The Benefits of the Trans-Pacific Partnership Agreement and Why the Presidential Candidates are Wrong About It

As the US Presidential primary election season is in full swing, leading candidates including Donald Trump, Ted Cruz, Bernie Sanders, and Hillary Clinton have their conflicting options with the agreement. Far left wing candidate Bernie Sanders and right wing candidates Donald Trump and Ted Cruz have similar view’s that the United States should move to become more protectionist and be involved in less trade. Hillary Clinton, who as Secretary of State believed the TPP would be the “Gold Standard” for trade agreements, has since changed her view due to the structure of the deal. Opposing the TPP agreement for either reason is a mistake due to the global economic benefits.

Is It Possible Donald Trump Was Right About China and the TPP?


Trade agreements such as the TPP eliminate tariffs and other trade barriers. The TPP also enforces patents, labor and environmental standards, copyrights, and other legal protections. Trade agreements give the governments of participating countries more control on how trade is conducted.

Vermont Senator Bernie Sanders argues that the TPP agreement will benefit the organizations he is targeting to break up, Wall Street banks and large multi-national corporations. The Senator has fought the agreement in the US Senate and believes it will cost US jobs and hurt consumers.

“Wall Street and other big corporations have won again…I will do all that I can to defeat this agreement” in Congress.” –Senator Bernie Sanders

Texas Senator Ted Cruz is strongly against the TPP agreement because he feels it will take jobs away from working-class Americans. Cruz and Trump’s stance on TPP separate themselves from the greater pro-business Republicans.

Research by Professor Peter Petri of Brandeis University and Michael Plummer of John Hopkins University suggests TPP is expected to increase real incomes in the United States by $131 billion (0.5% of GDP) and boost exports by $357 billion (9% of exports) by 2030. In absolute terms, the United States will be the largest beneficiary of the TPP agreement along with substantial economic gains by Japan, Malaysia, and Vietnam. Although the agreement is not projected to lower unemployment levels, it will raise US wages.



The candidates who believe less trade will allow US job growth are not totally accurate. The jobs lost to firms abroad are replaced by higher paying jobs in different industries. The net effect of higher wages and cheaper goods leads to consumers being better off.

Another argument against TPP is the case of opening trade with China and its effect on the US economy. The United States has lost jobs due to the lack of available positions in higher paying industries resulting in a shrinking middle class. The effects were largely a result of China’s large size and rapid entry into the global economy. The TPP agreement will not have the same effect due to the developed trading partners involved and the ease of installment. As a result, the TPP agreement will add long term value to the participating countries.

In the long term, countries open to trade thrive and countries which restrict trade experience a stagnant economy. Countries open to trade allow their economies to advance and experience long run economic growth. Overtime, workers adapt and learn new ways to become competitive in the global economy. Limiting trade in such a way as the presidential candidates are proposing is a threat to the United States’ long term growth and will damage the wealth of workers and consumers. The TPP agreement will allow the United States to keep up with the changing global economy and allow the longer term competitiveness of American workers.

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