Recently, a decades-old video of Donald Trump on “Oprah” circulated, in which Trump offered up all the same trade policy views he holds today: Our trading partners are cheating us, bilateral trade deficits are hurting the U.S. economy, U.S. negotiators have done a bad job with trade deals, and higher tariffs would help the U.S. economy.
Two back-to-back, stunning economic headlines arrived in less than twenty-four hours. The first appeared on March 5 in the Wall Street Journal: “U.S. Budget Gap Widened 77% in First Four Months of Fiscal Year.” Following on the heels of that shocker, Bloomberg on March 6 ran this headline: “U.S. Trade Gap Surged to $621 Billion in 2018, 10-year High.”
Aboard Air Force One on his way back from the G-20 summit in Buenos Aires, President Trump renewed his threat to withdraw the United States from the almost 25-year-old North American Free Trade Agreement with Canada and Mexico. It’s a threat the president would be wise to reconsider.
The separation of families on the border is a punishment grossly disproportionate to the offense. The Border Patrol keeps children in cages while their parents, charged with immigration offenses, are held elsewhere. The pictures have drawn outrage, and appropriately so.
As foreign policy is changing. With the selection of CIA Director Mike Pompeo to replace Rex Tillerson as secretary of state, President Donald Trump appears to be taking charge of his foreign policy. National Security Adviser H.R. McMaster and Defense Secretary Jim Mattis remain counsels of caution on many issues, but the former’s tenure could be short, and the latter might choose to exit if his advice has increasingly less effect.
With exquisitely poor timing, the Trump administration released its latest National Security Strategy targeting China while still demanding Beijing’s assistance against North Korea. Although the administration’s technique was maladroit, the document raised important questions about future U.S. policy toward the People’s Republic of China.
I have a real problem with progressives and others that claim that America’s wealth threshold has already been reached and we have nowhere else to go but down. I couldn’t disagree more.
Trade frictions are nothing new to the U.S.-China relationship. Over the years they’ve ebbed and flowed, but were managed with enough deft to avoid major meltdowns. That seems likely to change under President Donald Trump, an economic nationalist who sees trade as a zero-sum game and the United States emerging “the winner” of a trade war with China.
Media and social media have been percolating – mostly with invective – over President-elect Trump’s “deal” to keep Carrier and its 1,000 jobs from moving to Mexico. I am among the many critics of this ad hoc, interventionist approach to retaining or attracting companies to perform value-added, job-creating activities in the United States.
In the years ahead, U.S. economic growth is projected to remain modest at best. Consequently, for many firm interested in higher returns, international expansion is essential. Plus, markets outside the United States represent 73 percent of global purchasing power, 87 percent of economic growth, and 95 percent of world consumers, reports the U.S. Chamber of Commerce.
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