The Great Trade War that didn’t happen in 2017

This again makes me wonder whether politics, an arena where many journalists feel the most comfort, is overrated in its ability to influence underlying economic currents. Call me an economic determinist; the world hasn’t ended despite geopolitical ructions left and right.

The trade war didn’t happen. Prepare for a few skirmishes.

It was high on many observers’ lists of things that could go badly wrong in 2017. Buying and selling of goods and services across borders not only increased this year but also grew more than anticipated. Next year may test whether that’s a durable trend or just an accident that flew in the face of politics.

Part of the thanks goes to a more vigorous global economic expansion. The resilience of the international system should also get its due: Supply chains that snake around the globe took decades to build up and aren’t just going to go away overnight because of a few tweets from you-know-who. Broad forces at work are bigger than one man.

This again makes me wonder whether politics, an arena where many journalists feel the most comfort, is overrated in its ability to influence underlying economic currents. Call me an economic determinist; the world hasn’t ended despite geopolitical ructions left and right.

That doesn’t mean there aren’t flashpoints that may become a very big deal if the economic and market environment shifts. And it doesn’t mean that the trade map isn’t being refigured.

Some quick words on the second point. The Japan-EU free trade pact, endorsed by leaders in July, aims to eliminate almost all tariffs between the two partners. Eleven nations left at the Trans-Pacific Partnership altar by Donald Trump are pressing ahead with their own version sans the U.S. Moves are afoot to tie the economies of Indochina and Myanmar more closely to China.

Globalization may be changing its complexion, but it isn’t dead. It’s a mistake to conflate giant multilateral trade deals, as we have come to understand them, with global trade. Major dealings can exist without those major deals.

Let’s get to NAFTA, a looming mini-crisis. It’s foreseeable that negotiations won’t get any momentum until Trump announces his intention to withdraw from the decades-old deal. Whoa! Hold on. Aren’t the parties renegotiating, not quitting? Didn’t the U.S., Canada and Mexico dodge a bullet when farm-state Republicans explained to Trump the damage that ending the accord would…

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