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Thanks for clarifying the studies John, but even with the opinions of your learned colleagues, surely the point remains that whether we benefit or lose from a USFTA will depend on what is agreed under it. My guess - and correct me if I'm wrong - is that the CIE and ACIL studies modelled some general assumptions about price shocks etc resulting from an FTA. But as we all know, these FTAs are not really "free" trade agreements, and in some respects not "trade" agreements - for example, investment provisions. Recent statements by Vaile and media reports say that negotiations have been fraught - and it looks like we might be going to surrender either our PBS rights or media content rights etc. Putting a value on these things - particularly the latter - is difficult, and my bet is that the CIE study ignored these matters. In theory, the government doesn't need to sign the any FTA unless we get a benefit. But the politics means that it might well sign with a net loss if, say, its farming constituency got a win in the deal, or if it didn't fully understand the economics of trade diversion verus trade creation etc - as various statements emanating from Vaile's office suggest it doesn't. These are all complex matters, but the main point I'm making is that we cannot really know whether the US FTA will produce net benefits or net costs for Australia before the details are sorted out.
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