What can Hillary do to gain trade reformers trust?

May 17, 2016

by Michael Stumo

Ralph Waldo Emerson once said “Your actions speak so loudly, I can not hear what you are saying.”

I was interviewed by a Southern California NPR reporter yesterday about why left of center trade reformers don't trust Hillary Clinton to fix trade. CPA members, of course, are all over the map supporting Trump, Sanders and Clinton. I'd like to share my reasoning on the reporter's question. 

What can Clinton do to show voters she has truly reformed her trade policy views?

Polls show that trade is now directly linked to the all important "jobs and economy" issue in voters minds. This is really important.  Some polls have shown that Donald Trump, for all his negatives, is trusted more by general election voters on the economy than HRC.

What past HRC actions have caused this voter distrust on trade? Here is one list.

  1. She advocated for NAFTA, which turned our trade surplus with Mexico into one of our largest bilateral trade deficits. She has never recanted.
  2. She promoted the TPP has the gold standard trade agreement while she was Secretary of State.
  3. She has championed her husband Bill's economic record and announced he may be in charge of economic policy.
  4. She has refused to denounce giving Permanent Normalized Trade Relations status, which Bill promoted, to China.
  5. She has positioned herself as a continuation of the Obama administration which promotes the TPP.
  6. Candidate Clinton, in 2008, supported effective anti-currency manipulation legislation (as did candidate Obama) which the Obama administration later opposed.  In 2009, Secretary Clinton asked China to continue buying US bonds, which was China's main mechanism of currency manipulation.
  7. Candidate Clinton, in 2008, opposed trade agreements with Korea, Colombia and Panama but flipped as Secretary of State.
  8. She recently told Face the Nation on CBS that America has generally benefited from "trade" and that "95% of consumers live outside of the US" which is a pro-TPP talking point of the US Chamber of Commerce which advocates for transnational companies without loyalty to America.

How is she trying to change on trade through words? Here is a partial list.

  1. She opposes the TPP "in its current form" because its standards are not high enough.
  2. She has called for a chief trade prosecutor to do more trade enforcement.
  3. She has denounced the rules of origin in TPP as allowing third countries to ship goods into the TPP region without being a part of the TPP.
  4. She supports strict monitoring and unspecified action to combat currency manipulation.

What can HRC do to gain the trust of trade reform advocates on the left, some of which are members of the Coalition for a Prosperous America?

  1. She can stop echoing US Chamber of Commerce talking points. She continues to throw bones to the free trade agreement advocates.
  2. She can call for a national goal of balanced trade which would focus all trade and economy relevant agencies of the Executive Branch upon getting rid of the trade deficit. Free trade should produce quantitatively balanced trade over time, it has failed, so let's just establish the goal of balanced trade and do what it takes to get there.
  3. She can state that our trade policy is fundamentally broken because modern mercantilism negates any relevance of tariff cuts.
  4. She can state that the Washington Consensus on neoliberal trade has been proven wrong because job losses, wage declines and income inequality have far outweighed any consumer gains from cheap imported products.
  5. She can establish a goal of rebuilding a diverse array of domestic supply chains which are the ecosystems necessary to rebuild manufacturing and jobs and defend them from committed mercantilist rival nations.
  6. She can state that the tariff and non-tariff barrier cuts in trade agreements have not helped, and have often prevented the US from responding effectively to foreign nations with aggressive trade and competitiveness strategies that target the US market.

Why would Hillary avoid going this far to gain the trust of the voters on trade?

  1. She may not believe any of these criticisms because she truly is a free trader.
  2. Bill would be upset because he is an unreformed free trader.
  3. She may fear sounding like Donald Trump.
  4. Establishment economists, pundits and editorial boards would go ballistic, shouting epithets like "protectionism", "isolationism", "abdicated American leadership".

I hope HRC does go this far in criticizing old trade policy and laying the groundwork for a new trade and competitiveness strategy designed to make America win. America is strong with a strong economy that pays good wages and rebuilds the middle class. We are not strong merely because we can sign a trade deal... any country can do that.  We can no longer cede disproportionate domestic market share to foreign imports and merely consume cheap goods.  That is a recipe for failure. And we need to win.




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