Kevin P. Gallagher

 

Kevin P. Gallagher is a professor of global development policy at Boston University’s Pardee School for Global Studies, where he co-directs the Global Economic Governance Initiative. His book, Ruling Capital: Emerging Markets and the Reregulation of Cross-Border Finance, has just been published by Cornell University Press. 

Recent Articles

The Trade Strategy We Need

Trump isn’t wrong to criticize the trading system. But his policies won’t fix it.

(Chinatopix via AP)
This article appears in the Fall 2018 issue of The American Prospect magazine. Subscribe here . Hardly a week goes by without another U.S. tariff hike on China, Mexico, Canada, or one of our European allies. Different justifications are given each time: to stop Mexicans from immigrating to the United States, to shrink the trade deficit, to make China and Germany play by the rules, and of course, to “make America great again.” But Trump’s tariff tantrum is doomed to fail because it isn’t driven by a clear idea of what is wrong with the system. His policies will inflict pain on the United States and across the global economy, and crack the foundations of the international system. Worse, they are not part of an underlying economic strategy to restore balanced and equitable growth in the U.S. and world economy. The one real bright spot is that Trump’s actions have revived an overdue debate about reform of the global trading system. Argument has been going on...

What Will Trump Deliver on Trade?

A new NAFTA could be an even bigger bonanza for business.

AP Photo/Eric Gay
President Trump appears to be serious about changing the terms of U.S. trade deals, having recently drawn up an executive order to withdraw from the North American Free Trade Agreement (NAFTA) to show that he means business about renegotiating the deal. But will President Trump change trade deals to make North American citizens and workers better off—or just business? NAFTA, which drastically cut tariffs and liberalized financial flows, but did not harmonize social standards, was sold to the American public as a deal where, according to the Peterson Institute for International Economics, “U.S. exports to Mexico will continue to outstrip Mexican exports to the United States,” where Mexico would finally “ export goods, not people ” and all parties would be better off. There is now a consensus that NAFTA was oversold. The U.S. has a glaring trade deficit with Mexico, NAFTA put downward pressure on wages and regulation for social welfare, accentuated job...

Saving Obama from a Bad Trade Deal

Republican intransigence may have saved the president's legacy—from himself.

(AP Photo/Evan Vucci, File)
Plans to rush fast-track authority for two trade deals for a quick House and Senate vote abruptly broke down on Tuesday. The White House was hoping to put the vote to Congress as early as this week. But Republicans wanted to see more details of one of the deals, which addresses trade with Pacific nations—before agreeing to a fast-track vote. Democrats who favored the deal were seeking some concessions to appease their skeptical colleagues. An aide to Senator Ron Wyden, the Democrats’ lead Senate negotiator, told Reuters : "Senator Wyden is looking for some good, eleventh hour concessions that he can get to demonstrate to Democrats that he has gotten the best deal possible.” Republicans, however, refused to deliver even window dressing. The vote is now off until April at the earliest. But April may be too close to the gravitational field of the 2016 elections, and the whole scheme could go down. The deadlock could be a huge blessing in disguise for the Obama...

Exporting Financial Instability

Obama’s Trans-Pacific Partnership agreement could set back the gains made by emerging and developing countries after the financial crisis.

(AP Photo/Vincent Thian)
The late Dr. Martin Luther King is praised for saying “injustice anywhere is a threat to justice everywhere.” Along the same lines, if we learned anything from the global financial crisis it is that financial instability anywhere is a threat to financial stability everywhere. The Obama administration appears not to have learned that lesson. The trade treaty agenda announced at the State of the Union address is an injustice that will rob our trading partners of the ability to prevent and mitigate a financial crisis. That could not only spell instability for our trading partners, but for the U.S. economy as well. At the State of the Union, Obama asked the Congress to grant him the authority to finish the Trans-Pacific Partnership (TPP)—a trade and investment treaty with a number of Pacific Rim countries including Peru, Chile, Mexico, Canada, Australia, New Zealand, Malaysia, Japan, and others. Given that the United States has trade treaties with the majority of those...

Not a Great Deal for Asia

The Trans-Pacific Partnership could end up hurting the broader economic interests of both the U.S. and smaller Asian nations.

(Flickr/images_of_money)
The Trans-Pacific Partnership is best understood as President Barack Obama’s extension of the Bush-era doctrine of “competitive liberalization.” Frustrated with pushback at the World Trade Organization by nations like China, Brazil, India, and South Africa, the United States seeks a coalition of the willing to import a commercial framework that rewards private firms at the expense of the common good. That policy regime is ailing in the U.S. and gets worse when exported. The Trans-Pacific Partnership (TPP) certainly isn’t about raising standards of living. The most ambitious estimates of the gains from the TPP suggest that participating nations will gain a mere one-tenth of 1 percent of the gross domestic product. Sixty percent of the projected gains go to Vietnam and the United States, and the other 20 percent goes to Malaysia—largely because the U.S. already has trade pacts with the other proposed big players in the TPP. However, the proposed deal is far...