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Donald Trump’s Trade Bluster

Posted December 12, 2016

Under Economic Issues, International Trade Issues

(The Economist)

In a YouTube video released on November 22nd, Donald Trump—seated in front of an American flag and a leonine statue—confirmed his plan to put America first, “whether it’s producing steel, building cars or curing disease”. Mr Trump has already arm-twisted Carrier, a maker of air conditioning units in Indiana, to keep 800 jobs in the state rather than move them to Mexico. His transition team is preparing a list of “executive actions we can take on day one to restore our laws and bring back our jobs”. Implicit in the video was Mr Trump’s view of international trade: a patriotic contest in which countries strive to take each other’s jobs—or seize them back.

In Mr Trump’s view of the world, trade deals are adversarial and zero-sum. Other countries are rivals competing for the same spoils, not trading partners enjoying mutually beneficial exchange. His plans to scupper the Trans-Pacific Partnership (TPP), a deal painstakingly negotiated over ten years with 11 other countries around the Pacific Rim, tally with Mr Trump’s reading of history. Too often, he thinks, bad deals, like the North American Free-Trade Agreement (NAFTA) and China’s accession to the World Trade Organisation (WTO), have destroyed American jobs and created American losers. Click here to read more.