- - Tuesday, March 1, 2016

ANALYSIS/OPINION:

International trade is the lifeblood of vibrant economies everywhere. The conventional wisdom is that the Republican Party is the party of business, but many Republicans look askance at foreign commerce. Donald Trump has skillfully exploited these concerns. That’s a pity. With global conflict on the rise, there’s much to worry about abroad, but trade among nations offers far more benefits to the American economy than harm. Nobody wants to shoot a customer, and nations don’t, either.

A Gallup poll last week found that 58 percent of those surveyed regard foreign trade as an opportunity, and 34 percent see foreign trade as a threat to the domestic economy. Democrats and Independents registered as the strongest backers of foreign trade, with 63 percent regarding it favorably, although Democratic senators mounted the stiffest opposition to President Obama’s signature Trans-Pacific Partnership, a sweeping trade agreement with 11 other nations.

But it’s rank-and-file Republicans who elicit the skepticism of foreign trade similar to that of contrarian Democrats: 50 percent of Republicans see it as a threat to American prosperity. Party loyalty colors how nearly everyone sees domestic issues, and in the era of George W. Bush, Republicans favored foreign trade more than Democrats, by 46 percent to 36 percent in 2008.

Careful concern over the impact of foreign trade on the American economy is certainly reasonable. There is a correlation between an increase in foreign trade and a decrease in the gross domestic product, as the conservative publication American Thinker points out in an analysis of Gallup trade findings: “During the 1960s, the United States averaged a trade volume at 9.4 percent of GDP and an average annual rate of real per capita GDP growth at more than 3.3 percent. Since 2000, the volume of trade has averaged 26.5 percent of GDP … while real per capita GDP growth has averaged just 1.0 percent per year …”

Robust U.S. trade abroad has accompanied slower economic growth at home. Americans are rightly anxious about the impact of persistent large annual trade deficits, which have ranged between $361 billion and $761 billion since 2000. Donald Trump has capitalized on domestic anguish over nations that sell their wares to Americans but don’t respond in kind. Mr. Trump’s promise to resolve Mexico’s $58 billion trade surplus with the United States while pressuring it to pay for a border wall makes good campaign rhetoric, but some of his tariff talk wanders into murky territory. But pressuring China to quit manipulating its currency — as it did again on Monday while running $366 billion trade surplus with the United States — could kick-start America’s underperforming economy.

There are other obstacles to U.S. prosperity that should make more inviting targets than foreign trade. If President Obama’s successor is a Republican, he should slash the U.S. corporate tax rate of 39 percent, the world’s highest, which give businesses strong incentive to flee to tax-friendly countries. He should also peel back some of Mr. Obama’s thousands of regulations, which have saddled the economy with a $1.9 trillion annual burden. There are threats to the American economy out there, but free trade isn’t one of them.

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