In opening remarks at TD Ameritrade’s National LINC conference, former U.K. Prime Minister David Cameron expounded on the benefits of free trade and globalization and warned against protectionism and anti-Muslim (not anti-terrorist) policies.
But Cameron also noted that a “serious course correction” is needed to address the struggles of the many people who have been left behind — struggles that led to the Brexit vote in the U.K. to leave the E.U. that ended his term as prime minister and the election of Donald Trump in the U.S.
Without such a correction, developed economies like the U.K. and U.S. will fall victim to the policies of the extreme left or right, said Cameron.
Cameron recommended that governments invest more money in education and training for workers, raise the minimum wage and end the taxation of the lowest paid.
Cameron said he doesn’t think far-right leaders Marine Le Pen in France and Geert Wilders in the Netherlands will win their respective national elections, but he also didn’t think the Brexit vote would go the way it did.
If Le Pen does win in France — the third largest economy in Europe — “the EU will not survive in its current form,” said Cameron.
About the U.S. election and the policies of President Donald Trump, Cameron said tax reform was necessary — “it’s crazy to me that American companies have to invest overseas because of corporate taxes here" — and deregulation is good, but protectionism, anti-NATO and anti-Muslim policies are not.
“We won’t make America great again by making Eastern Europe weak again,” said Cameron, referring obliquely to comments by Trump against NATO and favorable toward President Vladimir Putin of Russia.
Protectionist policies also hurt the U.S. and global economy. They were tried in the U.S. in the 1980s and in the U.S. and Europe in the 1930s and they failed, said Cameron.
“Free trade and growth of world trade hasn’t made our countries poor. It’s made them rich," he said.
He said global trade is not a zero sum game where one country benefits at the expense of another and only countries with a trade surplus are successful. If that were the case, then who has the deficits? asked Cameron. Mars? Jupiter? “That’s nonsense.”
Cameron recommended a “more cooperative relationship” with China, binding them to global institutions like the World Trade Organization and UN. “Hold China to their word, bind them to organizations,” he said.
“The biggest global challenge” that countries face now, said Cameron, is the “defeat of the scourge of Islamic extremists … This is not a clash between civilizations. That’s what the terrororists want. … The truth is billions of people follow the religion peacefully. We have to be on their side against the extremists. ... We need to be guardians of freedom and tolerance. Hold fast to those things. That’s what made America and Britain great.”
--- Related on ThinkAdvisor: