We’ve simply evolved from a (relatively) poor manufacturing nation into a (relatively) rich services and technology nation. This has nothing much to do with trade policy, either. It’s just what rich countries do. What’s more, it’s a decidedly good thing overall, even if it does affect a smallish number of people badly.

But, hey, I’m sure dropping TPP and making a better deal on NAFTA will create a boom in manufacturing jobs in Ohio, PA, etc.  Oh, and I’ve got a bridge to sell you.


Photo of the day

This is almost too amazing too be true.  A meteor over India via Wired.


Why the lies

Thanks to ohwilleke for directing me to this terrific Tyler Cowen column on Trump’s lies:

By requiring subordinates to speak untruths, a leader can undercut their independent standing, including their standing with the public, with the media and with other members of the administration. That makes those individuals grow more dependent on the leader and less likely to mount independent rebellions against the structure of command. Promoting such chains of lies is a classic tactic when a leader distrusts his subordinates and expects to continue to distrust them in the future.

Another reason for promoting lying is what economists sometimes call loyalty filters. If you want to ascertain if someone is truly loyal to you, ask them to do something outrageous or stupid. If they balk, then you know right away they aren’t fully with you. That too is a sign of incipient mistrust within the ruling clique, and it is part of the same worldview that leads Trump to rely so heavily on family members…

Trump specializes in lower-status lies, typically more of the bald-faced sort, namely stating “x” when obviously “not x” is the case. They are proclamations of power, and signals that the opinions of mainstream media and political opponents will be disregarded. The lie needs to be understood as more than just the lie. For one thing, a lot of Americans, especially many Trump supporters, are more comfortable with that style than with the “fancier” lies they believe they are hearing from the establishment. For another, joining the Trump coalition has been made costlier for marginal outsiders and ignoring the Trump coalition is now less likely for committed opponents. In other words, the Trump administration is itself sending loyalty signals to its supporters by burning its bridges with other groups.

These lower-status lies are also a short-run strategy. They represent a belief that a lot can be pushed through fairly quickly, bundled with some obfuscation of the truth, and that long-term credibility does not need to be maintained. Once we get past blaming Trump for various misdeeds, it’s worth taking a moment to admit we should be scared he might be right about that.

So the overall picture is this: The Trump administration trusts neither its own appointees nor its own supporters, and is creating a situation where that lack of trust is reciprocal. That is of all things a strategy for getting things done, and these first one hundred days are going to be a doozy.

Are you down with TPP? Yeah you know me.

Sorry, but cannot help but think of the similarly-named song every time I hear about TPP.  Anyway, Adam Davidson, who pretty much always has a good take on things related to the economy and trade:

Both proponents and detractors exaggerated the effects of the T.P.P., the impact of which was always going to be modest in measurable economic terms. The Peterson Institute for International Economics, a reputable but strongly pro-T.P.P. research organization, for instance, estimated that U.S. national income would grow by a hundred and thirty-one billion dollars a year by 2030 under the trade deal, a number that many T.P.P. advocates repeat as evidence of its magnitude. But, even if the estimate turned out to be right, it would represent just half a per cent of the over-all U.S. economy—outweighed by even slight changes in, say, the average price of oil or the Federal Reserve’s key interest rate—and would have essentially no measurable impact on almost anybody’s life. In other words, it could easily be seen as somewhere between worthless and barely measurable in economic terms…

Why did the Obama Administration fight so hard for T.P.P.? The trade agreement was central to long-term U.S. interests around the world. It was the first step in engineering a single interlocking trade system to span North America, a significant portion of South America, and a decent chunk of Southeast Asia, as well as Japan. Modern products—from cheaper goods such as clothes to expensive and durable products such as computers, cars, and medical devices—are no longer made in one country. They require stable, predictable international supply chains, and the T.P.P. would have encouraged C.E.O.s, logistics managers, and others to place their bets on the world’s single largest trading zone, one that would have been dominated by the U.S., the largest and most developed economy in it…

By imposing a single legal regime on trade throughout its area, the T.P.P. would have offered incentives to firms to partner with others in the region. As the dominant party in the pact, the U.S. would have controlled future access to that zone. Labor and environmental activists in America had already won major victories, insuring that the T.P.P. would force a new set of standards on trading partners. For the poorer countries, especially Vietnam, these would have meant real advances for workers and the environment. After passage, other countries in the Pacific and in South America would have been anxious to join this large and growing trading zone and would have wanted to make sure they stayed on the good side of the United States. The zone would have all but surrounded China, which was not part of the pact, and would have served to pressure that country to change its own practices…

President Trump, like many others, is right to be concerned about people losing factory jobs, particularly in the Rust Belt, which delivered his victory. The T.P.P. probably would have killed some jobs there, and it surely would have created some others. Estimates suggest that it would have been a wash. But, over all, it wouldn’t have had much direct impact on blue-collar workers. The global shift away from tariffs and other trade barriers began in 1964 and was, largely, complete by the mid-two-thousands. There are a few real fights left, particularly over trade involving finance, entertainment, and pharmaceuticals, but, for American manufacturing companies and their workers, there just aren’t that many high trade barriers left. No deal is likely to have a significant impact on the number of jobs or on the wages workers receive. Jobs ultimately follow economic activity. Where are the customers? Where does it make the most sense to produce the goods those customers want?

Short version: not horrible, but certainly a move in the wrong direction.

And just to be gratuitous…

Future of fruit

So, let’s take a break from Trump for a post and talk about one of my other favorite topics– fruit (and GMO’s).  A recent Wonkblog post on GMO apples (yum) reminded me of this excellent NYT story on the future of fruit from back in December.  In a very cool technological development, scientists have invented new ways to dramatically improve the shelf-life of fruit with a natural treatment:

What if a Florida tomato could be left on the vine long enough to turn red and fully develop its flavor — and still be ripe and juicy when it arrived at a grocery store in New York days later?

That is precisely the promise of a start-up here in Southern California, Apeel Sciences, that aims to make obsolete the gas, wax and other tricks growers use to keep fruits and vegetables fresh over time.

Using leaves, stems, banana peels and other fresh plant materials left behind after fruits and vegetables are picked or processed, Apeel has developed a method for creating imperceptible, edible barriers that the company says can extend the life of produce like green beans and berries by as much as five times. Apeel can even deliver a day-of-the-week bunch of bananas, each ripening on a different day.

An Apeel product already has been used to stretch the shelf life of cassava in Africa.

“It takes 30 days to get blueberries grown in Chile to market in the United States, which means they have to be picked before they’re ripe and shipped under heavy refrigeration,” said James Rogers, the founder and chief executive of Apeel. “We can change that.”

Awesome!!!  And, here’s where I mention, I’m loving the bumper crop of Chilean blueberries.  Fresh blueberries for $3/pint in January (hooray, Southern hemisphere) means I’m back on fresh blueberries instead of frozen for now.  But, in general, this is really, really cool.

If the product performs as advertised, it could bring sweeping changes to the produce industry and grocery aisles. It could reduce food waste and the use of pesticides and increase the varieties of fruits and vegetables available…

Another effort to alter that trade-off is SmartFresh, a product developed with Professor Watkins’s research that keeps apples from ripening too quickly in storage.

Apeel’s products, sold under the brand names Edipeel and Invisipeel, take plant materials and extract all liquids from them to produce tiny pellets. The company then uses molecules from those pellets to control the rate of water and gases that go in and out of produce, thus slowing down the rate of decay.

The version of Apeel for avocados, for example, creates a barrier that effectively fools anthracnose, a fungus that exploits tiny cracks that develop in the fruit’s skin when it begins to shrivel. Anthracnose extends a little leg through those cracks and into the fruit itself, creating the ugly brown spots that are such a nasty surprise when an avocado is opened.

Edipeel can stave off anthracnose by up to 30 days longer than existing techniques for combating the fungus. “It basically sees a different molecule than it’s used to seeing and moves on,” Mr. Rogers said.

Invisipeel can be applied while crops are still in the field. Edipeel can be applied after a harvest; crops can be coated while on a conveyor belt or dipped in the solution.

So far, the products are derived primarily from the remains of produce that has been certified organic, like grape skins left over from wine production and stems left behind after broccoli is harvested. They can be easily washed away with water.

And, maybe, I’ll get decent-tasting apples in January through March until the Chilean and New Zealand apples finally show up in April.

And, speaking of apples, solid Wonkblog piece on the new never-browning GMO apple.  Importantly, I think, the only modified genes in here are apple genes (and the science behind this is pretty cool).  I always eat a whole apple at a time, so brown slices are simply not an issue for me.  But if this gets more kids to eat apples via slices, that’s great.  And if it gets more people to accept GMO food as no less healthy, even better.  The company behind this is optimistic.  That said, I’m pessimisstic as I think there’s just too much irrational fear of GMO food.  This may be the food that breaks through (then again, maybe if everybody knew there were already eating a ton of GMO soy and corn every day), but maybe not:

After years of development, protest and regulatory red tape, the first genetically modified, non-browning apples will soon go on sale in the United States.

The fruit, sold sliced and marketed under the brand Arctic Apple, could hit a cluster of Midwestern grocery stores as early as Feb. 1. The limited release is an early test run for the controversial apple, which has been genetically modified to eliminate the browning that occurs when an apple is left out in the open air.

Critics and advocates of genetic engineering say that the apple could be a turning point in the nation’s highly polarizing debate over genetically modified organisms (GMOs). While genetic modifications have in the past been mainly defended as a way to protect crops, the Arctic Apple would be one of the first GMOs marketed directly to consumers as more convenient.

“What companies are desperate for is some really popular GMO product to hit the market,” said McKay Jenkins, the author of a forthcoming history of the debate. “Any successful product could lift the cloud over GMOs.”

Industry executives predict the apple could open a whole new trade in genetically engineered produce, potentially opening the market to pink pineapples, antioxidant-enriched tomatoes, and other food currently in development.

“We see this as less about genetic modification and more about convenience,” said Neal Carter, founder of the company that makes the Arctic Apple. “I think consumers are very ready for apples that don’t go brown. Everyone can identify with that ‘yuck’ factor.”

GMO critics say they are hopeful, however, that consumers will continue to show skepticism about the produce. Despite a growing consensus in scientific circles that GMOs pose little risk, environmental and consumer groups have successfuly mounted campaigns against GMOs over the past 30 years, successfully limiting the practice to commodity crops like soybeans and corn…

For the Arctic Apple, however, the greatest test is yet to come: whether the convenience of a non-browning apple is enough to convince consumers to look past GMO’s negative reputation.

“I don’t know what their chances are — it’s a very polarized debate,” said Michael White, an assistant professor of genetics at the Washington University School of Medicine. “But I think this is huge. What the Arctic Apple is doing, trying to push GMOs on their own merits, could lead to a more positive discussion.”

Despite widespread scientific consensus that genetic engineering is not dangerous to human health, the practice remains controversial and poorly understood. Both the World Health Organization and the National Academies of Science have concluded that there’s no health reasons for avoiding the current slate of genetically engineered foods.

Personally, I’ll buy them just to support the effort (and to try and get my son Evan to eat more fruit). Anyway, no matter what, the future of fruit looks to be different and better.

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