Make North America Great Again
This past weekend some huge news broke, although it received scant attention due to the deluge of Supreme Court coverage. The successful completion of the United States-Mexico-Canada Agreement (USMCA) on trade represents a tectonic shift in America’s approach to the world and marks a milestone step forward toward recovering opportunity for American workers. In addition, this historic deal rightly places incredible pressure on China, the primary exploiter of America on trade.
The USMCA framework showcases the practical genius of our negotiator and entrepreneur-in-chief, President Trump. Unlike the lawyers and bureaucrats who dominate most high political offices, as a global businessman Trump implicitly understands the predicament that American workers and firms face competing against a commercially abusive China. The president also grasped, unlike his predecessors, that the United States enjoys a unique advantage as the largest and most dynamic consuming country in the world. For too long, in the global game of multilateral poker, we acted as though we held a pair of 8’s, when in fact our hand is a straight flush.
Though Trump was widely pilloried for taking an adversarial tone during his G-7 visit to Canada, the ultimate result was a new and much better agreement with our crucial neighbors to the north and south. Even more remarkable, consider the marked contrast in style and ideology comparing Trump to both Canadian Prime Minister Trudeau and Mexican President-elect Andres Manuel Lopez Obrador. Even those left-leaning leaders recognize that their future requires a long-term alignment with the United States.
In fact, Trump’s move to solidify the North American relationships will reorient the global supply chain and tilt future growth and prosperity away from Asia and toward the Americas. He even called upon the two-centuries-old U.S. policy of the Monroe Doctrine in his recent United Nations speech to describe this shift in power and sovereignty back to the Western Hemisphere.
These developments properly put China in a corner regarding trade. Since its entry into the World Trade Organization, China and its mercantilist, unfair trade practices facilitated a wholesale transfer of wealth from American workers to that Asian nation. We tolerated not only a total lack of economic symmetry and reciprocity from China, but also a systemic theft of our most valuable assets, American intellectual property.
The bipartisan Intellectual Property Commission, led by former admiral and commander-in-chief of the U.S. Pacific Command Dennis Blair, reported that the total cost of counterfeit goods, pirated software, and other industrial espionage drained as much as $600 billion annually from America’s economy. It also named China as “the world’s principal IP infringer” where “theft by thousands of Chinese actors continues to be rampant.”
But thanks to our thriving economy, coupled with smart trade deals already inked with Canada, Mexico, and Korea, plus realistic promises of similar pacts with Japan and Great Britain, China now faces the trade music. Given its internal problems – consumer spending there just declined to its lowest level in 15 years – China will be hard-pressed to obstruct an America on the march as U.S. consumer confidence soars to 18-year highs and Team Trump negotiates accordingly.
The USMCA represents a big win for the nation and for President Trump. Moreover, it will become the key that unlocks the quagmire of our present economic subservience to China. The 2016 movement toward economic nationalism vaulted Donald Trump to his historic upset victory. He acknowledged this reality in his inaugural address, stating, “The factories shuttered and left our shores. … The wealth of our middle class has been ripped from their homes and then redistributed across the entire world.”
But Trump did not just curse the darkness, he also lit a candle, promising that the “American carnage” of hopelessness would stop, and stop immediately. This USMCA and coming negotiations with China prove, once again, that he makes good on his promises.