The Trade Challenge, With Edward Alden and Ana Swanson (Election 2024, Episode 3)
Oct 1, 2024
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Edward Alden is a senior fellow at the CFR and a distinguished professor, while Ana Swanson is a trade journalist at the New York Times. They dive into the evolving landscape of U.S. trade policy, highlighting challenges stemming from competition with China. The duo dissects past deindustrialization narratives and the impacts of tariffs, especially during Trump’s presidency. They explore how shifting protectionist sentiments are reshaping society and influencing the upcoming election's trade discussions.
The shift in U.S. trade policy reflects a growing focus on protecting domestic jobs rather than expanding trade opportunities with foreign markets.
The evolving political landscape shows that tariffs are increasingly seen as a necessary measure to address voter concerns about foreign competition.
Deep dives
Evolution of U.S. Trade Policy
U.S. trade policy has significantly evolved over the past decade, moving away from a focus on expanding trade for economic growth to addressing the potential risks associated with foreign competition, particularly from China. Historically, both Republican and Democratic administrations supported increasing trade opportunities to benefit American producers and consumers; however, this has shifted due to the perceived negative consequences of trade on domestic jobs. The ongoing debate has centered more on the challenges and job losses attributed to imports, which has caused a reevaluation of the net benefits of trade agreements. Current political leaders from both parties express increasing concern regarding the implications of expanding trade; rather than viewing trade primarily as an opportunity, they now focus on its associated risks and potential job losses.
Impact of China on U.S. Trade
China's integration into the global economy has had complex repercussions for the U.S., affecting jobs and manufacturing while also providing access to inexpensive goods that have bolstered consumer buying power. While many criticize China's dominant trade practices, the reality remains that American consumers benefit from the cheaper products available, even as concerns about the loss of U.S. manufacturing jobs arise. Restrictions on technology trade with China have increased under both the Biden and Trump administrations, indicating ongoing apprehensions about American dependency on Chinese technology and goods. This reflects an emerging consensus that the U.S. must reevaluate its trading relationships, particularly in the technology sector, as competition with China continues to intensify.
Trade Agreements and Tariffs
Trade agreements such as NAFTA have had mixed results, with regions like the upper Midwest associating these agreements with job losses and deindustrialization, while other areas celebrated the economic benefits. The Biden administration has largely maintained the tariffs instituted during the Trump era, indicating a shift in Democratic trade policy toward a more protective stance, in contrast to historical support for free trade. Tariffs have reshaped U.S. sourcing habits, resulting in decreased imports from China and an increased reliance on trade with countries such as Mexico and Vietnam. This shift underscores the politically charged nature of trade, with many voters supporting protectionist measures that align with their economic interests despite the potential long-term costs to consumers and the global market.
Political Ramifications of Tariff Policies
The political landscape surrounding U.S. trade policy has transformed, with tariffs becoming a popular tool used to appeal to voters who feel threatened by foreign competition. Trump's presidency marked a distinct turn toward more aggressive trade policies that resonated with working-class Americans, which has left Democrats to reconsider their traditional free-trade stance. There is growing concern that further escalations in tariffs, as proposed by Trump, could lead to a significantly detrimental tariff war impacting American consumers and industries alike. The challenge for both political parties lies in balancing protectionist desires with the economic realities of international trade, as voters increasingly demand actions that protect American jobs without recognizing the broader implications.
Edward Alden, a senior fellow at the CFR and the Ross Distinguished Visiting Professor at Western Washington University, and Ana Swanson, a trade and international economics journalist at the New York Times, sit down with James M. Lindsay to discuss opportunities and constraints that the next U.S. president will confront on U.S. trade policy. This episode is the third in a special TPI series on the U.S. 2024 presidential election and is supported by the Carnegie Corporation of New York.
For an episode transcript and show notes, visit The President’s Inbox at: https://www.cfr.org/podcasts/tpi/trade-challenge-edward-alden-and-ana-swanson-election-2024-episode-3
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