America Letter: Trump trashes trade deals

Donald Trump's appearance in front of a wall of rubbish at a waste recycling plant in a near-derelict former steel town in Pennsylvania was too irresistible a moment for the social media and tabloid wags to pass up.

"A huge pile of trash took centre stage at a Donald Trump rally [on] Tuesday – and there was also a wall of garbage behind the candidate," reported the New York Daily News.

Trump picked the town of Monessen in western Pennsylvania on Tuesday and a backdrop of rubbish to declare "American economic independence" – six days before the July 4th Independence Day holiday – and to trash what he called "failed" trade policies. The presumptive Republican presidential nominee wants international trade deals such as the Trans-Pacific Partnership that President Barack Obama wants to sign with 11 Pacific Rim countries and the 1994 North American Free Trade Agreement with Canada and Mexico renegotiated or ripped up.

“Globalisation has made the financial elite who donate to politicians very wealthy. But it has left millions of our workers with nothing but poverty and heartache,” said Trump.

The New York billionaire was trolled during the speech by the campaign team of his Democratic rival Hillary Clinton who gleefully highlighted Trump's past outsourcing, noting how one of the Donald J Trump Signature Collection shirts was "made in Bangladesh".

Instead of international trade deals with blocs of countries, Trump wants to negotiate better bilateral trade deals that do not lock the US down. It is similar to the “cake” strategy (having and eating it) of the Brexit campaigners in the UK who want the benefits of being in the single European market but a limit on the movement of people in it.

Trump likes trade, just not free trade. Like the Brexiters, he wants to do business with the world but not at the expense of economic sovereignty.

His swing through Pennsylvania, Ohio, Maine and New Hampshire this week were part of his ongoing offensive to win over disaffected Democrats and the Independent supporters of Clinton challenger, Bernie Sanders, the socialist Vermont senator who blames international trade deals for the demise of the American middle class.

Given the deficit that appears to be mounting up against Trump in swing states such as Florida, North Carolina and Virginia, according to a Ballotpedia poll this week, the Republican is targeting Rust Belt states in the industrial north and midwest, hoping to turn some traditionally blue states red in November's election.

Trump’s strategy to win over white, blue-collar workers – adopting Democratic anti-trade complaints – has put him at loggerheads (again) with the Republican establishment. The US Chamber of Commerce, traditionally supportive of Republican candidates, took the unusual step of publicly hammering Trump for his protectionist, tariff-threatening economic policies during his Pennsylvania speech, saying that his plans “would see higher prices, fewer jobs and a weaker economy.”

Anger

Trump sharpened his rhetoric in a later speech in Ohio, saying that the Pacific trade deal was being “pushed by special interests who want to rape our country”, feeding supporters angry at the establishment.

While the benefits of the North American Free Trade Agreement have been recognised – making US manufacturers more globally competitive by creating supply chains across North America – it has fallen short in generating mass employment. This has left an open door that both Sanders and Trump have been pushing, albeit from opposing ideological flanks.

Opposition to trade deals transcends the Republican-Democrat divide. A Bloomberg Politics poll in March found that 82 per cent of respondents would be willing to pay "a little bit more" for goods made in the US, while 44 per cent said Nafta had been bad for the US economy. Just 29 per cent said it had been positive. Republicans and Democrats were pretty much divided on the issue.

Obama used a trip to Ottawa this week and a summit with Canadian prime minister Justice Trudeau and Mexican president Enrique Pena Nieto to reject Trump's policies, though, speaking to the Canadian parliament, he acknowledged the anxieties awakened by Trump in the US and Brexit in the UK.

Returning to a recurring theme, Obama told lawmakers in Ottawa that “globalisation and technological wonders” were feeding a rise in inequality and wage stagnation that was making workers fearful of diminishing prospects for them and their children. He cited the fallout from Brexit and the frustrations the vote had stirred in the UK.

“The long-term trend of inequality and dislocation and the resulting social division – those can’t be ignored,” he said.

“How we respond to the forces of globalisation and technological change will determine the durability of an international order that ensures security and prosperity for future generations.”

Brexit and the rise of Trump has shown that the anti-establishment forces have been winning the response so far.