LSU economist touts free trade benefits

While sitting on a roundtable discussion on energy and economic implications for Louisiana, LSU Professor Emeritus of Economics Loren Scott related to attendees of the an anecdote about his mother
“(She) told me when I was growing up anybody could (become) the president of the United States,” Scott said in reference to GOP nominee Donald Trump. “For the first time in my life, I believe my momma.”
Trump, and specifically his anti-trade rhetoric, were a common theme for the hour-long discussion among Scott, Associate Director of the Tulane Energy Institute Eric Smith and Dek Terrell, professor and executive director of LSU Economics and the LSU Policy Research Group and David Dismukes, the executive director of the LSU Center of Energy Studies.
Wednesday’s roundtable was part of the 2016 Energy Summit, at the LSU Center for Energy Studies and LSU Economics and Policy Research Group.
“If there’s one thing where economists universally agree, it’s that free trade is a good thing,” Scott said of Trump’s promise to renegotiate trade deals.
Scott said Louisiana lost its largest manufacturing employer, Fruit of the Loom, around the time the 1994 North America Free Trade Agreement was signed into law. But from1992-2000, the state enjoyed its best growth period in history.
He said that while trade agreements have winners and losers, the standard of living for all countries goes up. Scott also said the U.S. can expect one certainty if tariffs go up: “They (other nations) always retaliate.”
While the discussion on trade deals was fairly favorable, the panelists described a much darker situation for the state of the oil industry in the Gulf of Mexico.
Smith detailed issues with shallow waters, saying the production was more expensive that drilling on land.
Scott said the oil companies had succeeded in negotiating to break-even point per barrel down to $55 to $60, rather than the traditional $70 to $80. He warned that while that was good “the price has just got to go up.”
The summit coincided with a recent push by LSU to increase involvement in the energy sector. The E.J. Ourso College of Business recently created an energy undergraduate minor to allow students to specialize in the industry. The LSU Petroleum Engineering Research and Technology Transfer Laboratory has been working to simulate a wide scale disaster, such as the one with the Deepwater Horizon oil spill.