(What’s Left of) Our Economy: What the Mini-Deal Says About Trump’s China Policy

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agriculture, business investment, censorship, China, decoupling, democracy, Democrats, election 2020, Elizabeth Warren, Hong Kong, Hong Kong protests, human rights, impeachment, Populism, Republicans, tariffs, Trade, trade talks, trade war, Trump, Uighurs, Ukraine, Ukraine Scandal, {What's Left of) Our Economy

The “Phase One” min-deal reached by the United States and China tamping down bilateral trade tensions for the moment, speaks volumes about the three major forces that are now driving President Trump’s China policy, and that will keep shaping it through the next U.S. election – though not always in consistent ways. They are:

>the President’s evident belief that his reelection hopes are being threatened mainly by revived impeachment threats but also by an economic slowdown that has unmistakably been influenced by the so-called trade war with China;

>his consequently increased need for political support from the establishment Republicans so numerous in Congress who have never boarded the Trump Tariff Train and who are worried about their own reelection chances next year; and

>Mr. Trump’s consistent (though generally unstated) belief that no matter how the formal trade talks proceed, America’s national security as well as economic interests require the U.S. economy to continue steadily decoupling from China’s.

The strength of the impeachment drive faced by the president is now indisputable. Some polls are even showing growing Republican support for not only impeachment by the House but removal by the Senate. Moreover, this political challenge comes at a time when the President’s strongest suit by far (at least according to polls) – his economic policy record – is looking somewhat weaker.

Few signs point to a recession breaking out by Election Day, much less during the preceding weeks or months. But growth has been slowing to levels that Mr. Trump himself has deemed unacceptable – in no small measure because they were the rates that prevailed for most of the Obama administration.

The tariff-heavy Trump trade policies hardly deserve all the blame. (See, e.g., this recent post.) But the failure of business investment to stay elevated following passage of major tax cuts for business is especially telling. It buttresses claims that both the President’s various sets of tariffs and the inconsistency with which they’ve been both threatened and applied have inhibited companies from approving big new expenditures on new factories and other facilities.

As a result, nothing that can reasonably be expected from Washington (in other words, ruling out a big infrastructure spending bill) is likelier to boost the economy more than a nerve-calming trade truce with China mainly featuring some Chinese market opening or re-opening (especially for agricultural products) in return for some U.S. tariff cuts, promises to refrain from new levies, or some some combination of such moves. At the least, such an agreement would in theory help growth maintain the momentum it has remaining.

A mini-deal along these lines would also please the Senate Republicans who might ultimately judge the President’s fate, and who generally have lagged far behind the GOP base in turning against pre-Trump China and broader trade policies. Moreover, as I’ve written, impeachment politics have greatly magnified their sway over Mr. Trump before. Despite his sky-high popularity with Republican voters, the President was heavily dependent on their political backing until this spring in order to neutralize any impeachment chances while his Russia ties were being investigated. That’s surely why his early policy initiatives were dominated by traditional Republican priorities, like tax cuts and repeal of former President Barack Obama’s healthcare overhaul, rather than by populist priorities like an infrastructure bill and the prompt imposition to tariffs.

Once the Special Counsel and other investigations flopped for various reasons, Mr. Trump had a much freer hand. But because of the emergence of “UkraineGate,” for now, those days are over. Probes growing out of those events are certain to last for months. Therefore, continued, much less higher, tariffs on China that could further drag on the economy and further frustrate the rural constituencies so crucial to the President and many other Republicans seem out of the question.

The President is so hamstrung that he’s been unable to marshal greater public support for staying the tariff course even though China is antagonizing American public opinion with its harsh suppression of the Hong Kong protests and the Muslim Uighur minority, and with its heavy handed efforts to extend its censorship practices to the National Basketball Association and other U.S. businesses. And don’t forget: These developments have placed China in a much weaker position, too.  

One reason that the President hasn’t been able to capitalize could well be his reluctance to declare publicly the functional equivalent of economic war, or his intent to decouple – presumably because any such statements would prompt the Chinese to crack down even further on American companies even doing business in the PRC that have nothing to do with job and production offshoring aimed at serving the U.S. market from super-cheap and highly subsidized Chinese facilities, as opposed to serving Chinese customers. And that reasoning has been entirely understandable.

Much less understandable – the President’s insistence that a trade war with China would be easy to win and inflict no economic harm on Americans, rather than choosing to challenge his compatriots to endure some sacrifices in order to beat back a mortal threat to their national security as well as prosperity. No wonder public support for so-called hard-line policies remotely strong enough to offset the opposition and reservations of the Congressional Republicans and most Democratic politicians is nowhere to be seen.

And don’t doubt that the Chinese fully understand. Whatever problems they initially experienced in figuring Mr. Trump out, they surely have concluded that they’re best advised to play the waiting game on the broader and deeper so-called structural issues dividing the two countries (e.g., intellectual property theft, technology extortion, massive subsidies) until the President is replaced by a Democrat who’s much easier to deal with.

Indeed, the evidence for this conclusion is abundant. China issues have played a small role in the Democratic primary campaign so far – even when it comes to long-time critics of pre-Trump trade policies like Democratic Socialist Vermont Senator Bernie Sanders, and Massachusetts Senator Elizabeth Warren. One likely explanation: In recent years, Democratic voters and leaners have markedly flipped on those pre-Trump approaches, from deep dislike to general approval. This shift in public opinion (matched in part by a trade flip in the other direction among Republicans and leaners) may also warrant some Chinese confidence that even a President Warren might prove a more acceptable interlocutor than Mr. Trump.

Nonetheless, the formal talks are not the only track on which the Trump administration’s China trade policies are running. And the other track – featuring unilateral U.S. moves to restrict Chinese involvement in the American economy, and thereby foster decoupling – is much less controversial than the trade talks and especially the tariffs and tariff threats clearly required to spur any meaningful progress.

Highly revealing on this score (in terms of the importance attached in Washington to decoupling): Even as a high level Chinese delegation was jetting to Washington, the President approved actions against Chinese tech companies and Chinese officials that were justified by human rights concerns, but that in the first case clearly advanced decoupling. Just as revealing (in terms of possible Chinese acceptance of a more skeptical new bipartisan U.S. consensus on China policy): Despite the provocative timing, the Chinese didn’t turn around and head back home once they heard the announcement.

Reinforcing the new American consensus on decoupling has unmistakably been the growing realization by the U.S. corporate sector that its heavy bets on China have dangerously increased its vulnerability not only to the whims of American politics, but to a Chinese regime that’s turned out to be much less hospitable than expected. As a result, “Phase One” is not only a suspiciously convenient-looking term being used by the President to describe his new deal. It also looks suitable for describing where his administration’s overall China policy stands right now.     

Making News: Video of Presidential Campaign Economics Interview Now On-Line!

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Democrats, economy, election 2020, Elizabeth Warren, Liquid Lunch, Making News, NewsmaxTV.com, Wall Street

This past week has been so crazy news-wise that I’d completely forgotten to post a link to a video of an interview I did for NewsmaxTV.com two Fridays ago. The subject: some recent economy-related developments in the current and intensifying presidential campaign!

So click here for a great (and still timely!) discussion on the “Liquid Lunch” program focusing in particular on Massachusetts Senator Elizabeth Warren’s rise to just-about-front-runner status among the Democratic contenders – and on an apparently strong reaction from Wall Street.

And keep checking with RealityChek for news of upcoming media appearances and other developments.

Im-Politic: On the Democrats’ Debates

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African Americans, Amy Klobuchar, Barack Obama, Bernie Sanders, Beto O'Rourke, China, Cory Booker, debates, Democratic Party, Democrats, Democrats debates, economy, election 2020, Elizabeth Warren, Im-Politic, Joe Biden, Kamala Harris, Michael Bennet, Pete Buttigieg, race relations, tariffs, Trade, Trump

So thanks to last week’s two debates, we’ve now seen most of the Democratic presidential candidates in, as sportscasters like to say, “limited action,” and have had some time to ruminate about the results. Here’s my sense of some of the biggest takeaways.

>The Democrats generally are in denial about the health of the economy. This problem became clear immediately, as the first question on Night One, posed to Massachusetts U.S. Senator Elizabeth Warren, noted that her “many plans” for the economy come “at a time when 71 percent of Americans say the economy is doing well, including 60 percent of Democrats. What do you say to those who worry this kind of significant change could be risky to the economy?”

Warren’s response? Ignore the cited polling data and claim – presenting no evidence – that “Who is this economy really working for? It’s doing great for a thinner and thinner slice at the top.” For good measure, sharing her fact-free perspective at the outset were her Minnesota Senate colleague Amy Klobuchar, and former Texas Congressman Beto O’Rourke. And don’t forget former Vice President Joe Biden’s charge on Night Two that “Donald Trump has put us in a horrible situation” economically. Or California Senator Kamala Harris’ view that the economy is great only for those who own stocks.

No one is saying that too many Americans aren’t still being left behind in an economy that’s unmistakably shifted into a somewhat higher gear under President Trump. No one is saying that the economy hasn’t shown some signs of slowing. (See, e.g., this recent post.) No one is saying that the economy is going to be a decisively winning Trump issue in 2020. (This new poll throws lots of cold water on that proposition.) And no one is saying that because the economy is so far performing pretty well, Americans are especially happy about the overall state of the union. (Survey results like these make clear that they’re not.)

But no one should be feeling too great about so many politicians remaining so deeply in denial (or at least pontificating as if they are) about a state of affairs that is so easy to document.

>Kamala Harris is simply race-baiting. Let’s assume that all of the California U.S. Senator’s allegations about former Vice President Joe Biden’s record on school busing decades ago are completely accurate. How can the conclusion be avoided that she’s trying to portray Biden as remaining deficient as racial issues today, and in the process, stir up the worst kinds of national divisions? After all, he served as the second-in-command to the nation’s first African-American president. Black politicians, and especially long-serving black politicians, have publicly praised him as a long-time trusted ally.

In other words, whatever Biden’s past shortcomings on race, nothing could be more obvious than that they’ve vanished in every meaningful way, and in every way relevant to policymaking. It’s no longer possible accurately and responsibly to depict him as a problem for the African-American community. Harris’ indictment also indicates a refusal to acknowledge that individuals can learn, evolve, and grow, and to give them any credit when they do.

I recently spoke about this privately with an African-American friend who argued that the real Biden race problem that’s emerged recently stemmed from his indignant response to similar allegations and insinuations by New Jersey Senator Cory Booker, another 2020 African-American Democratic hopeful. In other words, Biden’s refusal to apologize for comments about racist southern Senators signaled an insensitivity to racial slurs (like describing African-American men as “boys”) that could well prompt younger blacks to stay at home in the fall of 2020, and boost Mr. Trump’s odds of reelection.

I don’t disagree with that political analysis at all (though I don’t consider it a foregone conclusion, either). But politics aside, that would point to the same type of intolerance, censoriousness, and sanctimony being displayed by Harris. More of this, America these days clearly doesn’t need.

>Biden performed better than I expected. The former Vice President and still 2020 Democratic front-runner has widely been declared a major loser in his debate exchange with Harris, and poll results reinforce that conclusion. I agree that Biden was poorly prepared for attacks on racial issues that he must have known would come that evening from someone. In particular, his substantive defense of his busing record – that he only opposed a sweeping federal mandate – did indeed (as Harris charged) ignore the decisive role that the Federal government has regularly needed to play in advancing civil rights when state government were either hostile or indifferent to the cause.

Nevertheless, Biden certainly didn’t act like the “Sleepy Joe” he’s been labeled as by President Trump, and that seemed like an apt description for some of his more disjoint moments in these early phases of the 2020 election (for example, this rambling discussion of the China challenge). He flashed temper (or at least indignation), he sounded articulate, he stood tall, his energy level didn’t notably flag. In fact, assuming that his health holds up (he turns 77 in November), Biden looked like a candidate who could mix it up with Trump on a debate stage. As demonstrated by the race relations storm he’s kicked up, however, he’s as gaffe-prone as ever.

>The Democrats have no grip on China issues. Sure, they generally acknowledge that China poses problems for the United States (but there’s some disagreement as to what they are). But few so far have offered realistic solutions to these problems.

For example, Senator Michael Bennet of Colorado, “I think the president’s been right to push back on China but he’s done it in completely the wrong way. We should mobilize the entire rest of the world who all have a shared interest in pushing back on China’s mercantilist trade policies and I think we can do that.”

What a shame that he was never asked why countries like Germany, Japan, and South Korea, which profit enormously from selling sophisticated industrial machinery to China, would want to see any slowing in U.S.-China trade when so many of those machines are used in factories that supply the American market?

Mayor Pete Buttigieg of South Bend, Indiana agrees that the China challenge “is a really serious one,” but seemed most concerned that the Chinese are “using technology for the perfection of dictatorship.” He endorsed the stale and misleading “tariffs are taxes” trope, and insisted that “the biggest thing we’ve got to do is invest in our own domestic competitiveness.” He never explained if he’s OK with the infrastructure the nation unmistakably needs being manufactured in China and elsewhere abroad, or why “education” is so critical when children in China and everywhere else have the same capacity to capitalize on their learning as children in America – even though population considerations will long ensure that their wages stay orders of magnitude lower no matter how advanced the work they do.

Interestingly, Sanders is the only Democratic hopeful with a lengthy record of voting in Congress on China trade and related economic issues – always correctly (in my view) opposing reckless expansion. That explains CNBC’s ironic but on-target recent observation that “Sanders in particular has targeted Trump because his trade views overlap with the president’s.” And hence mushy Sanders statements like “I think we do need new trade policies that are fair to the working people of this country not just to the CEOs, but as usual, I think Trump gets it wrong in terms of implementation,”

Warren seems equally conflicted, agreeing with Mr. Trump that “tariffs are one part of reworking our trade policy overall” but lamely chiding him for engaging in “tariff negotiation by tweet” instead of “fighting back” with “strength and a coherent plan, not with chaos.”

Indeed, Warren has a detailed-looking plan for implementing a strategy of “economic patriotism.” It contains some good features, like what seem to be industrial policy proposals (with no real specifics), tightening up Buy American government procurement policies, and requirements that production that results from (amped up) taxpayer-funded research and development programs take place in the United States. But it’s unclear whether she realizes that tariffs are going to be central to their success. In addition, she appears quite enamored with devaluing the dollar as a trade policy panacea. And she puts considerable stock in government-run training and reeducation programs that, to date, have been proven failures and that have long (as noted above) evidently assume that Americans are the most educable and train-able people on earth.

If you’re a Democrat, or any American who wants to see elections held between the most qualified candidates possible, the good news is that the party’s hopefuls will have eleven more debate chances to up their games. Unfortunately, it might also turn out that the nation will simply witness eleven more events marked by hollow, and too often angry, grandstanding.

Im-Politic: Elizabeth Warren, Nationalist?

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Elizabeth Warren, Emmanuel Macron, global poverty, globalization, Im-Politic, nationalism, progressives, Seattle WTO protests, third world, Trade, World Trade Organization, WTO

Whatever its historical roots, “nationalism” has recently become a dirty word. Among the dangers embodied by this concept, as determined by political correctness authorities such as France’s (politically besieged) President Emmanuel Macron, it’s “a betrayal of patriotism. By saying ‘Our interests first, who cares about the others,’ we erase what a nation holds dearest, what gives it life, what gives it grace, and what is essential: its moral values.”

How stunning, therefore, to read Elizabeth Warren’s recent speech on U.S. foreign policy. According to this definition, the Massachusetts Democratic Senator, progressive heroine, and likely 2020 presidential hopeful, is a card-carrying, selfish, immoral (amoral?) America First-style nationalist – at least when it comes to international trade and related globalization issues.

Skeptical? Just read the Warren transcript. On the one hand, she admitted that “The globalization of trade has opened up opportunity and lifted billions out of poverty around the world” – which by any standard is a pretty remarkable achievement. Yet on the other hand, Warren condemned the “trade and economic policies” behind this epic success for failing to deliver “the same kind of benefits for America’s middle class.”

In fact, she emphasized, “U.S. trade policy has delivered one punch in the gut after another to [U.S.] workers and to the unions that fight for them.”

It’s true that, elsewhere in her speech, Warren briefly referred to revamping American trade policy to ensure “that workers are meaningfully represented at the negotiating table and build trade agreements that strengthen labor standards worldwide.” But much more often, she lambasted agreements like the North American Free Trade Agreement (NAFTA) and its successor, the U.S.-Mexico-Canada Agreement (USMCA) for encouraging “outsourcing jobs to Mexico.”

In other words, either such outsourcing somehow failed to ameliorate poverty in Mexico (even though Warren credits it with uplifting the poor elsewhere), or she assigns little importance to achieving that goal. In either case, Warren has some major explaining to do.

Also fascinating about Warren’s speech: If it’s to be taken seriously (never a sure thing when it comes to politicians’ rhetoric), it would represent a significant, and in my view, welcome change in progressives’ take on trade, globalization, and what’s fundamentally wrong with them.

For since these issues became front-page news during the debate over NAFTA, at the start of the 1990s, critics to the left-of-center have proclaimed that U.S. trade and related policies would remain unacceptable unless they boosted living standards everywhere, not just in America – and that they had betrayed workers in developing countries as completely as their counterparts in the United States.

American progressives’ emphasis on the devastation created in the third world by U.S.-spearheaded trade arrangements came to a head during the Seattle World Trade Organization (WTO) protests in 1999 – as did the companion belief that win-win solutions for workers and consumers everywhere should be and could be the very raison d’etre of the global economy. And as indicated by this 2015 statement from the Congressional Progressive Caucus, it remains their party line today.

The point here is not that no conceivable form of globalization can ever produce globe-wide benefits. Instead, it’s that the road to mutual gain is unlikely to proceed in a straight, smooth, uninterrupted line, and that without recognizing that hard choices are likely for the foreseeable future, and that those global benefits may not be distributed evenly, the worst of all worlds is all too likely.

So here’s hoping that her speech is evidence that Warren is becoming aware of these at-least-likely complications, that she’ll start prompting such globalization realism on the American Left – and that she won’t be deterred by apologists for a failed status quo who, along with most of her fellow progressives, have been reduced to portraying nationalism as part of the problem, rather than potentially part of the solution.

Im-Politic: You Bet Oprah Could Win

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2016 elections, 2018 elections, 2020 elections, Bernie Sanders, Democrats, economy, Elizabeth Warren, Im-Politic, independents, Joe Biden, Oprah Winfrey, politics, Republicans, Trump

Here’s a confession: I’ve never watched “Oprah.”

Still, since I’ve been in a waking state for much of the last few decades, I’m of course aware of the prominence she’s achieved in American culture and society, and the high regard in which so many hold her. That’s why I take absolutely seriously the idea that Oprah Winfrey could win the Democratic presidential nomination in 2020, and even take the White House.

One suggestive data point is already out. In a new poll, she tops President Trump by an impressive ten percentage points as a presidential choice. And as many observers have pointed out, unless the field of likely Democratic White House hopefuls changes markedly in the next two or so years (and we’re of course still awfully early in the presidential cycle, so don’t rule out that possibility by any means), Winfrey would face unusually flawed opponents.

Indeed, at this point, the leading Democratic contenders look to be Vermont Senator Bernie Sanders, Massachusetts Senator Elizabeth Warren, and former Vice President Joe Biden. Whatever you think of them as individuals either personally or politically, all three are septuagenarians, and two look to be well to the Left of a critical mass of American voters. And underscoring their vulnerability is how enthusiastically so many Democrats and progressives have reacted to the idea of “Oprah 2020.”

More reasons for optimism about a Winfrey White House run:

>She’s rich as Croesus and would have no trouble raising outside money.

>She has ocean-wide name recognition.

>She has made a career largely on her matchless ability to “feel the pain” of Main Street Americans (a skill that former President Bill Clinton so effectively conveyed).

>Mr. Trump has already broken through the celebrity “glass ceiling.”

>Similarly, she shows no evidence of being a whiz on policy issues, but no one associated such expertise with candidate Trump, either. And plenty of veteran Democratic- and liberal leaning academics and other specialists would no doubt flock to her cause and give her all the tutoring she needs for a campaign.

>Like the president, she can boast real business success.

Obviously, Winfrey would face important obstacles. I wouldn’t include race or gender on that list. It seems clear to me she’s transcended both categories. But her background isn’t completely scandal-free – as this article makes clear. In this vein, she could well be hurt from the inevitable gushing her candidacy will draw from a Hollywood/celebrity class that much of the public finds completely off-putting.

Perhaps most important, once Winfrey throws her hat in the ring, the halo currently surrounding her will surely fall off, and she’ll start looking more like a conventional politician. Certainly, even though the Mainstream Media will be favorably disposed to her (as they have been to any Trump opponent), she’ll still be under a much harsher spotlight than she has been so far.

Even so, there’s one advantage she’ll have in a 2020 campaign that I believe will be especially important in putting her over the top. And I feel pretty confident about this view even if Mr. Trump enjoys major traditional tailwinds like an economy that keeps performing reasonably well (at least by the standard indicators that attract all the media attention) and U.S. avoidance of military involvement in foreign crises that generate lots of casualties and costs.

Let’s call this advantage “Trump fatigue syndrome.” It’s entirely possible that Americans could enjoy the kinds of safety and prosperity that have often won presidents second terms, and still yearn for a return to normality in their politics and public life – or at least greater normality.

On the one hand, I agree with those (including many Democrats) who insist that the typical voter is much less interested in the “Russia-gate” charges and the other scandals with which the president has been charged than with their personal financial and economic conditions, and their sense of security.

On the other hand, though, I’m confident that those charges, their endless repetition in the media, and the President’s consistently harsh reactions to them and to any and all criticisms, are generating a wearying effect – and starting to erode the broad voter anger that contributed so much to Mr. Trump’s 2016 victory. In other words, outrage can be exhausting even for a die-hard Trump-er, and I expect Trump fatigue to spread as long as the current level of political warfare continues.

Indeed, the recent Alabama U.S. Senate and Virginia gubernatorial elections – won by moderate, soft-spoken Democrats amid an improving economy – indicate that precisely this syndrome is becoming established among relatively well-to-do suburban voters who supported the President in the general election. The persistence of Mr. Trump’s weak national poll ratings during at least decent economic times is another sign that many of his Republican, conservative, and independent backers are tiring of his act.

I also expect that the Democrats and the President’s other opponents know this, and will ensure that the various investigations underway into the actions of Mr. Trump and his family, aides, and other associates continue as long as possible. Trump foes in the media, political, and entertainment worlds are likely to keep baiting him with social media and other attacks for the same reason. The only risk they would run (and it’s not negligible):  At some point, the public could well demand that they “put up” (with some specific evidence of major Trump wrongdoing) or “shut up.”     

Even so, unless opposition research, or simply the campaign grind, destroys her aura of empathy and moderation and good sense, who better to cure Trump fatigue, at least by promising to restore some peace and quiet and dignity to the White House, than Winfrey?

Strangely, though, my case for Oprah 2020 also indicates that a major turn for the worse in America’s fortunes could greatly reduce her odds of winning the White House. Despite her impressive business career, I’m by no means convinced that many voters would regard Winfrey as an effective recession fighter. It seems even less plausible that she’d be seen as a promising commander-in-chief type if the world starts appearing a lot more dangerous. (Nor does that judgment reflect gender considerations. Unless you think many voters doubted 2016 Democratic presidential candidate Hillary Clinton’s national security experience or toughness?) Even more important, a worsening economy and a more menacing world would appear a great formula for reigniting American political anger – which Winfrey would struggle to mollify.

And don’t forget the biggest threat to a Winfrey candidacy (though it seems to me unlikely at present):  Mr. Trump is removed from office, and in the process eliminate the shine from the ideas of celebrity candidacies and presidencies. 

But however strongly I feel that, barring a Trump exit, Winfrey could be taking the oath of office in Washington, D.C. on January 20, 2021, I’m less sure about two other big questions: Will she start to play a political role on behalf of Democrats in this year’s off-year elections? And will she be able to encourage enough additional Trump fatigue to affect the outcome notably?

(What’s Left of) Our Economy: Which Democrats are Serious and Un-Serious About Trade Overhaul?

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AFL-CIO, Bernie Sanders, Canada, Charles Schumer, currency manipulation, Debbie Dingell, Democrats, dispute resolution, Elizabeth Warren, environmental standards, labor standards, Mexico, NAFTA, North American Free Trade Agreement, Politico, Richard Neal, Robert Lighthizer, Rosa deLauro, rules of origin, Thea Lee, Trade, Trump, U.S. Trade Representative, unions, Wilbur Ross, William Pascrell, {What's Left of) Our Economy

Usually, paying attention to instances of politicians and other public figures getting up on their soapboxes is a waste of time. Yesterday served up an exception: a press conference held by House Democrats in reaction to President Trump’s official decision to open talks to renegotiate the North American Free Trade Agreement (NAFTA). The statements recorded in this Politico account offer some evidence as to which leaders on America’s Left are willing to work with the administration on trade policies that can help the working class voters Democrats still profess to champion, and those who will remain content to sit on the sidelines and take partisan potshots.

Reportedly, all of the House members who spoke at the event “said…they feared Trump would make only modest changes to NAFTA after blasting it as an economic disaster throughout last year’s presidential campaign.” The basis for these worries? The letter sent yesterday by new U.S. Trade Representative Robert Lighthizer to Congressional leaders announcing the administration’s intention to open NAFTA talks with the two other signatories, Canada and Mexico. According to these House Democrats and some other trade critics, the document apparently was “short on details,” which many claimed indicated Trump’s intention simply to “tweak” rather than comprehensively overhaul the agreement.

All else equal, wondering about the president’s real intentions is anything but unreasonable. His personality, after all, is mercurial, and one of his major trade initiatives to date – the negotiations begun with Beijing following February’s summit with Chinese leader XiJinping – has legitimately disappointed advocates of the major course change he pledged during the campaign. (The other major trade initiative, scrapping the Trans-Pacific Partnership trade agreement, kept a leading campaign promise to the letter.) Moreover, the Lighthizer letter is indeed short on specifics.

But none of the participants in the press conference seems to have noticed that in previous statements –including reportedly to leading Democratic lawmakers, top Trump officials have emphasized the need for dramatic NAFTA changes.

For example, Commerce Secretary Wilbur Ross has described as high NAFTA-related priorities greatly tightening the pact’s rules of origin in order to incentivize more non-NAFTA manufacturing investment inside the free trade zone, and restructuring a dispute-resolution system that gives each signatory an equal vote even though the United States represents more than 85 percent of North America’s total economic output. Reinforcing this point was the Lighthizer letter’s contention that “establishing effective implementation and aggressive enforcement of the commitments made by our trading partners under our trade agreements is vital to the success of these agreements and should be improved in the context of NAFTA.”

Meanwhile, Lighthizer reportedly has told Senators that the administration is thinking of adding to NAFTA rules that would prohibit currency manipulation – a move that would set a valuable precedent for future trade deals. In addition, his letter mentioned the need to improve NAFTA’s labor and environmental protections. In my view, they’re largely unenforceable. But they’ve been a prime focus of Democratic Party trade policy positions for decades.

So given that background, it seems fair at this point to finger Connecticut’s Rosa deLauro, New Jersey’s Bill Pascrell, and Massachusetts’ Richard Neal as grandstanders. The former stressed the “tweaking” allegation. The latter two charged that “It was clear from the start that the administration was only interested in working with the Congressional Republican leadership in drafting this notice [the Lighthizer letter].”

I’d also include in this group several key Senate Democrats, including Leader Charles Schumer of New York, former presidential candidate Bernie Sanders of New York, and Elizabeth Warren of Massachusetts. They voted against Lighthizer’s confirmation despite his decades-long record of fighting predatory foreign trade practices both as Deputy U.S. Trade Representative during the Reagan administration, and as a trade lawyer representing domestic American producers.

More temperate in their judgments were Michigan’s Debbie Dingell, and the AFL-CIO’s Thea Lee. The former stated that she was “investing the time to understand where the consensus is.” The latter said, “We enter every negotiation in a good faith state of mind and we expect a lot from our government. Certainly candidate Trump made a lot of promises about fixing flawed trade agreements and looking out for American workers and good jobs, so we will hold him and his administration to that promise.”

I can’t think of a more reasonable position for politicians and other supporters of a movement that still styles itself as the “party of the common man [and woman].”

Im-Politic: No Learning Curve for America’s Left on Immigration

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American Muslims, Angela Merkel, assimilation, Attorney General, Cory Booker, Democrats, Elizabeth Warren, Germany, Hillary Clinton, Im-Politic, Immigration, Jeff Sessions, Jeremy Corbyn, Labour Party, liberals, Marketwatch.com, Muslims, national security, Obama, Open Borders, progressive, Social Democratic Party, terrorism, Trump, United Kingdom

I keep waiting for America’s self-styled progressives to start recognizing that they’re going absolutely nowhere in national politics until they abandon their devotion to Open Borders policies, and start responding to their fellow citizens’ legitimate economic and especially security concerns about mass immigration.

Sadly, nothing could be clearer from recent developments than that the wait will continue indefinitely. Even worse, the U.S. Left seems to be even more clueless on the subject than its counterparts in Europe.

Certainly President Obama remains unrepentant about his own record. In his Farewell Address, he touted his record in fighting Islamic terrorism overseas (not that he used the term), and warned against the dangers of domestic radicalization. But his boast that “no foreign terrorist organization has successfully planned and executed an attack on our homeland these past eight years” once again made painfully clear his neglect of the dangerous impact of already having admitting so many newcomers whose original religion or culture creates huge obstacles to successful assimilation into American society. Why else would he have glossed over the deadly attacks by Muslim immigrants in Boston, San Bernardino, and Orlando?

In fact, according to Mr. Obama, the only Americans who need to learn about current and emerging immigration realities are those in the native-born population – because their fear that some immigrants today could “destroy the fundamental character” of the country is not only obsolete, but bigoted.

Other progressives also seem to be doubling down on efforts to address valid immigration concerns with smears. Can anyone reasonably doubt, for example, that Alabama Republican Senator Jeff Sessions’ appointment as President-elect Trump’s Attorney General would be sailing through the Senate if had not so forthrightly championed immigration realism – and enforcing the nation’s existing laws?

Yes, many Senate Democrats have accused Sessions of harboring racist views and neglecting the rights of a wide variety of discrimination victims. At the same time, none of these alleged transgressions prevented New Jersey Democratic Senator Cory Booker – Sessions’ leading Congressional opponent – from feeling “blessed and honored” just last year “to have partnered with Sen. Sessions in being the Senate sponsors” of a Congressional Gold Medal for the voting rights activists of the 1960s. No one else in the Senate protested, either.

Maybe Booker’s Massachusetts Senate colleague, Elizabeth Warren, is moving in the opposite direction? Not if her declaration that she’s running for reelection is any indication. Warren marked the occasion by vowing to “fight back against attacks on Latinos, African-Americans, Muslims, immigrants, women, and LGBT Americans. Our diversity is what makes our country strong – and on this, there will be NO compromise.” As if all these groups can be lumped in the exact same victimization category.

In fact, the only sign of progress I can detect is that no progressives are urging Mr. Obama or Mr. Trump to quintuple the number of U.S. refugee admissions from war-wracked Middle Eastern countries – as failed Democratic presidential contender Hillary Clinton proposed.

The contrast with European progressive leaders is stunning. As reported in an insightful column on Marketwatch.com, the head of Germany’s Social Democratic Party – and the country’s vice chancellor in the current coalition government – is calling for “ncreased video surveillance…a ban on fundamentalist mosques as breeding grounds for terrorism, and…an end to freeloading on Germany’s generous child-support subsidies by other European Union citizens.”

Another German progressive leader has slammed Chancellor Angela Merkel for “uncontrolled border opening [and]a police force that has been downsized to the point of inefficiency, that neither has the personnel nor the technical resources that would enable it to cope with the current threat situation,”

Meanwhile, Jeremy Corbyn, who heads the United Kingdom’s struggling Labour Party, is unmistakably rethinking his former opposition to Britain’s decision to leave the European Union in large part because of the grouping’s lax immigration policies. Corbyn had previously opposed “Brexit,” which British voters passed in a referendum in June.

Germany, of course, has experienced Muslim terrorist attacks much bloodier than America’s. The Labour Party seems headed for its worst showing in Parliament since the 1930s. Will it take these kinds of security and political disasters to bring U.S. progressives to their senses on immigration?

Following Up: Democrats’ Safety Net-Heavy Policies Still Missing the Mark for Trump Voters

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2016 election, Center for American Progress, Democrats, Economic Policy Institute, Elizabeth Warren, entitlements, Following Up, manufacturing, middle class, Mitt Romney, Neera Tanden, private sector jobs, progressives, safety net, Trade, Trump, Welfare State, working class

A little over a week ago, I wrote that much of the American Left was way off-base in believing that working class Americans who supported Donald Trump’s successful presidential run had voted against their economic interests. My thesis: These Trump voters were (rightly) much more interested in the family wage private sector jobs his campaign was promising rather than the various forms of welfare that Democratic candidates were strongly suggesting were adequate substitutes. And revealingly, compelling confirmation for my claim arrived just this week – in my email box!

The evidence came in the form of fund-raising pitches from the Economic Policy Institute (EPI) and the Center for American Progress CAP). Yes, it’s true that such solicitations aren’t the same as detailed policy papers. It’s also true that both organizations have in the past supported at least some of the trade policy overhauls emphasized by Mr. Trump as vital to job creation in the genuinely productive sectors of the U.S. economy – especially manufacturing. It seems that their interest in new trade policies continues to some extent. And it’s true as well that funding appeals are practically by definition aimed mainly at core or likely supporters – so they don’t necessarily reflect the full output of thinking of these think tanks.

Nevertheless, as a result, fund-raising pitches almost by definition reveal much about these core backers’ priorities, and those of an organization. And in both the EPI and CAP emails, creating more good jobs via trade was a concept conspicuously absent, while what I’ve described as cleverly disguised (even when necessary or desirable) welfare measures were front and center. And here’s a fact that goes far toward clinching the case that the Left remains largely clueless re helping the “ninety-nine percent” it claims to champion. These think tanks in many ways represent the two main wings of progressivism and the Democratic party– what have been called the Bernie Sanders and Hillary Clinton camps.

Take EPI’s pitch – which came in the form of a note from Democratic Senator Elizabeth Warren of Massachusetts. Warren certainly identified a big problem faced by working class voters and bearing much blame for the neglect they obviously feel: “A lot of people in this country work hard, but they aren’t building any security—and they are angry about it.”

Warren continued:

“They’re angry that bonuses go up for CEOs while their own paychecks are stuck in the same place year after year. They’re angry that basic costs like housing, health care, and childcare have skyrocketed. And they’re angry about a tax system that benefits the rich and powerful.

“They’re angry because our economy and our government work for those who have already made it big, but don’t work for them.”

And in my view, she correctly identified a goal that needs to be achieved for greater and more broadly based American economic success: “Our top economic priority must be improving the lives of working people in this country—because everyone in this country should have a fighting chance to build a future.”

But what did Warren emphasize as the policies most needed to help the working (and middle) class? “[F]ighting to raise the minimum wage to a living wage [and expanding] Social Security for millions of Americans…” along with addressing “the gender and race wage gaps….” The words “trade,” “offshoring,” and “globalization” simply don’t appear.

The appeal for the Center for American Progress came from its president, Neera Tanden. You might be familiar with Tanden from the presidential campaign. As a prominent Hillary Clinton supporter, she’s been a fixture on many of the Sunday morning talk shows. She was also one of the most prominent Democrats embarrassed by the hacked and leaked emails of Clinton campaign manager John Podesta.

Tanden’s email yesterday was titled “Defend Our Economic Security” – and therefore seemed full of promise. I thought that it might deal with neglected issues I’ve written profusely about, like the weaknesses that have emerged in the American defense manufacturing base, or the recklessness of permitting the nation’s best tech companies transfer much of their best (and defense-related) knowhow to China.

No such luck, however. Tanden’s focus instead was on “the issues that matter most to working families” – which of course is laudable. But as her letter makes clear, CAP is most concerned with “how the American middle class has been squeezed by the rising costs of health care, child care, higher education, housing, and retirement” and the greatest challenge it sees is preventing President-elect Trump and the incoming Republican-controlled Congress from cutting the government programs that have helped the middle (and working) class cope with these rising costs.

Again, I have no objection to ensuring the continued health of many of these programs, or entire safety net. But in CAP’s apparent view, they’re ends in and of themselves. I also understand the need to demonize political opponents in fund-raising literature. It’s a tried and true way to fire up the donor base.

But the organization doesn’t seem interested in policies to foster the types of private sector jobs that would enable Americans to reduce their burgeoning reliance on these measures. That notion is also difficult to find at the Economic Policy Institute. Both institutes may be right in viewing a safety net-centric economic game plan as a winning political formula. And if they were, in an ironic way, they’d be confirming one of former GOP presidential candidate Mitt Romney’s biggest verbal mis-steps during the 2012 election – his suggestion that 47 percent of Americans are welfare state takers.

But one of the clearest lessons of the 2016 election is that the masses of working class voters who opted for Mr. Trump aren’t buying it. All of which presents the Democrats – who have styled themselves as the Party of the Common Man – with a dilemma that’s not only momentous, but possibly existential.

Im-Politic: Why U.S. Progressives Need to Become Nationalists

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America First, Bernie Sanders, Democrats, Elizabeth Warren, free trade agreements, globalism, Im-Politic, Immigration, labor unions, nationalism, New Balance, offshoring, Populism, progressives, third world, Trade, Trump, white working class, working class

Tiny groups of individuals shouldn’t be mistaken for entire movements, or even significant factions of movements. Therefore, I don’t want to make too much of those Trump haters who burned their New Balance sneakers and/or slammed the company on social media because it stated that the election as president of a strong trade policy critic would be good for manufacturers seeking to make most of their products in the United States, like itself.

At the same time, the backlash against New Balance sheds lots of light on serious problems in the ranks of American progressivism that contributed to Trump’s triumph and that will need to be solved if the Left end of the country’s political spectrum is to win working class loyalties and convincingly claim populist chops.

Let me start with a little story (one of my father’s favorite phrases!). Back in the late-1990s, when President Clinton had requested new trade negotiating authority from Congress, I attended a meeting at AFL-CIO headquarters of activists seeking to block his ambitions. Early at the session, we agreed that we should explain to legislators and the public what kinds of trade policies we favored, not simply what we opposed, and someone (not me) suggested something along these lines as a unifying theme:

“The main purpose of U.S. trade policy should be to promote healthy growth for the American economy and higher living standards for the majority of the American people.”

That didn’t seem terribly controversial to me. But several hands immediately rose in protest. A representative of the Maryknoll Sisters made clear the objection. Why, she asked, were we ignoring the well-being of the rest of the world?

To his credit, the American labor leader who was running the meeting tried to argue that, however much he sympathized with her point, it was axiomatic that the first obligation of the U.S. government was to promote and defend the interests of the American people. But he didn’t make the argument very emphatically, and many of the others around the table – who came from left-of-center organizations – were even more conflicted. I tried to shore up the first speaker, but quickly realized I was in the greatly outnumbered and spent the rest of the session listening.

I don’t remember what the final version said, and doubt it was ever made public, but the phrasing of that opening point was definitely watered down. On my way out, some folks who worked for labor union offices outside the Beltway came over to me and asked, as they were shaking their heads, “What the heck was that all about?” I replied, “You’ve just learned a valuable lesson about American liberals. Many don’t believe that American workers’ interests should come first.”

They’d actually gotten many such lessons throughout the 1990s. As the first Bush administration and especially the Clinton administration turned U.S. trade policy into an exercise in offshoring, not domestic growth, their progressive critics decided that the best way to resist was to spotlight the harm this new strategy would inflict on workers and peasants in the developing world as well as in the United States. In fact, the third world and its grievances turned into a prime focus of those who famously protested the 1999 meeting of the World Trade Organization in Seattle.

This approach made some tactical sense, as many liberals in Congress clearly were not constitutionally inclined to buy an America First trade policy. But although there are any number of ways in which U.S. trade policies could be changed to create more situations of mutual benefit between rich and poor countries (see this recent article for an example), the progressive stance also reflected a refusal to recognize that many hard choices have confronted – and still confront – the nation on trade.

In public policy trying to please everyone tends to wind up pleasing no one. So substantively, this wishful thinking was a formula for confusion at best. Politically, the impact was far worse: The progressives wound up muddying and therefore weakening the message trade critics were trying to send to the public.

Small wonder that even though the critics won some procedural trade fights during the 2000s, even after the financial crisis of 2007 and 2008, President Obama managed to secure Congressional passage of three new free trade agreements. Not until a major politician forthrightly vowed to prioritize American interests in trade policy making did the powerful globalization status quo meet its match – and then some.

Based on their initial post-election statements, it seems that progressive leaders realize that rejecting the option of working with Mr. Trump on trade policy would be the height of folly. That is, it seems that they’re implicitly rejecting the notion that the President-elect is so odious that a company that employs American workers despite powerful pressures to offshore should be condemned not for endorsing the whole of his candidacy, but simply for noting that his election would likely aid those efforts.  Therefore, big changes on the trade front seem inevitable above and beyond the collapse of the Trans-Pacific Partnership (TPP) agreement.

Yet even the progressives’ leaders still face a towering obstacle in their own quest to regain the votes of the millions of working class voters – probably like many of those New Balance workers – who deserted their party’s standard bearer last Tuesday night. They have no chance of succeeding if they continue describing all forms of common sense immigration policies as bigoted. And for those of you who think that I’m just talking about the white working class, keep in mind that the phrase “union household” also describes this constituency.

In other words, during the 2016 elections, progressives in part tried to convince Main Street America that they would gain from a massive increase in the nation’s supply of unskilled labor through both amnesty and the powerful magnet effect it would generate. And at the same time, if these working class voters worried about the resulting downward pressure on wages, along with the effects on the nation’s cohesion of surging bilingualism and its security of newcomers from the culturally medieval Middle East, they were condemned by the Left as nativists, racists, and even worse.

The pointed references to Mr. Trump’s alleged xenophobia by both Senators Bernie Sanders and Elizabeth Warren (earlier in the campaign) show that their faction of American politics has much to learn on this score. Until they understand that real U.S. populists can’t be globalists in this day and age, they’re likely to continue wandering the political wilderness.

Im-Politic: The Day After, Part II

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2016 election, African Americans, Bernie Sanders, consumer confidence, Democrats, Elizabeth Warren, exit polls, Hillary Clinton, Hispanics, Im-Politic, labor, NAFTA, polls, TPP, Trade, trade laws, Trans-Pacific Partnership, Trump, white working class

It’s the day after the day after in America, and I’m still stupefied by the advent of the Age of Trump. I have absolutely no inside info on what to expect in the way of policy recommendations from the transition team or the new administration, so I’ll be just as eager as anyone for the hints and trial balloons to emerge.

But continuing with the theme of yesterday’s post, I believe it is possible to identify some important questions that major actors in American politics – and the voters they’ll keep trying to reach – will need to grapple with. Let’s focus today on the Democrats and their allies and constituencies, since they face the most obvious challenges:

>At least one piece of the conventional wisdom about Hillary Clinton’s failings strikes me as being right on target – especially since the emails exposed by Wikileaks make clear that her senior advisers spotted it as well: She never developed a clear, compelling positive message.

It’s not that “Stronger together” isn’t a positive idea, and no doubt had some appeal at a time of deep national division. But this slogan begs the question “Stronger together to where?” Regularly, Clinton suggested that she meant “to the 1990s,” when her husband was president. Many Americans – particularly in the chattering classes – do indeed view the period as a time of unprecedented prosperity along with peace. To many others, however – especially in working class precincts – the decade evoked memories of job-killing trade agreements like NAFTA. And of course many others were reminded of a string of scandals, both real and alleged.

In fact, I’d take the critique of Clinton’s message one step further. Even though her campaign website and many of her speeches were filled with any number of specific proposals, they were quickly replaced on the campaign trail, and especially in her ads, by a non-stop assault on Trump’s character and qualifications for the Oval Office. Clinton’s defeat strongly indicates that you can’t beat even a deeply flawed something with nothing.

>In fairness to Clinton, however, her messaging problems might have been related to a genuine quandary she faced. Democrats have styled themselves, and often acted like, the Party of the Common Man. As I and others have written, when it comes to issues like trade, demographic changes in Democrats’ ranks seem to be clashing with this relatively populist identity, and Tuesday night’s results indisputably show that the party has the majority of the white working class.

Indeed, according to the preliminary evidence, Clinton’s performance among union voters was feeble by the standards of recent Democratic presidential candidates – despite labor leaders’ vehement opposition to Trump. And keep in mind that nearly half of this electoral bloc is comprised of government workers, who naturally tend to favor the freer spending Democrats. As a result, Clinton’s backing from members of private sector unions was probably much weaker still.

So the Democrats face a fundamental choice, and it could well have rhetorically crippled an undecided Clinton. Will they turn their backs on private sector union members, possibly also in the belief that America’s changing population profile is steadily reducing their political importance? Or despite the gulf between private sector union workers and younger, better educated Democrats on issues like trade (along perhaps with immigration and those amorphous but crucial cultural and values issues), will they try to bring them back?

>Nonetheless, major Democratic constituencies and their leaders – including the unions and the party’s progressive wing – still loudly oppose America’s current approach to trade. But as mentioned above, they’ve been almost hysterically anti-Trump, to the point of incoherence.

If they’re serious about overhauling trade policy, it’s time for these folks to wake up and turn the partisanship down. They’ll soon be getting a president who supports most of their major and longstanding trade positions, including opposing the Trans-Pacific Partnership (TPP), sanctioning China for currency manipulation, rewriting NAFTA, and using U.S. trade law more energetically to fight predatory foreign practices.

Working with Mr. Trump, they can achieve these goals. Remaining in spiteful high dudgeon could doom reforms they’ve sought literally for decades. Statements by Senators Bernie Sanders and Elizabeth Warren, and from organized labor, are promising signs that these progressive leaders are open to cooperation with the incoming Chief Executive. Assuming that these declarations are serious, it’s time for the rest of the movement to fall in line and recognize that for the first time in modern U.S. history, the White House looks to be on their side.

>Finally (for now), nothing could be clearer about the 2016 election returns than the serious flaws they’ve revealed in the so-called science of polling. But politically focused surveys aren’t the only soundings apparently needing major surgery. Many of the best known economic surveys arguably were way off base as well.

For example, many polls – including this week’s exit polls – show strong public support for some form of legalization for illegal immigrants. Can this finding be reconciled with Mr. Trump’s win? Other surveys have revealed a notable warming of Americans’ views of free trade and recent trade agreements. That’s also hard to square with this week’s actual results – and would have been even had Mr. Trump lost by a respectable margin.

Also deserving of greater scrutiny – surveys of consumer and other forms of economic confidence. They have strongly tended to show significant improvement since the depths of the last recession, which isn’t hard to understand. But even their general claims of a simple return to pre-recession levels or, in some cases, better, ring false in light of this week’s voting.

One possible explanation is the gap identified by some researchers between rising optimism by African-Americans and Hispanics and the more downbeat views of whites. But if so, why did Trump fare much better among the latter than widely predicted, and why did he best 2012 Republican nominee Mitt Romney with both groups even though the economy was considerably weaker four years ago?

I can’t emphasize enough, however, how tentative my observations are, and how long my (and so many other) questions will defy confident answers. My only certainty so far is that election night this week was the most important historic event I’ve ever experienced. (I was born at the end of 1953.) I just wish I knew whether for good or ill.