President Obama’s announcement about entering into free trade talks with our European allies could not only drive global economic growth and provide a welcome basis for domestic political consensus building – it may actually prove to be a long-lasting contributor to this country’s fiscal sanity. That seems particularly true when it comes to finding new solutions for making our aging populations a key part of a 21stcentury global economic growth-and-prosperity strategy.
Free trade agreements – leading to the reduction of barriers to goods and services across national borders and thus a boon to economic activity, wealth creation and prosperity – were a hallmark of the post-World War II political-economic landscape, of course. That was as true for regional deals such as the North American Free Trade Agreement and the creation of the EU itself as it was for the often more celebrated global deals like the Kennedy Round of the ’60s or the birth of the World Trade Organization.
Inside U.S. domestic politics, these free-trade deals were also a consensus-building glue of comity, good will and cross-party agreement. This was largely true even as extremes in both parties – notably labor protectionists on the Democratic side and economic isolationists on the Republican side – came to view their particular interests at odds with expanding global economic activity. In the U.S., one can track political positions on free trade with a particular sector’s assumptions of its own global competitiveness; it’s hard to remember the days when the steel or textiles sectors were proponents of free trade.
But even if the Obama administration can overcome protectionist opposition to a free-trade deal on both sides of the aisle at home, there’s still the delicate matter of finding sufficient consensus for the agreement itself with Europe. The latest of the promised multilateral free trade talks, the Doha Round, has been stalled across more than one American administration and resisted by any number of our trading partners for over a decade now – so anyone wondering, ‘Is there really a future for free trade?’ can be forgiven.
Here’s what’s true: The deal will take enough common interests to overcome the inevitable conflicts and tension, as with any agreement. Those commonalities have been found recently in less traditional frameworks across investment standards, including intellectual property, the environment, or even HIV/AIDS, as opposed to the more traditional “tariff cutting” of the good old days.
One of those interests is the aging of all our societies, which has been gaining focused attention the past several years as more and more governments understand the economic opportunities of imagining their aging populations differently. The S&P Global Aging Report in 2010 characterized global population aging as the most seminal of 21st century challenges: “No other force is likely to shape the future of national economic health, public finances, and policymaking as the irreversible rate at which the world's population is aging. The problem has been long observed and is well understood.”
RELATED: A Clear View of Aging Populations
Since at least 2010, it’s been evident that aging populations are a true global phenomenon, with the disparate populations of Turkey, Brazil, Mexico and China aging even more rapidly than the already “older populations” of Japan, South Korea, Europe and America. This 21st-century trend for America, Europe and now the rest of the world – as countries modernize and urbanize – is due as much to low birth rates as the cause of the “aging population phenomenon” as the increased longevity we so cherish.
And as soon as 2020 there will be 1 billion of us over the age of 60, a fiscally impossible number to consider dependent upon public policy and culture as we did in the 20th century.
American and European leaders ought to explore common trade agreement-type solutions to the challenge of the population shift from young to old. Any agreement with a goal of driving economic growth and job creation cannot ignore the huge opportunity of a whole demographic segment becoming economically engaged.
There are those in the private and public sector already focused on the topic of America’s “aging population” as a component of American foreign policy. It’s a short step, then, to move this into the arena of the U.S./European trade talks. It will take creativity and commitment, but it’s an opportunity for leadership on a critical topic of our time – one that will also be appreciated by our friends across the globe who face the same pressing challenge of aging populations.