Former Majority Leader Eric Cantor, whose historic ejection from Congress was fueled by a populist uprising in Virginia’s 7th Congressional District, traveled to the world’s most elite economic forum to bash the GOP frontrunner’s America-first trade policy.
Bloomberg reports that at Davos:
The prospect of Trump in the White House is ratcheting up anxiety among the 2,500 business and political leaders gathered at the Swiss ski resort for the annual World Economic Forum.
“Unfortunately I do think that if there were to be a Trump administration the casualty would likely be trade,” said Eric Cantor, a former Republican House Majority Leader and now vice chairman of Moelis & Company. “That’s a very serious prospect for the world.”
The significance of Cantor delivering this message at the World Economic Forum is inescapable. Donald Trump has campaigned against both Obamatrade and the broader ideology of trade globalism that is being pushed by other GOP contenders.
Trump said in September that the American people:
[A]re tired of being ripped off by every single country that does business with us. Whether it’s China, Japan, Mexico, Vietnam—which is in there big and heavy right now—Japan with the cars… two weeks ago I was in Los Angeles. I saw the biggest ships you have ever seen with cars pouring off from Japan, into Los Angeles. Just pouring off these ships… the ships are loaded up with cars, thousands of cars and they are just pouring off. And I say, isn’t that a shame, it’s so one-sided.
Reports confirm Trump’s concerns about Trans-Pacific Partnership agreement (TPP) being a one-side trade deal.
The Wall Street Journal writes that TPP– which Sen. Rubio has said would be the “second pillar” of a President Rubio three-pillar foreign policy strategy– would harm the U.S. automobile industry by dramatically favoring foreign imports over American-made exports.
According to a study by Peter Petri, a professor of international finance at Brandeis University, under the TPP, the U.S. “auto sector is set to see a tangible impact. In the transportation sector, led by cars, the TPP could boost imports by an extra $30.8 billion by 2025, compared with an exports gain of $7.8 billion,” the Wall Street Journal reports.
Trump has also made his pledged to crack down on foreign currency manipulation a signature of his campaign. By contrast, both Marco Rubio and Ted Cruz voted down an amendment spearheaded by Rob Portman to crack down on the illicit trade practice.
A 2014 report from the Economic Policy Institute notes that eliminating currency manipulation could create 2.3 to 5.8 million jobs. The report states that initiating “policies that would make currency manipulation costly and/or futile… [would] create jobs in every state and in most or all congressional districts. They would boost GDP, boost jobs and reduce unemployment, and actually reduce the federal deficit by spurring economic growth—all without direct budget costs. No other policies could achieve this economic trifecta.”
Although Cantor — who many Washington insiders presumed would be a future Speaker of the House– was unceremoniously dispatched from Congress, the man who took over the Speaker’s chair, Paul Ryan, is not only Cantor’s ideological soul mate, but is the Party’s single most aggressive promoter of trade globalism and open border immigration policies. If Cantor’s political faith is globalism, then one could analogize that Paul Ryan is that faith’s priest.
As a result of Ryan’s efforts, Congress gave Obama fast track trade authority, helping to ensure the passage not only of the Trans-Pacific Partnership agreement, but all subsequent trade pacts, which are now liberated from the Senate filibuster, amendment process, and constitutional treaty vote. Thus, it is very likely that the outcome of the GOP primary contest will determine whether or not America is permanently bound under the Trans-Pacific Partnership agreement and the multinational governing commission it establishes.
Trump’s position on the critical issue of trade may help to explain his populist appeal. As President of the Steel Workers Union, Leo Gerard recently wrote in a piece outlining his opposition to the TPP:
Americans who once earned family-supporting wages working in factories, foundries and mills across this country began destroying themselves at a shocking rate five years after implementation of the North American Free Trade Agreement (NAFTA)… Unemployed, desperate and despairing, these once-middle-class workers are killing themselves at unconscionable rates with guns, heroin and alcohol-induced cirrhosis… The cause of the self-slaughter, the researchers suggested, is financial strain. Bread winners couldn’t pay their bills and couldn’t foresee a future when they could. That is because jobs in manufacturing and construction – jobs that had provided middle-class incomes for workers without college degrees for decades – disappeared.
The negative impact of globalist trade deals has also been felt in the African American community. Last year, AFL-CIO and United Steelworkers released an ad entitled “American Refugee” which features an African American steel plant worker in Baltimore who was “among 2,100 workers laid off when the plant closed in August 2012.” In the ad, the worker, staring straight in the camera, says, “the person you are looking at right now considers himself a refugee of our failed trade policies. President Obama, we welcome you to come to the site of what failed trade policies have brought– the devastation of this facility. Explain to us how we benefit from TPP. We don’t believe that we do.”
The effects on manufacturing losses on the domestic job market would be compounded by automation.
As Business Insider reports, citing a recent report from Davos entitled “The Future of Jobs”: “Robots, automation and AI will replace 5 million human jobs by 2020.” Business Insider explains that automation “is transforming the labour markets beyond all recognition from decades ago, it will lead to a net loss of over 5 million jobs in 15 major developed and emerging economies by 2020.”