Trade Divides the D.C. Parties Internally

Among the issues continuing to split the majority (Democrat) party in America is global trade, especially in goods. Today’s report in the New York Times about warnings within the Biden administration of inordinate harm to blacks and the poor from freer trade is further indication that a return to the national party’s international commercial bent of recent decades is not in the offing. Instead, the current White House has maintained many of the preceding Trump barriers and may selectively seek more. Increasingly anti-corporate Republicans could go along. This, despite the generally inflationary effects of trade restrictions. While the “McKinsey” wing of the governing establishment continues to tout globalism (and in its own new report says trade remains healthy, particularly in services), the consensus for such policies is as fragile as the supply chains that lately have broken down in the wake of Covid-19. Of course, most trade proponents always recognized that it can have short-run losers, but argued, in the spirit of Pareto optimality, for compensating appropriate parties from the general bounty to be gained. One method for doing this, the often-controversial Trade Adjustment Assistance program, has expired amid congressional division. Any movement on that front, as on freer trade overall, appears unlikely in the current political environment.

Foreign Trade Competition Has Hurt Black and Disadvantaged Workers Most, Report Says

A government trade agency report suggested that the impact of trade policy differed for workers depending on their race and socioeconomic status.