Where Leverage Lies

The Trump administration says it wants to use “all possible sources of leverage” in its pursuit of “fairer” trade and U.S. jobs growth. Its emerging trade policy couldn’t be running faster from some of the most important ones.

It’s arguable at best that the American public has “rejected the way in which the framework of rules governing international trade operates.” It’s downright disingenuous — and dangerous — to claim a mandate for breaking faith with the WTO.

Trade wars break out when the rules of the game are unclear or purposely undermined. That strengthens nobody.

Building an entire trade policy on bilateral showdowns and reciprocity would make sense only if we could turn the clock back 100 years and press pause. Today’s trade landscape is global and dynamic. It’s entirely appropriate to get tough sometimes, and reciprocity can be one guiding principle. But the Trump team needs to view reciprocity as a springboard to a fuller, more coherent strategy — one that recognizes the legitimacy of key international institutions. Otherwise, it stands to sacrifice U.S. leverage and U.S. global leadership in favor of false idols.

See also: Bill Reinsch’s recent thoughts on the concept of “economic nationalism.”