Speakers at the Republican Party’s convention touted US President Donald Trump’s “tough-on-trade” approach as a key argument for his re-election in November, although results have been mixed, especially with a key China deal.
Top Trump economic adviser Larry Kudlow, a dairy farmer, a mining-town mayor and a metal-welding businessman all credited Trump’s trade policies with lifting their hopes.
“I am a lifelong Democrat, but for far too long, members of both parties allowed our country to be ripped off by our trading partners, especially China, who dumped steel into our markets and slapped tariffs on our products,” Robert Vlaisavljevich, the mayor of Eveleth, an iron-ore mining town in the election battleground state of Minnesota, said at the event on Tuesday night.
“And what did so-called leaders like Joe Biden do? Nothing,” he added, referring to Trump’s Democratic opponent in the November 3 election.
Trump raised tariffs on imports, including on steel, which is made from iron ore, renegotiated a deal with two of the country’s main trading partners, Canada and Mexico, and started a tariff war with China before brokering a phase one deal earlier this year.
Steel prices rallied following the tariffs imposed in March 2018, feeding optimism in US steel towns. But higher prices later hurt demand from automakers, and resulted in layoffs at United States Steel Corp.
The US-China trade deal took about 18 months to negotiate, and US exports to China fell by nearly 8 percent from 2016 to 2019, according to census data.
Since the coronavirus, first discovered in China, swept across the world, the US-China relationship has worsened. More than 177,000 Americans have died, the most of any country.
China has fallen short of its pledged goals of increased purchases of US goods as its own economy has suffered. Through July 2020, total Chinese imports of covered US goods were $48.5bn, about half of what the Peterson Institute for International Economics calculates they should be at this stage.
“In pursuit of this extraordinarily weak trade deal that China is not even living up to, Donald Trump was outmanoeuvred at every turn by (Chinese President) Xi Jinping,” Biden campaign spokesman Andrew Bates said.
In defence of Trump
Kudlow defended Trump’s economic performance, touting the stock market’s surge to a record even as millions of people remain unemployed.
Kudlow’s take on the second night of the convention emphasised the most-positive aspects of the economic comeback since the lockdown at the start of the coronavirus crisis: Rebounds in housing sales and manufacturing, and resilient consumer spending at retailers such as Home Depot Inc, Walmart Inc and Amazon.com Inc.
“Right now, our economic health is coming back,” he said.
Yet in portraying the pandemic, and the economic shutdown to contain it, as once-in-a-century events that are in the past, he looked past fresh data points indicating a long road ahead – including Tuesday’s decline in consumer confidence to the lowest since 2014.
Kudlow described the recovery as “V” shaped, though many economists see a bumpier road ahead. Applications for US unemployment benefits unexpectedly increased to more than 1.1 million in last week’s report and millions more continue to file for assistance each week.
Cris Peterson, whose family has a 1,000-cow dairy farm in Wisconsin, another election battleground, told the convention new trade deals gave her confidence to rebuild after a fire destroyed her barn in 2017.
“Trump understood and again took steps to provide the supports we needed,” Peterson said. “Our entire economy, and dairy farming, are once again roaring back.”
The administration devoted $16bn to trade aid in 2019, much of that in direct payments to farmers.
After some dairy farmers were left without a place to sell their milk after the coronavirus closed schools and restaurants earlier this year, the administration announced billions more in aid for farmers.