Neil Irwin raises the question of whether economists have been too single-minded in pushing efficiency, while ignoring issues of distribution. This is way, way too generous to economists. In fact, economists have been totally happy to ignore efficiency considerations when the inefficiencies redistribute income upward. This situation pops up all the time.
As I frequently point out in comments here and elsewhere, we protect doctors, dentists and other highly paid professionals from competition with their lower paid counterparts in the developing world or even other wealthy countries. We have maintained these protections even while our trade negotiators did everything they could to make steel workers and textile workers compete against their low-paid counterparts in Mexico, China, and other developing countries.
This protectionism is obviously inefficient and cost U.S. consumers more than $100 billion a year in higher medical bills and other costs...
The same story applies to patent and copyright protection. These are forms of protection that can be equivalent to a tariff of 1,000 percent or even 10,000 percent. The worst abuses are in the prescription drug industry where we spend around $430 billion a year on drugs that would cost around $40 billion in a free market. This is throwing $390 billion a year into the toilet and worsening people's health. Where is there concern for efficiency in this case?
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It is worth noting that the gains from the TPP projected by Peterson Institute study are more than twice as large as the gains projected by the non-partisan International Trade Commission (ITC). The ITC study projected that when most of the deal's benefits are fully realized in 2032, the benefits will be a bit larger than a typical month of GDP growth. This study also did not account for the costs associated with stronger and longer patent and copyright rules.
