Free trade agreements aren’t the only reason people are losing their jobs.
In the current political push about fair trade instead of free trade by the Trump administration, many citizens are left in fear of increasing globalization and open economic markets.
Ji Young Choi spoke Friday about global trade and politics at the fifth of eight sessions of the Great Decisions community series on U.S. foreign policy. Choi is an associate professor of politics and government at Ohio Wesleyan University.
Choi emphasized that Free Trade Agreements (FTAs) are beneficial overall to the economy in the long run, but also pose some problems for the short-term. Competitive sectors, such as manufacturing, can enjoy more international trading and more options for employment, allowing consumers to have more diverse options for products and prices.
Innovations in technology and deregulation of trade agreements can also create a more competitive, foreign job market, which could be detrimental to a domestic economy.
Choi cited other factors that affect the shrinking and worrisome job market, mainly pointing to innovations in technology. As productivity in the manufacturing market has been increasing steadily, jobs in this market have declined significantly since the late 1970s. The process will be accelerated, said Choi, through developments in artificial intelligence, smart robots and self-driving cars.
Financial crises also have affected the job market. Since the late 1980s, there has been a process of financial deregulation due to the rise of new, liberal economic ideas, causing financial institutions and big corporations to engage in risky business activities in foreign markets.
After the Subprime Mortgage Crisis in 2007, many people lost their jobs, homes and even the financial sector suffered. Anti-globalization views have also emerged since the crisis. Ten years later, President Donald Trump is working on the deregulation of banks.
“When the economy picks up, you forget about the past and then deregulation starts again…it can create another financial crisis later on,” Choi said.
Choi supports more open markets, saying they have more opportunities for growth and, therefore, typically grow faster than closed markets. Choi suggested companies retrain their workers and provide compensation for such a rapidly changing job market.
“Back in the golden days of America…everybody pooled their resources together,” said Therese Spaulding, who attended the lecture. “Now, we have a president who’s spending, spending, spending with no plan of paying or any long-term program…To me, it’s an inevitable decline that we’re heading into.”
