One Thing Trump and Kamala Agree On
Bubba
05 Sep
One Thing Trump and Kamala Agree On
There's a surprising amount of overlap when it comes to President Biden, Kamala Harris, J.D. Vance and Donald Trump’s trade policies. (WSJ)
The latest: U.S. Steel shares plummeted yesterday amid reports President Biden is planning to block the sale of the company to Japan’s Nippon Steel.
Trump, Vance, Harris and Biden have all expressed opposition to Nippon Steel’s acquisition of U.S. Steel on the grounds that the company should remain American-owned and -operated.
Nippon has promised to invest $2.7 billion in refurbishing U.S. Steel’s aging plants.
Despite tariffs imposed under Trump and continued by Biden, U.S. steel mill employment is down 7% since January 2020.
The criticism: Supporters of the Nippon deal say it would boost American manufacturing, spur technological innovation in domestic steel and make the U.S. industry more competitive against China.
The numbers: A recent study by the Committee to Unleash Prosperity, a pro-free market group, found that U.S. affiliates of foreign multinational enterprises make up less than 1% of all U.S. companies but account for 13% of business R&D spending, 17.3% of investment in plant and equipment and 23.6% of total U.S. goods exports.
These affiliates employ over 7.9 million U.S. workers, and 35% of those jobs are in manufacturing.
This is much higher than the overall private sector, where only 9.7% of jobs are in manufacturing.
Average compensation at these multinationals was $86,859 per U.S. worker, 22% higher than the private sector average.
CTUP’s take:
Ironically, our politicians are scaring off foreign investment in the private sector at the exact same time they are borrowing more money than ever from abroad to finance government spending!
Related: There’s common ground between Trump and Harris on a number of populist stances, like the Child Tax Credit, no taxes on tips and deficits as an afterthought.
Axios’ Zachary Basu has described this as a “populist bidding war” between the two candidates.
Basu:
In an election both sides are treating as existential, ruthless politics are the name of the game. In some cases, that means skimping on details or abandoning sound economics.
Bubba’s Two Cents
The Trump-Harris convergence is a clear sign of how much the consensus has shifted when it comes to conventional wisdom on issues like trade and spending. A lot of Americans with traditional GOP views on economics are probably wondering if the political times have passed them by.
But there are glimmers of hope for this group.
While it’s hard to deny old guard Republican thinking has been thrust aside in some areas, it also seems like a lot of the hype around the GOP’s economically populist turn may be overblown.
