Donald Trump's election will provide a great many challenges, including a threat to the environment. The greatest threat will, however, be to free trade and so the prosperity and wellbeing of the whole world.
That might sound a bit dramatic, and I am trying not to be political here. The fact is that specialization and trade are the basis of all the gains we have made in the standard of living and anything that restrict that makes us worse off. This is a lesson known for many years and most persuasively put by Smith and Ricardo and refined by J.S. Mill and all economists working in the field since.
There are costs of free trade. The one that is presently causing people like Donald Trump to get elected is that some industries decline due to trade. For one place to specialize in a good or service others cannot. This means some people lose their jobs in industries which are uncompetitive. People so affected tend to be pretty unhappy about it.
Economists point out that while some industries decline, others grow and so resources in a country transfer from one industry to another. The result is improved efficiency in the allocation of resources and a higher standard of living for everyone. The costs of adjustment are temporary.
It's a difficult sell, but until now we have relied on the education, good sense and long term vision of those in government to do no more than slow transition and cushion the blow for those affected. Now we have people being elected who are happy to pander to those who shout loudly, but don't have the necessary perspective. Make no mistake if the free trade arrangements we have worked so hard to build over more than one hundred years are unwound we will all suffer.
There are many articles out there on this issue right now. Below is the Guardian's.
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