Democrats Speak on Trade—Sort Of

August 3, 2020

Well, the Democrats have, at last, spoken on trade, at least in draft. Below is an excerpt from their draft 2020 platform, all four paragraphs of it.

Building A Fair System of International Trade for Our Workers

For too long, the global trading system has failed to keep its promises to American workers. Too many corporations have rushed to outsource jobs, and too many countries have broken their promises to be honest and transparent partners. The COVID-19 pandemic has shown the risks of relying too heavily on global supply chains, as shutdowns and shortages have created chaos for workers and consumers and made our public health response even more challenging. The Trump Administration has failed time after time to deliver for American workers on this crucial issue, siding with corporate interests over our workers and launching a trade war with China that they have no plan for winning—creating incredible hardship for American farmers, manufacturers, workers, and consumers in the process.

Democrats will pursue a trade policy that puts workers first. We will negotiate strong and enforceable standards for labor, human rights, and the environment in the core text of our trade deals. Future trade agreements should build on the pro-labor provisions added to the United States-Mexico-Canada Agreement (USMCA) by Democratic members of Congress.

Democrats will take aggressive action against China or any other country that tries to undercut American manufacturing by manipulating their currencies and maintaining a misaligned exchange rate with the dollar, dumping products like steel and aluminum in our markets, or providing unfair subsidies. Unlike President Trump, we will stand up to efforts from China and other state actors to steal America’s intellectual property and will demand China and other countries cease and desist from conducting cyberespionage against our companies.

We will eliminate President Trump’s tax and trade policies that encourage big corporations to ship jobs overseas and evade paying their fair share of taxes. If companies shut down their operations here and outsource jobs, we’ll claw back any public investments or benefits they received from taxpayers. And we will take immediate action to repair the damage President Trump’s reckless policies have done to American farmers, by working with our allies to stand up to China and negotiate from the strongest possible position.

This is a campaign document, and therefore heavily rhetorical, but it is noteworthy for what it does not say as much as for what it does say. What it does say is pretty much straight out of the progressive handbook: trade has enabled large corporations to offshore jobs; reliance on global supply chains is a mistake; other countries, particularly China, have taken advantage of us; Democrats' trade agreements will include strong labor and environment provisions; Trump has made everything worse; Democrats will make everything better. (Those last two are not specifically progressive—all the Democratic candidates have said them.) Alas, the platform is not very specific about how they will make things better aside from threatening to remove benefits from companies that offshore or do not pay their fair share of taxes.

There are two things that are new: the mention of human rights protection as a trade agreement priority and the reference to global supply chains in a Covid-19 context. Former vice president Biden has, in the past, said human rights will be one of his priorities, but this is the first time I have seen that specifically mentioned in the context of trade agreements. Covid-19, of course, is new, and the link to global supply chains is no surprise. I would have expected the platform to go a bit farther on that point and discuss federal procurement policy—i.e., Buy American—as Biden has done in his own proposal, but that apparently did not make the cut.

More importantly, a lot of other stuff did not make the cut. Not surprising: China tariffs are ignored except in a vague reference to the damage done to farmers. The Democrats do not have a good answer to how they will deal with them and probably will not until after the election. Steel and aluminum are mentioned as having a dumping problem, which they do, but Trump's additional tariffs are not dumping duties, and there is no mention of what their fate might be in a Biden administration. No mention of the Trans-Pacific Partnership, a controversial issue among Democrats.

More surprising, since this is supposed to at least pretend to be a policy document, there is no mention of trade negotiating priorities. Nothing on the current talks with Japan, the United Kingdom, Kenya, or even China, few of which are likely to conclude before next January 20.  Nothing on the World Trade Organization, despite its current difficulties, some of them brought on by the United States.

In short, there is no policy vision here. We learn that Democrats will fix the bad things Trump has done and that they will do a better job of taking on the same problems he has identified, but that's just cleaning up the mess. It is a good demonstration of Democrats' commitment to workers. But for us trade wonks, it does not provide a vision of what kind of trading system Democrats would like to see, and, equally important, how they propose to get there. One of the most significant differences between Trump and Biden is that the former is a unilateralist, and the latter is a multilateralist. That is an important distinction in trade, and it would have been reassuring to see Biden's approach acknowledged in the platform.

The obvious response to this is that it is a campaign document, and it is unrealistic to expect it to lay out a coherent, comprehensive trade policy. Both points are well taken, but in an era where the bar for intelligent debate has gotten lower and lower, it would have been nice to see the bar raised, if only by an inch or two.

William Reinsch holds the Scholl Chair in International Business at the Center for Strategic and International Studies in Washington, D.C.

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