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Biden’s New “Made in America” Trade Views Come To Light

August 17, 2020

By Kenneth Rapoza, Industry Analyst, CPA

Joe Biden's trade team has the right ideas on China. Here are some standouts we note in his Made in All of America trade policy.

We are pleased to see that Joe Biden has come to grips with the fact that China is a problem for U.S. manufacturing and the U.S. labor force in general.  This is what we gathered from his latest proposals on trade and manufacturing in his recently released Plan to Ensure the Future is Made in All of America.

From the plan, we get his view that “manufacturing was the Arsenal of Democracy in World War II, and must be part of the Arsenal of American Prosperity today, helping fuel an economic recovery for working families” post-pandemic. 

Prior to this week’s release of the Made in America plan, Biden issued a policy note on July 7 saying his administration would “shift production of a range of critical products back to US soil.”  Once again, his team has reiterated in their latest proposal to “put Americans to work making critical products, (like) medical equipment and supplies.”The proposal was written by an unnamed team of Biden advisors.

It would be great if they are implemented. However there is room for doubt about to what extent a Biden administration would implement these things. His record in the Senate and as Vice President does not show much previous concern for supporting manufacturing on US soil.

In addition to picking his running mate, California Senator Kamala Harris, the Biden team has unveiled more of their thinking about trade and China. We sum it up here in four simple bullet points.

  • Trade enforcement: Biden says that China or any other country that undermines American manufacturing with unfair pricing, currency manipulation, or unfair subsidies would be met with tough measures from a Biden administration.  The Democrats released their 2020 Party Platform in July where they said they support taking “aggressive action against China or any other country that tries to undercut American manufacturing by manipulating their currencies and maintaining a misaligned exchange rate with the dollar, dumping products like steel and aluminum in our markets, or providing unfair subsidies.”

We at CPA also believe a misaligned dollar is a bigger problem than currency manipulation, but it’s a step forward to see the platform call out misaligned exchange rates. It’s also good to see the words “aggressive action.”

  • Work with allies: Biden says he will work with other countries to pressure China to follow the rules. Here he was more specific, naming longtime problems such as oversupply and overcapacity in steel and aluminum, fiber optics and shipbuilding. According to the Plan, Biden will “work with allies to modernize international trade rules and associated domestic regulations regarding government procurement to make sure that the U.S. and allies can use their own taxpayer dollars to spur investment in their own countries.”

  • IP protection: Biden says China’s government is engaging in an “assault on American creativity”. Here, he includes the JV requirements of tech know-how being transferred to mainland China companies, but it’s unclear how he would achieve this. Biden says his version of a phase one deal would tackle IP. He is proposing state-funded investment of $300 billion over his presidential term to create millions of STEM jobs, and to secure the US position as a global leader “in the most critical and competitive new industries and technologies,” the report states. Credible estimates indicate that this level of investment could help create 3 million jobs or more. China’s total R&D expenditures have increased nearly 30-fold from 1991 to 2016. By some estimates, China will overtake the US in R&D spending this year. And, as part of China’s “Made in China 2025” plan, China’s government has launched funds to increase manufacturing and technological innovation in key industries, including battery technology, artificial intelligence, and 5G.

  • Cyber espionage: Biden mentions the previous administration’s agreement with China on cyberespionage. He said that by letting that agreement lapse, China spying increased. He would return to it, assuming China is willing to agree. Biden says he will develop new sanctions as punishment against Chinese entities that steal U.S. tech secrets by cutting them off from U.S. capital markets.


For her part, Kamala Harris is mainly seen as a law-and-order type who has not revealed any strong convictions on trade. In the past she has said trade is all about the export market. This is a common distraction by free-trade types. In fact, the domestic US manufacturing market, worth $7 trillion, is five times the size of annual US manufacturing exports, so the US has much more to gain by recapturing the US domestic market than competing for additional pieces of foreign markets.  Here is Harris on trade in 2019: “I am not a protectionist Democrat. Look, we need to sell our stuff. And that means we need to sell it to people overseas. That means we need trade policies that allow that to happen.”

She believes China needs to be “held accountable” on IP theft and in anti-dumping practices.- Harris is a strong advocate of government action on climate change and that influences her trade policies. She believes trade agreements should balance the environmental regulations competing companies must abide by in each country. This puts her in line with the Biden Plan. The policy blueprint for a Biden Administration on the environment and trade states the US would apply a “carbon adjustment fee against countries that are failing to meet their climate and environmental obligations” – which we assume to mean China and India off the bat.

This extra duty would “stop polluting countries from undermining our workers and manufacturers, ensuring we can lead, compete, and win as we harness the opportunity of a clean energy economy achieving net zero emissions by 2050,” the Biden Plan states.

Biden has to work hard to convince voters that he is going to take tough action on trade. He is still seen as a status quo Democrat on trade, not much different than Bill Clinton or Barack Obama, who got us into NAFTA, allowed China into the World Trade Organization, and repeatedly promised to get tough with trade cheaters but did little.

Times have changed. The release of Biden’s Made in America plan shows that he understands the changes. The Democrats cannot continue to ignore working-class voters and the manufacturing heartland. In the weeks ahead, we expect more trade talk from Team Biden-Harris.

commentary

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  • Dr.Vince & Dianne Foster
    I agree that I don’t trust Biden on trade, given his history of supporting all “free trade” deals. He is the lesser of 2 evils, a “choice” created by the ruling elites, as they once again squashed Bernie Sanders. I will write in Bernie’s name in November. I spent years fighting the TPP and then NAFTA 2.0. I also am a cancer survivor who will continue to oppose 5G in my neighborhood, regardless of whether it’s Chinese or American-made. There are tons of scientific papers on the damage from EMF, and it is already being installed without public permission, around my town.
  • Jarrell Jackman
    Impossible to take this article seriously. There should have been a disclaimer that sounds good on paper but this is coming from a man whose past belies this plan
  • Mark Sanguinetti
    After reading Ken’s comment on the clear example of today’s legalized bribery in the USA with $1.5 billion funneled through the son of Joe Biden. I did research and found this article, which seems to be politically NOT bias.
    Hunter Biden and China: Sorting through a murky business deal
    https://www.politifact.com/article/2020/may/22/hunter-biden-and-china-sorting-through-murky-busin/
    Go through the politicians in the USA to help the business interests of China, while giving the son of a politician a very large commission.
  • Mark Sanguinetti
    Joe Biden, as vice president favored the Trans-Pacific Partnership and with Barack Obama as President tried to get it to pass congress completely. As a Delaware Senator in 2000 he voted in favor of the U.S. China Relations Act. During the 1990s, as Delaware senator, Biden repeatedly voted to support Most Favored Nation Status for China in 1991, 1992, 1997 and finally the most critical vote in 2000 that made Most Favored Nation status permanent and allowed China into the World Trade Organization.
    But now since this is election season Biden is making promises he has never done, while having actual political office. When people know what he has actually supported and done they should clearly see Biden’s global trade deception and false promises during election season. Also when he was a Delaware Senator in 1993, he voted to pass NAFTA, which is the North American Free Trade Agreement.
  • Mark Sanguinetti
    Joe Biden, as vice president favored the Trans-Pacific Partnership and with Barack Obama as President tried to get it to pass congress completely. As a Delaware Senator in 2000 he voted in favor of the U.S. China Relations Act. During the 1990s, as Delaware senator, Biden repeatedly voted to support Most Favored Nation Status for China in 1991, 1992, 1997 and finally the most critical vote in 2000 that made Most Favored Nation status permanent and allowed China into the World Trade Organization.
    But now since this is election season Biden is making promises he has never done, while having actual political office. When people know what he has actually supported and done they should clearly see Biden’s global trade deception and false promises during election season. Also when he was a Delaware Senator in 1993, he voted to pass NAFTA, which is the North American Free Trade Agreement.
  • Ken Beveridge
    I agree with Kevin – this is hilarious. Anybody that believes anything the Dems say at this point is either delusional, or has an agenda that matches theirs.

    Joe Biden is a bought and paid for agent of the Chinese Communist Party. What is his price for treason? $1.5 Billion, funneled through his son. Anybody honestly believe that they gave that crack head $1.5 billion to “invest” for them?
  • Kevin Williams
    I had to laugh when reading this article. Does anyone remember NAFTA and the politicians that supported the Great Sucking Sound legislation for American manufacturing.
    Joe, and yes he had help supported NAFTA, Bill Clinton signed into law on the last few days of his administration.
    So they created a huge problem and now you expect us to trust them?

    Sounds like there poll results have directed there policy which sounds a lot like Trumps agenda.