Picketty call for total re-think on trade agreements to defeat Trumpism

April 30, 2018: Celebrated French economist Thomas Picketty’s response to the ‘shock’ of Trump’s trade policy, calling for all new trade agreements to address inequality and climate change, has been republished as Trump intensifies his trade war this week.

“Let it be said at once: Trump’s victory is primarily due to the explosion in economic and geographic inequality in the United States over several decades and the inability of successive governments to deal with this,” Picketty wrote in Le Monde in November 2016, then translated for The Guardian. He blamed both Clinton and Obama administrations for their expansion of market liberalisation.

“The main lesson for Europe and the world is clear: as a matter of urgency, globalization must be fundamentally re-oriented. The main challenges of our times are the rise in inequality and global warming. We must therefore implement international treaties enabling us to respond to these challenges and to promote a model for fair and sustainable development,” Picketty said.

The specific measures he called for in any trade agreement were common minimum rates of corporation tax and targets for carbon emissions which can be verified and sanctioned. He called for an end to Investor-State Disputes Settlement because the private tribunals involved opposed any intrusion on the strict profit goals of individual corporations. He noted that this meant a complete upheaval in the way Europe works, and specifically called for the Canada – EU Trade Agreement not to go ahead. (It is still not implemented.)

“It is time to change the political discourse on globalization: trade is a good thing, but fair and sustainable development also demands public services, infrastructure, health and education systems. In turn, these themselves demand fair taxation systems. If we fail to deliver these, Trumpism will prevail”, Picketty concluded.