Mandate for Leadership - Chapter 26 - Trade

1. CHAPTER OVERVIEW

Authors: Peter Navarro (The Case for Fair Trade) and Kent Lassman (The Case for Free Trade)

Chapter 26 of “Project 2025: Mandate for Leadership” presents two contrasting viewpoints on U.S. trade policy, reflecting the ongoing debate within the conservative movement between proponents of “fair trade” and advocates for “free trade.” Peter Navarro, a former trade advisor to President Trump known for his hawkish stance on China, argues for a “fair trade” approach that prioritizes protecting American workers and businesses from unfair foreign competition, particularly from China. He advocates for tariffs, trade barriers, and a decoupling of the U.S. economy from China’s. Kent Lassman, president and CEO of the Competitive Enterprise Institute, a free-market think tank, argues for a “free trade” approach that emphasizes lowering trade barriers and promoting free markets, arguing that this is the best way to boost economic growth, create jobs, and strengthen American leadership in the global economy.

The chapter’s significance lies in its illumination of the divisions within the Republican Party on trade policy. While traditionally associated with free trade, the Republican Party under Trump has embraced a more protectionist stance, driven by concerns about globalization, job losses in manufacturing, and China’s economic rise. This chapter highlights the potential for a future conservative administration to adopt either a more protectionist or a more free trade-oriented approach, with significant implications for the U.S. economy, global trade relations, and American workers.

2. KEY THEMES & FRAMEWORKS

Navarro’s Argument (The Case for Fair Trade):

Trade Deficits as a Sign of Weakness: Navarro argues that trade deficits are a sign of economic weakness and that they harm American workers and businesses. He claims that the U.S. has been a “loser” in global trade due to unfair trade practices by other countries, particularly China.
Reciprocal Trade and Tariffs: Navarro advocates for a “reciprocal trade” approach, where the U.S. would impose tariffs or other trade barriers on countries that do not offer reciprocal access to their markets. He believes that tariffs are a necessary tool to protect American industries and jobs from unfair competition.
Decoupling from China: Navarro calls for “decoupling” the U.S. economy from China’s, arguing that China’s economic and military rise poses a threat to American national security and economic interests. He advocates for reducing U.S. dependence on China for manufacturing, supply chains, and technology.
Protecting American Manufacturing: Navarro emphasizes the importance of protecting American manufacturing jobs and rebuilding the U.S. industrial base. He believes that trade policy should be used to support domestic manufacturing and to discourage offshoring.

Lassman’s Argument (The Case for Free Trade):

Free Trade as an Engine of Growth: Lassman argues that free trade is the best way to promote economic growth, create jobs, and raise living standards. He believes that lowering trade barriers and promoting free markets will benefit consumers, businesses, and the overall economy.
Trade as a Force for Peace: Lassman contends that trade promotes peace and stability by fostering economic interdependence between countries. He believes that engaging with China through trade is the best way to encourage political and economic reforms.
American Economic Strength: Lassman argues that the U.S. economy is strong and resilient and that American businesses are competitive in the global marketplace. He believes that the U.S. should focus on its strengths, such as innovation and entrepreneurship, rather than trying to protect declining industries.
Limited Government: Lassman advocates for a limited role for government in trade policy, arguing that the government should focus on reducing trade barriers and promoting free markets, rather than trying to pick winners and losers.

3. DETAILED BREAKDOWN

3.1 The Case for Fair Trade ⁽⁷⁹⁸⁾

Introduction: Navarro begins by arguing that the U.S. has been a “loser” in global trade due to “unfair, unbalanced, and nonreciprocal trade” practices by other countries.
Trade Deficits: He emphasizes the importance of reducing trade deficits, claiming that they are a sign of economic weakness and that they harm American workers and businesses.
China’s “Economic Warfare”: Navarro accuses China of engaging in “economic warfare” against the U.S., including currency manipulation, intellectual property theft, and dumping of subsidized goods.
Reciprocal Trade: He advocates for a “reciprocal trade” approach, where the U.S. would impose tariffs on countries that do not offer reciprocal access to their markets.
Decoupling from China: Navarro calls for “decoupling” the U.S. economy from China’s, arguing that it is essential for national security and economic competitiveness.
Conclusion: Navarro concludes by arguing that a “fair trade” approach is necessary to “make America great again” and to “protect American workers and businesses.”

3.2 The Case for Free Trade ⁽⁸²⁸⁾

Introduction: Lassman begins by arguing that free trade is the best way to promote economic growth, create jobs, and raise living standards.
Benefits of Free Trade: He outlines the benefits of free trade, including lower prices for consumers, increased choices, and greater efficiency.
Trade and Peace: Lassman argues that trade promotes peace and stability by fostering economic interdependence between countries.
American Competitiveness: He contends that American businesses are competitive in the global marketplace and that the U.S. should focus on its strengths, such as innovation and entrepreneurship.
Limited Government: Lassman advocates for a limited role for government in trade policy, arguing that the government should focus on reducing trade barriers and promoting free markets.
Conclusion: Lassman concludes by arguing that a “free trade” approach is the best way to “ensure a prosperous and peaceful future” for America.

4. POLICY RECOMMENDATIONS

Navarro:

Impose Tariffs: Impose tariffs on goods from countries that engage in unfair trade practices, particularly China. ⁽⁸⁰⁰⁾
Negotiate Reciprocal Trade Agreements: Negotiate trade agreements that ensure reciprocal access to markets and protect American industries and jobs. ⁽⁸⁰⁰⁾
Decouple from China: Reduce U.S. dependence on China for manufacturing, supply chains, and technology. ⁽⁸¹⁶⁾
Support American Manufacturing: Implement policies to support American manufacturing and to discourage offshoring. ⁽⁷⁹⁹⁾

Lassman:

Reduce Trade Barriers: Reduce tariffs, quotas, and other trade barriers to promote free trade. ⁽⁸²⁹⁾
Negotiate Free Trade Agreements: Negotiate free trade agreements with other countries to expand market access for American businesses. ⁽⁸³⁹⁾
Promote Free Markets: Promote free markets and competition, allowing businesses to succeed or fail based on their merits. ⁽⁸²⁹⁾
Limit Government Intervention: Limit government intervention in trade policy, allowing the private sector to drive economic growth. ⁽⁸²⁹⁾

5. STRATEGIC OBJECTIVES

Navarro:

Protect American Jobs and Businesses: Protect American jobs and businesses from unfair foreign competition, particularly from China.
Reduce Trade Deficits: Reduce the U.S. trade deficit by promoting exports and discouraging imports.
Counter China’s Economic and Military Rise: Use trade policy as a tool to counter China’s growing economic and military power.
Rebuild American Manufacturing: Revive American manufacturing and reduce U.S. dependence on foreign countries for essential goods.

Lassman:

Promote Economic Growth: Boost economic growth by expanding trade and promoting free markets.
Create Jobs: Create jobs by making American businesses more competitive in the global marketplace.
Strengthen American Leadership: Strengthen American leadership in the global economy by promoting free trade and open markets.
Promote Peace and Stability: Foster peace and stability by encouraging economic interdependence between countries.

6. CROSS-REFERENCES

Agenda 47: Navarro’s argument for “fair trade” aligns with the protectionist sentiments expressed in Trump’s Agenda 47, while Lassman’s argument for “free trade” reflects a more traditional conservative approach.
Project 2025, Chapter 4: This chapter, focusing on the Department of Defense, complements Navarro’s argument by highlighting the national security implications of economic competition with China.
Project 2025, Chapter 21: This chapter, focusing on the Department of Commerce, supports Navarro’s argument by calling for a more active role for the department in countering China’s “malign influence” and protecting American businesses from unfair trade practices.

7. POTENTIAL IMPACTS

Impact on Prices and Consumer Choice: A more protectionist approach, as advocated by Navarro, could lead to higher prices for consumers and reduced choices, as tariffs and other trade barriers make imported goods more expensive. A free trade approach, as advocated by Lassman, could lead to lower prices and increased choices for consumers.
Impact on Jobs and the Economy: The impact of trade policy on jobs and the economy is complex and depends on a variety of factors. A protectionist approach could protect some jobs in certain industries but could also lead to job losses in other industries that rely on imports or that are harmed by retaliatory tariffs. A free trade approach could lead to job creation in export-oriented industries but could also lead to job losses in industries that face increased competition from imports.
Impact on U.S. Global Leadership: A protectionist approach could undermine U.S. global leadership and credibility, as it would signal a retreat from the rules-based international trading system. A free trade approach could strengthen U.S. leadership by promoting open markets and economic cooperation.
Impact on U.S.-China Relations: A more confrontational approach to China, as advocated by Navarro, could further escalate tensions between the two countries and could lead to a trade war. A more engagement-oriented approach, as advocated by Lassman, could help to manage tensions and to encourage China to adopt more market-oriented reforms.

8. CRITICISMS & COUNTERARGUMENTS

Navarro:

Economic Harm: Critics argue that Navarro’s protectionist policies would harm the U.S. economy by raising prices for consumers, reducing choices, and discouraging investment.
Trade Wars: Opponents argue that Navarro’s confrontational approach to trade would lead to trade wars that would harm both the U.S. and its trading partners.
Undermining Global Cooperation: Critics argue that Navarro’s “America First” approach to trade would undermine global cooperation and weaken the rules-based international trading system.

Lassman:

Job Losses: Critics argue that Lassman’s free trade policies would lead to job losses in industries that face increased competition from imports.
Environmental Damage: Opponents argue that free trade agreements can lead to environmental damage by encouraging the exploitation of natural resources and by weakening environmental regulations.
Exploitation of Workers: Critics argue that free trade agreements can lead to the exploitation of workers in developing countries, as companies seek to lower costs by moving production to countries with lower wages and weaker labor standards.

9. KEY QUOTES

Navarro:

“America’s record on trade—specifically American’s chronic and ever-expanding trade deficit—says that America is the globe’s biggest trade loser and a victim of unfair, unbalanced, and nonreciprocal trade.” ⁽⁷⁹⁹⁾ This quote reflects Navarro’s view of the U.S. as a victim of unfair trade practices.
“China is waging economic warfare against the United States.” ⁽⁸⁰⁴⁾ This quote highlights Navarro’s hawkish stance on China.
“We must decouple from China to protect our national security and economic competitiveness.” ⁽⁸¹⁶⁾ This quote reveals Navarro’s support for economic nationalism.

Lassman:

“Free trade is the best way to promote economic growth, create jobs, and raise living standards.” ⁽⁸²⁹⁾ This quote encapsulates Lassman’s belief in the benefits of free trade.
“Trade promotes peace and stability by fostering economic interdependence between countries.” ⁽⁸³⁹⁾ This quote highlights Lassman’s view of trade as a force for peace.
“The U.S. economy is strong and resilient, and American businesses are competitive in the global marketplace.” ⁽⁸³¹⁾ This quote reflects Lassman’s confidence in the American economy.

10. SUMMARY & SIGNIFICANCE

Chapter 26 of “Project 2025: Mandate for Leadership” presents two contrasting views on U.S. trade policy, reflecting the ongoing debate between “fair trade” and “free trade” advocates. Navarro’s argument for a more protectionist approach is likely to resonate with some segments of the Republican base who are concerned about the loss of manufacturing jobs and the impact of globalization on American workers. However, Lassman’s argument for a more free market-oriented approach is more aligned with the traditional Republican view of trade policy and is likely to be favored by business interests.

This chapter highlights the potential for a future conservative administration to adopt either a more protectionist or a more free trade-oriented approach, with significant implications for the U.S. economy, global trade relations, and American workers. The choice between these two approaches will likely depend on the political climate, the relative strength of different factions within the Republican Party, and the perceived threat from China.