President Obama and the Republicans have finally agreed on something: the Trans-Pacific Partnership. The TPP, as it's come to be known, is a mammoth proposition, one that would build new trade bridges among the U.S., Japan, Mexico, Singapore, Vietnam, and more than a half-dozen other nations. Yet despite this surprising agreement between the President and the GOP, there are still plenty of people on both sides of the Pacific who want to give the deal a thumbs down.
To win over naysayers, proponents of the TPP tout that it will lower tariffs, create jobs, and boost output. But few believe this anymore as is clear from the dismal failure of trade talks the last decade or so. The seven rounds of Trade Agreements under the GATT, from post WW II to the early nineties has come to a halt, and even regional agreements are cast in doubt these days.
So, to gain agreement, Mssrs. Obama, Abe, and others need to do more to gain support for the TPP. They need to find one "issue" with profound consequence for all nations involved, one that everyone must get right to prosper in the 21st century. One that will drive incentives to say yes and overcome the gloom and doom that has become the stuff of trade talks these days.
Though it may seem an odd match for a trade agreement, the solution is the aging of the population. For all twelve nations wrapped up in the deal, it is essential to craft new strategies and policies for thriving economically in an era when the "old" will outnumber the "young." If free trade and investment is to be understood as an engine of growth, as was the case from the days of president Kennedy to Clinton, today's leaders must infuse the agreement with an organizing principle that is at the basis of 21st century economic growth that is meaningful to parties.
Precedent suggests why it can work. In the history of trade negotiations, discussions have moved from the traditional goals of reducing tariffs to improving conditions inside society in order to attract foreign investment and become platforms for economic growth. In the historic WTO negotiations, the dialogue evolved from beyond tariffs to include labor standards, environmental standards, intellectual property, and more.
Each of these issues transcends any one nation's needs and unites them on a common goal. Indeed, population aging could be exactly the unifying force needed to align TPP national guidelines.
Further, by bringing TPP negotiations into conversation with population aging, the controversial deal could get new life. It's no secret that trade and investment agreements have fallen out of favor - or, at best, out of the spotlight. Who remembers or talks about the Doha Round in 2001, the last round of trade negotiations among WTO members? It's essentially been abandoned.
As such, President Obama, Congressional Republican leaders, and foreign national leaders in the TPP should consider the theme of aging populations as they hammer out the deal's final details - and try to win public favor.
Why population aging? More and more, we have come to recognize that the 21st century will be shaped by the intersection of two demographic forces: the "longevity revolution," in which it's becoming routine to live to 80, 90, and 100; and the drop of fertility, as apparent consequence of modernization and urbanization. Often -- and wrongly -- these changes are seen as unique to "rich" nations. But in fact it is the emerging and developing markets of the world that are experiencing these twin phenomena most rapidly. This demographic revolution has a powerful impact on economic growth and wealth creation - two targets that trade agreements are supposed to advance.
Both trade and aging are questions at the core of economic growth and success. Though they're odd partners on the surface, they're united at their core.
There are four platforms upon which this connection could be made:
- Age-Friendly Business Principles: Build in a set of age-friendly business principals that would become standard in all nations in the TPP agreement. The WEF had already recognized the value of such principles, and if TPP nations would formally agree to these support these established principles, they would be coalesced around a vision that transcends tariff rates and trade routes.
For Mr. Obama, Congressional Republicans, and all others shaping the deal on both sides of the Pacific, the TPP headwinds are strong. They'd be wise to infuse the TPP dialogue with the opportunities of population aging. Not only would this be sound economic policy, but it would give them a new platform from which to tout the benefits of the deal. They badly need one, especially when it is brought home for approval.