Genevieve Tran

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What do international trade deals mean for your city?

Benjamin Barber says mayors need to be on the global stage? Here is a snag already within their own cities:

One important division of city government is Economic Development which incubates local talent and invests in conditions that attract business to the area. I have learned that in Toronto, Canada, at least, this is strangely not coordinated with the City's Procurement / Purchasing department i.e. the biggest potential customer in the area for these new innovative services, talent, products etc. (government is 20% of all spending). The two departments are FAR away from each other on the org chart. The Purchasing department simply goes for the lowest competent bidder, period; their main purpose being to block corruption / collusion by making decisions as universally agreeable as possible--the cheapest thing. (Not the most innovative, economically impactful, sustainable etc. thing). Long-term economic effects cannot be determined by this sole consideration. Apparently, this is the case with many cities in developed countries.

However, small new emerging businesses don't have the ability to bid as cheaply as the huge multi-nationals so they die out or move away--and then the city becomes less globally competitive without its talent. And it's unsure that the hodge-podge of financially efficient services that do run a city necessarily make it a great one. Further strangeness: city revenues are not from income tax (federal) or sales tax (state/provincial), but property tax. Which means that a city has to get people to move there and own real estate to really make money--i.e. bad when people leave.

Canada and the EU are in talks to form a free trade zone (Comprehensive Economic and Trade Agreement), which cities' aren't even at the discussion table for. However, this will open up even more contracts to outside competition. Does global competition make a city better or more economically messed up? Is this something mayors are even mandated to deal with?

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    Sep 27 2013: Hi, Genevieve: The region where I at present live (I wasn't born here), was surviving with old systems of agriculture and its market were only the national and local ones. There were not ater saving technics, not solar power, no international transport or international banking fast exchange systems, etc. Of course, there wasn't programs for creating talents and innovation.
    All this has taken place, and have been implemented (or at least have been tried to) because to the need for opening new markets in Europe and all over the world. The system is not perfect yet, and at present, with the 'crisis' things are getting worse. But people knows the way to do it and have the illusion to. May be when the crisis is over, we can emerge again. I hope.
    I am not farmer, merchant or banker, and what I humbly try to explain -despite my poor English-, is just mi opinion about the fact that everything that means open international borders to compete is good for nations.
    In the past, our Mediterranean coast populations established near the sea, receiving frequent visits from other people, even warriors or pirates, were mercantile and culturally more advanced than the inside ones and much more than the ones living isolatedly in the mountains.
    Sorry for my bad English.
    You have proposed a very interestind and modern topic. Greets.
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      Sep 29 2013: I think that you're thinking and writing in English about such a hairy topic is great! Trust me, not a lot of people could join quasi-intellectual forums in other languages and write at length as you have! Wherever you're from, people evidently keep on top of the movements of the English-speaking wave of information that dominates the Internet :)

      Who were your fabulous politicians that saw the need for change and invited these innovations in?--were they differently educated than everyone else? Are the voters happy with what's been happening?
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        Sep 29 2013: Hi Genevieve: Thank you very much for your kind words, for undeserved praise for me, you're very kind. It is true that it is difficult for me to give my opinion on a forum where everyone seems to express easily in English. I love the English language, but I must say about my difficulties about expressing mi opinons, especially because I'm always afraid not to express clearly my opinions and to be misunderstood (it often happens).
        However, I think this little effort is also part of the "TED spirit." Gaining knowledge, exchanging points of view and renewing ideas or beliefs is the nerve center of we friends of TED, love. TED is a good place to come and chat, and worths the effort.
        I must say that not everything is what it seems: frequently I need to use the dictionary and sometimes, for expressing idioms, I need the help of an electronic translator. Now I 'll try to answer your questions:
        In my opinion, the economic growth that has occurred in the region where I live is not an achievement of politicians (though some of them of have helped) but of people, who managed to transform vast desert courses in vegetable production. and they have put the ideas and material means; banks have helped a lot with the investment.
        The second answer is much sadder: Voters in Spain, aren't happy at all, because the economic crisis has swept like a tremendous hurricane life and hopes of many people across the country. This topic is very painful for us all, and we consider ourselves innocent of evil that others did, but we all pay the price.
        However, in the agricultural sector, which we discussed, the crisis has not been as strong or harmful, because international markets are still open and continuing product demand, so in that aspect, it's not so bad, after everything.
        Best wishes :)
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    Sep 27 2013: Cities are a stable influence on countries, and should be allowed to conduct their own affairs. As they are not centralized this increases the chances many times as people can vote with their feet and move if they don't like the city they are in which is much harder if you don't like the country.

    With a city it is possible to be heard by the city politicians which is not possible with a centralized government.

    Cities are great example of comparative advantage. E.G.

    If things are so expensive in the silicon valley why do high tech companies still locate there? because the talent is there which makes the unit cost of high tech lower because of the talent.

    The U.S. is the largest manufacturing country in the world because despite higher labor cost the U.S. is the best and automating. (not a city but comparative advantage is illustrated, most people think China is)

    Seattle and aerospace

    N.Y. and finance

    Washington DC and corruption

    Hollywood and movies

    Detroit and cars (in the past, only changed by the corrupt city government)

    Also you have to look at the schools that create those cities E.G.

    Stanford and San Jose

    USC and Hollywood

    MIT and Boston
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      Sep 29 2013: Pat, you've given such great examples of cities that have undergone specialization. What has a successful city in your list done to build toward that niche they've carved for their local economy? Do you have any insight as to whether it was tight cooperation within the city's policy-making machine? Or something else?

      Like, in Silicon Valley, was it purely "free market" forces? Or, was there a conscious effort somewhere in policy that made it what it is?
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    Sep 26 2013: For my region, global competition undoubtedly, means a nice and useful challenge. Our early agriculture products have empowered scientific research for better seeds and also for better waste of water and finally for the best proficiency and incredible progress on solar power's efficient use. To compete with the crops of other countries, trending to produce earlie and cheaper vegetables, let hundred of thousands of people, spanish or foreign people, be employed.
    International trade, in my opinion, means healthy and -generally- fair competition, and competition always is better than nothing.
    Greets.
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      Sep 27 2013: Hi Sean, what do you think it is about your region that has made global competition a healthy thing? Is it because your local government didn't have a strong program for creating the area's own talent and innovation and needed to import them?
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    Sep 29 2013: In a taped interview Obama asked Steve Jobs why he was going to China for production instead of staying in the USA. He said that the USA could not give him the amount of engineers, workers, facilities in the specified time period. Additionally, the government regulations, taxes, programs, and especially the unions would hold him up for years and cost him millions. He went to China and told them he needed XXX square foot of factory floor, 1,200 engineers, 4,000 laborers ( I forgot the real numbers these are mine ), and wanted to start in two weeks. The Chinese asked him if he wanted to be inland or beside the sea for his shipping purposes. He chose sea and the Chinese said will one week be alright.

    The point of this story is that cities cannot do the things that countries can do. As big as LA or NY are they could not have made these deals. Cities can say we have rail, deep water ports, transportation systems and that is about all. China was not concerned about union relationships .... government regulations are what they say they are .... taxes are what they say they will be ... no mayor anywhere could do this.

    In the USA international trade deals are usually to the benefit of cronies and political indebtedness. The cities do profit by taxes, employment, sales generation, etc...

    In short, cities are at the mercy of the country and their laws rules and conventions. None of which mayors can control.

    Good luck. Bob.
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      Sep 30 2013: You're totally right. Every time I read about how dexterous a country like Singapore can be in responding to organizing its policies, regulations etc. to galvanize all its parts to receive the benefits of trade for its locality (while being encouraging of international investment and business), it makes so much sense. All the parts are aligned and incentives are not in conflict.

      Jennifer Granholm the former Governor of Michigan has often cited the few cases where the country and the state cooperated, and it meant a huge difference in the turnaround of her state (retraining, retooling to make lithium batteries for cars). She has spoken about this Singapore example on NPR and here on the Daily Show: http://www.thedailyshow.com/watch/thu-september-22-2011/exclusive---jennifer-granholm-extended-interview-pt--2
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    Sep 29 2013: International trade is predicated on cheap energy. To not see the folly of that given our historical, present and future consumption and consequent environmental issues (global warming etc) is to bury ones head in the sand... Planning using the rear view mirror simply will not work. All of our systems are currently in collapse and more of the same will only make things worse.

    It's time to connect the dots, if future generations will have a snow balls chance of survival.
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      Sep 30 2013: Hi Craig, you've made a great point. Suppliers these days source so many of their upstream raw materials and parts from China and other places that compromise the environment for low cost of goods. They win many contracts because they can do this. It all comes down to cheap energy and raw materials.

      This supply chain model runs deep. And even if we encourage innovators to bid on contracts, chances are, even if their technology is green and they promise the employment of the best and brightest, a large portion of their parts etc. will be still be sourced from these same cheap energy places. One TEDxNewYork talk had a business idea about growing a garden in Manhattan apt windows based on a crowd-sourced invention. Looking into it, I found that to keep it cheap and sale-able, this "green" product was plastic made in China, involved tons of shipping and had a crazy carbon footprint, all so Manhattanites could grow enough arugula every second week for a salad (!)

      http://www.ted.com/talks/britta_riley_a_garden_in_my_apartment.html

      It's difficult.
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      Sep 27 2013: I watched a documentary about Jamaica where they had to buy Ecuador's bananas while theirs rotted on the trees among so many other wastes! I think that "trade" pact wasn't entered into on equal terms, and that is what happens with all IMF, World Bank projects to pay back loans.

      What terms do you think Jamaica should have accepted (if at all) the trade? Is it even possible to trade with a way bigger and more powerful entity such as the US?