The European Union-United States Free Trade Agreement, which aims to integrate both economies, is being negotiating in secret, a fact that has caused fear and anger among many citizens, both in the United States and in Europe. It is feared variations that the legislation community can experiment with the objective of facilitating the exchange between both blocks. It is also feared that as a consequence, it will increase the unemployment rateIn contrast, TTIP advocates predict an improvement in the quality of life for European citizens.
Until now, the information was multiple, both for and against, and scattered. But recently, Jeromin capaldo, a researcher from the Tufts University has shed some light on the matter.
Specifically, his work It is entitled as follows: »Transatlantic Trade and Investment Agreement: Disintegration of the European Union, Unemployment and Instability».
Jeromin speaks that the studies on which the European Union defends its position are studies based on a inadequate economic model. Unlike the model used for this research; the United Nations Global Policy.
The job predicts a gray future for policy makers in the European Union, who would face losses of approximately 600.000 jobs as well as significant losses in workers' income (In the case of France, the most affected, about € 5.500 per worker).
Clear points from the report
- The TTIP would lead to net losses in terms of net exports up to a decade after being approved, compared to the “no TTIP” scenario. The Northern European economies would suffer the greatest losses (2,7% of GDP), followed by France (1,9%), Germany (1,4%) and the United Kingdom (0,95%).
- The TTIP would lead to net losses in terms of GDP. As with the figures for net exports, Northern European countries would suffer the greatest reduction in GDP (-0,50%) followed by France (-0,48%) and Germany (-0,29%) .
- The TTIP would lead to losses in workers' earnings. France would be the most affected, with losses of € 5.500 per worker, followed by Northern European countries (€ -4.800 per worker), the United Kingdom (€ -4.200 per worker) and Germany (-€ 3.400 per worker).
- The TTIP would lead to job losses. We estimate that approximately 600.000 jobs will be lost. Northern European countries would be the most affected (-223.000 jobs), followed by Germany (-134.000 jobs), France (-130.000 jobs) and Southern European countries (-90.000 jobs).
- The TTIP would lead to a reduction of the share of wages in GDP, reinforcing a trend that contributes to the current stagnation. Its counterpart is an increase in the contribution of profits and income to total earnings, indicating that there will be a transfer of income from labor to capital. The most important transfers would take place in the United Kingdom (7%), France (8%), Germany and Northern Europe (4%).
- The TTIP would lead to a loss in the public revenue of the States. The excess of indirect taxes (such as Value Added Tax) on subsidies will decrease in all EU countries, with France suffering the largest loss (0.64% of GDP). Public deficits would increase their share of the GDP of each EU country, pushing public finances close to, or beyond, the limits imposed by the Maastricht Treaty.
- The TTIP would lead to a increased financial instability and accumulation of imbalances. With declining export earnings, declining wages and declining revenue, demand would have to be sustained by profits and investment. But with weak consumption growth, the benefits cannot be expected to come from increased sales. A more realistic assumption is that profits and investment (mostly in financial assets) would be sustained by rising asset prices. The potential for macroeconomic instability of this proposal is well known to all.
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