Business View Magazine - May 2016 7
Editor’s
Note
Anyone who is paying any attention, at all, to America’s seemingly endless presidential campaign, and can somehow still manage, beyond the spin
and the superfluous, to make any sense of any one of its truly important, underlying issues, cannot be unaware that the topic of trade is one such
issue that is being argued about by the remaining five candidates, albeit with various degrees of passionate intensity.
Obviously, trade is an important thing to discuss in any nation that is deciding upon the future leadership of its government, as trade policy is a crucial
part of every nation’s ethos and well-being. Indeed, trade is one of the oldest and most important mechanisms of human civilization. Empires are
built on trade; wars are fought over it. Because it involves the transfer of the ownership of goods and services that have value, for both good and ill,
trade is what makes the world go ‘round. In America, it is estimated that one out of every five jobs is related, somehow, to trade.
In theory, the most successful trade would be a win-win for both parties – a trade in which the results are fairly equal, with the trade, itself, being
the measure of the value of each one’s part of the bargain. But trade has rarely ever been that equitable - and value, as we know, is very subjective.
Human nature, being what it is, is always seeking an advantage.
The reality of trade is that ways and means are consistently being sought to tilt the trade scales as much as possible in one direction or another, be-
cause in the long run, the individual, the business, the corporation, the city, the state, the nation, the empire that has traded most successfully has,
historically, been the richer, more dominant entity in a world where resources, talent, and human energy abound, but not necessarily in the same
places or at the same time. The weaker party is generally the loser when it comes to a trade war.
Both Donald Trump and Bernie Sanders, whose political experience and public personae couldn’t be more disparate, both seem to agree about
trade. They both contend that the trade deals that the United States has functioned under for the last few decades have been tilted - to the detri-
ment of America and to the benefit of its trading partners. They aver that these so-called “free-trade” deals, with their nifty acronyms - NAFTA, CAFTA,
TPP - have, in fact, made us, or in the case of the TTP (Trans Pacific Partnership), will continue to make us, the weaker party in the trade dynamic.
Trump blames the countries to which many American jobs and industries have fled – Mexico and China. He wants to erect protectionist barriers in
the form of tariffs so that the balance of trade can be recalibrated. Tariffs are used to restrict trade, as they increase the price of imported goods
and services, making them more expensive to domestic consumers, thus driving them to consume more domestically-made merchandise. Trump
believes that China, in particular, is “dumping” its products here, selling them below cost, while being propped up by Beijing. He wants a better deal,
and after all, that’s his “art.” His critics predict a trade war if his policies were to be implemented.
Sanders decries the corrupt collusion between the federal government and giant, multi-national corporations whose leaders and lawyers have de-
signed these deals to tilt the scales in favor of American-born companies - allowing them to conduct their businesses in other countries, where labor
is cheaper and taxes lower, without penalty, thereby reaping the economic and social benefits of the mother country, while siphoning off millions
of jobs from the American middle class. He would cancel these trade deals and start over, seeking fairer terms with more protections for American
workers and higher costs for their bosses.
Among the remaining candidates, Hillary Clinton was a strong supporter of both NAFTA and CAFTA, and when she was Secretary of State, she called
the TTP the “gold standard” of trade deals. She has since reversed her position on the latter. Ted Cruz, too, once supported the TTP, but he has also
pulled a one-eighty. John Kasich is the only unrepentant free-trader left standing.
It’s probably safe to assume that readers of Business View Magazine are more likely to know about, care about, and/or be involved with trade than
the general population. After all, business people do trades all the time – if not internationally, than certainly, domestically. They couldn’t stay in
business if they didn’t, and they likely couldn’t thrive unless they were looking for the next advantage. (As we said – it’s human nature.)
We take no official position regarding the various candidates’ views on trade policy. Our job is not to proselytize, but to inform, enlighten, and even
entertain when we can. We do, however, encourage you to spend the time to learn about them, yourselves. Beyond the rhetoric and the racket that
is a modern presidential campaign are serious issues with serious consequences that may ultimately affect your business. Trade is one of them.
Empires have crumbled because of it, and wars – trade or otherwise – are never pretty.
Al Krulick
Editor-in-Chief
Business View Magazine
