PRESIDENT TRUMPS international economic team is still a work in progress, though based on two early top nominations Robert Lighthizer as U.S. trade representative and Peter Navarro to head a new National Trade Council he fully intends to keep the protectionist promises of the campaign trail. Certainly a newly released administration document, The Presidents 2017 Trade Policy Agenda, reflects the influence of Mr.Lighthizer and Mr. Navarro. The six-page statement rehearses once again their critique of U.S. trade policy since the Cold Wars end: Multilateral trade agreements and institutions such as the North American Free Trade Agreement and World Trade Organization have sacrificed American sovereignty, to the ultimate cost of U.S. jobs, especially manufacturing jobs.
Familiar and, indeed, shared by many of Mr.Trumps Democratic opponents though it may be, this narrative is far from an accurate diagnosis. It is true, as the new Trump agenda notes, that manufacturing employment declined, in absolute numbers, between 2000 (the last year before the United States approved Chinas entry to the WTO) and 2016, from 17.2 million to 12.3 million. Whether this decline is 100 percent the fault of the WTO, NAFTA or any other multilateral trade deal, as opposed to automation and other long-term factors not unique to the United States, is another question.
As a new analysis by economic historian Bradford DeLong of the University of California at Berkeley shows, the past two decades of job losses in manufacturing are part of a trend that began after the Korean War. Factory work went from 32 percent of non-farm employment in 1953 to 16 percent in 1990: long before NAFTA or China. For comparisons sake, Mr. DeLong notes that Germany held out by many U.S. trade critics as a paragon of manufacturing employment preservation shed half of its factory jobs between 1970 and 2015.
Obviously, these numbers dont salve the pain, material and psychic, of those who lost out from these sweeping historical processes. They do, however, suggest theres little to be gained by trying to renegotiate existing trade institutions, or to opt out of them selectively, when, say, a WTO ruling does not comport with U.S. interests as the new Trump agenda suggests. To the contrary, DeLong calculates that Chinas accession to the WTO and NAFTA combined cost the U.S. 500,000 net manufacturing jobs, in a workforce of more than 150 million people.
Again, we dont dispute the impact especially on the light industries such as shoes or furniture hardest hit by imports. Nor do we quarrel with the Trump agendas assertion that trade with China has largely failed to induce greater abiding of the law and transparency by that one-party state. Yet the best way to counteract Chinas mercantilism would seem to be by precisely the sort of U.S.-led multilateral cooperation that the Trump administration has rejected, in the form of the Trans-Pacific Partnership. The Trump agenda blames past policymakers for turn[ing] a blind eye to unfair trade practices in the pursuit of putative geopolitical advantage. Geopolitics, though, is just another word for shaping the world to serve all U.S. interests, with a minimum of conflict. And the real blindness consists in unilaterally asserting sovereignty and protection without regard to the legitimate interests of other nations, or their capacity for retaliation.
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Trump's blindness on trade is all too easy to see - Washington Post
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