Ripon Forum


Vol. 51, No. 2

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In this edition

by LOU ZICKAR From a Congress that riven with politics to a bureaucracy that is spinning out of control, this edition of the Forum looks at how governance has broken down in Washington and how things can be turned things around.

The Case For Term Limits

Term limits for members of Congress will change the incentives for members and pave the way for more effective government.

The Case Against Terms Limits

Term limits weaken the legislative branch, at the expense of further empowering the executive and interest groups.

COEQUAL OR CO-OPTED?

The balance of power has shifted over the years in favor of the Executive Branch. And according to this former lawmaker and veteran political observer, it is time for Congress to claim this power back.

Fixing the Civil Service

Once a cure for good government, the U.S. civil service system is now a cancer on the federal bureaucracy that is choking out efficiency and needs to be reformed.

Biennial Budgeting: A Positive Idea for America’s Bottom Line

It is time to convert the broken appropriations process to a two-year cycle, with one year focused on spending, and the other year focused on overseeing the funds that are being spent.

Creating a Congress of Tomorrow

When the governing process fails to function, reform is necessary. And this first term lawmaker from the State of Illinois has introduced a bipartisan plan that would do just that.

An Uncomfortable Reality… Congress Needs More Staff

At a time when political dysfunction is paralyzing Capitol Hill, it is time to help Members of Congress do their jobs better by letting them hire more staff.

A Smart Government Plan with Bipartisan Roots

As presidential advisor Jared Kushner looks for ways to reform government so it is “ahead of schedule and under budget,” he should look at an idea that Congress almost passed 40 years ago.

To Strengthen our Infrastructure, Invest in Rural Broadband

If new infrastructure spending is to be effective, it must move beyond simple concrete and rebar and focus on digital networks that virtually connect all areas of America.

Trade & the Trump Administration

The best trade policy the President can pursue to improve the lives of the American people is to eliminate trade barriers at home and abroad.

Ripon Profile of Pat Meehan

The Pennsylvania lawmaker talks about the challenges facing his District & his priorities on Capitol Hill. He also offers a bit of advice for the President: “Take a break from Tweeting.”

Trade & the Trump Administration

A powerful – and politically divisive – engine of growth

International trade is a powerful driver of economic growth. It introduces competition, inspires innovation, and results in productivity gains which improve our standard of living. However, it has become a particularly contentious issue in the United States.

In 2009, 57 percent of Republicans believed that trade agreements were good for the nation. That number has since plummeted to 24 percent, with 68 percent of Republicans opposing U.S. trade agreements. This shift was undoubtedly propelled by the 2016 presidential election.

President Donald Trump has been especially vocal about his disdain for U.S. trade policy. During his campaign, he vehemently condemned the North American Free Trade Agreement (NAFTA). He also asserted that “globalization has wiped out our middle class.” He has since taken significant steps toward fulfilling his campaign pledges.

First, he immediately withdrew the United States from the Trans-Pacific Partnership (TPP), a U.S. trade agreement with 11 nations in the Asia Pacific. He also plans to begin renegotiating NAFTA later this year. Furthermore, President Trump met with President Xi of China this month to discuss bilateral trade.

It is evident that the President is committed to making trade policy a priority. However, his actions and rhetoric thus far have been largely misguided. To ensure a prosperous American economy, we must embrace the comprehensive, widespread benefits of open trade.

It is evident that the President is committed to making trade policy a priority. However, his actions and rhetoric thus far have been largely misguided.

International trade spurs international competition, which results in the creation of higher-quality, lower-priced goods and services. This benefits consumers by increasing the availability of valuable products at low prices. It also benefits producers: over half of all imports are used by American manufacturers in the production of final goods. These imports lower the cost of production, which also enables U.S. businesses to sell goods at lower prices.

Increasing trade barriers, on the other hand, disproportionately hurts the poor. A study released earlier this year found that current U.S. tariffs raise the tax burden for lower-income households substantially more than for middle- and high-income households. This is because poorer households tend to spend a larger share of their income on traded goods, and increasing tariffs increases the costs of these goods. The tax burden is highest on single parents and families with children.

The President has been particularly outspoken about using trade barriers to encourage domestic manufacturing, protect domestic industries like steel, and prevent job losses due to trade. However, the vast majority of the decline in U.S. manufacturing employment has been triggered by advances in automation and productivity. This explains why manufacturing output in the United States has continued to rise even while the number of manufacturing workers has decreased.

The impact of trade on jobs is similarly misunderstood. When a country opens itself to trade, international competition leads to specialization. This means that American firms start producing the best products they can for the lowest costs. The natural result of specialization is labor market shifts; some jobs will be displaced while new jobs are created in emerging sectors of the economy. But specialization also increases U.S. productivity, which generates economic growth. This growth is estimated to boost U.S. household income by $13,600 per year.

More than one in every five jobs is supported by international trade and nearly five million jobs were created as a direct result of NAFTA.

There is no denying that labor market shifts can be painful. However, less than one percent of all job separations in the United States are due to import competition. Alternatively, more than one in every five jobs is supported by international trade and nearly five million jobs were created as a direct result of NAFTA. Exports generate jobs by increasing demand for U.S. products, while imports generate jobs by increasing the purchasing power of consumers, reducing input costs for businesses, and generating additional economic activity.

Engaging in international trade is also in the strategic interest of the United States. Trade agreements encourage international cooperation, strengthen relationships with our allies, and bolster U.S. leadership and economic influence around the globe. This is why numerous secretaries of state and defense, foreign ambassadors, and other political leaders have fought for the implementation of trade agreements like the Trans-Pacific Partnership.

President Trump is committed to negotiating only bilateral trade agreements. However, there is no evidence that bilateral trade agreements produce better economic results than multilateral agreements. To the contrary, regional negotiations have resulted in greater market access for U.S. exporters than bilateral deals. Furthermore, TPP countries are determined to move forward without the United States. The United States will continue to miss out on opportunities for multilateral cooperation as long as it is confined to bilateral trade negotiations.

Trade is a powerful engine of growth. It expands market access for producers, lowers costs for consumers, and produces invaluable productivity and efficiency gains which stimulate economic growth. While it is not surprising that public opinion has taken a turn, the best trade policy President Trump can pursue to improve the lives of the American people is to eliminate trade barriers at home and abroad.

Jacqueline Varas serves as a Director of Immigration and Trade Policy at the American Action Forum.