Why Is Foreign Policy For Trade So Important

First, Foreign policy encompasses a much larger policy area than trade. The reason I’ve chose trade as a proxy for foreign relations is that it is a telling signal for the relationship between two countries. What is revealed in these trade agreements in the future which these two countries intend to share. This has been long the paradigm which has guided trade policy, at least in the western world. With the rise of the eastern asian economic block, this paradigm has been stress tested due to a number of reasons.

Officially, the U.S. policy has been to provide beneficial trade agreements to those countries which have had democratic governments, and have advanced the interests of the U.S. In 1979, the policy changed ubruptly when the U.S. installed and supported a decidedly undemocratic and un-western form or rule in Iran.

So in the wake of this decision, what has been the guiding principle of U.S. trade relations? To advance democracy using the lever of economic force? Decidedly not, as is evidenced by the U.S. trade policy in the following years, taking us all the way to the present where our main concern is China and Russia.

The calculation is simple, China has an incredibly large domestic economy, which the U.S. business interests have an interest in gaining access to. Much of the trade policy of the 2010’s was shaped around this fact. The economic power which the U.S. wields has at no point been used to pressure China to adopt a democratic regime. As Americans we should be asking, “is our trade policy centered on spreading democracy or advancing corporate interests?”

To be clear, there is a marginal advantage to the everyday American when U.S. corporations “win” abroad, but that advantage pales in comparison to the common goal of using U.S. power to impart democracy to other parts of the world. In other words, the electorate of the U.S. must support either:

  1. A policy which advances the goals of the U.S. as a political power in the world, in the capacity that it has the levers of power to spread democracy, or
  2. A policy which is a-political and seeks to advance the interests of business which seeks to gain market access and profit from countries which don’t share our values

Truly, the U.S. still wields an incredible amount of economic power – though I should caution that this unilateral power is not infinite nor unending. China has already assumed an equal economic force in the world among a group of countries which vastly out-populate the western world.

We will necessarily have to trade with Asia in the global economy. Whether we capitulate to corporate demands instead of valid national concerns remains to be seen. For too long, the U.S. trade policy has revolved around indemnifying corporations against abuses of local labor forces, but we will likely find that it is those labor forces which we have formerly short-handed which could be the greatest promoters of democracy in their home countries. There should be a concerted effort to win those laborers over to the side of democracy, rather than the interests of the next rising power in China.

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