Krugman’s blog, 5/15/17

There was one post yesterday, “Nattering Nabobs of NAFTA:”

This discussion with David Rennie of The Economist on Trump is pretty scary. To paraphrase an old Brad DeLong line, Trump is more ignorant and impulsive than you can imagine, even taking into account that he’s more ignorant and impulsive than you can imagine. How close we came to leaving NAFTA:

People inside the White House also called the new Agriculture Secretary Sonny Perdue. Perdue had only been confirmed, like, a day or two earlier. And they called him in, [saying], “You need to come over here now! You need to! He’s about to withdraw from NAFTA.”

So Sonny Perdue literally asked his staff to draw up a map of the bits of America that had voted for Donald Trump and the bits of America that do well from exporting grain and corn through NAFTA. [The map] showed how these two areas often overlap. So he went in, said to Donald Trump, “Actually, Trump America, your voters, they do pretty well out of NAFTA.” And the president said, “Oh. Then maybe I won’t withdraw from NAFTA.”

Which put me to work wasting some time. Who actually exports a lot to Mexico? The top 10, as % of state GDP in 2014:

Trump states indeed. But I was more interested in the economic geography. What we see here mainly is the gravity equation: trade falls off with distance, with border and near-border states doing a lot of Mexico trade. The outliers are Michigan and to a lesser extent Indiana and Tennessee, which presumably reflects the especially close NAFTA integration of the auto industry.

Interesting stuff, at least for me. Also the kind of thing that should be taken into account in future trade negotiations, as the president takes expert advice into account and [hysterical laughing fit]

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