Biden Trade Protectionism

There is a continuing interest in capturing the state of the current global political economy and the global economic policymaking of the major states – the US, China, India, Brazil, Europe, Japan, Korea, and others. Not surprisingly the debate is most active in the US. Experts and officials alike are intent in describing current Biden Administration policy. Most recently some experts have been labeling the global economic framework as ‘post- neoliberalism’, defining it, apparently, in contradistinction to the previous dominant policy framework – ‘neoliberalism’.  The dilemma of course is a definitional one as much as anything else  – the terms are well known, their meaning not so much. 

Recently, colleagues of mine have kicked off a discussion. One, Dan Drezner, from the Fletcher School and the Substack ‘Drezner’s World’ has waded into the policy mix, actually in an article from Reason titled, “The Post-Neoliberalism Moment”. As Dan early in the piece thought to frame first neoliberalism he suggested the following: 

The term neoliberal has been stigmatized far more successfully than it has been defined. For our purposes, it refers to a set of policy ideas that became strongly associated with the so-called Washington Consensus: a mix of deregulation, trade liberalization, and macroeconomic prudence that the United States encouraged countries across the globe to embrace. These policies contributed to the hyperglobalization that defined the post–Cold War era from the fall of the Berlin Wall to Brexit.

Dan made it clear, however, that this economic model no longer dominates: 

In the 16 years since the 2008 financial crisis, neoliberalism has taken a rhetorical beating; New Yorker essayist Louis Menand characterized it as “a political swear word.” Until recently, no coherent alternative set of ideas had been put forward in mainstream circles—but that has been changing. 

And what has been the replacement, well Dan suggests that its the politicians and officials that have been most active in leaving neoliberalism behind:

These ideas are being shaped by powerful officials. The primary difference between Biden and Trump in this area is that Trump’s opposition to globalization was based on gut instincts and implemented as such. The Biden administration has been more sophisticated. Policy principals ranging from U.S. Trade Representative Katherine Tai to National Security Adviser Jake Sullivan have been explicit in criticizing “oversimplified market efficiency” and proposing an alternative centered far more on resilience.

For elements of this policy transformation one need only look to recent Biden Administration policies including the Infrastructure Investment and Jobs Act, the CHIPS and Science Act, and the Inflation Reduction Act. As Dan concludes, the totality of these policy initiatives is: “all represent a pivot to industrial policy—a focus on domestic production.” 

In constructing this post-neoliberalism model, folks argue that there is a necessary trade-off between resilience and efficiency. As Dan suggests: “A key assumption behind post-neoliberalism is that policy makers can implement the right policies in the right way to nudge markets in the right direction.” 

Now another colleague of mine, Henry Farrell from Johns Hopkins, tries his hand at a definition in a recent Substack Post at his ‘Programmable Mutter’, titled, “If Post-Neoliberalism is in Trouble, We’re all in Trouble”. The Post partly responds to Dan, and further articulates Henry’s view of post-neoliberalism. As he describes it: 

A key assumption behind post-neoliberalism is that policy makers can implement the right policies in the right way to nudge markets in the right direction. … I see post-neoliberalism less as a coherent alternative body of thought, than as the claim, variously articulated by a very loosely associated cluster of intellectuals and policy makers, that markets should not be the default solution. … More generally, post-neoliberalism isn’t and shouldn’t be a simple reverse image of the system that it has to remake. It can’t be, not least because it has to build in part on what is already there.

The dilemma, as I see it, for understanding any of these  post-neoliberalism models, and also, though less intensely – neoliberalism, is pretty much all definitional. The base of the problem is not really understanding what ‘resilience’ and ‘efficiency’ really mean. And that in turn causes confusion over trying to then understand ‘globalization’.  And that unfortunately builds vagueness into our understanding of these economic models especially over what we are to understand to be – post-neoliberalism. 

But what isn’t so difficult to understand is the problem that has been created in this post-neoliberal period by current trade policy especially as seen in the United States. Layer it as much as you can but the Biden Administration policy is ‘protectionist’ and the Trump Administration, was, and will in all likelihood be, even more protectionist if Trump is returned to office in late 2024. As Inu Manak has written in a recent piece for the Hinrich Foundation in Australia – a foundation focused on global trade: 

Trade has become toxic, not just on the campaign trail, but in the way that it is discussed by both Democrats and Republicans. “Traditional” US trade policy, which began to form its nearly century-old roots under the leadership of President Franklin Roosevelt and his Secretary of State, Cordell Hull, has been described by US Trade Representative Katherine Tai as “trickle-down economics,” where “maximum tariff liberalization…contributed to the hollowing out of our industrial heartland. … The current US approach to trade, if it can be called an approach at all, risks weakening US influence abroad and economically disadvantaging Americans at home. It rests on the false belief that retrenchment of “traditional” US trade policy—by putting America First or catering to a select group of US workers and branding such efforts as “worker-centric trade policy”—will somehow restore the United States to a position of hegemonic dominance with no peer competitor. 

The Biden Administration’s allergy to new trade policy initiatives can be seen in its Indo-Pacific economic strategy – the IPEF – the Indo-Pacific Economic Framework for Prosperity. This framework is intended to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for the fourteen countries negotiating the IPEF. The countries included are: Australia, Brunei Darussalam, Fiji India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam with the United States. The IPEF partners represent 40 percent of global GDP and 28 percent of global goods and services trade. Negotiations have proceeded well for three of the four pillars including supply chains, clean economy, and fair economy pillars but the Biden Administration has decided not to proceed in negotiating for fair and resilient trade. As William Reinsch at CSIS described the situation: 

The commentariat is busy these days debating the future of the Biden administration’s trade policy in the wake of its effective abandonment of the trade pillar in the Indo-Pacific Economic Framework (IPEF) negotiations. (The administration says the talks will continue, and I imagine they will, but I don’t see a conclusion, at least before the election.) The policy is clearly a failure at this point, …

As colleague Ryan Haas of the Brookings Institution, and a former US official – from 2013 to 2017, Hass served as the director for China, Taiwan and Mongolia at the National Security Council (NSC) staff – underscored in his examination of trade policy in the Indo-Pacific: 

These constraints will be most visible on trade. The absence of a credible trade and economic agenda for Asia has been the Biden administration’s greatest weakness. Political and national security imperatives will continue to drive the United States’ approach to trade. Do not expect any outbreak of creativity or boldness on trade by the Biden administration in 2024.

The Biden Administration failed to roll back the tariffs imposed by the Trump trade folk. It is a major failure of US trade policy and an expression of the Biden SAdministration’s trade protectionism. It bodes ill for growing the global economy and achieving productivity gains for the United States and others.

Image Credit: E-International Relations

This Post originally appeared at my Substack Post Alan’s Newsletter – https://open.substack.com/pub/globalsummitryproject/p/biden-trade-protectionism?r=bj&utm_campaign=post&utm_medium=web&showWelcome=true

 

‘The Decline of US Hegemony and its Consequences for the Global Order’ – A Roundtable at the International Studies Association

ISA 2023: Exhibit, Advertise, and SponsorSo, the International Studies Association (ISA) just concluded in Montreal  after a visibly energetic in-person gathering following several years of virtual meetings only.

I was fortunate enough to chair the roundtable. All sorts of good folk attended including panelists: Arthur Stein, UCLA, Lou Pauly, University of Toronto, Yves Tiberghien, University of British Columbia, and Kyle Lascurettes, Lewis and Clark College. Unfortunately, our colleagues, Janice Stein could not join but I was fortunate enough to receive her speaking note and I have tried to reflect some of her thinking with the notes from other colleagues.

What didn’t surprise me, of course, during the session was the recognition from all that we have a fraught period of transition in the international system. There is the obvious Russian aggression against Ukraine and the challenge by Russia to some of the basic tenets of the current order – most notably territorial integrity and national sovereignty. There is also the obvious growing leading power tensions between the US and China and the growing threat of confrontation and conflict especially over Taiwan that currently stock the relationship. There was the obvious attention to US determination to sustain dominance even in the face of a dramatic power transition with the emergence of China and more broadly the Global South – India and other Indo-Pacific nations including Indonesia, etc. and other Southeast Asian states and then, of course, the return of Lula to Brazil.

But raw geopolitics did not dominate the discourse of the Roundtable. Equally significant in our discussions was the acknowledgement of the continuance of the intergovernmental institutions and collective actions of states to advance global order and achieve collective action within the framework of the current and evolving Order. While some decried the faltering of the global institutions, nevertheless, there was general acceptance that regional and other informal order-based institutions continued advance policies in various ways. AS one of my colleagues Kyle Lascurettes noted: “There is a truly global rules-based order that stands a good chance of outliving American hegemonic decline. But the so called “liberal” or “Western” rules-based order is and will be in trouble.” Indeed, the liberal order or the Liberal International Order (LIO) disappeared, I’d argue with the Global Financial Crisis” in 2008 but the Global Order does indeed remain. And, as Yves Tiberghien focusing on the dramatic power transition suggested: “today is a time of disruption and transition – a special phase. Major shocks, change, crises, innovation will take place over the next 1-2 decades … Also shift in awareness. Western dominated order was an anomaly of last 200 years, with a rise phase for 300 years before that. Return of multiple voices all over the world. Return to a diverse, polymorphic, poly polarity.” As Jagannath Panda recently wrote in an EAF blog on March 20, 2023:  “Obituaries of the US-led liberal international order may be exaggerated, but the shift towards multipolarity is in motion.”

And what then do we have as the Global Order, and how will it advance. Arthur Stein recalled the fragile nature of the Order, which he described for me in his opening chapter of my 2008 edited volume – Can the World be Governed? The global order, he wrote then, and repeated at our Roundtable was:  ‘a weakly confederal world’. As he said at the time (2008, 52) : ”In fact, one could argue not only that multilateralism is an existential reality but that weak confederalism is the nature of modern reality.”

So the LIO has faded,  and what remains is the global RBIO (rules-based international order). Weaker and less collaborative – indeed as Arthur pointed out, the low hanging fruit of cooperation has passed and it is and will be increasingly difficult to reach collaborative solutions . But as Yves points out that there is continuing support for aspects of the Order including with China where Yves notes the significant China support for COP15 the Conference on  Biodiversity where the multilateral conference came together to agree on a new set of goals to guide global action through 2030 and to halt and reverse nature loss and the recently concluded agreement on the text for the critical High Seas Treaty. The challenge for the leading powers is to maintain a forward collaborative thrust, and as Lou Pauly warned, it is critical for the US to accept: “The challenge is to overcome perennial tendencies toward either insularity or spasmodic over-extension, toward temporizing on necessary decisions, toward shifting the costs of adjustment to the relatively poor internally, and toward exporting the rest of those costs to other countries.” It will not be easy; and Arthur reminded us that American domestic politics has been a problem since 1919 and continues today with the failure to approve through the US Senate, international agreements and the often strained effort to use executive power.

As Janice Stein alludes to in her notes: “Plurilateral and minilateral institutions – from AUKUS to IPEF to Trade and Technology Councils will be the principal sites of innovation. I have called this process “taking it offsite.” New institutions are being stood up, led by the willing, who set rules and invite others to join if they wish. One could argue that we are entering a period of start-up innovation in the creation of new, smaller, more flexible, and more focused institutions.

Although Janice may be a touch pessimistic over multilateral collaborative action, the Global Order has its worked cut out for it to avoid great power conflict and achieve critical global governance policies in climate, global finance, global health and much more.

 

Image Credit: ISA

The Current Narrative of the Chinese Communist Party’s Foreign Policy: “A Community of Shared Future for Mankind”?

When it comes to China’s current foreign policy, phrases such as “Wolf-Warrior Diplomacy” (WWD) and “Belt and Road Initiative” (BRI) frequently appear. The name WWD originates from a Chinese film series, “Wolf Warrior”, which depicts a patriotic solider battling foreign powers and mercenaries. Nowadays, many refer to China’s increasingly strong statements and assertive diplomatic declarations as WWD.

On the other hand, BRI refers to global infrastructure development projects led by China to promote international cooperation, multilateralism, and trade. It may appear that these two sets of foreign policy approaches rather conflict. However, the phrase “A Community of Shared Future for Mankind” (人类命运共同体), a part of the official narrative of China’s foreign policy may have led to both of these contrasting approaches. What is “A Community of Shared Future for Mankind”? How does this phrase explain trends in China’s recent foreign policies including WWD and also BRI?

What is “A Community of Shared Future for Mankind”?

By literal translation, the above phrase means “A Community of Shared Fate for Mankind” (SF) rather than, as it is often expressed in English, “A Community of Shared Future for Mankind”. SF suggests a global order described by China’s President Xi Jinping encompassing the shared rights and responsibility of each nation in terms of “politics, security, economy, culture, and environment” in a globalized world. In President Xi’s words SF is: “to build A Community of Shared Future for Mankind [to] construct a beautiful and clean world with long lasting peace, general security, mutual prosperity, openness, and inclusivity”. At a United Nations Economic and Social Council (ECOSOC) meeting in July, 2020, China’s Foreign Minister Wang Yi argued that China will push to build SF by promoting multilateralism in accordance with international laws and “… denounce global hegemony and protectionism”. These and other  remarks by China’s leaders demonstrate, it would seem, the Chinese Communist Party’s (CCP) ambition to achieve greater global influence, and that China is prepared to work with all nations to build a SF. Indeed, not all nations may be agreeable with the ideology of SF. It is inevitable that the CCP will face some frictions when it tries to expand the influence of SF in the world. Therefore, the CCP may have to use a tailored approach in its foreign policies to push its SF agenda.

SF as an Umbrella term for China’s Foreign Policy

President Xi has publicly made statements such as “[the CCP] will reference history and create the future. It must continuously push and construct A Community of Shared Future for Mankind”. Under this guidance, top Chinese officials have made clear that China’s foreign policy will revolve around SF. China’s approach to global order, then,  promotes politically correct topics such as climate change, global disparity, and it also opposes terrorism and hegemony. Although it encourages cross-cultural exchange, it makes no explicit mention of protecting the rights of marginalized communities. The vague language in the SF permits CCP officials greater flexibility in deciding what kind of matters are consistent with the SF and therefore align with President Xi’s agenda.

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The Link Between Domestic Politics and Global Governance

Colin Bradford is the Guest Blogger for this Post. He is a senior non-resident fellow at Brookings in Washington. He is a also a Principal of the Vision20 and a Co-Chair of the China-West Dialogue all with Yves Tiberghien, Professor of Political Science, University of British Columbia and Alan S Alexandroff Director the Global Summitry Project of Munk School of Global Affairs & Public Policy, University of Toronto and the Blog Master here at RisingBRICSAM

The underlying political driver of the current tensions in the global order is the actual or potential failure of economies to deliver social outcomes that are politically sustainable.  This is not just a phenomenon that brought about Brexit and Boris Johnson in the UK or Trump in the US – now apparently unelected.  This has been, and is, the drama of developing economies for decades. The failure to deliver social outcomes that are politically sustainable is  the source of social unrest now in Eastern Europe, the fear of the Communist Party of China, and the discontent of Europeans with the strictures of the EU.  It is global and deep seated; sweeping and systemic.

Populist nationalism is on the rise and authoritarianism is increasing as a result. The easy road for politicians to take today is to appeal to national strength and rally their publics around the flag.  The hard road to take is seize on this moment of hyper-interconnectivity revealed by the COVID 19 crisis and realize that strong multilateral cooperation and coordination is essential for global health and economic recovery in the short run and systemic transformation in the medium and long run.

The urgent necessity is for governments, societies and firms to realize that there is no going back to normal, that systemic crises require systemic change and that social priorities and people-centered policies are vital to restoring confidence in markets and governance.

But to systemically transform the social order reinforcement, resonance and support from the global system of international institutions is the new global governance priority.  Multilateralism needs to be revived to create innovative responses to these new domestic social priorities.  Strengthening the WHO, the ILO, the OECD and the multilateral regional development banks is necessary so that they can become the drivers of the international system as front-line innovators, taking on the dominant norm setting roles that the IMF, World Bank and WTO assumed during the Bretton Woods era.

The fact that social priorities are primordial domestic priorities does not mean the international institutions have no role to play.  To the contrary, key roles of international institutions are essential now through peer reviews, sharing best practice, and widening the array of policy options for national governments to engage in selective borrowing for internal application based on national criteria, culture and practice.   The funding international institutions provide provokes dialogues with governments and societies about priorities and challenges which enable countries to take advantage of global knowledge frontiers embodied in the experience of international institutions. Returning to knowledge-based policy making in national practice, which is sorely needed now, can be facilitated by these interactions between global institutions and national governments.

New forms of multilateralism and a new global order need to support transformation in the social order. This force field also operates in reverse.  Social transformation would strengthen societies as a whole such that the new social order would support the global order by: reducing ‘my-country-first’ nationalism, unilateralism, and dampen geopolitical tensions. The social order and the global order would be in constructive symbiosis instead, as currently, in rather destructive dynamics of a bipolar competitive era.

The new nexus between economics, society and the global order would create positive synergies toward better futures and greater systemic sustainability.

Image Credit: TechCrunch

The first ‘First Glance’

You’d have to be in Antarctica, maybe not even there, not to see the growing chaos in the liberal international order (LIO) since Donald Trump’s election as the 45th President of the United States.  And, it is evident that the election of the ‘Great Dismantler’ does not nearly explain the growing turbulence in international relations. Rising great power rivalry, the rise of populist leadership in liberal democrat countries and the growing authoritarian swath of global leadership – all this, and more. impact and undermine the LIO. 

So, it is fitting, I think, to announce the ‘First Glance’ series at the RisingBRICSAM blog.  On the weekend of the G7 in Charlevoix, Quebec with Trump anger and accusations at full tilt targeting his G7 allies, and Trump’s early departure to fly to Singapore for his summit encounter with the DPRK’s Kim Jong Un, it is the right time to rev-up the blog. 

The ‘First Glance’ posts will, I hope be relatively frequent.  They likely will be shorter than the traditional RisingBRICSAM posts – more from the hip, but with a desire to inform closer in ‘real time’. The LIO is under stress and from the country most responsible for its building.  What is happening,  and the course of international relations and the LIO demand greater attention. 

Here’s to ‘First Glance’.   

Alan S Alexandroff

Description and Evaluation of It All: Launching a Global Summitry Archive

Here at Rising BRICSAM for some time now we’ve been concerned with Global Summitry, and summitry more generally. While Rising BRICSAM was born some years ago concerned with the emergence of new energetic emerging market actors – the BRICs, then the BRICS, and more – Rising BRICSAM has remained focused on all the ‘Influentials’ in global governance. As part of that focus we have sought to describe, examine and evaluate the effectiveness of the variety of states, institutions and now non-state actors (NSAs) that form the architecture of global order governance.

Under the umbrella of the Global Summitry Project (GSP) we have over the years launched a number of initiatives: the Global Summitry Reports (GSRs), Spotlight, China Perspectives and our most ambitious project the Oxford University Press journal, Global Summitry: Politics, Economics and Law in International Governance.

The Global Summitry Archive

And it is with great pleasure now that GSP announces the launch of the Global Summitry Archive (the Archive). This Archive aims to collect, preserve and make publicly available all information and the websites related to global summits.

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So Much Talk of ‘Disorder’!

So it appears just about everyone has joined in. There are of course insightful views of the current global order from some of my IR colleagues, including but not limited to by Thomas Wright at Brookings or Joe Nye at Harvard.  But it would appear that many others have joined in as well. And it is understandable.  The rise of populist forces, especially in Europe, the surprise election of Donald Trump in the United States and the continuing global economic slowdown, the decline in trade and the incomplete recovery from the financial crisis of 2008 leave an attractive political and economic landscape to contemplate the future of the global order,   

This is not to suggest that folks other than my IR colleagues don’t have the necessary insights to assess the implications of current actions and events.  Many do.  For there is after all a need to assess the political actions, the military capabilities and the economic trends in the global order.  And it remains, after all, that it it is still unclear how to determine great power capability, power and dominance.  Depending on who you read, it is all about military assets; others suggest it is economic capability; and still others introduce soft power aspects as well.  Thus, it is probably not very surprising that as well known an economist as Nouriel Roubini finds he is able to analyze the ‘disorder’ presented by recent events.  As he declares in a recent Project Syndicate article

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The Threat is Real – The Global Order and Its Travails

Donald Trump greets supporters during his election night rally in Manhattan. REUTERS/Mike Segar

Donald Trump greets supporters during his election night rally in Manhattan.

There is no doubt today about the threat to the Liberal Order.  For decades we thought the the greatest threat to the Liberal Order was posed by those outsiders, the bad Russians, Mao’s China, other authoritarian adversaries.

But we were wrong!

The election of Donald Trump as the 45th President of the United States poses the greatest challenge yet to the Liberal Order the United States and its allies built after World War II.  Gideon Rachman in the FT , yesterday, November 8th, expressed it well:

Mr Trump’s proposed policies threaten to take an axe to the liberal world order that the US has supported and sustained since 1945. In particular, he has challenged two of the main bipartisan principles that underpin America’s approach to the world. The first is support for an open, international trading system. The second is the commitment to the US-led alliances that underpin global security.

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Lacking Global Leadership

Nova Délhi - Índia, 29/03/2012. Presidenta Dilma Rousseff posa para foto junto com os Chefes de Estado do BRICS. Foto: Roberto Stuckert Filho/PR.

Nova Délhi – Índia, 29/03/2012. Presidenta Dilma Rousseff posa para foto junto com os Chefes de Estado do BRICS. Foto: Roberto Stuckert Filho/PR.

[Editorial Note:  This piece was originally posted at the RisingPowersProject at the inauguration of this new site.]

So the Hangzhou G20 Summit has come and gone and now the eighth BRICS leadership conference hosted again by India, but this year in Goa as opposed to the previous India BRICS Summit in New Delhi is just about upon us. This BRICS Leaders’ Summit will take place on October 15th and 16th.

So where are we in determining the the state of global order leadership and the Liberal Order that has been so prominent since the end of the Cold War? A sweep of editorials and reviews of China’s G20 in Hangzhou has been notably downbeat.  At this site ‘Rising Powers in Global Governance’, my colleague, Jonathan Luckhurst described the Hangzhou reviews this way: “The Group of Twenty (G20) has received poor reviews in recent years, so expert reactions to the Hangzhou G20 Summit of September 4-5, 2016 were hardly surprising.”

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Collaborative Leadership Stumbles; A Dangerous Political Fuse Has Been Lit

How Hwee Young:AFP:Getty Images Ratification

Well all the columns and opinions have been written, I assume,  over the Chinese G20 Summit. Other than congratulating the Chinese leadership for having pulled it off – and there is something to be said for that – the general conclusion to be drawn from these many pieces was that little was achieved with the major concern – coordinated economic growth by all the G20. The communique was a classic instance of bureaucratic ‘gobbledegook’.   While the yardsticks were moved on a number of issues, no bold announcement by the G20 Leaders was made.  As my colleague, Colin Bradford declared in his Brookings blogpost, “2016: The year for leadership that wasn’t for the China G-20”

2016 may have been the year that teed up the need for new direction, fresh initiatives, and strong leadership, but the contrary interests of G-20 member countries seem to have missed this opportunity at Hangzhou. Whereas some of the keywords for an ambitious transformative approach are in the Hangzhou G-20 communiqué, there is evidence of avoiding commitments, ducking the big ideas, and mouthing the right words but dodging the verbs and adjectives that contained ambition.

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