Trade Is What Makes Trump's Campaign Tick
How to explain the rise of Donald Trump?
A nativist? A blower of racist dog whistles? A hypocritical champion of American manufacturing?
All of the above?
The GOP front-runner has plenty of critics, and I’m among them. A lot of Trump-branded clothing has been made overseas for years. Far worse, his arguments on everything from ISIS to immigration represent the worst sort of demagoguery. Still, those are only some of the issues that ultimately motivate his supporters.
What really gets them going is economics.
It doesn’t matter how wonderful the top-line employment number is each month, or how much GDP expanded each quarter; many Americans have found this economic recovery lacking. Jobs may be more plentiful for some, but lots of others find they don’t pay like the used to. And many are turning to Trump for answers.
Without this current of economic insecurity, you’d have a candidate simply bashing immigrants and probably going nowhere in the polls. But Trump’s acknowledgement of that insecurity, and his diagnosis of its cause – a laser-like focus on trade with China – is clearly resonating.
“We’re going to beat China, Japan, beat Mexico at trade,” he said in his New Hampshire primary victory speech. “We’re going to beat all of these countries that are taking so much of our money away on a daily basis.”
This isn’t well received by everyone. Every time Trump mentions China, it produces enough eye rolls among media members to be labeled a mass event. To them his buffoonery seeps into everything he mentions, and “China” is no different.
But here, he’s not wrong.
Well, he gets the specifics wrong. America doesn’t run an annual, $505 billion goods trade deficit with China, as Trump told debate moderators last month; it was only about $365 billion in 2015. That remains a jaw-dropping total. Several studies have connected this deficit to millions of jobs lost between 2001 and 2013.
What about currency manipulation? In a Wall Street Journal op-ed, Trump called it “the worst of China’s sins” and linked it directly to the trade deficit. When he said as much on a recent debate stage, he was met with skepticism by rivals who must consider currency a dead issue.
But many economists – including C. Fred Bergsten of the Peterson Institute for International Economics, and no less a free-trader than Art Laffer – have estimated that currency manipulation is behind all of that job loss. Others have tied normalized Chinese trade relations with chronic job insecurity for a significant number of U.S. workers.
Currency might not be a regular topic around most dinner tables, but jobs are. And much of Trump’s support comes from working-class voters who have watched middle-income jobs, the kind once attainable without a college degree, grow scarce.
Listen to this billionaire talk about trade, and you begin to see his appeal to the working man. But we’ve spent more time fact-checking a candidate whose calling card is unscripted verbosity. Twitter exploded with glee, for instance, when Trump told moderators he hadn’t called for a 45 percent tariff on Chinese goods – and the audio proved otherwise.
The takeaway should have been this: Specifics be damned, Trump believes retaliatory trade measures are necessary to combat mercantilism in Asia. And while he’s the only Republican candidate to regularly say so in 2016, he wouldn’t be the first Republican president to do so.
Ronald Reagan himself did on a number of occasions, most famously to provide relief to Harley-Davidson – then the last remaining domestic motorcycle manufacturer – from overwhelming import competition. In doing so Reagan effectively saved Harley from extinction.
George W. Bush imposed his own tariffs in 2002 after a wave of subsidized imports caused bankruptcies and layoffs in the U.S. steel industry. This kind of dumping is happening again today, and it cost 12,000 steelworker jobs in 2015 alone.
Yet, save for the occasional John Kasich comment, there is no trade debate among today’s GOP candidates. The only one regularly raising the issue is Donald Trump.
I find that notable. Trump isn’t proposing a flat tax, or widespread deregulation; voters aren’t buying most of those ideas any more now than they did in 2012.
And they aren’t coming to Trump solely because of his hard-line immigration stance; he’s not the only candidate to spout similar rhetoric.
Instead, he’s drawing an army of first-time voters, less-than-affluent Americans, and self-identified Republicans who are registered as Democrats. They’re backing him, in large part, because he’s tough on trade. And he’s the first front-runner to do that in a long time.
That position has fueled the rise of Donald Trump, and it might win him a few more primaries in the next few weeks.