This week’s Insider Deals are so good you’ll want all of themFILE - The United States Steel Mon Valley Works Clairton Plant in Clairton, Pa., is shown on Feb. 26, 2024. President Biden and Donald Trump agree on essentially nothing, from taxes and climate change to immigration and regulation. Yet on trade policy, the two presumptive presidential nominees have embraced surprisingly similar approaches.
“If you look at the election, it’s obvious,’’ said William Reinsch, a former trade official now at the Center for Strategic and International Studies. “Where are the deciding states? Pennsylvania, Michigan, Wisconsin — right there, you can see that trade is going to have an outsize role.’’ Yet like free trade, trade protectionism carries its own economic price. It can raise costs for households and businesses just as the nation is struggling to fully tame inflation. It tends to prop up inefficient companies. It spurs retaliation from other nations against American exporters. And it typically sours relations with allies and adversaries alike.He did pressure Mexico and Canada into rewriting a North American trade deal that Trump insisted had destroyed U.S. manufacturing jobs.
Dani Rodrik, a Harvard economist who was an early critic of the globalization of the 1990s and 2000s, views Biden trade policies more favorably than he does Trump’s approach. David Autor, a leading economist at the Massachusetts Institute of Technology, and two colleagues concluded in a 2016 paper that from 1999 to 2011, cheap Chinese imports wiped out 2.4 million American jobs.
Worse, the retaliatory taxes imposed by China and other nations on U.S. goods had “negative employment impacts,’’ especially for farmers. These were only partly offset by billions in government aid that Trump bestowed on farmers to cushion their pain. After entering office, Biden retained many of Trump’s trade policies and made no effort to revive Obama’s old Pacific Rim trade pact. He kept Trump’s steel and aluminum tariffs, while letting some trading partners avoid it until they reached a quota. He also retained China tariffs. Biden even turned up the heat on Beijing by restricting its access to advanced computer chips and the equipment to make them.