@bgrinter

George Lucas famously said that crises usually start with trade disputes.

The older I get, the more I understand how much wisdom he had in his naïve stories.

@iju @bgrinter

I knew someone who worked for the WTO, and he said he used The Phantom Menace to explain to students how trade wars lead to real wars.

My Mastodon bubble consensus is that the WTO is here to support oligarchic globalism, but its employees apparently think they’re there to prevent war!

@Akshay @bgrinter

WTO probably does keep the current regimes happy and thus helps avoid wars by creating environments where they don't have to resort to violence.

There's also a concessus that at the same time it entrenches global north and south by making labour harder to unionize (eg. global capital, local workforce).

It also leads to overspecialisation, which in turn leads to rising Gini, and thus more have-nots even in the North.

(I'm qualified to talk of this stuff to undergraduates.)

@iju
In that light, it would seem that breaking economic ties by increasing tarrifs for trade with partners and competitors does two things:

1: Satisfy Trump's ego because hurting people makes you feel strong (and look strong to his target audience)

2: Change the economic and political situation to make wars of aggression cheaper because part of the economic cost has already been paid when he strangled trade, and everyone is already at each other's throats economically.

@Akshay @bgrinter

@iju,
apart from *not doing whatever Trump does", what do you think would reduce/prevent negative effects of the current WTO rules, of entrenching northern countries as the rich and driving up inequality everywhere?

Mutual economic dependence sounds good, but there'd have to be something to prevent people, countries, companies from leveraging power imbalances to their advantage and others' detriment... what could that be, and who could impose it?

@Akshay @bgrinter

@Mr_Teatime @Akshay @bgrinter

Generally speaking, WTO rules are meant to solidify power imbalances as they existed in the early 1990s. You can't really do anything on those within WTO rule-set without forcing a break-up by either introducing an alternative framework that would aid a critical number of countries (in the past poor countries were robed into WTO by using colonial-era dependencies), or by Trump being an idiot.

½

@Mr_Teatime @Akshay @bgrinter

2/3

As for your other point, you're assuming that the tragedy of commons would apply. That is to say, that players (both countries, international companies, and smaller entities) wouldn't have a vested interest to make rules, both written and unspoken, as their lack is the largest hinderance of trade (creating needs for all-sort of costly insurances).

If something were to unbalance this, it's a proof that the politics weren't in line with the practices.

2/3

@Mr_Teatime @Akshay @bgrinter

3/3

For example, the Black Wednesday in 1992 happened partly due to forcing UK to ERM from political reasons with expectation that the economic reasons would follow suit (instead of changing economic reasons to suit political needs; this can work).

Once the faultly built foundation started to creak, the UK govt made the additional mistake of spending money to save face, without understanding that such political actions don't have enough power.