Washington slept here : how Donald Trump caught the politicians napping on trade

This paper explores how Donald Trump managed first to secure the Republican Party nomination, and then an upset victory in the general election, by running on an unapologetically protectionist platform. It argues Trump filled a political vacuum by taking positions long rejected by political professionals in both major parties and appealing to a class of potential voters that had been neglected. The analysis starts with a review of the decades-long economic transition in which producers of labor-intensive goods either became more international, thus switching from a protectionist to a pro-trade orientation, or died, thus becoming politically irrelevant. The net result was a reduction in the demand for and use of protectionist measures, and a steep decline in the political salience of trade (as measured in bills dealing with trade issues introduced in Congress, in the prominence of trade on White House agendas, and campaign promises to restrict imports). Trump recognized the large and untapped reservoir of potential votes in the post-industrial underclass that globalization left behind, and succeeded by prosecuting an unorthodox pro-protectionism campaign in which the usual sources of pro-trade campaign finance were rendered irrelevant

Trade after Trump : can the Biden administration shore up the eroding foundations of American leadership?

The results of the 2020 elections do not mean a quick or easy return to U.S. leadership in the trading system. This examination instead stresses a series of global and domestic challenges, several of which stem from long-term shifts in power and wealth. In addition to the rise of China, these include a reputational hangover from the Trump administration and the proliferation of agreements that prize targeted liberalization over nondiscrimination. The Biden administration must also contend with protectionist industries, lack of comity between the branches of government, and the two parties’ contradictory priorities on trade-related issues. The net effect is that American statesmen may continue to assign a low priority to trade, their attention is more likely to be directed toward discriminatory than multilateral initiatives, and the administration will face competing demands that complicate the negotiation and approval even of free trade agreements with selected partners

The trade policy of the United States under the Trump administration

The evolution of American trade policy is best understood over the long run as a function of the international distribution of power and wealth, but in the short run policy it is dominated by the exigencies of domestic politics. The decline in that country’s position has long raised doubts regarding its readiness to lead, and those doubts have been greatly amplified by the Trump administration. The arc of the administration’s policy thus far appears as a series of year-long phases by which almost inchoate sentiments have been progressively transformed into ever more concrete policy, culminating in the resuscitation of trade laws that were nearly forgotten but not gone. Chief among them were a “reciprocity” statute that gives the president broad powers to define and enforce U.S. rights; a global safeguards law that had been quiescent since the Bush administration used it to protect steel in 2002; and especially a national security law that the president invoked to restrict steel and aluminum imports. In 2019 the Trump administration has supplemented its trade war with new negotiations, including talks with the European Union, the United Kingdom, and Japan. While these talks do not directly engage China, the U.S. strategy is driven largely by a desire to isolate that rival. The world may well be headed towards a system where most commercially significant countries are pressed to align with one or another of these giants. No matter who occupies the White House, trade policymaking will remain perennially challenging for a system of government that is always divided by branch and frequently by party. Donald Trump was able to act in 2017-2018 with little restraint from Congress, but some of the things he aims to do now will require the acquiescence of Congress. Securing that cooperation will be more challenging as a result of the 2018 elections, in which Democrats recaptured control of the House of Representatives. Over the long term, Trumpism may well survive Trump, unless pro-trade forces manage to retake control of one of the two major parties

Employment and the Political Economy of Trade: A Structured Review of the Literature

The aims of this paper are to review the main schools of thought on the political economy of trade and employment, to review the empirical evidence supporting these schools, and to consider the implications for public policy. Special emphasis is given to the potential costs of liberalization and the manner that concerns about these costs may inhibit countries‘ willingness to open markets and thereby limit the potential gains from trade. These issues are explored through a structured examination of the political economy literature, including the contributions of political scientists, economists, and historians, focusing on the role of different types of political actors in the formation of policy concerning trade-and-employment issues. Those actors include the general public (the members of which are simultaneously workers, consumers, and voters); economic interests (firms, associations, and labour unions); and policy makers in both the executive and legislative branches of government. The paper proceeds in three steps, the first being to define each of the main schools of thought. The next step is to review empirical studies that have tested the validity of these schools of thought. The third and final step is to consider complementary policies.trade, employment, inclusive growth, wages

The Political Economy of Services in Regional Trade Agreements

Do the services commitments that countries have made in their post-Uruguay Round regional trade agreements (RTAs) indicate the types of concessions that they would be willing to multilateralise in the General Agreement on Trade in Services (GATS)? While there are important legal and economic dimensions to ponder in answering this question, considerations of political economy must also be taken into account. This paper focuses on issues in political economy that underlay RTAs in general, and especially the specific commitments and concessions that countries make on trade in services. It examines in detail the way that considerations of political economy have helped to shape the RTAs of Chile, Japan, the European Union and the United States. These four case studies help to develop and test a series of hypotheses regarding the international and domestic political factors that influence why RTAs are negotiated in the first place, between what kind of countries and with what kind of content, especially with respect to their provisions affecting services. The analysis rejects on a preliminary basis the hypothesis that RTAs create constituencies opposed to multilateral liberalisation, and finds empirical support for other hypotheses that are more multilateral-friendly.GATS, WTO, political economy, multilateralising regionalism, trade in services, regional trade agreements