The United States Trade Representative has released the
President’s 2017 Trade Policy Agenda document (Agenda) on March 1, 2017. The Agenda sets forth its purpose as well as
its top priorities. Interestingly, the
purpose points to the voters as the impetus for the focus of the Agenda:
In 2016, voters in both major parties [?] called for a
fundamental change in direction of U.S. trade policy. The American people grew frustrated with our
prior trade policy not because they have
ceased to believe in free trade and open markets, but because they did not all
see clear benefits from international trade agreements. President Trump has called for a new
approach, and the Trump Administration will deliver on that promise.
The overarching
purpose of our trade policy – the guiding principle behind all of our actions
in this key area – will be to expand trade in a way that is freer and fairer
for all Americans. Every action we take
with respect to trade will be designed to increase our economic growth, promote
job creation in the United States, promote reciprocity with our trading
partners, strengthen our manufacturing base and our ability to defend
ourselves, and expand our agricultural and services industry exports. As a general matter, we believe that these
goals can be best accomplished by focusing on bilateral negotiations rather
than multilateral negotiations – and by renegotiating and revising trade
agreements when our goals are not being met.
Finally, we reject the notion that the United States should, for
putative geopolitical advantage, turn a blind eye to unfair trade practices that
disadvantage American workers, farmers, ranchers, and businesses in global
markets. [emphasis added]
One of the specific key objectives noted by the Agenda
includes “Ensuring that U.S. owners of intellectual property (IP) have a full
and fair opportunity to use and profit from their IP.” The Agenda further lays out its top
priorities as: “(1) defend U.S. national sovereignty over trade policy; (2)
strictly enforce U.S. trade laws; (3) use all possible sources of leverage to
encourage other countries to open their markets to U.S. exports of goods and
services, and provide adequate and
effective protection and enforcement of U.S. intellectual property rights;
and (4) negotiate new and better trade deals with countries in key markets
around the world.” [emphasis added].
In discussing the first priority and the WTO Dispute Settlement
Understanding, the Agenda states: “[E]ven if a WTO dispute settlement panel –
or the WTO Appellate Body – rules against the United States, such a ruling does
not automatically lead to a change in U.S. law or practice. Consistent with these important protections
and applicable U.S. law, the Trump Administration will aggressively defend
American sovereignty over matters of trade policy.” On strictly enforcing U.S. trade laws, the
Agenda states: “We strongly support true market based competition – and we
welcome the partnership of any country that agrees with us. Unfortunately, however, large portions of the
global economy do not reflect market forces.
Important sectors of the global economy, and significant markets around
the world, have been at times distorted by foreign government subsidies, theft
of intellectual property, currency manipulation, unfair competitive behavior by
state-owned enterprises, violations of labor laws, use of forced labor, and
numerous other unfair practices.”
On using leverage to open markets, the Agenda asserts that: “Other
countries have looked to harm U.S. companies by blocking or unreasonably
restricting the flow of digital data and services, or through theft of trade
secrets. In still others, foreign
countries can use technical barriers – such as unnecessary regulations on
particular items – to limit competition, including in the services sector. Concerns have also been raised over currency
practices and their impact on the competitiveness of U.S. goods and services. These are only a few examples of the tactics that
can be used to block or impede the competitiveness of U.S. exporters.” The Agenda notes that transparency in
implementing regulations of WTO rules and trade agreements would be
helpful.
On the section on negotiating new and better trade deals,
the Agenda notes the following issues:
1. In 2000, the U.S. trade deficit in manufactured goods was
$317 billion. Last year, it was $648
billion – an increase of 100 percent.
2. Our trade deficit in goods and services with China soared
from $81.9 billion in 2000 to almost $334 billion in 2015 (the last year for
which such data are available), an increase of more than 300 percent.
3. Of course, a rising trade deficit may be consistent with a
stronger economy. However, that has not
been the experience of the typical American household. In 2000, U.S. real median household income
(in 2015 dollars) was $57,790. In 2015
(the most recent year for which data are available), it was $56,516. In fact, despite the recovery since the
financial crisis, real median household income in the United States remains
lower today than it was 16 years ago.
4. In January 2000, there were 17,284,000 manufacturing jobs
in the United States – a figure roughly in line with the total number of U.S.
manufacturing jobs going back to the early 1980s. In January 2017, there were only 12,341,000
manufacturing jobs in the United States – a loss of almost 5 million jobs.
5. In the 16 years before China joined the WTO – from 1984 to
2000 – U.S. industrial production grew by almost 71 percent. In the period from 2000 to 2016, U.S.
industrial production grew by less than 9 percent.
The Agenda also notes that the most important trade deal
under the Obama Administration—with South Korea—resulted in a massive trade
deficit. It will be interesting to see
how intellectual property policy works out in coming negotiations.
