Wednesday, September 23, 2020

President Donald J. Trump Delivers for American Workers

POST-GAZETTE - Res Publica
President Donald J. Trump Delivers for American Workers
by David Trumbull -- September 18, 2020

Trump pulled the U.S. out of the Trans-Pacific Partnership. That deal would have destroyed millions of U.S. jobs. I understand why Obama pursued it. The idea was that the loss of millions of Americans jobs was an acceptable cost of linking the U.S. and Vietnam to provide an offset to China's hegemony in East Asia. I didn't believe that it would work that way, and the fact that China was rapidly building new factories in Vietnam in anticipation of TPP is evidence, at least to me, that I was right. TPP was not going to re-balance power in East Asia and those millions of American jobs would have been lost with nothing gained.

Trump vowed to re-negotiate NAFTA and there was outcry on the right and left than that was an outrageous thing. The fact is that we have renegotiated individual provisions in NAFTA hundreds of times (I wrote some of those proposals that ended up being accepted by the three nations), Trump merely set out to do a more thorough version of what we had been doing piece-meal all along. NAFTA is 25 years old, in our more recent agreements we learnt from the mistakes of NAFTA and created better agreements, Trump took the lessons learnt and went back to Canada and Mexico and got us a better agreement. Of course, the new agreement had to go to congress for approval, which it got, because it was evident to everyone that Trump got us a better deal.

The old NAFTA had problems, but nothing in comparison to the damage that China was inflicting on the U.S. When China entered the WTO at the end of 2001 it got all the benefits of membership, and while it committed to observing the disciplines of membership, it has not. Year after year the U.S. government issued a written report on the many ways that China was not living up to its WTO commitments and how that was harming the U.S. economy. And year after year the U.S. did nothing about it. Trump bypassed congress and invoked Section 301 of the Trade Act of 1974 to unilaterally impose a 25% tariff on most goods from China.

Almost all my clients are paying that tariff. They have no choice. China's illegal trade practices have put out of business entire industries in all other countries. Almost all of these companies paying the tariff say that Trump is doing what must be done because just as all their suppliers outside of China have been put out of business by China, they believe that, without this strong action, they would be the next targeted by China for elimination. Now, during the pandemic, Trump is keeping these U.S. companies afloat by invoking the Defense Production Act.

I also have clients in the New England lobster industry who were at a disadvantage relative to Canadian lobster men because Canadian lobster enter the EU duty-free while U.S. lobster are subject to import duty. Trump got the EU to give U.S. lobster's duty-free parity with Canadian, without the U.S. making any significant trade concessions to the EU. On September 14 the Trump administration published notice of a new $527 million seafood trade relief program that will pay licensed fishermen up to $250,000 to offset sales lost due to China's tariffs on U.S. seafood.

Prior to the election I was skeptical about Trump. I liked what he said about trade, but I wasn't sure he had specific actions to put in place. As president he has far exceeded what I dreamed possible.