Biden’s Lead is Good News for Trade
First as a senator and then as vice president, Biden supported every major trade initiative—including the North American Free Trade Agreement in 1993 and the creation of the World Trade Organization the following year. In 2000, Biden voted in favor of normalizing trade relations with China, paving the way for China’s entry into the World Trade Organization. As vice president during the administration of former Barack Obama, Biden supported the Trans-Pacific Partnership.
To be sure, Biden’s record isn’t perfect; he voted against the Dominican Republic-Central America Free Trade Agreement, and for quotas on steel imports. There were other votes that would normally have given free traders pause, but compared to the sprint toward 1930s-style protectionism under Trump, they are minor apostasies.
Trump will surely point to Biden’s support of NAFTA and trade with China as a reason voters in the Midwest can’t trust the former vice president.
On NAFTA, Biden has no reason to be defensive. In 2016, the U.S. International Trade Commission found that NAFTA produced small but significant economic gains. Not only that, Trump’s much-advertised replacement for NAFTA, the United States-Mexico-Canada Agreement, is only a minor rewrite of its predecessor.
China is more complicated. China’s entry into the World Trade Organization was a good idea and made sense at the time. It remains a positive development: Beijing has cut tariffs since joining the World Trade Organization, and the United States has more influence over China’s trade policy and practices now that Beijing participates inside the system. All is not well with U.S.-China commercial relations, though. Much of the concern stems from actions taken by Beijing in recent years, including abuse of intellectual property, forced technology transfer as a condition of doing business in China, theft of trade secrets, massive industrial subsidies, and cyberintrusions into commercial networks.
Now is the time for a responsible hawkishness toward China’s economic practices. Even after the so-called “phase one” deal between the United States and China, tariffs now cover about 70 percent of imports from China with an average rate 6.3 times higher than when the trade war began.
By abandoning negotiations toward a Pacific trade agreement and levying tariffs on imports from China, Trump’s irresponsible policies have weakened the United States economically and hurt its ability to influence Beijing’s commercial practices. Biden will need to fully flesh out a China policy, but his instincts toward multilateral engagement are vastly superior to erecting an “economic Iron Curtain,” as former Treasury Secretary Hank Paulson dubbed the Trump tariffs.