FACT:

1 in 25 of all humans ever have accessed the internet.

THE NUMBERS: 

All humans, ever:        ~117.0 billion*
All humans, 2022:             7.9 billion
Internet users, 2022:         5.3 billion

* Population Research Bureau estimate, 2021

WHAT THEY MEAN:

Posted three weeks ago, the “Declaration for the Future of the Internet” joins the Biden administration and 60 other governments in an attempt to define the principal challenges to the digital future and set a direction for policies to address them. A few bits of data first:

According to the International Telecommunications Union, 4.9 billion people around the world used the Internet last year. A less official update from WorldInternetStats.com this spring finds 5.3 billion. This is just over two-thirds of the world’s 7.9 billion people, up from 50% at the end of the Obama administration, and about 1% in faraway 2000. Put another way, demographers at the Population Research Bureau calculate the total human population since the origin of the human species about 300,000 years ago at 117 billion.  If this is about right, today’s Internet users make up one in 25 of all the men, women, and children who have ever lived. This year they will:

… transfer roughly 100 zettabytes of data around the world via fiber-optic cable and satellite beam. (A zettabyte is 1 sextillion bytes. The European Space Agency believes the universe contains somewhere between 100 sextillion and 1,000 sextillion stars.)

… conduct $26.7 trillion in electronic commerce, by UNCTAD’s 2022 estimate. (The International Monetary Fund believes global GDP this year is $103 trillion.)

… and spend 4.2 trillion hours on social media. (This sums to 479 million years, roughly the time elapsed since the “Cambrian Explosion.” Alternatively, the longest recorded single lifespan, that of Arles resident Jeanne Calment, 1873-1998, was 0.00000000012 trillion years.)

Another way to put these figures in context: at the birth of the Internet somewhere in the 1980s, a statistician might count a few million bytes of data transferred across early computer networks, about $0 in electronic commerce, and a few thousand academics and government officials berating each other on electronic bulletin-boards.

So, quite a remarkable first generation.

After appropriately noting this fact and recognizing the scientific and technical achievement that enabled it, the Declaration for the Future of the Internet focuses on (a) emerging policy challenges for the second generation, and (b) the values and goals that should inform a response to them. Top concerns include:  escalating use of digital technologies, in some cases by governments, for disinformation and cybercrime; spread of national firewalling and restriction of information, also by governments; fears among many users of loss of privacy and eroding ability to control personal data, whether to governments, unscrupulous businesses, or criminals; and abuse of online platforms to inflame conflict, undermine respect for human rights, and threaten groups vulnerable to prejudice and hate.

The Declaration offers no specific technical measures or agreements to address these concerns, nor new venues in which governments and/or “multistakeholder” fora should develop them. Instead, it sets out a long-term objective — “an environment that reinforces our democratic systems and promotes active participation of every citizen in democratic processes, secures and protects individuals’ privacy, maintains secure and reliable connectivity, resists efforts to splinter the global Internet, and promotes a free and competitive global economy” — and proposes five general principles to inform the actual policies that might deliver this:

1. “Protection of Human Rights and Fundamental Freedoms,” including combatting online violence and exploitation, reducing illegal content, and protecting freedom of expression.

2. “A Global Internet,” in which governments are discouraged from restricting access to lawful content, or shutting down access generally or to specific types of information, and encouraged to support free flows of data, cooperate in research and development, and act responsibly themselves.

3. “Inclusive and Affordable Access,” including through closing digital divides, encouraging diverse cultural and multilingual content, and supporting digital literacy and skills for publics.

4. “Trust in the Digital Ecosystem,” involving common responsibilities to combat cybercrime, protect personal data, use trustworthy technologies, avoid attacks on elections, support open trade and fair markets, and minimize digital contributions to climate change emissions.

5. “Multistakeholder governance,” to support technical advance and avoid undermining technical infrastructure.

FURTHER READING

Via the White House, the Declaration for the Future of the Internet.

A signers list from the State Department: 39 governments in Europe, five in the Pacific, three in Africa, one in the Middle East, and nine in the Western Hemisphere. (Some puzzling non-participants — Korea? Switzerland? Norway?)

And looking back: In the 50-million-internet-user world of 1997, the Clinton administration imagines policies for today’s digital global market.

BEA on the American digital economy in 2020 (with quiet side note to BEA, the dots are three places off to the right on page 4).

UNCTAD on global e-commerce.

The Internet Society’s attempt to document the actual “launch of the Internet” date. Authors settle on the January 1, 1983, transition of U.S.-based academic and government networks to an interoperable TCP/IP protocol:

Geneva-based CERN, on the other hand, looks to Berners-Lee’s 1989 WWW software, and the first web-site launch.
And some fun with 2022 Internet numbers
100 zettabytes – The European Space Agency calculates stars in the heavens.

1 in 25 humans: The Population Research Bureau counts all the people who have ever lived.

4.2 trillion person-hours of social media: Stephen Jay Gould’s Wonderful Life (1989); Gould’s theses on the Cambrian’s possibly wider variety of phyla are not in favor, but still the best ever user-friendly descriptions of Anomalocaris, Opabinia, and the weird world of the first big animals.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

Solar power installation in the U.S. is suddenly slowing down. 

THE NUMBERS: 

Solar power as share of U.S. electricity generation

2050:    22%*
2021:      4%
2010       1%

* “Annual Energy Outlook 2022”, Energy Information Administration, reference case, assuming no major change in policy or external environment.

WHAT THEY MEAN:

A cautionary tale, unfolding this spring in the American solar power industry, as hopes of “de-carbonization” in electricity begin to clash with an “industrial strategy” meant to promote photovoltaic manufacturing in part through reliance on tariffs, and a recently booming U.S. solar power-generation industry suddenly begins to fade.

“De-carbonization”:  One of the Biden administration’s top-tier climate policy goals is to use less coal and other greenhouse gas-producing hydrocarbons, and use more alternative energy sources, to generate electricity.  Solar power, a core element of this effort, provided about 4 percent of U.S. electricity in 2021, up from less than 1 percent a decade ago.  With a battery of tax incentives, government purchases, and other policy tools in place, U.S. homes, buildings, and utilities added 23.6 gigawatts of solar capacity – just under half of all new U.S. electricity generation – last year.  The Energy Department’s yearly “Annual Energy Outlook”, released in March, predicts that all else equal, the solar share of U.S. electricity will reach about 10% in 2030 and 22% – in practical terms, about 1,000 gigawatts of a total just above 5,000 gigawatts – by 2050.

“Industrial strategy”: Meanwhile, the administration also hopes to use U.S. government policy tools to help make the U.S. a large producer of (among many new products) the actual photovoltaic cells, modules, and panels that turn the sun’s light and heat into electricity.  Most of these are now made in and imported from Asia, where rapidly growing capacity has helped to drive down solar panel prices by about 90% over the past decade.  China makes about 70% of the world’s output, Southeast Asia 15%, and Korea 5%.  The U.S. is at about 3% of world production – a small fraction of world output, but not a trivial total, which translates to about 7.5 gigawatts of electricity, or about a third of annual U.S. solar power installation.  A series of trade law complaints from U.S. manufacturers over the past decade have tried to shift this balance through appeals for tariffs.  The outcomes have been equivocal to date; the newest such effort, however – an ‘anti-dumping’ case filed by a small California company – may be enough to set back actual American use of solar power for years.  To review –

(1)    The normal (“MFN”) tariff on photovoltaic cells, modules, and panels is zero.  Beginning in 2012 and 2014, “anti-dumping” and “countervailing duty” suits have imposed tariffs on Chinese-made photovoltaic cells and modules in a range (depending on the company) of 13.3% to 249.95%.  These laws are deliberately depoliticized, with litigation handled by civil servants, and currently oversee “orders” (i.e. tariffs) on 644 products (mostly steel) to offset respectively unfairly low pricing and subsidies defined by the intricate terms of the two laws’ 1994 revision.  Cabinet officers, presidents, and similar individuals have little ability to change these decisions.

(2)    As frequently happens with tariffs, however, the main effect of the 2012 and 2014 decisions seems to have been to shift buyers’ orders a bit south, particularly to Malaysia, Vietnam, Thailand, and most recently Cambodia.  A second suit led the Trump administration in 2018 to impose a complex four-year global “safeguard” tariff lasting for four years, beginning at 30% and scaling down to 15% in 2021, and applied when solar panel imports rose about 2.5 gigawatts.  Known as “Section 201” in trade-bar jargon, the safeguard contrasts with the anti-dumping and countervailing duty laws, as it allows Presidents to set a wide variety of import management or restrictions, or alternatively to decline any action on grounds of larger national interest.  The 2018 tariffs expired last February, and based on a recommendation from the International Trade Commission, the Biden administration decided (a) to extend the safeguard for four years, but (b) raised the duty-free level to 5 gigawatts – more or less the current level of cell and module imports – and eliminated tariffs on the “bifacial” panels especially popular with utilities.

(3?)    Most recently, in April the Commerce Department began investigating yet another anti-dumping suit, from a California company, alleging that the Vietnamese/Malaysian/Thai/Cambodian suppliers of panels are taking Chinese panels and reselling them.  This has opened the possibility of *retroactive* tariffs – in principle, as high as 250 percent, though as with the Chinese case potential outcomes likely would vary by source – as well as higher future costs.  This may be more than the recently strong U.S. market for solar power can absorb:  a survey by the Solar Energy Industry Association three weeks ago, for example, finds Association members delaying or scaling back 318 of their 596 current utility-scale projects out of concern over the costs and penalties this new antidumping case may bring  It has also led to a decision to extend the life of two Indiana coal-fired electricity plants for two years.

In general, then, a lesson in the limits and drawbacks of tariffs as industrial strategy tools; an illustration of the potential resulting clash of industrial strategy and decarbonization, as the cost of tariffs begins to overpower the tax incentives and purchasing policies meant to promote renewable energy; and a sudden question about hopes for rapid “de-carbonization” in electricity.  Not at all an outcome anyone would want; but one, depending on the next steps in this new case, in which the most damaging outcomes can still be averted.

FURTHER READING

The Energy Information Administration has energy data, trends, and projections in “Annual Energy Outlook 2022.”

National Economic Council Chair Brian Deese outlines a broad concept of industrial strategy, with climate change and clean energy as a core example.  A key paragraph:

“By enacting long-term, technology-neutral incentives to generate zero-carbon energy and innovation, we can lay the foundation for more American-made clean-energy technologies and bolster domestic supply chains.  We can partner with allies to expand our collective capacity to produce clean energy, while opening new export markets for American products. And we can do it in a way that lowers immediate costs for Americans, keeps our affordable-energy advantage, and accelerates growth in energy communities transitioning toward industries of the future.”

Full text.

The National Renewable Energy Laboratory has a primer on solar cell, panel and module manufacturing.

Also from the NREL, a very useful summary/timeline of the intricate web of production data, trade flows, and the now-intricate web of anti-dumping, countervailing duty, and safeguard tariffs on photovoltaic cells and modules.

Expert recommendation, December 2021:  The U.S. International Trade Commission’s 593-page report recommending extension of the 2018 ‘safeguard’ tariffs on solar panels, cells, and modules, with analysis and data on production and trade.

“If you’re not into the whole brevity thing”, February 2022:  The White House’s epically verbose announcement (“Proclamation of action to continue facilitating positive adjustment to competition of certain crystalline silicon photovoltaic cells, whether or not fully assembled into other products”) of extension of the safeguard tariffs.

A new suit, April 1, 2022:  the Commerce Department announces a new anti-dumping investigation.

And its impact, April 26, 2022 – The Solar Energy Industry Association surveys worried members, finds sudden pullbacks, delays, and interruptions of solar power projects.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

Ukraine economy to contract by 35% this year. 

THE NUMBERS: 

Average monthly cargo tonnage for Port of Odesa

Jan.-Dec. 2021:        1.9 million tons
March-April 2022:     0 tons

WHAT THEY MEAN:

From the Commerce Department’s Monday announcement, lifting Trump-era tariffs on Ukrainian steel:

“[T]he United States of America will be temporarily suspending 232* tariffs on Ukrainian steel for one year. Ukraine’s steel industry is uniquely important to the country’s economic strength, employing 1 in 13 Ukrainians with good-paying jobs. … Many of Ukraine’s steel mills have continued to pay, feed, and even shelter their employees over the course of fighting. Despite nearby fighting, some Ukrainian mills have even started producing again. Creating export opportunities for these mills is essential to their ability to continue employing their workers and maintaining one of Ukraine’s most important industries.

A look at the role of trade in Ukraine’s pre-war economy suggests that the Commerce Department’s hope to support Ukrainian exports (and the April decisions by the U.K. and European Union to lift all tariffs on Ukrainian goods) is well-founded. But it is probably incomplete, and the western governments need to be thinking about logistics as well.

By way of introduction, in October 2021, the International Monetary Fund’s semiannual “World Economic Outlook” projected a modest 3.5% growth rate for Ukraine. The April 2022 WEO made no guesses at any of these figures, except for a -35% drop in GDP. Such a contraction is one of the worst ever recorded: Compare, for example, the -10.5% decline in Greek GDP in 2011, and the -7.6% and -13.1% declines for Thailand and Indonesia in 1998, rightly remembered in these countries as national tragedies.

Export losses will likely account for a large part of this contraction. According to the World Trade Organization, exports accounted for 44% of Ukraine’s pre-invasion GDP. ($49 billion in goods exports + $15 billion in services exports, in a $152 billion economy.) This makes Ukraine, though a relatively small economy, roughly as export-reliant as Germany, Korea, or Mexico. The main products were $10 billion in iron and steel, $8.5 billion in corn and wheat, and $5 billion in sunflower oil, and the its main pre-war customers were the EU at 35% of all Ukrainian exports, followed by China at 15%, then Russia and Turkey at about 5% each.

About 75% of Ukraine’s exports gets to buyers through ten Black Sea ports; Odesa, the largest, handled 22.5 million tons of wheat, corn, iron, and other cargo last year. The vast majority of this trade is now blocked, even for grains already harvested or mills still producing metal. Deputy Infrastructure Minister Yurii Vaskov, speaking last week, reports that all ten are closed, either by Russian naval blockade (Odesa) or military occupation (Mariupol, Kherson), while the International Maritime Organization knows of 84 civilian cargo ships trapped in Ukrainian ports. The effects are showing up in U.S. trade data, which already show U.S. imports of Ukrainian steel down by about two-thirds, from 20,700 tons in January to 12,900 tons in February and 6,800 tons in March.

With this in the background, tariffs are always a consideration but not the primary issue. President Zelensky’s appeal yesterday for help in reopening the ports highlights the core problem; in the meantime, Ukraine’s government is trying to channel as many of its exports as possible through smaller Danube River ports, along with railways connecting to Poland, Slovakia, Hungary, and Romania. By Vaskov’s analysis, this accommodated 3.5 million tons of cargo in April — about a quarter of last year’s 12.5 million tons per month — and may be able to manage 5 million tons a month by fall. With this in the background, the tariff relief programs offered by the Biden Administration, the U.K., and the EU are useful as both practical and easy policy steps and as moral support, but need a complementary plan to help Ukraine find ways to move the actual metal and grain to their buyers.

* “232” referring to “Section 232” of U.S. trade law.

FURTHER READING

The WTO’s snapshot of Ukraine’s trade profile, 2021.

Vaskov of the Infrastructure Ministry on efforts to shift from Black Sea maritime export to rail and river.

U.S. Department of Agriculture on Ukraine’s role in world agriculture (No. 1 in sunflower oil production and exports, No. 4 for wheat exports, No. 5 for corn exports).

The International Maritime Organization’s latest update on cargo ships trapped in Black Sea ports: https://www.imo.org/en/MediaCentre/HotTopics/Pages/MaritimeSecurityandSafetyintheBlackSeaandSeaofAzov.aspx

Ukraine is a principal supplier of grains to Egypt, Indonesia, Bangladesh, Turkey, and other mid- and low-income countries. The UN World Food Program fears 76 million people will begin to go hungry if grain exports do not resume.

And a first-hand late April National Public Radio report from the Odesa Port.

Tariff announcements

The United Kingdom government announces removal of tariffs on Ukrainian goods.

The EU joins.

And Commerce Secretary Gina Raimondo this past Monday announces a year-long suspension of Trump-era steel tariffs.

And GDP figures in context

What does Ukraine’s wartime contraction of -35% mean? Some other points of comparison, drawn from the International Monetary Fund’s World Economic Outlook database (which covers the years 1980-2022):

1932: Great Depression contraction of -12.9% in the United States
1998: Great Recession contractions of -13.1% in Indonesia and -7.6% in Thailand;
2011: Greece’s -10.5% contraction in debt crisis;
2011: Libya’s -67% contraction in government collapse and conflict.  This appears to be the sharpest contraction in the database.
2015: Yemen’s -28% drop as civil war spreads country-wide;
2019: Venezuela’s -35% contraction 2019, as state oil company PDVESA defaults on bond obligations.
2021: Myanmar’s -17% drop after February coup d’etat

The current (April 2022) WEO database.

… and for comparison, the October 2021 edition.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

World count of child labor, 2020: 160 million boys and girls. 

THE NUMBERS: 

International Labor Organization estimates of child labor worldwide

2020        160.0 million
2016         151.6 million
2012         168.0 million
2008        215.2 million
2004        222.3 million
2000        245.5 million

WHAT THEY MEAN:

Every four years since 2001, the venerable International Labour Organization has published an estimate of child labor* numbers and rates around the world. The first edition, looking at the world of 2000, found 245.5 million of the world’s 1.53 billion children in child labor. The most recent, out in June 2021, reported 160 million child laborers in a slightly larger population of 1.67 billion children. That is, over 20 years the actual number of child laborers fell by 35%, and the share of the world’s children in child labor dropped from 16% percent to 9.6%.

The 2021 report, though, also found something surprising and distressing. Between 2016 and 2000 —for the first time in the series — the ILO’s count of working children rose.  The estimate for 2016 had been 151.6 million boys and girls in child labor; thus the 2020 report’s 160 million (a pre-COVID number) meant about 8.4 million more. Equally striking and perhaps even more discouraging, almost all of this rise in child labor was among younger children aged 5-12.

What has happened? Three closer looks at the 2020 findings suggest a pattern, and perhaps part of a response:

1. Child labor is mostly rural: The American mental image of child labor draws much from America’s 20th-century activism and legislative reforms: Progressive-Era photographs of wan children in coal mines and textile mills; factory-focused state laws and a temporarily successful  national law in the 1910s; the Fair Labor Standards Act drawn up by Frances Perkins’ Department of Labor in the 1930s. Child labor today, however, is mainly agricultural work. The ILO’s report finds 70% of child labor — about 112 million of the world’s 160 million working boys and girls — in rural areas, principally in small family-run farms and enterprises. Another 20%, or 32 million children, are in low-level urban services. “Industry,” which in ILO usage includes construction sites, mines, and factories, accounts for 10.3% or 16 million child workers, and a smaller 6% of child labor among young children aged 5-11.

2. Child labor is mostly family-based: 72% of child laborers are in “family work” as of 2020. This is a much higher share than the 63% the ILO reported for 2016. Employment of child labor in private companies, meanwhile, has dropped from 31.9% in 2016 to 17.3% in 2020.

3. Child labor is growing regionally concentrated: On close reading, the ILO’s 2021 data do not really show a worldwide upward turn, but regional trends that have begun to diverge. In Asia, in the Western Hemisphere, and in rich countries, child labor counts and rates continue to fall; taken together, the child labor count in these regions fell from 82.5 million in 2016 to 58.6 million in 2020.** Counts rose, however, in sub-Saharan Africa and also in the Middle East, and the ILO’s “Europe and Central Asia” region. In pure numbers, most of the growth came in sub-Saharan Africa, where the ILO’s count rose from 70 million in 2016 to 86.6 million — now more than half the world total — in 2020, and from 6.7 million to 10.7 million in the Middle East and Europe/Central Asia.

How might policies, both within countries and internationally, respond? African patterns of child labor mirror the world pattern, except more intensely: 82% of African child labor is in rural areas and in agriculture (with 5.3% in “industry”), and likewise 82% of African children involved work in family enterprises and farms rather than for companies or in itinerant “odd job” work. With this in the background, laws and enforcement programs along the lines of the 20th century U.S. experience are important. But the core challenge appears to be finding ways to ensure that parents have the financial ability and incentives to keep children in school.  Here Latin American experience may offer a model: In the 1990s and 2000s, Brazil and Mexico were able to drive down child labor rates more rapidly than development alone could do, by providing small stipends to families certifying their children were in school for regular hours.

* Covering children from the ages of 5 to 17. “Child labor” is defined as meaning any work for children aged 5 to 14, and work above 14 hours per week for children aged 15 to 17.

** Breaking this out by region, child labor in Asia has dropped from 113 million in 2008 to 70 million in 2016, and 49 million in 2020; in Latin America and the Caribbean, from 14 million to 10.5 million and 8.0 million; in high-income countries, from an estimated 2 million in 2016 to 1.6 million in 2020.)  From 2016 to 2020, child labor counts rose from 1.2 million to 2.4 million in Arab states, and from 5.5 million to 8.3 million in Europe and Central Asia.

FURTHER READING

The ILO’s June 2021 report on worldwide child labor counts and trends in 2020.

Policy

The Department of Labor’s International Labor Affairs Bureau looks at child labor rates and policy around the world.

… and Labor Secretary Martin Walsh outlines U.S. policy to the ILO’s 2021 conference on child labor.

The ILO on lessons from reducing child labor through education policies in low-income countries.

And the Inter-American Development Bank reviews Brazil’s “Bolsa Familia” program, credited with sharply reducing child labor and infant mortality rates in the 1990s and 2000s.

And the American experience

The National Archives reprints Lewis Hine’s classic photographs of child labor in early 20th-century American streets, mines, and factories.

BLS recounts the development of U.S. child labor law, from a Connecticut statute in 1913 through the Fair Labor Standards Act of 1938.

… and the Government Accountability Office, in 2018, looks at physical risks and child labor enforcement for America’s contemporary working children (including in legally permissible summer jobs, family farm work, and so forth as well as illegal “child labor”). In the 2010s, about 700 Labor Department investigations each year found child labor law violations. These were most common in “leisure and hospitality,” but that may reflect more frequent investigations in these industries, as opposed to higher rates of child labor.  GAO does not venture a guess at the scale of child labor in the U.S., but does conclude that “since 2011, data indicate that the number of children working is increasing.”

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

“Section 301” contribution to U.S. inflation rate; range of estimates: 0.3% to 1.3%?

THE NUMBERS: 

U.S. goods imports from China

Jan.-Feb. 2022        $90.1 billion
Jan.-Feb. 2018        $84.6 billion

WHAT THEY MEAN:

Reviewing her limited short-term options for easing inflation, Treasury Secretary Janet Yellen last week noted possible removal of Trump-era tariffs on Chinese goods. Three bits of background data on these tariffs, then some tentative conclusions:

1. Scale: Tariff System Roughly Doubled in Size: In 2017, the last full year before imposition of the administration’s “Section 232” and “Section 301” tariffs,* the U.S. tariff system brought in $32.9 billion in revenue on $2.34 trillion in imports. Dividing tariff revenue by import value, this yields a “trade-weighted” tariff average of 1.4%, though in a system (as PPI’s Ed Gresser noted in testimony last week) very unevenly weighted toward taxation of consumer goods and low-income families. By 2019, the administration had added to this system a battery of administratively imposed tariffs, including:  (a) “232” tariffs of 25% on steel and 10% on aluminum, valued in 2017 at about $50 billion; (b) “301” tariffs of 7.5%, 10%, and 25% on about $350 billion in Chinese goods, and (c) a few smaller decisions such as “201” or “safeguard” tariffs on washing machines and solar panels.

In 2021, all this brought in $85 billion on $2.83 trillion in imports, essentially doubling the overall U.S. tariff average to 2.9%. As of early 2022, the Biden administration has unwound some of the metals tariffs through agreements with the EU, Japan, and the U.K.; the tariffs on Chinese goods, though with some promise of a revived “exclusion” process for businesses especially damaged by extra tariff costs remain in place.

2. Effects on U.S. Imports from China Noticeable but Modest: China’s share of U.S. imports has dropped, but the actual value of imports from China is now above pre-tariff levels. More precisely, imports of Chinese-made and -assembled goods totaled $506 billion in 2017, or 21.6% of overall U.S. imports. The Chinese import total dropped temporarily after the 301 tariffs went into effect over the course of 2018 and early 2019, to $451 billion or 18.1% of a $2.493 trillion 2019 total. By 2021, though, they had rebounded to $505 billion — essentially equal to the figure for 2017, though this was a smaller share of a much expanded $2.83 trillion U.S. import total.**

3. Little if Any Effect on China’s Overall Exports: The larger “301” impact on China’s global trade seems very small. Statistics published by China’s Ministry of Commerce show Chinese worldwide exports at $2.42 trillion in pre-tariff 2017, then $2.66 trillion in 2018 and a slightly dented $2.64 trillion in 2019, followed by a post-COVID surge to $3.3 trillion in 2021. This suggests that any damage to China’s export economy was small and quickly healed.

4. U.S. Economy and Inflation: Finally, returning to the Treasury Secretary’s concerns and setting trade flows aside, tariffs are generally an unattractive form of taxation. This is because they not only directly raise the cost of imported goods as a sales or excise tax would, but in contrast to sales or excise taxes, they also enable rent-seeking price increases throughout the domestic economy. These neither increase supply nor move demand towards an equilibrium, and therefore have both growth-reducing and inflation-encouraging effects.

Taken as tax policy, the “232” tariffs on steel and aluminum raised metals-buyers’ tariff payments from $0.3 billion in 2017 to $3.2 billion in 2021, or by about $3 billion per year. The “301” tariffs are likewise focused on industrial inputs bought heavily by manufacturers and construction firms ($3 billion more on auto parts, $2.5 billion on electrical components, $1.1 billion on basic chemicals, and so on) and much more expensive. With Chinese import totals for 2017 and 2021 essentially identical, buyers paid $13.5 billion in tariffs in 2017, and $56.6 billion in 2021. Estimates of the 301 contribution to last year’s 7% spike in U.S. inflation range from 0.3% to 0.5% from higher import prices, to a more recent Peterson Institute estimate of 1.3% with domestic-price-raising effects included.

Hence Dr. Yellen’s interest. Her cautious comment on a potential decision to dial tariffs back: “There would be some desirable effects. It’s something we’re looking at.”

*  “232” and “301” stand for sections of U.S. trade law.  The 232 section enables Presidents to impose tariffs on ‘national security’ grounds; the 301 section enables them to impose tariffs as retaliation for overseas policies which impose a “significant burden on U.S. commerce”.

** On the other side of the trade-balance sheet, U.S. export trends to China followed a similar post-tariff-and-Chinese-retaliation track, dropping from $130 billion in 2017 to $106 billion in 2019, then rebounding to $151 billion in 2021.

***  Had China retained the 21.6% share imports it held in 2017, the 2021 total would have been around $600 billion.  (Assuming all else equal, of course.) Vietnam, whose exports to the U.S. jumped from $46 billion to $102 billion in these years, picked up about half of the missing $100 billion; secondary beneficiaries include India, Mexico, and a few other mid-income countries.

FURTHER READING

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

3 million industrial robots, 100,000 services robots, and 32 million domestic robots are at work worldwide.

THE NUMBERS: 

Operating robots, 2020*

3 million       ‘Industrial’
0.1 million     ‘Professional’ services
32 million     ‘Consumer’

* International Federation of Robotics, 11/21

WHAT THEY MEAN:

Karel Capek’s R.U.R., which introduced the word ‘robot’ to the world’s vocabulary 101 years ago, is a cautionary tale. In Act 1, enthusiastic human inventors and business promoters predict that robots will bring the end of scarcity, the abolition of degrading manual labor, and the opening of an age of universal “freedom from worry.” By Act 3, in a sense, they get their wish, but in a way that comes as an unpleasant surprise.

A century later, and two generations since the first industrial robot* went live, how close are we to either of Capek’s predictions?

World Robotics 2021, the annual survey from the International Federation of Robotics, counts 3 million working industrial robots, 109,000 “professional” services robots, and about 32 million blue-collar “consumer” robots at work around the world last year. By their counts, the heartlands of industrial robotics are in East Asia:

(a)    Japan is the largest robot-maker, producing 136,000 new robots in 2020.  This was over a third of the 384,500 new robots installed worldwide.

(b)    Korea is the world’s most roboticized industrial economy, with nearly 932 robots per every 10,000 factory workers, double the 400-to-10,000 ratio of a decade ago.  Singapore is a relatively close second at 605 robots per 10,000, with Japan third at 390.  Rounding out the top ten are Germany at 371, Sweden at 289, Hong Kong at 275, the U.S. at 255, Taiwan at 248, and China and Denmark at 246 each.

(c)    China is home to the world’s largest operating robot workforce.  Over 800,000 robots were working in Chinese factories at the end of 2019, and 168,400 more came online in 2020. IFR’s worldwide count of new robots was 384,50, meaning that China accounted for nearly half of all new robot installations.  Japan placed a distant second with 38,700 new robots and the U.S. was third at 30,800. By industry, the largest numbers of new robots in China and Korea go to electronics assembly and semiconductor production; in the United States and Germany, they are in the automotive industry; in Japan, automotive and electronics more or less equally.

IFR guesses that 2021 saw 435,000 new robot installations; the count is likely to top half a million for the first time in 2024, with nearly all the projected net growth in Asia.  Meanwhile, about 100,000 more complex services robots are at work (transport and logistics; cleaning; agriculture; hazardous waste disposal); and in homes, about 32 million vacuuming, gutter-cleaning, security, and other domestic robots are in fact at least diminishing the human quotient of manual labor. R,U.R.’s universal plenty and absence of worry (and their sinister hidden meanings) have yet to materialize.

* “Unimate,” at a General Motors auto plant in New Jersey, in 1961.

FURTHER READING

Global highlights from the International Federation of Robotics’ World Robotics 2021.

… or, downloads of highlights for industrial and services robots.

The New York-based Institute of Electrical and Electronics Engineers has a weekly new-robot video. Try the creepy burrowing robot.

… and also a sentimental look back at Unimate.

Industry and research international 

Most roboticized industry: The Korean Association of Robot Industry.

Largest producer: The Robotics Society of Japan.

A semiconductor manufacturing robot.

Singapore has a robot-police patrol dedicated to scolding people.

And from Germany a (slightly dated) video on the bleak human future — passive, outmoded future-man sits glumly in chair as mechanical “DynaMaid” mockingly inquires about his “day at work.”

A few looks ahead, and one look back, from robot arts & lit

Capek’s R.U.R. (1921) invented the word “robot,” and the classic “robot uprising” plot. The title acronym stands for a fictional “Rossum’s Universal Robots” company, and “Rossum” is a slightly modified version of the Czech word for “reason.”  A Penn State robotics academic looks at R.U.R. a century later.

In robot-friendly Japan, by contrast, Astro-Boy (said to be the first anime character) is a helpful friend to humanity.

Stanislaw Lem’s “Mortal Engines” collection speculates about machine intelligence. In “The Hunt,” a well-meaning human pilot volunteers to destroy a supposedly mad robot; next, in “Mask”, a troubled, self-aware female robot-assassin tracks down a political dissident.

Philip K. Dick thought humans and robots would lose the ability to distinguish themselves from one another.

And was Capek really the first? Adrienne Mayer’s “Golds and Robots: Myths, Machines, and Ancient Dreams of Technology” looks at androids, flying cars, computers, and other semi-inventions of classical Greece, with comparators from India, Babylon, and the mechanical men of the Qin Dynasty court.

Laugh while you can

The International Federation of Robotics publishes research papers as well as annual statistical reports. Their research-paper link features a standard human-chauvinist “Captcha” request form; to get one of the papers, you have to certify that “I’m not a robot.” Bad idea! The robots will find out, and they might be angry.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

Most globalized language: English

THE NUMBERS: 

Continents and regions contributing words to the English language: Africa, Asia, Australia, Europe, South America, North America, Arabia, South Pacific, Caribbean.

WHAT THEY MEAN:

Coca-cola, bubble gum, bikinis, digital media tycoons, hamburgers, frozen mocha, and blue jeans: Do we live in a boringly homogenized New-York-and-California-ish world?  Not really. These are not American or even “English” words, but (barring “bubble,” “digital media,” and “blue”) imports from baroque Europe, the Incan empire, the South Pacific, pre-colonial Africa, 19th-century German immigrant communities, Tokugawa Japan and classical Arabia:

• The trademark name Coca-Cola combines the Quechua word for the coca plant and the Malinke name for a West African nut once used to flavor the drink.
• Gum seems to be a survivor of the ancient Egyptian language, brought into English via Greek.  It bested a logical competitor — the Aztec word “tzictli” or “chicle,” referring to the actual gum base — which holds out mainly in the candy trademark “Chiclets.”
• Bikini is the name of the unfortunate coral atoll in the Marshall Islands used to test nuclear bombs in 1946. (“Coral” is Greek and “atoll” comes from Divehi, a language spoken in the Maldives Islands southwest of India.)
• Tycoon is the Japanese title — itself based on a Chinese phrase meaning “great prince” — of a high Edo-era official. Commodore Perry brought it back from Tokyo in the 1850s, and young White House staffers using it as a nickname for President Lincoln stuck it firmly in English.
• Hamburger, obvious north German origin.
• Mocha is the Yemeni port from which coffee (an Arabic word) was first exported in the 12th century.

What about blue jeans? The Academie Francaise resentfully accepts “blue-jean” as a “mot d’origine anglo-americaine” now permanently implanted in the French language.  Mais non! The term “jeans” is French, originally Marseille dockside slang for denim-wearing Italian sailors from Genoa (“genes” in French) and brought to English sometime in the 16th century. “Denim” is French, too, literally meaning fabric “from Nimes.”

FURTHER READING

The Academie Francaise on “blue jeans.”

Vogue/France has a better take, here.

The sad story of the original Bikini.

Al-Arabiya explains mocha.

Earlier: A quick trawl through some modern English-language vocab and their origins, yields small word-pictures of old civilizations and modern neighbors. Some examples:

Ancient Egyptian: gum, oasis, ibis, basalt, ebony, ivory, pharaoh
Japan then: haiku, samurai, zen, geisha, tycoon
Japan now: manga, anime, karoshi, salaryman, sushi, karaoke
Persia then: chess, apricot, magic, jasmine, julep, caravan, tambourine
Iran now: chador, ayatollah, fatwa
Aztecs: chili, chocolate, coyote, mescal, tomato, guacamole
Vikings: berserk, fjord, iceberg, reindeer, saga, ski, Viking, walrus
Malay: bamboo, gong, paddy, java, orangutan, amok, gecko, bantam

BBC’s “Vocabularist” notes that “pyramid” was originally a Greek word, meaning a kind of layer-pastry, like baklava. The actual Egyptians apparently called a pyramid a “mer.”

And two language/linguistics sources

How many words are there, actually? Some blathering and hand-waving from the Oxford English Dictionary editors, who term this good question “a distraction”:

“The question ‘How many words are there in the English language?’ cannot be answered by recourse to a dictionary.”

What?! They’re supposed to know! It’s their job! OED editors try to climb out of self-dug hole.

OED’s most recent update, for March 2022, has “nearly 700” newly classified words: first gentleman, burner phone, gender-critical, trigger warning, ydraw (died out in the 1400s), decarbonize, etc. A look at the March updates.

And how many languages? The Summer Institute of Linguistics, originally an evangelical group dedicated to Bible translations, lists 7,151 known languages around the world, from A-Pucikwar (sadly vanished, Andaman Islands, no known relationship to others, said to use only the numbers “one,” “two,” plus some variants of “more”) to Zuni (9,500 speakers, New Mexico) by country and language family.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

Every American earthworm north of the Mason-Dixon Line is an alien invader.

THE NUMBERS: 

Number of identified North American species:*     ~160,000
Number of “invasive species” in North America:        ~6,500

* Not counting nematodes, microorganisms, or flatworms.

WHAT THEY MEAN:

The gardener loves him/her*; the northern forestry manager fears him/her. A worried observation from the Minnesota Department of Natural Resources:

“All of the terrestrial earthworms in Minnesota are non-native, invasive species from Europe and Asia.  …  [A]t least seven species are invading our hardwood forests and causing the loss of tree seedlings, wildflowers, and ferns.”

A hundred native North American worm varieties happily navigate the red and black earth of the American south, and a few more cling on in the Pacific Northwest. In Canada, New England, Pennsylvania, and the upper Midwest, though, the last Ice Age froze off the local worms above a latitude roughly matching that of the Mason-Dixon Line.** The 15 or so worm species common in these parts now are all descendants of European worms brought in after the Mayflower landing. As such, they are “invasive species,” spreading north and west at a pace of about 50 feet per year, and forestry science views them as dangerous pests. Eating off the forest “duff layer” of dead leaves and organic matter as they go, the Euro-worms trigger a long and depressing chain of events: soil compaction, loss of small forest plants and tree seedlings, decline of native orchids and wildflowers, reduction of habitat for small animals, slower forest regeneration, increased vulnerability to pests, ultimately “a grave threat to the biodiversity and long-term stability of hardwood forest ecosystems.”

Dollying up and back for a robin’s-eye view of the matter, the 15 worms are one group of many invaders. Excluding microbes, flatworms and nematodes — not because they don’t matter, but they’re hard to count — North America is home to about 165,000 species of animals, fungi, and plants. Ignoring the traditional kingdom/phylum/order courtesies, they are arranged as follows:

Ignoring the traditional kingdom/phylum/order courtesies, they are arranged as follows: 90,000 insects; 45,000 fungi; 17,000 plants; 8,000 arachnids; 4,261 vertebrates (including 2,400 fish, 900 birds,442 mammals, 382 reptiles, and 261 amphibians); 1,600 crustaceans; 1,300 coelenterates (e.g. jellyfish, corals, and sea anemones), 755 mollusks, and 115 worms.

About 6,500 of these species by the U.S. Geological Survey’s estimate are newcomers, termed “invasive,” as they arrived after 1492. Celebrated examples include the Japanese kudzu vine in the Southeast, the Black Sea’s zebra mussel in the Great Lakes, the Southeast Asian snakehead fish in the Potomac and Chesapeake, the British starling everywhere but Canada, the Burmese pythons multiplying in the Everglades, the Argentine ants crawling up the California coast, and the very recent arrivals of “murder hornets” and Joro spider from Japan and Korea. Together they are said to cause roughly $20 billion in annual damage to the U.S. economy; the United States Geological Survey (USGS) believes that the “current annual environmental, economic, and health-related costs of invasive species exceed those of all other natural disasters combined.”

What, if anything, can be done about this? “Prevention” options are ideal, including laws banning deliberate introduction of alien species; inspection, sterilization, and quarantine rules at seaports and air terminals; and regulations requiring ships arriving from overseas to dump ballast water in mid-ocean and exchange it for sterile water as to prevent further introductions of shallow-water mollusks, worms, and crustaceans to new habitats.  Attempts to extirpate the invaders after arrival, though, are at best partial defenses and sometimes hopeless; the U.S. Geological Survey sadly says that “the odds of eradicating an introduced population of reptiles once it has spread across a large area are very low,” and the worms are another example, as they advance, a foot or two every month, further into the northern woods.

* Per the National Wildlife Federation, “Earthworms are hermaphrodites, meaning an individual worm has both male and female reproductive organs.”
** Drawn by two 18th-century surveyors, Charles Mason and Jerry Dixon, to mark Pennsylvania’s border with Maryland and West Virginia.

FURTHER READING

The U.S. Government invasive species gateway.

In Hawaii, 282 of 1,100 native species are threatened or endangered. Hawaii’s Invasive Species Council cam be found here.

A global invasive species database, including a list of the top 100 invasive-species threats worldwide.

For an international comparison, New Zealand’s quarantine system.

At sea: The International Maritime Bureau explains the International Ballast Convention, an agreement meant to prevent transcontinental movements of shallow-water clams, shrimp, mussels, fish, and other animals via ballast-water, which entered into force in 2017.

Damages: A French survey tries to estimate the cost of invasive species worldwide, reviewing 1,900 local estimates to arrive at a guess at $1.3 trillion worldwide since 1970; annual costs have steadily escalated to about $167 billion per year as of 2017. The most costly invasions are those of malarial mosquitoes, rats, cats, fire ants, and termites.

And some invaders, with estimated dates of entry

Spiders (2013): A University of Georgia release on the Joro spider, full of gleefully mock-reassuring innuendo (they are “relatively harmless to people,” and “their fangs are often not large enough to break human skin”).

Worms (~1600): Detail from the University of Minnesota on worms and the northern forest:

The non-native worms consume the duff (leaf litter) layer of forest floors as they eat their way across the continent’s forests from thousands of points of introduction, initially by European settlers and more recently by their use as live fishing bait. The worms alter the physical and chemical properties of soils, changing the pH, nutrient and water cycles, and disrupting symbiotic relationships between soil fungi and roots (mycorrhizas).  The earthworms also amplify the negative effects of droughts, warming climate, and deer grazing on native plants, [UMinn Research Associate Lee] Frelich said.  “Many native plant species, such as trillium and native orchids, cannot thrive under these changed circumstances.”  Conversely, the worms literally prepare the soil for non-native plants from Europe, which are co-evolved with the earthworms on their home continent, including buckthorn, garlic mustard, Japanese barberry [ed. – obviously not a ”European” plant, but still an invader], tatarian honeysuckle, and hedge nettle.

The U. of Minn. reports on earthworm risk and damage to northern forests.

Birds (1890): The starling was introduced by Gilded Age New Yorker Eugene Schieffelin, a pharmaceutical magnate and Bronx Zoo donor, who brought a flock of about 120 birds from England in 1890 as part of a scheme to introduce all of the 64 bird species found in the plays of William Shakespeare to Central Park.  Most of his skylarks, thrushes, and so forth died off.  Starlings thrived, to the detriment of local bluebirds and woodpeckers; Schieffelin’s original cageful has grown to 200 million across North America. Smithsonian Magazine explains here.

Snakes (1942 for the brown tree snake in Guam, ~1980 for the Burmese python in the Everglades): The brown tree snake, native to the Solomon Islands, was accidentally introduced to Guam during World War II, apparently in the wheel wells of military aircraft. Within fifty years it had wiped out 10 of Guam’s 13 native birds, 2 of its 3 mammals, and 6 of its 12 lizards. USGS comment:

The impacts of these introduced species, and particularly the brown Treesnake, are so severe that they have been compared to and found to have more lasting effects on the ecological diversity of an island ecosystem than did the naval bombardment and leveling of forests that occurred on Guam during World War II. 

Burmese pythons are a more recent migrant, first found in the Everglades in the mid-1980s, and now number “in the tens of thousands.” The U.S. Geological Survey notes that Florida is home to 53 invasive reptiles, and says “the odds of eradicating an introduced population of reptiles once it has spread across a large area are very low.”

The USGS on invasive reptiles.

A more optimistic take from National Geographic, as the pythons find a foe in the egg-eating native bobcat.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

By country count, the African Continental Free Trade Area (launched 2021) is the world’s largest FTA.

THE NUMBERS: 

African exports*, 2021 –

To world:                    $500 billion
To Asia:                       $158 billion
To western Europe:    $160 billion
Intra-African:                $88 billion
To U.S. & Canada         $30 billion

* International Monetary Fund, Direction of Trade Statistics 2021

WHAT THEY MEAN: 

Reflecting on the maritime past of East Africa and the Indian Ocean littoral in his Dhow Cultures of the Indian Ocean (2010), Tanzanian historian Abdul Sheriff offers an emotional appreciation of open societies and of trade as a way to share goods, ideas, and values across cultures:

“Commerce necessarily demands exchange of goods and ideas among peoples of different ecologies, cultures and religions … [T]he movement of people, the routes they follow, and the relationships they forge create unities in human history.  … Mercantile communities are necessarily open societies … [whose] cosmopolitan culture is made up of elements of diverse provenance, and while this does not automatically add up to a harmonious blend, it is remarkably tolerant toward other religions, cultures, and behaviors.”

The contemporary “African Continental Free Trade Area” (AfCFTA) is in concept an effort to create such a unity, and in practical terms an attempt to at least partially solve some persistent challenges to African growth and development: Why does so little trade go on within Africa, in comparison to Europe, Asia, or the Western Hemisphere? (South African think-tank TRALAC estimates that 17% of Africa’s trade is “intra-regional”, as opposed to over 60% for Europe and Asia, and about 46% for the Western Hemisphere.). And, relatedly, how can Africa reduce its reliance on exports of primary resources to Europe, Asia, and North America, and raise its ability to produce and sell manufactures, services, and farm products?

Launched in 2018 and signed in 2020, AfCFTA now applies in 41 of 55* countries in Africa, with a combined population of 1.1 billion. These figures make it the largest free trade agreement, by country membership in the world (assuming one doesn’t consider the 164-member WTO as such a group), and second to Asia’s Regional Comprehensive Economic Partnership as the largest by population. Its elimination of a planned-for/hoped-for 97% of tariffs on intra-African trade began a year ago; participants continue to talk about approaches to services, intellectual property rules, trade facilitation and “non-tariff barriers” such as customs transparency, technical standards notification, and other challenges that are often more costly than tariffs.

While many such questions remain open, an enthusiastic World Bank study projects an extra $450 billion in continental income by 2035, with 30 million people escaping poverty, Africa’s export trade shifting a bit away from energy and metal ores to manufactured goods, and African wages rising by about 10%. Side effects include raising U.S. exports to Africa by about $12 billion in manufacturing and $2 billion in agriculture (as African growth rates and incomes rise and allow for more imports), and $10 billion in services such as education, health, and logistics; rising competitiveness vis-à-vis other regions would push up African exports to the U.S. by about $16 billion.

Economic modeling and implementation challenges aside, AfCFTA is both a detailed program for Africa’s economic future and a remarkable commitment to swim against a bleak 2020s intellectual tide, in which visions of open societies are under great pressure, governments trust each other less than in the past, and publics perhaps more likely to believe that one country’s success may require another’s loss. As such it seems not only a visionary idea, but a good example for a world that needs one just now.

* State Department count is 54 countries, including 49 in sub-Saharan Africa and 5 in North Africa. The AfCFTA’s 55 include the disputed Western Sahara.

FURTHER READING

• The “sub-Saharan” continental economy has grown from $1.5 trillion to $2.1 trillion.
• Africa’s urban population has grown by about 80 million (from 392 million to 470 million), and will approach a billion in the next decade
• Africa’s internet-using population has likely doubled, from about 200 million to 400 million, accompanied by a six-fold increase in available bandwidth.

Tanzanian scholar Abdul Sheriff’s Dhow Cultures of the Indian Ocean on East Africa, Persia, India, and Indonesia in the global economy to 1500 (with cameos from the Roman Empire,“Star Raft” navigator Zheng He, and Portuguese explorer/buccaneer Vasco da Gama), with reflections on the nature of maritime and mercantile societies.

And Francois Xavier-Fauvelle’s The Golden Rhinoceros: Histories of the African Middle Ages has a series of snapshots — drawn from Nubian state correspondence, a coral house on Kenya’ Indian Ocean coast, a Saharan salt mine, an Arab account of the Malian court, the small gold statue of a rhinoceros from Great Zimbabwe — on long-ago government, trade and diplomacy in the Sahel, Ethiopia, and the East African coast.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

The U.S. tariff system is biased against poor families.

THE NUMBERS: 

U.S. MFN tariff rates:

On silver-plated forks:       0.0%

On stainless steel forks     15.8% + 0.9c each
values under 25 cents:

WHAT THEY MEAN: 

As Americans prepare 1040 forms and tax payments this week, some observations on the U.S.’ oldest and most regressive tax:

In principle, tariffs are simple. An American auto dealership pays the Customs Bureau the 2.5% tax on a German car and includes it in the sales price. But in practice, tariffs can be very complicated. Even setting aside the system’s many add-ons and holes,* the basic U.S. “Most Favored Nation” tariff schedule is a mini-tax code all to itself, arranged in 11,111 different “lines” from horses at the beginning (line 01012100) through salt, cars, butter, planes, powdered zinc, playing cards, computers and more, to antiques between 100 and 250 years old at the end (line 97069000), each with its own tax rate.

Information on this system’s operation is scarce. Congress appears to have held its most recent hearing on tariff policy in 1974. It has been even longer since the Treasury Department reported on the distributional and other economic effects of tariffs. And the only regular review of the tariff system’s impact on employment, production, and living standards — the U.S. International Trade Commission’s admirable if limited “Economic Effects of Significant Import Restraints” report — last came out in 2017.  But enough information is available to make three main points: (1) the tariff system is a small part of federal revenue; (2) it mainly taxes consumer necessities like clothes and shoes; and (3) it is, by far, the most regressive U.S. tax.  Some detail on each of these points, plus an additional fourth observation unrelated to taxation:

1. Tariffs provide about 2% of federal revenue. According to the Congressional Budget Office’s November estimates, the U.S. Treasury took in $4.06 trillion in Fiscal Year 2021 (i.e., Sept. 30, 2020 through Sept. 30, 2021). The Treasury used six major taxes to raise this money, topped by the $2.04 trillion income tax, the $1.31 trillion payroll tax, and the $0.37 trillion corporate tax. Tariffs placed fourth at $81 billion (for the Fiscal Year; the calendar year 2021 total was $85 billion), about equally divided between the administrative and provisional Trump-era tariffs on Chinese goods and metals, and the permanent “MFN” tariff system established by law. Rounding out the six taxes, excise taxes on fuels, alcohol, and tobacco placed fifth at $75 billion, and inheritance taxes sixth at $25 billion.

2. The U.S. tariff system is mainly a way to tax clothes, shoes, and a few other consumer necessities, and is therefore a “regressive” tax. The Trump-era tariffs hit manufacturers and construction firms hardest. (More on this in a few weeks.) The permanent tariff system is quite different, mainly taxing retailers and families by putting its highest rates on clothes, shoes, and a few other home goods such as silverware, plates and cups, and drinking glasses. Tariff rates on this set of goods average about 11.3%, roughly 16 times the 0.7% average for everything else. Thus in 2017, the last year before the Trump tariffs, these products accounted for about 6% of America’s goods imports ($144 billion of a $2.37 trillion total), but raised about 55% of tariff revenue ($17 billion of $33 billion). Any tax focused on clothes, shoes, and other home needs is “regressive” — that is, it hits low-income families harder than middle-class or rich families — since the poor must devote more of their income to these necessities.

3. Because consumer goods tariffs are high for cheap goods, and low for luxuries, they single out the poor to pay more. Worldwide, most tariff systems tax these goods more heavily than industrial products and natural resources. Thus the U.S. system is not unusual in being a regressive tax; but it is nearly alone in taxing cheap mass-market goods much more heavily than the exactly analogous luxury products bought by the wealthy. For example, Australian tariffs on shoes are almost all either 5% or zero, and do not set higher rates on cheap shoes than on expensive ones. American shoe tariffs by contrast are 8.5% for dress leathers, 20% for elite basketball and track shoes, and 48% for cheap sneakers imported at $3.00 and below. The fork example above is much the same:  buyers of sterling silver pay no tax at all, while buyers of cheap stainless steel pay about 20% (counting the 0.9 cent per fork flat fee as well as the 15% “ad valorem” tariff).

This skew is systematic, appearing in almost all tariffed consumer goods. A quick PPI table gives twelve typical examples:

Explanatory note: These home goods — clothes, shoes, home linens, luggage and handbags, jewelry, and tableware — account for a relatively small proportion of imports, totaling $123 billion in 2017, or 5% of the U.S.’ $2.3 trillion in merchandise imports. Nonetheless, these products account for $17 billion of the $32.4 billion in 2017 tariff revenue. Thus average tariff rates applied to these products are about 15%, 20 times higher the 0.8% average for other goods. About $25 billion worth of these products arrived duty-free under FTAs and trade preference programs, while $100 billion came under the MFN tariff s above.  

For the sake of simplicity, we have not included the actual tariff line numbers in the table above. They are available at the U.S. International Trade Commission’s tariff site. If you have a specific request, please email us. 

4. Tariffs do not appear effective as job or production protectors. Finally, though not a tax issue as such, the consumer goods tariffs appear not to have powerful effects on employment and production. For example, 98% of shoes are imported and no cheap sneakers have been made here since the 1970s; likewise 97% of clothes are imported, and most arrive under the normal tariff system rather than FTAs or preferences. Silverware is made in the United States, but in the high-priced luxury low-tariff category rather than the cheap high-tariff category.

Perhaps we can do better, and treat low-income Americans more fairly, than this.

* Add-ons: anti-dumping and countervailing duty penalties on particular goods, Trump-era “301” and “232” tariffs on metals and Chinese goods. Holes:  waivers of tariffs for particular countries through FTAs and preferences.

FURTHER READING

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

“Trade” is generally popular among Americans. 

THE NUMBERS: 

Gallup 2022 poll: International trade “is an opportunity for growth through exports”*

All respondents                    61%
Self-declared Democrats     72%

*The alternative, international trade is more “a threat to the economy through foreign imports,” gets 35% support among the general public; Gallup’s writeup does not cite Democratic support for this proposition.

WHAT THEY MEAN:

Gallup’s February trade poll asks, for the 22nd time since 1992, whether we are more inclined to see “exports as an opportunity for growth” or “foreign” imports as a “threat to the economy.” Lamentably off on the economics! But faced with this choice, 61% of respondents choose “opportunity” and 35% “threat.” This result is on the “optimistic” side of the poll’s average, which over the full 30 years comes out at 53%-33%. Its partisan filter, meanwhile, finds self-identified Democrats more “pro-trade” than average at 72%; Republicans are for now more pessimistic, with 44% choosing “opportunity” and 52% “threat.” Independents, at 65% “opportunity,” are closer to the Democratic view.

The second very recent trade poll, released last November by the Chicago Council for Global Affairs, asks about two specific trade agreements — the Comprehensive and Progressive Trans-Pacific Partnership (previously the more concise TPP), and U.S.-Mexico-Canada Agreement (before its renegotiation, the North American Free Trade Agreement) and whether in general “globalization” and “international trade” are good for the United States. Though the questions are different, the Council’s results are similar to Gallup’s: an overall positive view, with a noticeable partisan divergence.  Asked about a hypothetical decision by the U.S. to rejoin the CPTPP, 62% of Council respondents favored the idea while 33% opposed. Among Democrats, the split was a decisive 75% yes and 19% no; Republicans were also positive but less emphatic, at 50%-38%. Likewise, asked whether “international trade” is good for the U.S. economy in general, 86% of Democrats concurred as against 66% of Republicans; and asked whether trade is good for “creating jobs,” 68% of Democrats and 51% of Republicans agreed.

Both results are pretty typical of the last decade’s trade polling, showing a generally positive public view of trade but with Democrats more enthusiastic. A trawl back through earlier Gallup and Chicago Council polls, along with more by Pew Research, NBC/Wall Street Journal, Monmouth and others, finds at least three different demographic axes of divergence, suggesting that the partisan gap has a stronger foundation than simple reactions to a current administration:

1. Youth and Age: Young people generally seem more positive about trade than their elders.  As an example, Pew’s 2018 poll found 18-29-year-olds most likely to agree in a general sense that “trade is good” (84%), and also most likely to agree that trade creates jobs, lowers prices, and raises wages.

2. Race and Ethnicity: Monmouth University asked in 2019 (during the Trump administration’s burst of tariffing) whether “tariffs on products imported from our trading partners” would help or harm the U.S. economy. This poll divides the public a little simply, contrasting the views of non-Hispanic whites with those of all other races and ethnicities combined.  It found non-Hispanic white Americans tilting against tariffs (28% help the U.S. economy, 41% harm); among Hispanic, Asian Americans, and African Americans, by contrast, the split was a decisive 19% “help” and 57% “harm.”

3. Education: The same Monmouth poll, found differences on tariffs to be modest among the public as a whole, but with less-educated white Americans noticeably less likely than other demographics to see tariffs as harmful to the economy.  Among all Americans with college degrees, 23% predicted that tariffs would help the economy while 56% predicted harm; for all those without degrees, the split was a similar though less emphatic 25% “help” and 43% “harm”.  Among non-Hispanic white Americans, specifically though, views diverged sharply by education level:  respondents with college degrees viewed tariffs as likely to harm the economy by 54%-23%, while respondents without degrees split nearly evenly, at 31% “help” and 35% “harm.”

FURTHER READING

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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FACT:

America’s “non-MFN” tariffs on natural resources are usually low.

THE NUMBERS: 

Tariff rates on two Russian imports

Palladium, “MFN”:           0%
Palladium, “Column 2”:    0%

King crab, “MFN”:            0%
King crab, “Column 2”:     0%

WHAT THEY MEAN:

The Biden administration’s ban on Russian oil, coal, and gas is a large though not total trade sanction, cutting off about 60% of American imports of Russian goods. (Last year’s import total was $26 billion; energy made up $16 billion.) Congress, meanwhile, is considering a bill to revoke Russia’s “Most Favored Nation” tariff status. Some observations on this more complex measure:

Fundamentally, it means the tariff rates a country applies generally — as an example, the U.S.’ 6.5% “MFN” tariff on umbrellas (tariff line 66019100) applies to European umbrellas, Chinese umbrellas, Brazilian umbrellas, etc. (Following the late Senator Daniel Moynihan’s noble but forlorn hope to make trade policy terms of art more comprehensible, the U.S. also uses the term “permanent Normal Trade Relations or “NTR” to mean the same thing, but others don’t.) MFN tariffs are also a core feature of relationships among WTO members, as membership entails accepting a “non-discrimination” obligation requiring them to give one another equal tariff rates.

What then does “revoking” MFN status mean? In practice, should Congress pass such a law, buyers of Russian goods would no longer pay the current U.S. tariff rate. Instead they would pay the rates created in the 1930 “Smoot-Hawley” Tariff Act during the Hoover presidency.  These rates are now listed in “Column 2” of the U.S. Harmonized Tariff Schedule; as an example, an umbrella gets a 40% Column 2 tariff. More broadly, standard estimates of Smoot-Hawley average tariffs are (a) about 20% overall, based on dividing tariff revenue by import value, as opposed to 2.8% in 2021 (or 1.4% excluding the Trump-era tariffs on Chinese goods and metals) or (b) an even higher average of 59% excluding duty-free goods.

As the averages and the umbrella example both suggest, non-MFN tariffs are generally seen as quite punitive, and often are so in reality. However, they are much less punitive in the specific Russian case.  This is because Russia is mainly a natural-resource exporter, and Column 2 tariffs on natural resources are actually rarely high and often zero. In 1930, both Congress and Mr. Hoover wanted very high tariffs on manufactured goods and farm products, but avoided them on raw materials to keep costs low for U.S. factories. These sorts of things — energy, specialty metals, chemical inputs for fertilizer — make up most of America’s 21st-century purchases from Russia. A look at MFN and “Column 2” rates on the U.S.’ top 25 Russian imports last year (accounting for $22 billion of a $26 billion total) yields this result:

1. Energy ($16 billion): Eight crude and refined oil, gas, and coal products made up about 60% of all U.S. imports from Russia last year.  The Column 2 tariff on crude oil is 21 cents per barrel —twice the “MFN” 10.5 cents per barrel, but still insignificant.  So revoking MFN tariffs on energy would be unlikely to change trade flows at all, since the increases basically raise rates from about 0.1% to about 0.2%.  If the goal is to impose economic costs, yesterday’s ban will do a lot more.

2. Four specialty metals ($2.1 billion): palladium, rhodium, uranium, and silver in bullion form. Here, revoking MFN changes nothing, as U.S. tariffs are zero on these things at MFN, and also zero in Column 2.

3. Five natural resources and basic chemical products (also $2.1 billion): Diamonds are zero at MFN, and 10.5% in Column 2; likely some impact, but not a huge one.  The others — king crab, potassium chloride, urea, and urea/ammonium mixture (the latter two used as fertilizer precursors) — are all zero tariff now and also zero in Column 2.

4. Four industrial metals ($2.5 billion): The largest is pig iron at $1.2 billion, for which rates rise from zero to $1.11 per ton.  This was probably a lot in 1930, but is about 0.2% — not significant — at the 2022 market price of about $500 per ton. Increases are higher for the other three:  zero to 10.5% for unwrought aluminum alloy, zero to 11.5% for ferrosilicon, and zero to 30% for ferrosilicon.

5. Four value-added manufactured products ($1.5 billion): Here, a shift to Column 2 means a steep tariff increase.  For birch-faced plywood, tariffs rise from zero to 30%; for bullets and cartridge shells, zero to 50%; for semi-finished steel products, zero to 20%; and for reaction engines, zero to 35%.

Altogether, then, revoking MFN status for Russia imposes some penalties, but in most cases not very significant ones given Russia’s unusual export pattern.  It may nonetheless be an appropriate symbolic and moral gesture, in particular if many WTO members join in it.  But as a policy measure meant specifically to impose economic cost, the energy import ban is the one with practical real-world impact.

FURTHER READING

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

Read the full email and sign up for the Trade Fact of the Week

FACT:

The only previous attempt to erase a U.N. member country from the map: 1990.

THE NUMBERS: 

U.N. member states as of February 2022: 193

WHAT THEY MEAN: 

From the transcript of Ukrainian Ambassador Sergei Kyslytsya’s remarks to the U.N. Security Council a week ago Tuesday:

“The internationally recognized borders of Ukraine have been and will remain unchangeable.  Ukraine unequivocally qualifies the recent actions by the Russian Federation as violation of sovereignty and territorial integrity of Ukraine. … President Putin, who has taken a decision that we discuss today as a threat to the rules-based order, to the U.N. Charter, in particular its Article 2, as well as to international peace and security.”

Particularly relevant in the Ambassador’s reference to the U.N. Charter is Article 2’s Clause 3, on wars of conquest: “All Members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any state, or in any other manner inconsistent with the Purposes of the United Nations.”

Obviously, the actual U.N. members have frequently fallen short of the Charter’s aspirations over the 78 years since its signature. In the last decade especially, after a long period of peace among great powers, even close allies found it difficult to sustain a sense of common interest.  But however far governments have fallen short of the Charter’s goals, they have almost invariably respected its ban on wars of conquest. Only once before last week’s attack on Ukraine (in Saddam Hussein’s 1990 attempt to annex Kuwait to Iraq) has one U.N. member state attempted to erase another from the map. Three thoughts on the events since:

(1)    Respect for the ban on wars of conquest is at the foundation of any international aspiration, whether related to peaceful settlement of disputes among countries, scientific and medical progress, common action against environmental threats, prosperity and reduction of poverty, or reduction of the risk of war.

(2)    The breach of this principle in the attack on Ukraine last week is very rare in modern history and exceptionally dangerous, in that it was ordered not by the rogue dictator of an isolated minor power but by a permanent member of the U.N. Security Council.  Should it succeed, we may well expect more such events and a much more dangerous world.  Should it fail, the taboo on wars of conquest will be greatly strengthened, and future attempts far less likely.

(3)    The Biden administration and partner democracies have responded with a model of muscular, calm, and principled cooperation, first in attempting to dissuade the Russian government from attacking Ukraine, and then in their coordinated response, combining extensive financial and other sanctions with practical and moral support for Ukraine.  The contrast between this response and the self-pitying folly of “America First” movements — in the 1940s or the 2020s — is stark, reminding us that isolationism makes the world more dangerous and ultimately Americans themselves less safe; and that when defense of international order and the principles Ambassador Kyslytsya cites prove necessary, the world’s democracies have many and powerful options.