Do Democrats Have a Trade Policy?
February 18, 2020
Last summer here at the CSIS Scholl Chair, in an outburst of optimism—or naïveté, take your pick—we started to track the Democratic presidential candidates’ trade policies. We dutifully collected their quotes and waited eagerly for them to produce policies we could analyze. Recalling my past peripheral experience with presidential campaigns, I expected all the candidates to crank out policy papers on practically everything, including trade, even though they all know nobody reads them—except the Scholl Chair, where we are nothing if not committed.
Sadly, we have thus far been doubly disappointed. First, only three candidates so far have actually produced a policy, and only two of them remain in the race: former vice president Joe Biden and Senator Elizabeth Warren (D-MA), who certainly spoke the truth when she said she had a plan for everything. Our comments on the Biden and Warren plans can be found here and here.
Second, the media has proved itself unusually incompetent in taking up the issue. When they can manage a question on trade, which is rare, it is invariably about whether the candidate supported or opposed the United States-Mexico-Canada (USMCA) agreement and why. This is useless. That debate is over; all but Senator Bernie Sanders (I-VT) and Tom Steyer supported it, and it does not say much about how the candidates would conduct their trade policies beyond the obeisance to labor and environment issues that all the candidates feel obligated to make.
As a result, the Scholl Chair is in a state of some despair. While you probably must go back to the nineteenth century to find an election where tariffs played an important role, it does seem pretty clear that our current president is going to run on his trade policy and use the agreements he has negotiated as measures of his success. That means the eventual Democratic nominee will have to come up with a trade policy, and it will need to be more detailed than simply saying President Trump is doing it wrong and failing to build coalitions, which appears to be the best most of them can do so far. (They're right on both points, but it won't win them the election.)
However, despite the candidates' own ineptitude and the media's incompetence, there are a few smoke signals that emerge occasionally from the candidates' campfires, particularly the Sanders and Warren camps. Both of them have a fundamentally Trumpian approach to trade negotiations, although their implementation would be different. All three of them seem to have the view that access to the great U.S. market is so important that other countries will pay more to obtain it. But what they want them to pay is different. For Trump, it is about exporting more U.S. goods and turning our bilateral trade deficits into surpluses. For Sanders and Warren, it is about insisting our trading partners adopt a long list of progressive goals—adherence to International Labor Organization conventions, participation in the Paris Agreement on climate change, commit other environmental good deeds, respect human rights, and so on—all noble goals but not all usually found in trade agreements.
Their tactics also differ. Trump is prepared to attack and destroy existing relationships in order to remake them into what he wants. Sanders and Warren, for the most part, put their price on new negotiations, although Sanders has mentioned renegotiating the USMCA. That makes the two Democrats less of a threat to the entire international trading system than Trump is, and their willingness to work with allies to build coalitions and presumably work within multilateral institutions reinforce that.
These differences are important but so is the foundational similarity. The U.S. market is big, but it is not the biggest and hardly the fastest growing. To assume other countries will pay through the nose for better access to the U.S. market than they already have is both arrogant and delusional. In the case of Trump, some countries will play along and make token concessions sufficient to give him bragging rights but without making fundamental changes, while everybody else is hiding under the table hoping he doesn't notice them. In the case of Sanders and Warren, the price of negotiating is so high there will likely be no takers. One viral comment when Warren's policy first came out was that under her criteria the United States would not be able to negotiate with itself. If the United States can't meet its own standards, it is folly to expect others to do so.
Regrettably, all three seem to have missed the point of trade, which should be about promoting jobs and growth for all countries, not just the United States. We learned a long time ago that mercantilism is not a successful long-term policy, and if we're lucky, Sanders and Warren will learn that turning trade policy into a moral crusade is likely to be equally unsuccessful. Meanwhile, the Scholl Chair never sleeps (except on weekends). We will continue to relentlessly monitor the candidates for any trade-related comments they might make, and if one of them says something intelligent, or for that matter something stupid, you can count on hearing about it from us.
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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