Guest Opinion: Don’t back off from global trade
Campaigning is one thing. Governing, especially at the presidential level, is another. Some know this intuitively. Others learn in a hard school.
Both major party presidential candidates this year came out against the complex trade pact called the Trans-Pacific Partnership. They knew that, especially for workers, and out-of-workers, in America’s heartland, free trade with other nations can seem like a fool’s bargain. These agreements with low-wage nations understandably look like an unfair deal that end up destroying American manufacturing jobs.
It’s much easier to say that on the hustings than to go into an eggheady economic analysis about the efficiencies of world markets raising all boats.
But the fact of the matter is that Hillary Clinton changed her position on the TPP for strategic reasons after she had supported the trade agreement as secretary of state.
And one arm of President-elect Donald Trump’s business empire sells clothes made in China and elsewhere in the Far East. He knows better than the rest of us that slapping a 45 percent tariff on a silk necktie would not make it any easier to sell.
Nor would doing so be anything like a bargain for the American consumer. Those incredible deals at Wal-Mart on T-shirts, and dress shirts, made in Bangladesh and Colombia are made possible by trade agreements such as NAFTA and TPP, which, by the way, includes thousands of tax cuts for American businesses that would make trade a better two-way street for our country’s exporters as well as importers.
The benefits of free trade are one of the key elements of international commerce on which economists on the right, the center and the left all agree. Running the numbers, it turns out that the best way to increase prosperity in all the nations of the world is to allow each country’s economy to do what it does best. Chinese companies manufacture iPhones and clothing more efficiently than we do here. We’re a whole lot better, for instance, at postsecondary education — six of the top 10 universities in the world are American — and at creating intellectual property, with eight of the top 10 brands, from Apple to Visa, being American.
The incoming president, in a different role than campaigner, will do well to continue to fine-tune trade agreements in the American interest rather than cancel them.
Protectionism is a misnomer — trade wars protect no one, creating equal and opposite reactions from other countries that would greatly harm American workers and consumers. And the fact is that presidents on their own can only increase tariffs 15 percent, and then only for 150 days, unless a state of emergency is declared, an unlikely scenario.
One clear way for a new administration to increase the efficiencies free trade creates is to call out China’s blatant cheating on some of the agreements in place, from its subsidizing the price of rice and wheat to its currency manipulation to its stealing patented ideas to its hacking into our companies’ email systems to its counterfeiting of our brands.
Demanding compliance with current and future trade agreements, rather than backing away from them or pretending that discredited protectionist policies would help the average American, is the courageous course the new administration must take if it wants to ensure prosperity for our nation.