Franklin Lavin ’75 gave a presentation to 30 Andover students regarding current economic trends and policies in the U.S. and around the world last Friday. The Andover Economics Society and the International Club hosted the event. Mr. Lavin is the current Under Secretary for International Trade in the U.S. Department of Commerce. His primary role is to promote U.S. markets throughout the world. The forum opened up with Liz Brown ’09 giving a brief biography of Lavin’s past positions and accomplishments. Lavin subsequently took the stage to provide his wide-ranging thoughts on current economic trends. During this introduction, Lavin spoke of three trends that are significant to the evolution of economy in the 21st century. The first of these trends was the fact that with the emergence of states such as China, India and the Soviet Union, three billion new customers and competitors have joined the international economy. Lavin referred to this situation as “quite a sizeable shift in world economics in quite a short time.” The second was the “death of distance.” Lavin said that with the advent of jets, emails and packaging, real physical distances have little effect on world trade today. The final part of Under Secretary Lavin’s outline of a changing economy referred to the demise of trade barriers. Lavin mentioned how financial barriers like import and export taxes have substantially eroded. For instance, trade tariffs have decreased from 40% to 4% in the last 60 years. Following this “thesis,” Lavin brought attention to many other essential facts that mark this period of the world’s economy. One such point was the fact that the current economic success, exemplified by a 5.4% growth in the Global GDP is occurring during a time of political uncertainty. Lavin concluded his speech portion of the presentation, speaking about potential American free trade agreements (FTAs) with countries such as Taiwan. Free trade agreements are arrangements made between countries to remove trading tariffs and restrictions between these states, in an effort to encourage trade. The free trade agreement subject is currently significant because in June, President Bush’s Trade Promotion Authority, which gives him the right to negotiate trade deals and present them to Congress for a simple yes-or-no vote, will end. Lavin’s talk was followed by an extensive question and answer period. Question topics ranged from the effects of the increased popularity of Japanese cars in America on the U.S. economy to trade barriers in a post-Castro Cuba. One particular topic that gathered extensive discussion was the emergence of China as an economic powerhouse. Lavin said that just 30 years ago, “China was the North Korea of today, an economic catastrophe.” However, China has emerged as an economic power. Michael Zhan ’08 inquired if China’s unprecedented rise to international economic power is something other countries should feel threatened by. Lavin said, “China is now relevant to the system but who knows what role China will play. The United States needs to try to integrate China into the international system and if China is going to benefit from economic international trade then they need to contribute to it as well.” He added, “A prosperous China is good news for everyone.” Brown thought that the event was extremely successful in generating participation and enthusiasm from those in attendance. She said, “The ultimate goal of bringing Mr. Lavin to campus was to broaden the understanding of international commerce. As an expert, Mr. Lavin provided a perfectly unbiased perspective on the current issues concerning politics, finance and trade.”
