What’s Next? Part I

When I meet with virtually anyone these days, their main question never changes: What is going to happen next? There are topical variations. The question might be about tariffs, trade negotiations with particular countries such as Canada or Mexico, possible court decisions in trade litigation, the midterm elections, or even next Sunday’s football games, but they all have the same goal: finding out what comes next. Over the next year or so, from time to time, I will attempt to answer those questions (though not about football games). The basic question will remain the same, but each column will focus on a specific part of the trade landscape. Hopefully, I will get a few things right. This week’s column is the first attempt.

The question I am most often asked by foreign visitors is what will happen after Trump. This continues a recent trend. In 2018 and 2019, they were asking the same thing. From 2021 to 2024, they were asking what would happen after Biden. Previously, trade policy since 1950 was fairly consistent with occasional blips. Now it has become a major question mark as different administrations make big changes. Until recently, I have been saying half the answer was concrete—Trump would insist that the next Republican nominee remain faithful to all of his policies, and the party faithful would support whoever made the most convincing promise of total fealty. That would mean a trade policy very much like the one the United States has now, though perhaps with less drama. However, as Trump continues to sink in the polls and many of his policies remain unpopular, including his tariffs, it is possible that many Republican voters are tired of Trump and are ready to move on to something different. That would open the Republican nomination fight to more candidates with different ideas. It is too soon to say whether voters have turned that corner, but the midterm elections will provide some clues.

Even if that does happen, I would not expect major changes in trade policy. Republicans are not going back to the internationalism and free trade they advocated in previous decades, and they are not going to abandon the national security focus that has become the rationale for many of Trump’s trade actions. A future Republican president might, however, be much more interested in building allied support to deal with common adversaries such as China and global problems such as climate change and AI, which would have significant trade implications. Two hallmarks of the current administration are unilateralism and that it sometimes treats its friends worse than its enemies. A president less tied to Trump could change that and build more bridges by easing some of the trade penalties Trump has imposed on U.S. allies and friends. That would not mean a return to working within international organizations; in the Republican party, national sovereignty reigns supreme, and that is not likely to change.

Of course, if Republican voters have not turned the corner and remain loyal to Trump, we can expect a nominee who will promise to stay the course, including on trade. Left unsaid will be the likelihood that the same policy will be pursued with less drama and less dependence on personal animosities.

On the Democratic side, the picture has always been murkier because the party has long been divided on trade policy. Its left wing views trade much like Trump does—as harming workers, although its culprit is large corporations and their executives while Trump’s is foreign countries. The party’s center takes a more moderate approach on tariffs and is more careful about working within multilateral institutions such as the World Trade Organization (WTO). (These are oversimplifications due to space limits. Future columns will provide more details.) Also, as is usual with the party out of power, there will be a vigorous battle for the nomination, with candidates from both the left and center, and it is impossible at this point to predict an outcome—although, again, the midterm elections will provide clues as to the strength of the progressive movement with the overall electorate. Thus far, Democrats have failed to develop a coherent trade policy of their own or even a consistent criticism of Trump’s. The most common criticism has been one of process: Trump has not followed the law or rules in the implementation of his various trade actions. That’s a good point, with which the courts have so far agreed, but it is not a trade policy of its own. Another argument has been that tariffs can be good, but Trump’s tariffs are not, with Canada often cited as a prime example. Given the unpopularity of the current tariffs, those may be good campaign arguments, but they provide few clues as to what Democrats would do if they were in the White House.

At this point, the best guess is that they wouldn’t make anything worse but would leave many of the tariffs intact, if only because they need the revenue. Even so, we can expect them to be more concerned about playing by the rules—both U.S. law and regulation and WTO rules—and with building allied consensus. That might not lead to much of a rollback of current trade actions, but it would mean that future ones will be taken with greater care and greater deference to the concerns of U.S. friends and allies, although that will come with a greater emphasis on human rights and the environment.

At this point it would be foolhardy to predict the election outcome, but it does appear that regardless of who wins, the next administration’s trade policy will at best differ in degree and tone rather than taking a significant change in direction.

William A. Reinsch is a senior adviser (non-resident) and Scholl Chair emeritus with the Economics Program and Scholl Chair at the Center for Strategic and International Studies in Washington, D.C. He can be reached at [email protected].