Summary of No Trade Is Free by Robert Lighthizer E-Book

SUMMARY GP

• Herausgeber: BookRix
• Kategorie: Geisteswissenschaft
• Sprache: Englisch

Veröffentlichungsjahr: 2023

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This book does not in any capacity mean to replace the original book but to serve as a vast summary of the original book.

Summary of No Trade Is Free by Robert Lighthizer:Changing Course, Taking on China, and Helping America's Workers

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Robert Lighthizer, a key U.S. Trade Representative, led a significant reset of American trade policy over 40 years. He fought against one-sided free trade policies, focusing on corporate profits, cheap imports, and foreign governments. This led to a focus on corporate profits, cheap imports, and foreign governments, resulting in economic inequality and trade deficits. Lighthizer's book, No Trade is Free, is a memoir, history, and policy analysis that highlights the importance of a worker-focused trade policy and the fight for American jobs. It serves as a guide to the new world economy, which requires a worker-focused trade policy.

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GP SUMMARY

Summary of No Trade Is Free by Robert Lighthizer

Changing Course, Taking on China, and Helping America's Workers

Robert Lighthizer, US Trade Representative, fought against one-sided free trade policies, focusing on corporate profits, cheap imports, and foreign governments. His book, No Trade is Free, emphasizes worker-focused trade policy and job creation, guiding the new world economy.BookRix GmbH & Co. KG81371 Munich

Title page

Summary of

No Trade Is Free

A

Summary of Robert Lighthizer’s book

Changing Course, Taking on China, and Helping America's Workers

GP SUMMARY

Summary of No Trade Is Free by Robert Lighthizer: Changing Course, Taking on China, and Helping America's Workers

By GP SUMMARY© 2023, GP SUMMARY.

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NOTE TO READERS

This is an unofficial summary & analysis of Robert Lighthizer’s “No Trade Is Free: Changing Course, Taking on China, and Helping America's Workers” designed to enrich your reading experience.

DISCLAIMER

The contents of the summary are not intended to replace the original book. It is meant as a supplement to enhance the reader's understanding. The contents within can neither be stored electronically, transferred, nor kept in a database. Neither part nor full can the document be copied, scanned, faxed, or retained without the approval from the publisher or creator.

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Copyright 2023. All rights reserved.

Introduction

In 2010, the US-China Economic and Security Review Commission was invited to testify before a panel of twelve experts to evaluate the impacts of China's joining the World Trade Organization (WTO) ten years on. The panel was led by a trade lawyer known for his skepticism of trade relations with China and the international trade system. The panel's testimony highlighted the disastrous effects of China's 2000 decision to grant China "Most Favored Nation" status on America and workers, as well as the economic calamity it had caused. The panel predicted that the situation would worsen if the US stayed on the same course, and made specific policy recommendations, including imposing tariffs on Chinese imports, to correct the problem.

The issue of American trade relations with China was not an isolated problem but was emblematic of larger issues in US trade policy. The political establishments of both the Republican and Democratic parties, under the influence of multinational corporations and importers, were unwilling or unable to recognize their mistakes. Instead, they remained convinced that government policy had to put American workers and manufacturers at risk amid a quest to maximize corporate profits and economic efficiency while minimizing consumer prices.

The result of this effort today is a starker, more indisputable failure than even the author could have predicted. While corporate profits soared for a select group of importers and retailers, many of America's manufacturing companies were hollowed out, forced into bankruptcy or moving their factories abroad. Working-class families now rely on two full-time incomes in lower-end service sector jobs to maintain the same quality of life one manufacturing sector income once provided.

The US has had fifty years of trade deficits with Japan, annual deficits of more than $300 billion with China for years, and enormous and sharply growing deficits with Europe (primarily Germany and Ireland). The first personal computer was rolled out by Apple in 1976, made in America. Today, the vast majority of personal computers are imported, and 78% of world production is in China.

The US's furniture manufacturing sector has exploded since the 1980s, with imports flooded the market and half the workforce lost their jobs. The US is now on track to import more food than it exports for the first time in its history.

Donald Trump was elected president in 2016 in substantial part because he opposed the failed policy that got us such miserable results and promised to change it. His philosophy of international trade is at odds with the radical free trade theology that got us here. The American manufacturing sector is crucial for the well-being of citizens, families, and communities. International trade is beneficial only if it contributes to these broader goals, as citizens are first producers and only second consumers. The Biden administration took over US trade policy in 2017, following the changes made by President Trump and his predecessors.

The Trump administration changed the objective of international trade policy, focusing on bringing manufacturing jobs back to America, reducing imports and increasing exports of manufactured goods and agricultural products. This led to increased tariffs, fought unfair practices, and fought against the WTO. Additionally, the Trump administration awakened the country and the world to the dangers of growing economic dependence on China, a mercantilist nation that poses a military, diplomatic, and economic threat. The trade deficit with China was reduced in five straight quarters leading up to COVID-19, and supply chains were shifting away from China to the US and other countries. The historic "Phase One" trade agreement with China maintained tariffs, brought about systemic change, and created new markets for American products.

The book aims to challenge the way people think about trade policy and describe the Trump administration's implementation of this philosophy, demonstrating how a more assertive US trade policy aimed at helping US workers can work in practice. The author argues that the US's trade policy should be based on a more nuanced understanding of the effects of international trade on the US and the world. They discuss the Trump administration's worker-focused trade policy, which reshaped the US's economic relationship with China, a major adversary in the world. The author explains that trade is the Achilles' heel of the US relationship with China, and that it is crucial to understand its economic policy and threats. They also discuss the Trump administration's use of tariffs to negotiate with China and the need for a strategic decoupling policy.

The author also discusses the North American Free Trade Agreement with Mexico and Canada, the various international trade issues with other major trading partners and the global economy, and the path forward for America's approach to international trade. The author believes that the once nearly unanimous Washington consensus on free trade is dead, with President Biden adopting the Trump trade policy during his 2020 campaign. Understanding the shift in priorities is essential for anyone seeking a new path forward.

Part One

Foundations

Where It Started

In December 2016, the author was offered the position of United States Trade Representative, a position that would allow them to fight for a trade policy that supports a society where American workers can build better lives for themselves and their families through stable, well-paying jobs. The author's upbringing in Ashtabula, Ohio, was thriving in the 1950s and 1960s, with a port that brought in iron ore from the Minnesota Iron Range and shipped it by rail down to Pittsburgh to be made into steel. The city had a vibrant railroad industry and many small manufacturing jobs, many based at companies that supplied the auto industry in Detroit. However, many of the steel industry jobs that relied on that supply have moved overseas, and the manufacturing jobs supporting the auto industry in Detroit have also dwindled.

The author's upbringing in Ashtabula was influenced by his family's history of blue-collar jobs, with his father working in the steel mills and his mother attending Catholic school. The author's upbringing in Ashtabula was influenced by immigrants from Italy and Finland, and their experiences at Mother of Sorrows Catholic School in the area.

The decline of Ashtabula and much of the Midwest's industrial heartland is largely due to poor international trade policy and technological change. Surging steel imports have negatively impacted the port, and the country is no longer producing many of the things it needs. Instead, it imports goods from other countries and has them shipped to the US in an endless flow of container ships.

In the 1960s, the author attended Georgetown University in Washington, DC, which was both academically and socially exciting for him. The author's dedication to the fight for a better life for American workers and their families is evident in his dedication to trade policy and the importance of a stable, well-paying job market. The author describes their experience working as a lawyer at the law firm of Covington and Burling in Washington, where they were tasked with navigating the rapidly changing world of free trade. They faced the challenge of conveying the reality of the benefits of globalization to the elite world of Georgetown, where resistance to the tides of free trade was largely seen as untenable and antediluvian. The author's perspective on the costs versus benefits of free trade seemed questionable, as they did not consider the reality of those costs in the context of the people and families affected.

After law school, the author practiced law at the law firm of Covington and Burling and was recommended by Senator Robert Dole to help him put together his Senate Finance Committee staff. They worked closely with Senator Dole, who was the ranking member of the Senate Finance Committee and later became its chairman. In 1983, the author left Senator Dole's staff to accept an appointment as deputy US trade representative (USTR) under Bill Brock in the Reagan administration.

The author's role at USTR involved negotiating trade agreements on major issues with Japan, including steel and autos. President Reagan distinguished between free trade in theory and practice, stating that free trade could only be a force for American prosperity if it rested on a level playing field. They handled most of the actual negotiations with their trading partners, and during their time at USTR, they focused on negotiations, unfair practices of their trading partners, growing trade deficits, and the problem of Japanese industrial policy and its effect on US jobs.

The author's experience at USTR taught them the importance of strategic use of leverage and the importance of not giving up valuable resources for nothing. The Trump administration, unlike the Reagan administration, was heavily focused on trade issues, with President Trump being a key priority. He cared enormously about trade issues, which was one of the major reasons he chose to run for president. Trump's commitment to trade issues was evident in his daily discussions with the American people, who often listened to his pronouncements on trade and the harm done to the country by unfair imports.

During the Reagan years, trade was not a popular opinion in Washington, DC, and any support for free trade was regarded as a throwback to protectionism and isolationism. This neoclassical case for free trade was regarded as a recipe for total failure. Proponents of free trade reassured that the United States was much better off and stronger on balance by opening itself to trade. However, as the problem with international trade shifted from Japan to China, Trump's focus shifted as well.

The focus on trade changed as the growing problem with China was a much larger issue than the existing issues with Japan. As a result, Trump became a practical problem solver, knowledgeable, articulate, and passionate on the issues of trade that he considered pivotal. His law practice in the 1990s and 2000s was largely focused on representing US manufacturers in actions against foreign manufacturers who flooded the market with low-cost, unfairly traded products. These cases were appealed to domestic US courts and the dispute resolution process at the WTO in Geneva. The World Trade Organization (WTO) has become a significant issue in the US, as decisions often go against national laws and trade agreements.

The "China shock" in 2000 caused a surge in trade deficits, with China exploiting state-sponsored, government-organized unfair trade to gain a $270 billion trade surplus and take jobs. The 2008 financial crisis only exacerbated these deficits, but the US was on an unsustainable path. In 2011, a Trump presidential run was discussed, reflecting the country's roots in conservatism and the Republican Party. In 2016, Trump's campaign focused on trade, addressing issues with China, NAFTA, and trade deficits, demonstrating his commitment to working people. Despite challenges, Trump and his USTR team largely followed Trump's trade policy objectives, putting major trade partners on notice. President Trump's leadership and commitment to his trade policy goals have been praised, with Lighthizer being a key figure in his cabinet meeting in 2020.

Where We Are Now

The post-World War II strategy of reducing barriers to imports in return for new exports went off the rails in the 1990s, leading to the loss of millions of jobs and exploding trade deficits. The US needs to insist on fair trade in its market and reciprocal access in foreign markets, as decades of poor trade deals have produced neither. A trade policy that assures balanced trade is essential, as it cannot afford to continue transferring wealth to foreign countries in return for consumer products.

For some, trade is mostly a way to engage on the world stage, while for others, trade is about obtaining the cheapest products for consumers. Most Americans reject both approaches, believing that economic policy and trade policy should be about improving the prosperity of their communities. A trade policy for the common good, which the Trump administration tried to carry out, aimed to balance the benefits of trade liberalization with policies that prioritized the dignity of work and the common good.

The US-Mexico-Canada Agreement (USMCA) is an example of a trade policy oriented toward the common good, which has been a key factor in addressing challenges and achieving bipartisan consensus. However, the US services surplus is small and less reliable than goods deficits, and many things that are not considered exports are still counted as exports.