Alexandra Stark
Fellow, Future Security
What do labor rights, tax policy, clean air standards, or apprenticeship programs have to do with trade? How about immigration policy or the decision to use military force? In short, it depends who you ask. A surprising number of 2020 presidential campaigns are discussing one or more of these issues under the rubric of trade. Increasingly, trade and the range of proposals associated with it are a shorthand to translate intense policy debates about what kind of economy will serve U.S. interests best in the years ahead, how much government involvement is needed to get there, and how much global interconnection is the right amount for U.S. workers, communities and corporations into political terms. The New Models of Policy Change project, part of 国产视频鈥檚 Political Reform program, built this scorecard to help track the issues and to better understand how candidates are drawing connections.
Economists define international trade as the exchange of goods and services between entities in different countries. But when analysts and journalists write about international trade, they also mean the set of economic agreements, institutions, and arrangements that govern how money, goods, and services鈥攁s well as the jobs and assets attached to them鈥攎ove around the globe, and in and out of American communities.
When the American people talk about trade, on the other hand, evidence suggests that they are more often referring to the state of , the , and even and within communities, rather than to the international agreements and structures that govern trade. Since the aftermath of World War II, practitioners of American foreign policy and grand strategy have seen trade through yet another lens: as a means of creating ties that are valuable in and of themselves, regardless of what is traded and to whose advantage; building relationships; fostering interdependence; and making conflict less likely.
Over the decades since World War II, trade has periodically served as a flashpoint in U.S. presidential campaigns in combination with one or more of these issues. The 2020 campaign, however, has seen candidates using the umbrella of trade to offer proposals on everything from taxes and tariffs to climate change, and from supporting human rights abroad to reforming education and labor laws at home. Several candidates (and former candidates) have put forward detailed policy proposals that would transform the international economic system, in different directions.
At the same time, it has been challenging to pin down candidates on the key facets of trade policy as it currently exists, such as whether they would continue the tariffs put in place by President Trump. Candidates Gabbard, O鈥橰ourke, Steyer, and Weld have said that they would roll back 国产视频 tariffs upon taking office; Buttigieg and Yang have said that they would use the tariffs as leverage in trade negotiations. But 国产视频 many other challengers, while criticizing the trade war, have not made their intentions regarding the tariffs clear. Similarly, while the two most recent trade deals undertaken by the United States鈥敼悠 renegotiation of the (USMCA, formerly known as the North American Free Trade Agreement, or NAFTA), and the that went into effect without the United States after Presidents Obama and Trump both declined to submit it for congressional approval鈥攈ave been hotly debated, candidates have largely avoided taking clear positions on U.S. membership in either. (After the bipartisan House passage of USMCA in December 2019, only Sanders and Klobuchar on whether they would support the new version, with Sanders saying he would not, and Klobuchar saying she would.)聽
At the same time, some candidates have engaged in great depth on a range of issues which are either not often associated with trade policy in public debate or are highly technical and seldom raised in broader political debate.
The political discourse is redefining what trade is and how it relates to national security and domestic policy in real time. New Models of Policy Change looks to define and clarify that shift by tracking how 2020 candidates are defining trade and what they are proposing. We have identified six policy areas where candidates are making wide-ranging policy proposals under the rubric of trade: how the U.S. government makes trade policy; using trade to fight climate change; enforcement when trade is unfair; linking trade to worker and other human rights; trade and national security; and trade and taxes.
Above we chart which candidates have engaged on which issues, with each issue linked to a short essay describing the range of candidates鈥 proposals and how they might play out. Together, they offer a picture of a set of disagreements about how, or even whether, the United States manages its economy at home and to what ends its government engages in the global economy. 鈥淭rade鈥 is a narrow word to encompass such a fundamental and wide-ranging debate.
The candidates currently featured on the scorecard include the 12 Democratic candidates who qualified for the October 15th debate. While some have subsequently dropped out of the race, we have included them here to capture the full range of debate around trade. We also include the incumbent Republican, as well as 3 Republican primary candidates who in October were exceeding 1 percent in .
Our analysis does not suggest endorsement, support of, or opposition to any candidate; it is simply a record of whether each candidate has addressed a particular issue. We will update these documents as the campaign continues.
Since 1962, U.S. trade policymaking has been led by the United States Trade Representative (), a cabinet-level officer whose staff of 200 coordinates input from the Departments of Commerce, Labor, State, and many other agencies, ultimately controlling the agenda and process.
Some candidates, all of them Democrats, have called for reforms to the way the government analyzes and makes trade policy. Their arguments for why reform is needed have relatively little to do with economics鈥攖hough the picture of whom the United States trades with and what it exchanges has certainly changed dramatically since the existing institutions were created鈥攁nd a great deal to do with ideas about information and representation. Some candidates argue that the current structure under-represents the interests of organized labor and farm constituencies, and of values鈥攈uman rights, as well as environmental and climate stewardship鈥攖hat lack clear constituencies in the bureaucratic process. Senators Warren and Sanders go further, arguing that certain constituencies are unfairly dominating the current process.
Separately, multiple candidates believe that the current policy structure either does not give decision-makers the information they need to defend U.S. interests when other nations violate the terms of trade deals, or doesn鈥檛 provide that information in real time.
While Trump has often critiqued the product of past American trade policies and has directed the USTR to investigate China鈥檚 trade policies under and initiate a World Trade Organization (WTO) dispute with China, he has not put forward specific proposals to reshape the government鈥檚 analytical or decision-making processes.
A number of candidates have said that they would enlarge delegations to trade negotiations to include representatives of organized labor, the environmental movement, farmers, and/or local government officials. Former Vice President Biden, Mayor Buttigeig, Senator Harris, and Tom Steyer have all made some version of this proposal. Senator Warren says she would include labor and environment representatives in existing trade advisory groups, and create new ones; she would also make drafts of agreements publicly available for comment (they are currently very tightly held). Congressman O鈥橰ourke pledged to include labor and environment representatives in policy development.
O鈥橰ourke, Warren, and Sanders have each proposed significant changes to how trade results are analyzed and trade policy is made, though their recommendations do not significantly overlap. O鈥橰ourke proposes reforming and increasing analysis to detect currency manipulation, a task currently undertaken by the Treasury Department; and creating an independent trade enforcement commission to investigate violations of labor and environmental standards. Currently, outside actors such as business associations or labor unions must prepare their own investigations and then request that the government open an investigation. Often, the process takes years.
Warren proposes a significant reorganization of existing U.S. economic policy structures, moving the USTR within a new Department of Economic Development. The newly-proposed Department of Economic Development would replace the existing Commerce Department, subsume other agencies like the Small Business Administration, and include other authorities and programs, such as worker training programs. Warren鈥檚 plan would create new labor and environment enforcement divisions at the USTR and dramatically increase the number of U.S. embassies that are staffed with a labor attach茅 tasked with monitoring compliance with labor standards. She also takes up the problem of investigating violations, proposing to create automatic triggers for investigations into unfair labor and environmental practices.
Finally, Warren proposes a major change to the way the federal government approaches trade policy. She would set a requirement that potential partners in trade deals meet the human rights and environmental commitments they have made under existing international agreements as reported in the Department of State鈥檚 Country Reports on Human Rights Practices before they can be eligible for trade deals with the United States.
Sanders and a number of other candidates propose that such standards be written into trade agreements rather than being preconditions. Those proposals are discussed further in the sections on using trade to fight climate change and linking trade to worker and other human rights.
The interaction between trade and climate change is complex: In general, more economic activity means more greenhouse gas emissions. Indeed, unprecedented global expansion of trade over the past several decades has generated increased economic activity as well as increased use of transportation services, both of which contribute to higher emissions levels. However, trade can also lead to global improvements in energy efficiency鈥攁nd thus declines in greenhouse gas emissions鈥攂y increasing access to environmentally-friendly technologies, goods, and services. Countries may also shift what they produce toward more or less energy-intensive sectors. Climate activists argue that trade agreements can also 鈥渟hrink the 鈥榩olicy space鈥 available to countries to pursue environmental goals;鈥 according to this year from the Economist, if these goals 鈥減rohibit, or are perceived to prohibit, a country鈥檚 ability to distinguish between products according to emissions released during their production.鈥
A variety of modest or voluntary climate trade provisions already exist. For example, the 21 countries participating in the Asia-Pacific Economic Cooperation (APEC) forum pledged to lower import duties on a list of 鈥渆nvironmental goods鈥 in 2011. Existing in bilateral trade deals include support for renewable energy and energy efficiency, requirements that the parties ratify international climate agreements, harmonization of climate regulation, and measures for climate change adaptation. Additionally, a group of five small countries have to negotiate among themselves an agreement that would remove barriers to trade in environmental goods and services, eliminate fossil fuel subsidies, and develop guidelines for voluntary eco-labeling.
The Paris Agreement on climate change foresees that countries will include trade-related provisions in the self-administered and self-monitored pledges they made to reduce emissions. But as a March 2017 study of trade commitments taken on in response to the Paris Agreement , 鈥渢he major emitters and net exporters of carbon do not put a strong focus on trade or trade-related measures.鈥 The notes that 鈥渋n climate policy discussions, relatively little attention is paid to the global trade architecture,鈥 meaning that there is considerable room for improvement in this area.
Environmental organizations and academics have proposed different ways international trade rules could be used to promote the adoption of green technology, support countries struggling to adapt to climate change, or punish countries that do not meet their international commitments to reduce greenhouse gases. The universe of trade measures proposed to include eliminating tariffs and non-tariff barriers that obstruct trade in green goods, services, and technologies; harmonizing standards on environmental goods and services; eliminating distortionary subsidies in the energy and agriculture sectors; and many others.
The 2020 candidates are increasingly focused on domestic green jobs and investment in green R&D, and have made some proposals linking these Green New Deal-style policies to trade. Harris and Secretary Juli谩n Castro have said they would encourage green exports through focused investment from the U.S. Export-Import Bank and take other measures to support exports of American green tech and eliminate funding for emissions-intensive projects. Harris has specifically said she would work to end government funding of and support for fossil fuel exports. Biden and Warren have proposed different 鈥溾 measures that would allow the United States to place fees or quotas on carbon-intensive imports, a proposal to which the incoming chief of the European Commission, Ursula von der Leyen, has also committed the EU.
Warren has also proposed a 鈥淕reen Marshall Plan,鈥 with a proposal to 鈥渄edicate $100 billion to helping other countries purchase and deploy American-made clean energy technology.鈥
Trump, by contrast, has not talked about fighting climate change in the context of trade policy; his administration鈥檚 "energy dominance" policy priorities seek to promote U.S. energy exports and reduce dependence on imported oil.
Some candidates have listed specific climate and environmental requirements for every new trade deal, such as requiring trade partners to be Paris Agreement signatories and to have a plan to reduce their emissions. In his 鈥淧lan for a Clean Energy Revolution and Environmental Justice,鈥 Biden says that he would 鈥渃ondition future trade agreements on partners鈥 commitments to meet their enhanced Paris climate targets.鈥 Harris says she would oppose any trade deal that does not raise environmental standards. Warren would require that countries be Paris Agreement signatories and be making progress toward their targets before the United States negotiated trade deals with them.
Warren proposes changing the way environmental policies and subsidies are considered under international rules, saying her administration would negotiate a rule with other countries that would prevent such policies from being challenged as unfair subsidies. She has also proposed the creation of a "non-sustainable economies鈥 designation at the WTO that would allow the United States to impose tougher environmental standards on imports produced with large fossil fuel inputs; this too would have to be agreed at the WTO, which operates by consensus of all member states.
Candidates have also called for the creation of domestic trade enforcement mechanisms to identify and investigate violations of environmental and other standards. O鈥橰ourke has called for 鈥渃reating a Trade Enforcement Commission that is independent of the Office of the U.S. Trade Representative to identify violations of labor and environmental standards.鈥 Warren has called for a new labor and environmental enforcement division at the USTR and the creation of automatic triggers to investigate unfair trade practices related to environmental standards. O鈥橰ourke has also proposed to enforce environmental standards.
Finally, several candidates have indicated that they would expand the participation of environmental groups in trade negotiations, for example by including environmental interests in trade advisory committees. See our essay on reforms to how the U.S. government makes trade policy for candidates鈥 proposals for which constituencies should be represented in trade negotiations.
When Americans complain about the unfairness of trade, policymakers often point to other countries鈥 failures to meet obligations they agreed to take on in order to enter the WTO and take advantage of low-tariff trade with the United States. These countries pledge not to sell products below cost overseas (鈥渄umping鈥) or to limit the ways they use subsidies (government assistance to businesses) in order to support their own industries at the expense of foreign competitors. Many Americans also believe that some of our largest trading partners deliberately suppress the value of their currencies in order to be able to beat U.S. prices.
Much contemporary concern about unfair trade centers on China. A on China鈥檚 trade policies summarizes the administration鈥檚 view: 鈥淔or many years, China has pursued industrial policies and unfair trade practices鈥攊ncluding dumping, discriminatory non-tariff barriers, forced technology transfer, over capacity, and industrial subsidies鈥攖hat champion Chinese firms and make it impossible for many United States firms to compete on a level playing field.鈥 In 2018, the administration began to levy tariffs and other trade barriers on imports from China in response to what it labeled a pattern of . Since then, both the United States and China have engaged in a series of tit-for-tat .
Democratic and Republican candidates have criticized the administration鈥檚 trade war with China, pointing to losses suffered by and consumers as a result of increased tariffs and China鈥檚 retaliatory measures. Harris has called the policy 鈥渘othing more than the Trump trade tax,鈥 while Governor Weld has stated that 鈥淢r. Trump thinks that when he slaps a tariff on China it's paid by China. Back in Beijing. It's not. It's paid by American farmers or American businesses or individuals who need to import something from China.鈥 Representative Walsh has written in that 鈥淢r. 国产视频 tariffs are a tax increase on middle-class Americans and are devastating to our farmers. That鈥檚 not a smart electoral strategy."
Candidates have also criticized the administration鈥檚 lack of a broader strategy on the trade war. When asked about tariffs, for example, Buttigieg said, 鈥淚t鈥檚 not about the tariffs. Look, what鈥檚 going on right now is a president who has reduced the entire China challenge into a question of tariffs, when what we know is that the tariffs are coming down on us more than anybody else and there's a lack of a bigger strategy.鈥
While candidates on both sides have almost uniformly criticized the trade war, only Gabbard, O鈥橰ourke, Steyer, and Weld have affirmatively said that they would immediately repeal 国产视频 tariffs. Others have said that they would keep the Trump tariffs in place鈥攁t least in the short-run鈥攁nd use them as leverage against China. Yang, for example, has said, 鈥淚 would let the Chinese know that we need to hammer out a deal.鈥
While the Trump administration has worked to negotiate a deal with China, for his part, candidate Trump has that he would not hesitate to continue to use tariffs against Beijing or others. The president has also called for negotiating bilateral trade deals with key partners, in contrast to the multilateral approach favored by many of his rivals.
While criticizing 国产视频 policies, candidates in both parties have also been critical of China鈥檚 trade practices, often citing currency manipulation and intellectual property theft. As an alternative to tariffs, candidates across party lines鈥擝iden, Booker, Buttigieg, Castro, Harris, O鈥橰ourke, Walsh, Weld, and Yang鈥攈ave advocated for working with American allies to counter China鈥檚 unfair trade practices. Castro, for example, has argued, 鈥測ou want to outcompete China? We should start by building alliances around the world, not tearing them down.鈥 Walsh said, 鈥淲e could have a coalition of countries that could deal with China. [Trump has] done it all by himself. And America has paid a big, big price for that."
What that looks like in practice is less clear. O鈥橰ourke has proposed two specific ways that the United States could partner with allies at the WTO: collaborate on WTO complaints about Chinese import taxes, called countervailing duties, and launch a case arguing that China has not met its commitments overall and does not belong in the WTO. Sanford, Weld, and Yang see entering the successor to the Trans-Pacific Partnership, negotiated under the Obama administration but not submitted to Congress by either Obama or Trump, as a way to partner with others to push China to change its ways. Biden and O鈥橰ourke favor re-negotiating the agreement鈥攚hich is now in force among 11 other countries as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)鈥攁nd then joining on terms more favorable to the United States.
While working with allies is by far the most common suggestion among candidates, some have suggested other policies to deal with unfair trade practices. O鈥橰ourke鈥檚 comprehensive trade plan included a proposal to de-list Chinese companies from U.S. stock exchanges and limit access to the U.S. banking and financial system for Chinese companies. Warren鈥檚 plan contains extensive reforms to how the government assesses violations and conducts enforcement unilaterally.
Aside from China, candidates have had little to say about other countries with which the United States has had trade disagreements, though Trump has highlighted issues with Germany and others. O鈥橰ourke proposed working with developing countries to build their enforcement capacity by 鈥渃ollaborat[ing] on the inspection of facilities that may be violating standards. Facilities found to be in violation would be denied preferential tariffs and, in some cases, access to the U.S. market altogether,鈥 a strategy his campaign said was modeled on the U.S.-Peru trade agreement鈥檚 . Warren鈥檚 trade plan calls for creating a 鈥渘on-sustainable economy鈥 designation that would allow the United States to impose tougher penalties on countries with poor environmental and labor practices and embedding a labor attach茅 at U.S. embassies to monitor compliance. Warren鈥檚 campaign and others have also proposed reforms to how the U.S. makes trade policy domestically that would impinge on enforcement.
Concern that open trade could give an economic advantage to human rights violators is not new. Researchers Susan Ariel Aaronson and Jean Pierre Chauffour nineteenth-century treaties banning first the slave trade and later products made by prisoners of war. The post-World War I creators of the International Labour Organization (ILO) saw a link between the organization鈥檚 functions and trade. And in the 1940s, John Maynard Keynes proposed鈥攁nd 53 nations (including the United States) negotiated and signed鈥攖he , which provided for labor standards and their enforcement as part of a system of global trade governance. Congress declined to ratify the charter, however, and it never came into force. The global trade architecture we have, the World Trade Organization, does not account for human rights.
Starting in the late 1980s, both the United States and Europe began to include language seeking to promote human rights in bilateral and regional trade deals. In the subsequent decades, governments and activists have sought to address civil, political, and labor rights; abuses of women, children, and minorities; and the global problem of human trafficking, through language in trade deals. Advocates of these provisions argue that they are the right thing to do, in line with international and U.S. law, and also that they help American competitiveness by making it harder for countries to gain economic advantage by oppressing parts of their workforce or undercutting U.S. labor.
Even rights activists, however, debate how effective the provisions are. With very few exceptions, existing rights provisions are either entirely hortatory or not subject to any actual enforcement by international trade bodies. As discussed in the section on enforcement, activists have critiqued U.S. enforcement as weak, leading some to argue that rights are better pursued through other channels, while others argue for strengthened enforcement either at the domestic or international level.
Interest in labor and human rights in trade deals marks a major partisan divide; no Republican candidate has spoken out in favor of strengthening rights through trade. However, the revision of the U.S.-Mexico Canada free trade agreement (formerly known as NAFTA, now called USMCA) negotiated by the Trump administration parties to adopt specific laws related to the International Labour Organization Declaration on Fundamental Principles and Rights at Work, and achieved agreement from Mexico to strengthen its domestic labor laws, protect collective bargaining, and reform the system for administering labor justice. that while this is a step in the right direction, these laws may be difficult to enforce in practice.
A number of Democrats have called for using trade to improve labor and other human rights conditions. The candidates differ widely, however, on where in the global trade machinery it makes most sense to put stronger standards.
Biden, Castro, and Yang have spoken in broad terms about strengthening labor standards in trade agreements; Sanders has additionally stipulated that such standards be binding. Other candidates鈥擧arris and Steyer鈥攔eference 鈥減rotecting鈥 American workers without specifying labor rights, which by definition include the right to organize unions.
Warren proposes that observance of human rights standards be a precondition for new trade deals with the United States; countries would have to observe both the core standards for workers set by the International Labour Organization (ILO) and a broader set of internationally-recognized human rights in order to be eligible to negotiate trade deals. This is a very different position from the way trade talks have worked in recent decades. It also proposes the same standards for countries with widely varying levels of compliance with international human rights standards.
O鈥橰ourke also had ambitious labor rights goals, but tending in a different direction; he proposed to work with all WTO members to put internationally-agreed labor standards (including some the United States has not ratified) into the ground rules for trade that are subject to enforcement, including combating child labor and protecting collective bargaining rights. Countries' failure to uphold these standards would be considered an unfair subsidy and subject them to countervailing duties. O鈥橰ourke also said that new trade agreements should include other labor protections such as country-specific minimum wages.
Senator Booker and O鈥橰ourke have explicitly linked their views on new trade deals to the health of labor unions in the United States, both referencing a desire to promote unionization at home in the context of negotiating trade deals abroad. Additionally, O鈥橰ourke said that, when an industry stood to benefit from a new trade deal, he would require major employers to sign neutrality statements with labor unions.
In the decades since World War II, U.S. policy has seen trade and national security as closely linked, often justifying trade agreements as a way of using economics to reward important security partners and bind allies closer together. In 2020, national security rhetoric continues to feature in the trade debate, but seldom in regard to trade as a means of strengthening ties among allies.
Trump has used national security concerns as a justification for many of his trade actions, imposing tariffs on aluminum and steel imports under of the 1962 Trade Expansion Act, which allows the president to impose restrictions on imports that 鈥渢hreaten to impair the national security.鈥 He national security while considering whether to impose tariffs on automobiles and auto parts and to U.S. companies from doing business with Chinese tech company Huawei. The president鈥檚 rhetoric is grounded in a line of reasoning that defines security as synonymous with the strength of domestic industry.
His view is not shared by other candidates. Many technology experts, however, cite a narrower list of largely technological concerns around certain technologies and their acquisition by potential adversaries, chiefly China. Defense experts are concerned about the inability of the U.S. military and infrastructure to acquire certain technologies without the possibility of other countries鈥攁gain, chiefly China鈥攂eing able to compromise them.
Perhaps surprisingly, no candidate has discussed these national security aspects of trade policy.
In a departure from more traditional definitions of national security, Sanders explicitly identifies it in terms of food security, defined as reliable access to affordable, nutritious food. His plan for 鈥淩evitalizing Rural America鈥 raises concerns with current policy, noting, 鈥渙ur current trade policies encourage overproduction and push low-cost commodities on foreign countries, effectively undercutting and destroying local agricultural systems while enriching multinational corporations. 鈥We should] classify food supply security as a national security issue. We need trade policies that safeguard food security at home and around the globe.鈥
Taxation is not normally considered part of trade policy, yet it is an obvious companion to trade. National tax structures, like tariff rates, form important incentives for companies deciding not just what to produce where, but where to site employees and intellectual content, and where to claim profits.
As global financial flows have ballooned in the era of post-Cold War globalization, a number of countries have tax policies to attract investment or incentivize multinational corporations to move their headquarters. As a result, scholars have noted an accelerating decline in the effective rate of tax the United States collects from multinational corporations. Former Treasury Department official and Council on Foreign Relations scholar Brad Setser why this is so: 鈥淎 multinational corporation can route its global sales through Ireland, pay royalties to its Dutch subsidiary and then funnel income to its Bermudian subsidiary鈥攖aking advantage of Bermuda鈥檚 corporate tax rate of zero.鈥
Taxation issues may seem extremely wonky for presidential politics, but the theme of corporations and foreign entities combining to deprive the U.S. Treasury of revenue has been picked up by candidates on both the left and center. While candidates like Warren and Sanders have advocated for corporate tax policy reform, and often talk about tax evasion in the context of international trade and investment, others have picked up on proposals for international negotiation and reform. Warren鈥檚 鈥淩eal Corporate Profits Tax鈥 is a proposal to 鈥渃lose loopholes that let big corporations pay less,鈥 while Sanders鈥檚 鈥淚ncome Inequality Tax Plan鈥 proposes 鈥渢axes on companies with exorbitant pay gaps between their executives and typical workers.鈥
Both O鈥橰ourke and Warren have connected their proposals to a collaborative effort of more than 130 countries and jurisdictions, including the United States, to provide international rules and policy instruments to address tax avoidance and ensure that corporate profits are taxed where they are generated. The (base erosion and profit shifting) of the Organisation for Economic Co-operation and Development (OECD) and Group of 20 aims to restrain strategies that multinational companies use to exploit mismatches in national tax laws in order to avoid paying taxes. These cost countries an estimated $100鈥240 billion USD annually in lost tax revenue, according to the OECD.
O鈥橰ourke鈥檚 trade plan called for the United States to commit to the BEPS framework, while Warren鈥檚 plan would require that any country signing a trade agreement with the United States participate in it.