Donald Trump clearly believes in “Make America Great Again”. But what does “greatness” mean to him, for the other (less-noble) goals for which the slogan is a cover, and a remarkably chaotic implementation of his programme? In this bigger picture, the new tariff policies announced on April 2 seem relatively benign. After all, the United States has been a global leader in the openness of its economy, and has regularly struggled to get other economies to reciprocate fully. Some of the asymmetries in openness have been built into the rules governing the world trading system, which made allowances for the US’s dominant economic position at the end of World War II. The challenges of global rules for trade in an unequal world were reflected in the fact that, while the International Monetary Fund and the World Bank began operating soon after the end of the war, the World Trade Organisation (WTO), the third pillar of the post-war global order, took five decades to be established.
As other countries recovered from the war’s devastation, or achieved developed country status for the first time, the US has been regularly frustrated with the lack of equal access to their markets. This is at the heart of Trump’s claims of unfairness – the US no longer dominates the global economy as it did in 1945, but is expected to live with a system that gives the rest of the world an advantage in market access. Of course, there are other complications. As the global economy has grown, other countries have developed manufacturing capabilities that give them a comparative advantage they lacked earlier. In 1950, Japan barely had an automobile industry, and by the 1980s it was a global leader, only to be forced by the US to implement “voluntary” export restraints. Changes like this, along with trade openness, have moved manufacturing jobs out of the US, and to other countries. Economic growth in those countries has partly come at the expense of American workers, and the US has not done enough to mitigate those impacts. The heart of industrial America became the Rust Belt, and has proved to be an important part of Trump’s voter base.
