Greer warns of free trade’s toll as China flexes military might
US Trade Representative Jamieson Greer has condemned decades of US free trade policies as a ‘quixotic misadventure’ that failed to democratise China while damaging America’s economy and culture.
US Trade Representative Jamieson Greer has branded decades of US free trade policy as a “quixotic misadventure” for trying to bring democracy to Beijing – a scathing attack that comes one day after Xi Jinping’s military parade in Tiananmen Square showcased the growing might of the Chinese Communist Party.
In a major speech at the National Conservatism conference in Washington, Mr Greer sketched out the tariff philosophy of the Trump administration and argued that decades of free trade had turned America’s heartland into a rust-belt and undermined social cohesion by forcing individuals to class themselves into separate tribes of identity.
He argued that past free trade policies were not aligned with conservative values and had instead inflicted grave damage on America’s economy and culture.
Mr Greer said the approach embraced by the previous Republican administration under George W Bush was wrongheaded and grounded in “virtue signalling” as well as the misguided attempt to promote economic freedom by “exporting market economics to China, India and other countries.”
“When George W. Bush was running for President, he proclaimed his broad agreement with President Clinton on totally liberalised trade – particularly with China. Then candidate Bush was effusive saying ‘the case for trade is not just monetary, but moral … Economic freedom creates habits of liberty and habits of liberty create expectations of democracy.’”
“In reality, it was very damaging to our country and to the conservative cause. So called free trade has not brought democracy to China or anywhere else, nor has it led to peace,” Mr Greer said. “I would say that Bush’s hubris in attempting to bring democracy to Iraq was matched only by his expectation of bringing market economics to China.
Both were quixotic misadventures that were incredibly harmful to our country, economy and culture.”
Mr Greer argued the goal of trade policy should be to support American workers and their families, and that it was necessary for the US to once again create a “production economy.”
“The constitution set out authority for the new government to ‘regulate commerce with foreign nations.’ In other words, liberal international trade was not the default setting. The founders knew that other nations should not automatically benefit from free access to our market,” Mr Greer said.
He said there were obvious historical lessons which showed the benefits to the US of maintaining a robust production economy. Referring to the example of World War II, Mr Greer said that Bethlehem Steel and its subsidiaries were able to produce more steel than the Axis powers combined. But he cast doubt over whether America was capable of such a feat today.
Between the early 1990s and 2016, Mr Greer said that US leaders had “unwound the delicate balance” underpinning America’s conservative society by signing away US sovereignty and opening up the nation’s borders to “nearly unlimited flows” of foreign labour, capital, goods and services.
“We voluntarily dismantled our defences and outsourced the rules of trade to a system overseen by a World Trade Organisation in Switzerland,” he said. “(But) Neo-Liberalism did not make the world embrace free market economics.”
“During that process we lost five million manufacturing jobs, over 60,000 factories as cheap goods flooded our markets from countries like China who were completely misaligned with our own goals.”
Persistent US trade deficits were a major problem for working Americans because they “manifested as factories moving from Wisconsin to Mexico or Asia. A trade deficit is something someone in Asia is making that could have been made here by a worker.”
To help rebuild America, Mr Greer said tariffs would play a key role. But so would reclaiming American sovereignty from global bodies like the WTO through the running of a more autonomous trade policy.
Strengthening US economic resilience would also be critical in ensuring the country was not dependent on adversaries for supplying it with vital goods. Finally, he said solidarity was also needed to ensure success.
“The point is, an atomised nation can’t endure very long. People of all religions, races, creeds et cetera need to appreciate again that we are one people and one nation working together to prove the benefits of self government.”
Mr Greer’s strong defence of the aggressive use of tariffs by the Trump administration comes as China seeks to exploit the unease of other nations at the shift of direction in US trade policy while at the same time exerting greater influence over the international world order.
Canberra has already been unnerved at what the Trump tariffs may mean for the future of the Indo-Pacific region and its impact on bodies like the Quadrilateral Security Dialogue, a grouping composed of India, Japan, the US and Australia.
Experts are warning of a major setback in Washington’s ties with New Delhi and Indian Prime Minister Narendra Modi has tightened relations with Beijing. He recently attended the Chinese-led Shanghai Co-operation Organisation summit in Tianjin after his nation was hit with 50 per cent US tariffs.
In addition, Indonesian President Prabowo Subianto attended this week’s military parade in Beijing after his country was hit with a 19 per cent US tariff.
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