Trump’s New Trade Proposals Borrowed from Democrats

Donald Trump’s campaign has undoubtedly given protectionist rhetoric a new energy in American politics.  China, he says, is “killing us on trade” and the Trans-Pacific Partnership is “a rape of our country.”  Early on, he got attention for calling for a 45% tariff on all goods from China and for saying we should impose tariffs of 35% on imports from companies that invest overseas. 

On Tuesday, he delivered a highly publicized trade policy speech where he doubled down on his belligerent, mercantilist rhetoric.  He also offered some more detailed and thought-out policy proposals.  Here are the seven proposals he laid out:

  1. “Withdraw the United States from the Trans-Pacific Partnership.”
  2. “Appoint the toughest and smartest trade negotiators.”
  3. “Identify every violation of trade agreements a foreign country is currently using to harm our workers … [and] use every tool under American and international law to end these abuses.
  4. Renegotiate or withdraw from NAFTA
  5. “Label China a currency manipulator.”
  6. “Bring trade cases against China, both in this country and at the WTO.”
  7. “Use every lawful presidential power to remedy trade disputes, including the application of tariffs consistent with Section 201 and 301 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962.”

Despite the outlandish nature of Trump’s rhetoric, there’s actually nothing new or radical about these proposals.  They are, in fact, just what trade-skeptic Democrats have been demanding consistently for over a decade.

 Many Democrats in Congress think our existing trade agreements are harmful.  They oppose new agreements and think we should negotiate them differently.  They support aggressive use of domestic trade remedy laws.  They think accusations of foreign currency manipulation justify increased tariffs.  And, they want to “enforce” existing agreements more aggressively through international dispute settlement.

An economic policy advisor to the Clinton campaign immediately responded to Trump’s speech by noting that the seven proposals almost perfectly mirror Hillary Clinton’s own trade policy plan.  Other responses from the Clinton campaign and from organized labor have criticized Trump for being hypocritical or insincere.  They have not argued against his proposals.

It’s also worth noting what’s not on the list.  Trump is not proposing large tariff increases across the board (even though such action would be consistent with his general stance on trade).  Trump also hasn’t said that the United States should leave the World Trade Organization. 

The Republican-led House of Representatives actually voted on whether to leave the WTO in 2000 and 2005.  The votes were largely for show and they predictably failed, but slightly more than 15% of Republicans in the House supported the bill each time.  I doubt most of Trump’s supporters would balk at the idea today.

A possible reason that Trump hasn’t taken issue with the WTO is that he’s constantly accusing our trade partners of “cheating.”  You can’t cheat if there aren’t any rules, and those rules exist because of the WTO.  Trump needs the WTO if he’s going to bring trade cases and “enforce” the rules.

One major difference between his original calls for higher tariffs and his seven new trade policy proposals is that the former were themselves clearly in violation of under WTO rules (and also an unconstitutional abuse of executive power).  He’s still calling for higher tariffs—that’s what each of his proposals will lead to.  He’s just twisting that goal to fit better into an existing framework.

Trump hasn’t changed his economically backwards rhetoric about trade at all, but his new proposals are at least potentially compatible with existing law and international commitments. 

They remain, however, the worst possible policies to pursue within those limits.  The fact that Donald Trump and Hillary Clinton are arguing over who believes in those policies most sincerely bodes ill for the future of the U.S. trade agenda.