Fred Smith delivers TPP eulogy on Fox Business
FedEx founder and CEO Fred Smith went on Fox Business yesterday to counter the White House’s negative narrative on the already moribund Trans-Pacific Partnership (TPP), and also presented evidence for the positive role of free trade in the U.S. economy. “Trade is what made America great,” Smith told Fox Business Network’s Maria Bartiromo. “About 40 million Americans, including FedEx folks, make their jobs in trade.”
Smith explained that more than 27 percent of U.S. economic activity is directly related to trade, 95 percent of global consumers are outside of the country and 80 percent of the purchasing power is found across the border. So, while populist rhetoric might win elections, Smith took the opportunity to stress the economic implications of President Trump’s policies.
“The United States being cut off from trade would be like trying to breath without oxygen,” Smith said. “The decision to pull out of TPP is unfortunate, because the main beneficiary of that is China.
A core component of the scuttled TPP was an institutionalization of trade and intellectual property (IP) practices and laws in line with U.S. standards. The passing of the deal would have created a market that favored firms adopting U.S. standards over incipient Chinese firms. The inverse is not the case.
With the deal belly up, China is already negotiating its own massive regional deal, which lacks many of the IP requirements that protect the property of U.S. firms in the region. Smith noted that China has been mercantilist and uses advanced industrial policies that disadvantage American workers. However, with the TPP now dead, Smith echoed the warnings of other regional experts – it will be harder to hold China accountable moving forward.
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