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Why it will be so hard to roll back Trump’s trade agenda

Jan 27, 2021

Global trade is not the sexiest of issues. It is, however, one of the most important, both in regard to U.S. foreign relations and America’s domestic cohesion. It is also a policy arena that former president Donald Trump changed in ways that will be hard to roll back.

Lighthizer provided insight into what he and Trump accomplished in an interview on Tuesday with Oren Cass of American Compass. Contrary to what his critics contend, Trump did not intend to return to a 19th-century protectionist regime in which the United States would purportedly prosper while tariff walls protected it from global competition. The point was to replace the postwar consensus, which fetishized consumer preference and used access to U.S. markets to subsidize economic development among European and Asian allies. Instead, Lighthizer explained, every decision was “made based on how it’s going to affect working people, how it’s going to bring manufacturing jobs back to the United States, how it’s going to put pressure on wages.”

That policy worked. The country gained more than half a million manufacturing jobs between Trump’s election and the onset of the pandemic. Wages and incomes went up for all, but especially quickly for those at the lower end of the wage scale. The replacement of NAFTA with the United States-Mexico-Canada Agreement also baked future gains into the cake. Lighthizer said that the new pact’s requirements concerning how much of a car had to be manufactured in North America to qualify for preferential treatment is leading to new investment in automobile manufacturing within the United States. Those jobs won’t appear until the plants are built, but when they are complete, thousands of Americans will work at good-paying jobs.

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