Title: Evasion and Apostasy Trump and Trade

Tagline: Republicans are abandoning three centuries of accumulated free market

wisdom to side with Donald Trump on trade policy.
No issue better illustrates the agony and self-inflicted wounds in the Republican
Party than the Trump-inspired clashes over the future of U.S. trade policy. and
the multiple global, bilateral and regional trade agreements negotiated under
Republican (and Democratic) presidents.
While the Democratic Party has been wracked by deep divisions over trade for
three decades fuelled by adamant opposition from key constituents such as
labour and environmentalist organiszations Republicans have been fairly united
on the belief that international trade agreements represented an extension of
domestic doctrines of deregulations and market competition to the international
level. Added to this was a the strong aversion to the crony -capitalism that
inevitably accompanied the protectionist impulse as even good Republican
businessmen vied to curry favours from government and undercut competition
from foreign competitors.
Enter Donald Trump and Trumpism. Though the Republican nominees political
beliefs are often little more than personal rants, he has established a forceful and
destructive anti-trade agenda. In many interviews and speeches he has argued:
Globalization has made the financial elite, who donate to politicians, very
wealthy. But it has left millions of our workers with nothing but poverty and
heartache. Trillions of our dollars and millions of our jobs flowed overseas.
Today, we import nearly $800 billion more in goods than we export. We cant
continue to do that.
The direct culprits, according to Trump, are trade deals signed or supported by
presidents Clinton, Bush and Obama: [First], the disaster called NAFTA. Second
Chinas entry into the World Trade Organization. NAFTA was the worst trade deal
in the history of this country. And finally, The Trans-Pacific-Partnership is
the greatest danger yet. The TPP, as it is known, would be the death blow for
American manufacturing.
This essay is not the place to rebut lay out the full economic rebuttal to the
allegations of Trump and other anti-trade advocates (usually Democrats) case
against U.S. trade agreements. Suffice it to note that the U.S. trade
deficit/surplus has no relation to trade policy. It is derived from a simple
arithmetic identity: If your public and private savings dont match your
consumption and investment, you will inevitably run a trade deficit with the rest
of the world; if the reverse is true, you will run a surplus. Bilateral surpluses or
deficits are meaningless.
On jobs, in the years after NAFTA under the Clinton administration, the U.S.
created some 20 million additional jobs. In the years since China entered the
World Trade Organization in 2001, and the U.S. went onto the sign 17 bilateral
trade pacts, U.S. manufacturing production has increased by 40 per cent.
Yet some key Republican leaders have either caved to Trumps anti-trade
onslaught or thrown up misleading or evasive responses. (House Speaker Paul
Ryan is a conspicuous holdout).) Unfortunately, tTwo leading Republicans in the

campaign illustrate this point: Vice-Presidential nominee Gov. Mike Pence and
former sSpeaker of the Hhouse, Newt Gingrich.
Pence, a decent, traditional Midwestern conservative, has always approached
trade in a pragmatic, transactional mode. In Congress, he supported NAFTA (I
believe its just about the only thing President Bill Clintons ever done that I
agreed with); and he backed all of the 17 bilateral FTAs negotiated under
George W. Bush. On the TPP, he has argued, Trade means jobs, but trade also
means security. The time has come for all of us to urge the swift adoption of the
Trans Pacific Partnership. Yet when trade came up in a joint 60 Minutes
interview with Trump, Pence refused to defend his longstanding positionstance.
Rather, he evaded the substance of the free trade debate, merely stating that
NAFTA had cause for periodic updating as a defense of Trumps vow to tear up
the agreement and ignoring Trumps claim that the TPP is a rape of our
country.
With Gingrich, the apostasy on free trade and trade agreements is even less
defensible, not least because of the former speakers always formidable
intellectual acumen when tackling public policy issues. Thus his earlier defensce
of free trade/open markets was laced with references to the giants of market
liberalism Smith and Ricardo, Friedman and Hayek. In interviews some years
ago, Gingrich set his support for free markets in a broader historical context:
There is a permanent struggle over the world which goes back at least to the
18th century between the rising trading system and a couple of things. Local
politicians who want the right to rip off their people. Local industries who want
the right to be protected so that they can rip off their people. If you are talking
about the ability of the average person to create wealth, to live in prosperity, to
have safety and freedom, then free trade has been consistently, for almost 300
years, one of the most powerful forces of expanding human life, human freedom,
and human quality of live on the planet.
On bringing China into the world trading system, Gingrich stated: Trade
increases the likelihood that you and they will engage in win-win activities. So
free markets dramatically lower the friction relationships and increase the
relative pleasure and the relative success of human relationships. The more the
Chinese and Americans [sit] down together to create more wealth, the happier
theyll be with each other, [and] the less likely well have conflict.
But And yet recently, he has affirmed support for Trumps destructive tirades
against current U.S. trade policy, telling Politico: I basically agree with Trumps
speech on trade. In defending his stunning volte-face, the former speaker
merely asserted that we are in a different era. But, he cited only Chinas huge
theft of U.S. intellectual property as evidence of the new era.
This wont do for a number of reasons. Besides the fact that existing trade tools
can and are being utilizsed to rein in Chinas intellectual property theft,
Trumps agenda encompasses as Gingrich well knows a much broader
protectionist and economic nationalist agenda. This agenda includes huge tariff
increases for Mexico and China with attendant trade wars, ripping up existing
FTAs with major trading nations, and withdrawing from the TPP and the European
negotiations.

The speaker has opined: I think conservatives can be very tough-minded [on]
trade [and] not automatically yell Free Trade! when you get ripped off.
All true, but still are the campaign rants of a talented demagogue worth kicking
over three centuries of accumulated free market wisdom? aAnd does the
speaker really think Smith or Friedman or Hayek would also follow this path?
A version of this article was first published here on U.S. News.