In a previous Talking Trade post two years ago, Michael Moore-Jones warned that closing one’s borders was the surest way to “send jobs to China.” Today, this is actually happening. After US President Donald Trump slapped 25% tariffs on steel as part of his “America First” trade policy, the motorbike firm Harley Davidson – once praised by the President as a proud example of “made in the USA” – announced that it would be moving some of its production overseas to evade retaliatory EU tariffs and respond to rising steel costs at home. Many of Mr. Trump’s working-class supporters in the American factory will lose their jobs.
Surprisingly, few Harley Davidson employees – many of whom are Trump supporters – appear disillusioned with the president’s protectionism. “He wouldn’t do it unless it needed to be done, he’s a very smart businessman,” one worker told the Financial Times serenely, encapsulating the “In Trump We Trust” attitude that persists among many in the President’s base.
Many workers were, in fact, apparently quick to point an accusing finger at the EU and even Harley Davidson itself for leaving its traditional base in Wisconsin. They are resolutely defending Trump’s claim to be “just trying to save the US aluminum and steel industry” from the unfair trade practices of foreign countries. Other US presidents would surely have been crucified for less.
Trade experts predicting that protectionism would threaten US jobs have been vindicated by Harley Davidson’s pull-out. Working class Trump supporters have the most to lose. Why then do American workers continue to support Trump’s flawed protectionism?
It would be easy to dismiss Trump supporters as unwise or easily deceived. Yet, this would merely trivialize a more serious problem plaguing trade politics today. Caught up in a wave of identity politics, how a policy actually affects the US economy is now arguably less important to voters than who is actually articulating it.
Trump’s electoral victory in 2016 was strongly correlated with an increasing consciousness of White working class identity. This consciousness has been defined by insecurities over perceived threats arising from globalization and multiculturalism as well as a distrust of “Washington elites.” Political discourse and affiliation are thus less defined by strict policy alignment as by one’s sense of belonging to a particular “tribe.”
Trump’s influence has become so powerful because his ideas and blunt rhetoric have ingratiated him with the working class. He electrified his political base by tapping into their fear and resentment with sloganistic promises to “build a wall” and “drain the swamp.” No matter how unrealistic or even damaging such ideas may be in reality, Trump enjoys their unwavering loyalty, for they have come to embrace the President and his ideas as representative of their own.
In contrast, the way trade issues are communicated with the public leaves much to be desired. Articulated in technical language within exclusive spaces such as universities and financial journals, trade discussions are generally restricted to a highly-educated intellectual elite. Neither able to join the conversation nor square pro-trade arguments with their grim reality of precarious employment and stagnant wages, disillusionment has alienated the working class from the free-trade “establishment.”
For these frustrated voters, free trade symbolizes the relentless forces of globalization and the “Davos men” and “Davos women” that they believe to be destroying their communities and way of life. Ideas are more than the conclusions of rational deduction: they require emotional as well as logical buy-in in order to be persuasive. No matter how logically sound arguments for free trade may be, they are unlikely to gain emotional traction unless the festering disillusionment and resentment of many in the working class is assuaged.
Opposing free trade could, however, have serious consequences for Trump’s supporters. Instead of saving American jobs, tariffs on steel and the ensuing retaliation, for instance, could lead to losses of approximately 97,614 jobs while the US GDP could fall by around 3.64% and productivity by around 1.65%, weakening the economy and worsening the working class’ struggles with unemployment and wage stagnation. Without accepting how protectionism affects their economic circumstances, workers may be unable to take necessary political action to avert such a catastrophe, thus falling prey to demagoguery.
Simply informing working class voters about the consequences of protectionism is, however, not an adequate solution to this problem. The root cause of protectionist sentiment is not only a lack of awareness about the benefits of free trade, but also anger and suspicion of those who advocate for it. While more information about trade could win over some opponents of free trade and allow working class voters a better understanding of trade issues, it is unlikely to solve the emotional alienation felt by many such individuals.
Trust-building strategies may strike closer to the heart of the problem by attempting to heal the adversarial relationship between the working class and free trade advocates. Efforts should be made to conduct trade communication in a more inclusive way. Trade issues should be explained to as wide an audience as possible in layperson’s terms while greater efforts should be taken to account for the perspectives of communities disenfranchised by trade in trade analysis. This will hopefully go some way towards empowering workers to better follow and even participate in discussions on trade, ideally mitigating some of the tensions between the two groups.
Yet while effective in theory, such ideas may be difficult to pull off in reality. The deep, long-term antagonism held by free traders and protectionists against one another may render them unwilling to have meaningful discussions on a sufficiently large-scale. Even if such engagement takes place, there is no guarantee that any form of mutually-satisfactory understanding could emerge from such diametrically opposed worldviews; causing the impasse to persist further.
Despite these challenges, it is crucial that we persist in overcoming the suspicion of free trade within Trump’s working class base. Harley Davidson employees are arguably being misled by Trump’s scapegoating of globalization. “Detoxifying” the negative reputation of free trade is the first step in equipping workers to engage with trade issues on their own terms, allowing them to draw conclusions in line with their own interests rather than default to self-serving populist rhetoric.
***This Talking Trade was written by Ng Qi Siang, Research Intern at the Asian Trade Centre, Singapore***