The World Trade Organization authorizes new US retaliatory tariffs on EU imports in one of its biggest and longest-running formal disputes in history. Former WTO Appellate Member Jennifer Hillman (Council on Foreign Relations) joins to explain the complexity of the case and what happens next. They discuss WTO rules on subsidies, upcoming US retaliatory tariffs on imported airplanes, billions of dollars of imported European cheeses, alcohol, and other consumer products, as well as the products the United States left off this round of retaliation.
A strengthening dollar reignites a recurring debate about how to hit back against countries that deliberately weaken the value of their currencies. Joseph Gagnon (PIIE) and Maury Obstfeld (PIIE, Berkeley) join to discuss two recent and controversial policies proposed to attack that problem. The first is retaliatory tariffs under US countervailing duty law. The second is to give the US Treasury and Federal Reserve new access to hundreds of billions of dollars to use as countervailing currency intervention.
Erin Ennis and Jake Parker (US-China Business Council) join to explain results from the USCBC’s annual survey of its members of American companies doing business in China. They describe the original purpose and nearly 20-year history of the survey, as well as the latest findings about what worries American companies in China. They also discuss how companies miscommunicate with both the US and Chinese governments, how they feel about the Section 301 investigation and the tariffs, and how they are being treated during the trade war.
Nicholas Lardy joins to provide an update on Chinese economic performance over the year since the summer 2018 outset of the trade war. They assess a number of President Trump’s recent statements by examining data on China’s economic growth, exports, unemployment, and foreign investment taking place in the Chinese economy.
Yuan Yang (Financial Times) joins to explain the allegations and complications surrounding Chinese telecom equipment maker Huawei. They discuss alleged risks to national security, IP theft, unfair trade, sanctions violations, export controls, the entity list, and more.
Anand Menon (The UK in a Changing Europe) joins Keynes and Bown to provide an update on political developments, as well as the shifting timeline, for Britain to depart from the European Union with or without a trade agreement. They also discuss shortages, contingency planning, and the expected initial economic impact if no deal were to arrive.
Kadee Russ (University of California Davis) joins Keynes and Bown to discuss her research on why Korea’s trade surplus grew so widely after the Korea-US (KORUS) Free Trade Agreement went into effect in 2012. They explain the role of trade diversion, or US imports from South Korea displacing imports previously coming in from other countries like China and Mexico. They also discuss contributions due to differences in US and South Korean rates of economic growth, and the right way to think about trade deficits.
Jeromin Zettelmeyer (Peterson Institute for International Economics) joins Keynes and Bown to explain the growth of Germany’s trade and current account surplus, and the puzzle behind why it has not gone away. They discuss the role of the Europe Union, the value of the Euro, ways German policymakers could tackle the surplus, as well as worries over the return of economic nationalism.
Sophie Richardson (Human Rights Watch) joins Keynes and Bown in a wide-ranging conversation about human rights in China. They begin with basic human rights before turning to recent Chinese government efforts to surveil, detain and politically re-educate hundreds of thousands of Uighurs – the minority Turkic and Muslim community – in Xinjiang province. They also describe the concerns driving the Hong Kong protests, how countries and the United Nations Human Rights Council could hold the Chinese government accountable, as well as linkages between external efforts to improve human rights and the connection between the Chinese and the rest of the world’s economies.
Keynes and Bown discuss the Trump administration’s announcement to impose new tariffs totaling $300 billion of Chinese imports split across September 1 and December 15, 2019. Each tariff list targets a different set of consumer goods for the first time, and yet their rollout also avoids import surges associated with peak American shopping seasons. They also describe new evidence of heightening concerns of conditions in the US and global economy.
Keynes and Bown discuss the Trump administration’s decision to name China a currency manipulator. They are joined by former IMF Chief Economist Maury Obstfeld (PIIE), Joseph Gagnon (PIIE), and Alice Fulwood (The Economist), who help explain what affects the value of the US dollar, the history of Chinese currency manipulation, the challenge of identifying a country as a currency manipulator, and the implications of the Trump administration’s actions today.
Adam Posen (Peterson Institute for International Economics) joins Keynes and Bown to discuss the US Federal Reserve’s decision to cut interest rates for the first time in 10 years. They describe the uncertainty facing central bankers, the impact of the global economy on their decision-making, and whether there is a relationship between their actions and President Trump’s tariffs.
Former United States Trade Representative Michael Froman* joins Keynes and Bown to discuss the Obama administration’s approach toward China and the World Trade Organization. On China, they describe the challenge of relying on allies and US companies when using WTO dispute settlement, the utility of the US-China bilateral investment treaty negotiations, and the links between trade and national security. On the WTO, they discuss the deals that were agreed, the decision to end the Doha Round of negotiations, and the Obama administration’s frustrations with the Appellate Body.
Keynes and Bown are joined by Dukgeun Ahn (Seoul National University) to discuss Japan’s threat to limit South Korean access to inputs needed to make display panels and semiconductors for smartphones. The current dispute traces back to failures to resolve private reparations claims over World War II atrocities. They explain new economic threats to regional supply chains, Japan’s national security justification for its decision, the role of the WTO and a legal decision over the Fukushima nuclear accident, and even implications for the CPTPP.
Ben Hyman (Federal Reserve Bank of New York) joins to discuss the problem of workers hurt by increased competition arising through trade. They explain the US Trade Adjustment Assistance (TAA) program and new evidence on whether it helps workers stay in the labor market, retrain, and keep earning wages by remaining attached to jobs.
Former Indonesian Trade Minister Mari Pangestu joins Keynes and Bown in a wide-ranging conversation about trade policy and negotiations in Asia. They chat about Indonesia’s episodes of trade liberalization, corruption, and the benefits of losing a WTO dispute. They discuss her experience negotiating ASEAN (Association of Southeast Asian Nations) free trade agreements with both India and China, as well as the birth of the RCEP (Regional Comprehensive Economic Partnership) idea. They also explain how Indonesia is caught between China and the United States in the ongoing trade war, and the negotiations Indonesia now faces with the Trump administration under the Generalized System of Preferences.
Gordon Hanson (University of California San Diego) joins Keynes and Bown to explain the migration and humanitarian crisis at the heart of President Trump’s threat to impose new tariffs on imports from Mexico. They discuss the history of undocumented migration arising since the 1960s, as well as how it has been impacted by changes in US and Mexican economic conditions and immigration policies. They also describe how the crisis has been affected by rising violence in Guatemala, El Salvador, Honduras and Mexico, as well as the unintended consequences of US and Mexican migration and asylum policies.
Keynes and Bown describe President Trump’s decision to declare an emergency on the US southern border. On May 30, Trump invoked the 1977 International Emergency Economic Powers Act (IEEPA) and stated he would impose new tariffs on all US imports from Mexico starting June 10 unless, in his view, the “illegal migration crisis is alleviated through effective actions taken by Mexico.” They discuss the potential legality of such an action, as well as the likely economic implications for the United States, Mexico, and the trading system.
Keynes and Bown explain Trump’s latest trade actions in his national security cases on steel, aluminum and automobiles. They speak with Kristin Dziczek (Center for Automotive Research) about perceived threats to R&D of “American-owned” carmakers, as well as the political and economic implications of Trump negotiating voluntary export restraints on autos from the EU and Japan. They also describe the managed trade implications of the agreement to remove US tariffs on steel and aluminum from Canada and Mexico, as well as the possible resumption of future conflict.
Lucie Gadenne (University of Warwick, IFS) joins Keynes and Bown to explain when and why some countries use import tariffs as an important source of total tax revenue collections. They discuss her research on the fiscal cost of trade liberalization, what has happened recently when poor countries cut tariffs, and how and why things were different historically when today’s rich countries opened up to trade.
Keynes and Bown update the sudden change in US-China trade negotiations and President Trump’s tariff escalation. They speak with Lingling Wei in Beijing (Wall Street Journal) about misunderstandings and why the two sides remain so far apart. They also discuss the expected economic impact of Trump’s new tariffs, as well as his proposal to buy US farm products and distribute them to poor countries.
Duncan Robinson (The Economist) joins Soumaya Keynes and Chad Bown to provide an update on the Brexit process of the United Kingdom leaving the European Union. They discuss ongoing cleavages in the major British political parties, and implications of the 2019 elections to the European Parliament taking place in the United Kingdom as well as across Europe.
Soumaya Keynes and Chad Bown chat with Gene Grossman (Princeton University) about decades of research on what determines tariffs in the real world. They discuss the role that voters, politicians, lobbyists, and campaign contributions play in setting out the supply of and demand for trade protection. They also describe what political economists may have gotten wrong, as well as the role that identity politics may have played in shaping the recent trade backlash and election of Donald Trump.
Soumaya Keynes of The Economist and Chad P. Bown of PIIE discuss the hotly anticipated US International Trade Commission economic impact assessment of the US-Canada-Mexico Agreement. They explain the ITC use of economic models to show potential effects on the US economy of changing from the North American Free Trade Agreement to the new USMCA. They describe distributional and overall economic impacts arising through the resolution of uncertainty on data and digital information, new rules of origin for the automobile sector, and other policy changes induced by the USMCA.
Mona Pinchis-Paulsen (New York University) joins Soumaya Keynes and Chad Bown to discuss the historical origins and tradeoffs of justifying trade restrictions under the threat to national security. Sparked by an April 2019 WTO ruling involving combat between Russia and Ukraine, they explain the key fight within the original team of American negotiators that arose in the 1940s when setting up the International Trade Organization at the close of World War II. They discuss whether today’s Article XXI is 'self-judging' and 'non-justiciable,' they foreshadow conflicts around President Trump’s national security tariffs on steel and aluminum, and they describe implications for the future of the WTO.