Blowing up trade

Expanding the Trans-Pacific partnership may offer a way out of Donald Trump's global tariff war.

- Danyl McLauchlan

In 2013, the Serbian American economist Branko Milanovic published a graph that's come to be known as the elephant curve: it describes the distribution of income growth for different income groups across the world from 1988 to 2008 - the high-tide mark of global capitalism.

The curve shows significant gains for the rising middle-classes of developing nations - China, India, Vietnam, Malaysia, Poland - who comprise the elephant's back, signifying hundreds of millions of people rising out of poverty.

But the middleand lower-income workers of already wealthy democracies, notably Western Europe and the US, stagnated or declined, while the global elite - the richest 1% of those developed democracies - enjoyed astonishing gains and make up the proudly erect trunk at the far right of the wealth distribution.

The populist demagogues now flourishing in those nations accuse their economic and political elites of selling out their own voters to foreign interests and enriching themselves in the process - and it's hard to say they're wrong. Back in 2016, the left-wing documentary-maker Michael Moore warned that disenfranchised working voters saw Donald Trump as a human hand grenade they could use to intentionally blow up the system, taking vengeance on the leaders who neglected them.

To be fair to Trump, he promised to do exactly this: a suite of trade tariffs was his key policy promise in the 2024 presidential campaign and on “Liberation Day” he delivered.

REVIVING THE OLD DAYS