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  March 2nd, 2018 | Written by

Trump Administration’s Trade Policy Remains Confused

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  • The USTR report quotes Trump on the campaign trail: “There is no way to fix the TPP.”
  • No TPP country has welcomed Trump’s suggestion to negotiate bilaterally.
  • USTR on Japan, Vietnam, Malaysia, New Zealand, Brunei: Trump might engage with them individually or collectively.

The Trump administration’s trade policy is getting more confused by the day. One day after US Treasury Secretary Steven Mnuchin said that the possibility of the United States rejoining the TPP was “on the table,” the US Trade Representative sent an administration trade policy report to Congress that made no mention of that possibility.

Mnuchin, speaking at the US Chamber of Commerce, was reiterating what President Donald Trump said at the Davos economic summit in January, when he told an interviewer that he would consider rejoining TPP if the deal could be renegotiated. Trump pulled the US out of the Trans-Pacific Partnership on one of the first days of his administration.

The USTR report, by contrast, harkens back to Trump’s pronouncements on the campaign trail, quoting him as saying that “there is no way to fix the TPP.” The report also posits that “the US withdrawal from TPP allows the United States to pursue better and fairer trade relationships with the 11 other countries in the TPP,” suggesting that the administration would enter into bilateral negotiations with those countries, an eventuality thus far welcomed by none of them.

The report also noted that the US already has FTAs with six TPP countries: Canada, Australia, Mexico, Chile, Peru, and Singapore. As for the five remaining TPP countries—Japan, Vietnam, Malaysia, New Zealand, and Brunei—the report said that Trump might be willing “to engage with” them “either individually or collectively—on terms that will lead to significantly improved market outcomes.

That’s not the same as rejoining the TPP. To date, no negotiations with any of these countries, whether individually or collectively, have been made public. As far as anyone knows, NAFTA is the only trade deal officially being renegotiated at the present time.

And speaking of the North American Free Trade Agreement, the USTR was two-faced on that issue. In a brief fact sheet summarizing the report, the USTR noted that Trump is fulfilling a promise to renegotiate NAFTA with the primary goals of updating NAFTA “with modern provisions” and to “rebalance NAFTA for fair, reciprocal trade.”

But in the body of the report the USTR claimed that “NAFTA is certainly a bad deal for the United States” and recalls Trump’s campaign promise that he will notify Canada and Mexico “that America intends to withdraw from the deal” unless they agree to a renegotiation.

The USTR reserves its passion for a recounting of the administration’s tough enforcement of trade laws, retelling with pride all of the tariffs and duties imposed on imports. Because of the structure of US trade law, that’s something fairly easy for president to do, as demonstrated by the aluminum and steel tariffs that Trump imposed on imports yesterday. But what the USTR fails to mention, and what Trump will never say, is how these policies will damage US businesses and workers.