LULU GARCIA-NAVARRO, HOST:
President Trump ran for office four years ago promising to rip up decades' worth of trade agreements, and he's done that, although it hasn't always yielded the results he's wanted. Throughout the program today, we're looking at how President Trump has transformed politics, journalism and more in his first term. And right now, we're going to spend a few moments talking about what Trump has and hasn't managed to do on the trade front and what he might try to do in a second term. And for that, we're joined by NPR's Scott Horsley.
Hi, Scott.
SCOTT HORSLEY, BYLINE: Good morning, Lulu.
GARCIA-NAVARRO: Trump promised to shake things up on the international trading order, and he's done so.
HORSLEY: He certainly has. The president came into office arguing that other countries were taking advantage of the United States. He not only said that about China, our closest economic rival, but longtime allies like Canada and Mexico and our European trading partners. Trump continues to promote his "America First" trade policies as he campaigns for a second term in office. This is how he criticized the trade policies of his Democratic rival, Joe Biden, at a recent rally in Johnstown, Pa.
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PRESIDENT DONALD TRUMP: Biden supported NAFTA, TPP and China's entry into the WTO, which is one of the worst things that ever happened to this country.
HORSLEY: Trump, of course, pulled out of the TPP, that big Asia-Pacific trade deal, on one of his first days in office. He threatened to pull out of NAFTA. Instead, he wound up renegotiating it. And of course, he's used his most aggressive trade tactics against China, with, so far, mixed results.
GARCIA-NAVARRO: All right. Let's talk about that because, arguably, that has been sort of the centerpiece of his trade policies. He levied heavy tariffs on China, but he also struck a so-called phase one trade deal with Beijing. What's the score card on his first term when it comes to China trade, which is so important to this country?
HORSLEY: I think you'd have to say incomplete. Ostensibly, he launched the trade war with China to address Beijing's theft of intellectual property, the forced transfer of American technical know-how, other bad behaviors. But Trump himself always seemed most focused on the trade deficit. He believes that if we're buying more from China than they're buying from us, we're getting ripped off, and he was determined to change that.
Now, in that phase one deal, China did commit to buying more stuff from the U.S., although so far, its purchases are well short of what was promised. And farmers have actually been some of the biggest victims of the president's trade war. American farmers grow a lot more food than we can eat ourselves, so they depend on export markets, and those markets have been hurt by the trade battles. That's why, in his debate with Biden on Thursday, the president boasted about the relief checks his administration's been sending to farmers, a big constituency in states like Wisconsin and Iowa.
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TRUMP: I just gave $28 billion to our farmers. It was China...
JOE BIDEN: Taxpayers' money.
TRUMP: It's what?
BIDEN: Taxpayers' money - didn't come from China.
TRUMP: No, no. Yeah, you know who the taxpayer is? It's called China.
HORSLEY: Now, government payments have been a big source of farm income in an otherwise tough year for agriculture. And most of the farmers I talked to say they'd really rather have less government welfare and more open markets. In addition, while Trump insists that it's China paying the cost of his tariffs, a significant share of the cost has actually been borne by American businesses and consumers.
GARCIA-NAVARRO: Which I guess was Biden's point there. China is not the only target, though, of Trump's tariffs. He also went after steel and aluminum producers around the world, right?
HORSLEY: Yeah, and I'm afraid that really backfired. His target might've been overproduction in China, but the tariffs actually landed in places like Canada, Mexico, Europe. And those countries responded with retaliatory tariffs of their own. What's more, when Trump tried to help domestic steelmakers, he wound up hurting the much larger number of American companies that use steel and aluminum to make products of their own. I spoke earlier this year with H.O. Woltz, who runs a company in Mount Airy, N.C., that makes steel wire reinforcement products.
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H O WOLTZ: We counseled the administration that if they were to take tariff action on raw materials but not on the downstream products, they would create a calamity in the marketplace. And that's exactly what happened.
HORSLEY: Woltz's costs soared. He wound up losing market share. And even the domestic steelmakers haven't done that well.
GARCIA-NAVARRO: So what might we expect if Trump gets a second term?
HORSLEY: I think more of the same. The president has basically tried to undermine decades of U.S. trade policy that's supported low tariffs, a free flow of goods and services and stable rules of the road that we mostly wrote and other countries were asked to follow. Instead, Trump prefers his own "America First" approach. His feeling is we're the No. 1 market, and we should use that leverage to exert our will on other countries. In many cases, though, other countries are moving on with their own trade policies that leave the U.S. on the sidelines. And the trade deficit for goods, which Trump railed against four years ago - it's larger than ever today.
GARCIA-NAVARRO: That's NPR chief economic correspondent Scott Horsley.
Thank you so much.
HORSLEY: You're welcome, Lulu.
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