An article by Peter Navarro
President Trump arrived at the Group of 7 summit meeting in Canada on Friday amid an expression of “concern and disappointment”
from the six other nations’ finance ministers over United States trade
policies. Conspicuously absent has been any acknowledgment by these
ministers of the trade practices that contribute to America’s more than $500 billion annual global trade deficit in goods and services.
Consider Germany, with which the United States had a trade deficit in goods of about $64 billion in 2017.
While the United States tariff on cars made in Germany and elsewhere in
the European Union is 2.5 percent, the European Union tariff is four
times as high, at 10 percent. No wonder Germany sells us three cars for
every one we export to Germany.
Even
when Germany’s automakers build facilities in the United States, these
so-called factories are more like assembly plants. S.U.V.s in the BMW X
series that are assembled in the United States actually contain only 25 percent to 35 percent American-built content — the high-value engines and transmissions are manufactured in Germany and Austria.
Even
as Germany runs huge trade surpluses with the United States, it is not
on track to meet its financial commitment to the NATO alliance, to spend
at least 2 percent of its gross domestic product on defense by 2024.
Despite being Europe’s wealthiest country, Germany spends a mere 1.24 percent of its G.D.P. on defense.
America’s trade deficit in goods with Japan is higher than with Germany: $70 billion in 2017.
For every one car America exports to Japan, Japan sends us over 100.
High non-tariff barriers, including a complex regulatory system, make it
difficult to sell American cars in Japan. Meanwhile, Japan slaps
tariffs on a wide range of American agricultural products — as much as 32 percent on oranges, 50 percent on beef, 40 percent on various cheeses and 58 percent on wine.
As for Canada, which has been most strident in its criticism of the United States, it has for decades dumped its lumber
into the United States, threatening lumber industry jobs in Alaska,
Oregon and other states. It erects high non-tariff barriers that harm
our wheat and barley growers and place United States beer and spirits
exporters at a disadvantage. Wisconsin dairy farmers know all too well
that Canada unfairly manipulates its dairy prices to protect its dairy
farmers, hurting United States dairy exports to Canada and other markets
around the world.
It’s time for our
major trading partners — from strategic competitors like China to key
members of the Group of 7 — to realize that the era of American
complacency in the international marketplace is over. Going forward,
President Trump will pursue two goals on behalf of the American nation
and people.
First, trade must be not
only free but also fair and reciprocal. American tariffs are among the
lowest in the world. Our generosity and free market good will has only
led to a huge trade deficit and the transfer of wealth abroad.
Second,
President Trump reserves the right to defend those industries critical
to our own national security. To do this, the United States has imposed
tariffs on aluminum and steel imports. While critics may question how
these metal tariffs can be imposed in the name of national security on
allies and neighbors like Canada, they miss the fundamental point: These
tariffs are not aimed at any one country. They are a defensive measure
to ensure the domestic viability of two of the most important industries
necessary for United States military and civilian production at times
of crisis so that the United States can defend itself as well as its
allies.
Neither of these goals of the
Trump presidency should stand in the way of our longstanding and
productive strategic alliances and economic relationships with members
of the Group of 7. There will continue to be a strong need to cooperate
on issues of mutual interest, including defending democracy and freedom
against authoritarianism, and protecting our citizens from terrorism.
This also means we should find common ground on fair and reciprocal
trade in ways that favor market economics, lower trade barriers and are
mutually beneficial to workers across the Group of 7 nations.
President
Trump welcomes continuing dialogue and cooperation with Group of 7
members and our other allies and trading partners. But the days of
accepting unfair trade practices are over.
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a great article
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