Bernie beats Trump (and Biden) on trade

It is an indisputable fact that in recent decades, American workers have seen their wages stagnate and jobs disappear. Unfortunately, they found little relief in the policies of the Democratic or Republican parties. Quite the contrary, at least since Bill Clinton’s promotion of the North American Free Trade Agreement (known as NAFTA) in 1994, American policymakers have done a lot to harm and little to help the class. American worker in difficulty.

In order to see why Bernie is the best choice for working people in America, his stance on trade must be distinguished from both Biden’s waffles and Trump’s hollow rhetoric.

This has been combined with a media narrative that is more confusing than clarifying US trade policy. Any presidential candidate, Democrat or Republican, who criticizes existing or ongoing trade deals is duly labeled “populist” and sidelined as being beyond the bounds of rational political discussion. It has become common practice to put Donald Trump and Bernie Sanders together, tar them both as populists, with the obvious implication that Sanders is just the left-wing version of this imbalanced Republican.

Indeed, serious political discussion has been abandoned in favor of classic phrases about populist contempt for trade. Witness James Surowiecki from New Yorker: “Trump and Sanders downplay the enormous economic benefits of globalization for American consumers of all income, and their proposals are vague and may well be harmful if implemented.”

It is pure nonsense. And it’s more important than ever to dispel such claims, given the shrinking 2020 Democratic field, with Joe Biden and Bernie Sanders competing to be the champion of American workers. In order to see why Bernie is the best choice for working people in America, his stance on trade must be distinguished from both Biden’s waffles and Trump’s hollow rhetoric.

The basic fact is that as lawmaker and vice president Joe Biden has supported free trade agreements like NAFTA (under Clinton) and the Trans-Pacific Partnership (under Obama). And yet, as a presidential candidate, Biden has retreated of these agreements to avoid alienating American workers. It is not difficult to see that this is pure political opportunism. Barack Obama used the same strategy in its race in 2008.

Sanders, on the other hand, has consistently criticized trade deals designed to benefit companies rather than workers. He made it clear in 1993 why he opposed NAFTA, arguing that “the essence of NAFTA is that American workers will be forced to compete with desperate and impoverished Mexican workers,” which “will only benefit the ruling elites” of those countries. And in the 2016 primary, Hillary Clinton made a about-face on the Trans-Pacific Partnership – which she hailed as the ‘gold standard ‘ in trade deals – after Bernie sharply criticized it.

While there is no doubt that Bernie has a knack for forcing his main adversaries to turn around on trade matters, one wonders why he takes such a strident and critical stance towards free trade agreements.

This question is all the more urgent as a recent survey showed a record number of Americans, especially Democrats, warming to commerce. Some have sharp to that poll to say, “See, everyone loves business – so lefties like Bernie have to get on board.”

This is not surprising given the editorial cottage industry that has grown over the past three years to criticize Trump’s trade strategy and his economic policy more generally. But despite the pundits’ urge to put Trump and Bernie together as business skeptics and populists, there is a world of difference between their positions.

To understand why, it helps to begin by understanding the plight of American workers, whom so-called populist rhetoric is supposed to appeal to.

Consider the observations of Steven Rattner, one of President Obama’s former economic advisers and hardly a Bernie leftist. Rattner a highlighted, for those who hesitate to admit it, that globalization has left many workers behind. In particular, workers in the manufacturing sector who, when they lose their jobs, are unlikely to find new jobs that are as well paid or that are as confident of their benefits.

You may think, however, that this negative impact is limited to a relatively small group. Perhaps the gains for workers outweigh the loss of jobs, for example, in lowering the price of goods due to the efficiency of trade. But this is not true for the majority of American workers. Like Josh Bivens of the Institute for Economic Policy, noted“A reasonably conservative estimate is that between 1973 and 2006, global integration lowered the wages of American workers without a four-year college degree (the vast majority of the American workforce) by 4%.” This takes into account the fall in the prices of consumer goods.

It is important to recognize that Sanders is not opposed to trade deals of any kind. What is important is that these agreements are negotiated with the participation of the workers and include protections for the environment.

It is, underlines Bivens, the basic economy. Literally – if you look at a textbook on international trade, the Stolper-Samuelson theorem says exactly this. Due to the state of advancement of the US economy relative to its trading partners, the benefits of trade mostly flow to high-end sectors, as we import cheaper products from overseas rather than to manufacture them here. Not only does this depress wages, but it generates inequalities. High incomes win and low wages lose.

This makes redistributive policies more important than ever.

This is obviously a clear difference between Sanders and Trump when it comes to economic reform and trade. Trump is simply not interested in redistributive policies – instead, he has made false claims to bring jobs back to the United States with massive tax incentives. The most remarkable case is his false promise to create 13,000 jobs in Wisconsin in the form of a Foxconn manufacturing plant.

Finally, it’s important to recognize that Sanders is not opposed to trade deals of any kind. What is important is that these agreements are negotiated with the participation of the workers and include protections for the environment. This was lacking in Trump’s ‘NAFTA 2.0’, so Sanders rightly so opposite he. Compared to Trump and Biden, there is simply no doubt that Sanders’ business approach puts workers and the environment first, not corporate convenience.