Trump trashes TPP, U.S. trade policy

Republican presidential primary candidate Donald Trump said in last night’s debate he would get tough on trade partners who violate their commitments, but his opponent Sen. Ted Cruz challenged him over his plan to institute tariffs on China.    Republican presidential contender Donald Trump said Friday he wants to ditch the 12-nation Trans-Pacific Partnership trade deal in favor of bilateral trade agreements with allies.
   The morning after trade issues took center stage at the Republican debate in Miami, Trump held a press conference at his mansion in Palm Springs and said he would do a much better job than Democrats in negotiating free trade deals and addressing the trade deficit with China.
   For starters, the United States shouldn’t participate in regional trade deals, Trump said.
   “I want individual trade deals with individual countries,” he said.
   The billionaire New York businessman warned that China will take advantage of TPP and “come in through the back door.”
   Trump reiterated that, if elected, he would be much tougher on China than trade officials in previous administrations, pointing to what he called a $500 million trade deficit with China. The United States actually has a $366 million deficit with China regarding trade in goods, according to the latest data from the U.S. Census Bureau.
   Trump has previously said he would slap a 45 percent tariff on goods from China if the country didn’t play fair when it comes to adjusting the value of its currency or subsidizing exports.
   During the debate, however, Trump said the 45 percent figure was a negotiating tactic.
   “The 45 percent tax is a threat. It was not a tax, it was a threat. It will be a tax if they don’t behave…China dumps everything that they have over here…We can’t get into China…Manufacturers, they can’t get in. When they get in, they have to pay a tremendous tax,” he insisted.
   “The 45 percent is a threat that if they don’t behave, if they don’t follow the rules and regulations so that we can have it equal on both sides, we will tax you. It doesn’t have to be 45, it could be less. But it has to be something because our country and our trade and our deals and most importantly our jobs are going to hell.”
   Fellow primary candidate Sen. Ted Cruz of Texas said Trump’s plan would victimize American consumers because they would pay the tariff on imported goods.
   “So ask yourself at home: How is this helping you?” said Trump’s main rival for the nomination. “If your wages have been stagnant for 20 years; if you can’t pay the bills, how does it help you to have a president come and say, ‘I’m going to put a 45 percent tax on diapers when you buy diapers, on automobiles when you buy automobiles, on clothing when you buy clothing.’ That hurts you.
   “It’s why we’ve got to get beyond rhetoric of China bad, and actually get to how do you solve the problem. Because this solution would hurt jobs and hurt hard-working taxpayers in America,” he added.
   Cruz repeated that his simple flat tax proposal would be much better for Americans. It calls for a 10 percent tax on individuals and 16 percent for businesses, which would be adjusted downward for exports to offset any tariffs faced in an overseas market. The result is that every export pays no tax and imports pay the 16 percent business flat tax and China wouldn’t hit the United States with reciprocal tariffs, he claimed.
   Trump’s response was that high U.S. tariffs would essentially protect U.S. companies and encourage them to start producing more goods domestically. 
   “People will buy products from here, rather than buying it through China where we’re being ripped off…So we’ll build our factories here and we’ll make our own products. And that’s the way it should be done,” the real estate mogul said.
   “Trade deals are absolutely killing our country,” said Trump. “The devaluations of their currencies by China and Japan and many, many other countries, and we don’t do it because we don’t play the game. If you don’t tax certain products coming into this country from certain countries that are taking advantage of the United States and laughing at our stupidity, we’re going to continue to lose businesses and we’re going to continue to lose jobs.”
   Trump has been criticized in the past two weeks for making some private-label merchandise in China and Mexico, as well as taking advantage of visa programs to bring in foreign workers at some of his properties. Trump said that as a businessman, he had to take advantage of every available loophole, but knowing how the system works will enable him to clean it up.
   “Nobody knows the system better than me. I know the H1B. I know the H2B. Nobody knows it better than me. I’m a businessman. These are laws. These are regulations. These are rules. We’re allowed to do it. And frankly, because of the devaluations that other countries — the monetary devaluations that other countries are constantly doing and brilliantly doing against us — it’s very, very hard for our companies in this country to compete.
   “So I will take advantage of it; they’re the laws. But I’m the one that knows how to change it. Nobody else on this dais knows how to change it like I do, believe me,” Trump claimed.
   Ohio Gov. John Kasich said there needs to be faster enforcement mechanisms in trade deals to prevent rules violations from causing economic damage before they can be reversed.
   “One out of five Americans works in a job connected to trade…But my position has always been we want to have free trade, but fair trade. And I’ve been arguing all along that it is absolutely critical that when other countries break those agreements, we don’t turn the process over to some international bureaucrat who comes back a couple years later and says, ‘Oh, America was right,’ and people are out of work,” said Kasich.
   “The fact of the matter is we have to have an expedited process. When people cheat, when countries cheat and they take advantage of us, we need to blow the whistle. And as president of the United States, I absolutely will blow the whistle and begin to stand up for the American worker. But we don’t want to lock the doors and pull down the blinds and leave the world. Because frankly, if we do that, prices will go up. People will buy less. Other people will be out of work. And we don’t want to see that happen.
   “Trade, though, has to be balanced and we have to make sure that when we see a violation, like some country dumping their products into this country, believe me as president, I will stand up and I will shut down those imports because they’re a violation of the agreement we have and the American worker expects us to stand up,” he said.
   Sen. Marco Rubio of Florida also insisted that the United States can’t become isolationist when it comes to trade.
   “I support free trade deals that are good for America. We’re 5 percent of the world’s population. If all we do is sell things to each other, we can only sell to 5 percent of the people on earth. We have to have access to the hundreds of millions of people in the world today who can afford to buy things,” he said.
   “The problem is we’re a low-tariff country. To import something into the United States is not very expensive, but many of these countries we can’t export to because their tariffs are too high. And so I am in favor of deals that allow us to bring down those tariffs so that America can sell things to all these people around the world.
   “There are good trade deals and there are bad ones,” added Rubio. “So for example, here in Florida, we have benefited from the free trade deal with Colombia. It’s allowed flower exporters to come into the United States but it’s created jobs for hundreds of people who are now delivering those flowers and working in that industry. We have a surplus with Colombia.
   “On the other hand, you’ve seen trade deals like in Mexico that have been less than promising in some aspects, better in others.
   “Bottom line is I believe that America, if given access to foreign markets, our workers are the most productive in the world, our people are the most innovative on this planet. If it is a free and fair trade deal, we can compete against anyone in the world, and we need to in the 21st century,” Rubio said.
   Cruz said he also opposed the TPP.
   “We’re getting killed in international trade right now. And we’re getting killed because we have an administration that’s doesn’t look out for American workers and jobs are going overseas. We’re driving jobs overseas,” the senator said.
   “And the people who are losing out are in manufacturing jobs, or the steel industry or the auto industry. But I’ll tell you who else is going to be losing out, which is the service industry. This Obama administration is negotiating the Trade in Services Agreement which is another treaty to allow services to come in and take jobs from Americans as well.”
   Cruz said he would tackle the trade deficit in three ways.
   “Number one, we need to negotiate trade deals protecting American workers first, not the corporate board room. Number two, we need to lift the regulations on American businesses here so we see jobs coming back. And number three, we need a tax plan like the tax plan I’ve introduced that will not tax exports and that will tax imports, and that will bring millions of high-paying jobs back to America.”
   Trade was also a hot topic during Sunday’s Democratic debate in Flint, Mich., with Sen. Bernie Sanders and former Secretary of State Hillary Clinton channeling the populist anti-trade strain that has taken hold in the Democratic Party during this campaign.
   Americans at the grassroots level in both parties increasingly share the sentiment that America has lost jobs to low-wage countries without reciprocal benefits. The political climate appears to reduce the chances that President Obama will be able to get Congress to consider TPP ratification this year, and that if a vote came up it would go down in defeat.