At RealClearEnergy Pınar Çebi Wilber makes an argument that I’m sure will ring true for many Americans:
The ISDS should be a keystone of a modernized NAFTA. It can help to safeguard U.S. investments in Canada and Mexico, create neutral and transparent venues for settling trade disputes, and pave the way for the free and open trade that President Trump continues to advocate. If the president truly wants to strike a good deal in favor of the U.S. — and if he wants Congress and the business community on board with a modernized NAFTA — he should ensure that ISDS keeps working to the benefit of American investors.
That’s the ticket. Don’t protect U. S. jobs. Protect American DFI in Canada and Mexico to protect Canadian and Mexican jobs. I’m sure that’s an argument that will resonate with most Americans.
Just as a small hint, if investors assumed they bore no risk, that’s on them. I feel no need to indemnify them against the consequences of their folly.
It may not matter to most, but ISDS is intended specifically to break the invisible hand of which Adam Smith wrote. He argued that the risks of overseas investment would compel the wealthy merchant to invest domestically, thereby benefiting the home country regardless of the merchant’s intent.
Making investment safe means no invisible hand.
Maybe I wasn’t clear enough about it. That was basically my point. I thought that post was about as loopy as it gets. There are lots of legitimate reasons for reform but making the world safer for investors is not one of them.
ISDS is a controversial topic in Canada There is a strong view that it impairs the sovereign rights of government to take action for public health, environmental or other public good reasons.
This goes to a bigger picture question. What should American trade negotiators be seeking? It’s not that these negotiators got cleaned, they are merely following the objectives laid out by Congress and the President — it just happens the goals seem to be focused on securing American foreign FDI, IP over trade balance or American jobs.
It’s easier to answer what they shouldn’t be seeking. IMO the pursuit of intellectual property rights is a losing proposition for most of us unless we end trade with other countries completely. That’s pretty drastic. Why is that? Because in much of the world “intellectual property” is a meaningless noise. You can negotiate anything you want to but it will never get enforced. Negotiators shouldn’t be seeking private gain for a relative handful of Americans. Ideally, they should be trying to maximize the benefit for the greatest number of Americans.
“Just as a small hint, if investors assumed they bore no risk, that’s on them. I feel no need to indemnify them against the consequences of their folly.”
And yet you seem to hold no such standard for borrowers.
The article isn’t about indemnifying borrowers against the folly of their own actions. I don’t think that either borrowers or lenders should be indemnified. It’s a risk. They both need to view it as a risk.
Maybe it’s the circles that I run in but the calls I see for indemnifying borrowers against their own folly are outnumbered by the calls for indemnifying lenders about 1:10.
Let’s open this discussion up to the floor. Anybody heard any calls for a debt holiday lately?