“(T)The Biden administration – with a few important exceptions – has continued on the path that President Trump and I charted,” Lighthizer writes, noting that “the Biden team has continued to oppose (World Trade Organization) rulings against America, refused to lower Section 301 tariffs on China, and decreed the beginnings of an industrial policy.
“The tides have changed in the trade policy of this country,” he says.
The book, part victory lap and part policy prescription, is the clearest elaboration yet of what Trump’s second-term trade policies might be, as well as a rosy-tinged retrospective on his first. mandate. While it’s unclear whether the former president would reappoint Lighthizer to the post of U.S. trade representative if he returns to the White House, the 75-year-old advises his presidential campaign and remains in regular contact with trade executives at Capitol Hill and industry.
At just over 320 pages, “No Trade is Free” illustrates how far American politics have strayed from the pro-globalization consensus that predated Trump, Biden and the Covid-19 pandemic. Many of the book’s themes echo Trump’s early statements on the 2024 election campaign, including two loud campaign videos advocating higher tariffs and trade restrictions on China, as well as limits on Chinese nationals owning land. agriculture and critical industries in the United States.
Decoupling, not risk reduction: On China, Lighthizer advocates what he calls “strategic decoupling” — a bigger break with the Chinese economy than the “risk reduction” platform pushed by Biden and European leaders. This would involve raising tariffs on Chinese goods until the United States achieves “balanced trade” with China – or the elimination of the trade deficit – by abrogating its normal trade status and increasing tariffs. prices.
Lighthizer would also crack down on new investment between economies, allowing the Committee on Foreign Investment in the United States to refuse deals in the United States involving Chinese companies, not only on national security grounds, but also on economic competitiveness. And he would create a new government commission to review U.S. investments in the Chinese economy, advocating an approach similar to that proposed by Sens. Bob Casey And John Corny in their National Critical Capabilities Defense Act and which is currently being considered by the White House.
“The likelihood that the investment will cause long-term economic harm should be sufficient to block” investment deals, he writes.
Chinese investments in U.S. farmland and critical industries would come under particular scrutiny.
Congress must “enact new authority to give the government the power to prevent US entities from investing in China except where it is in our interest,” Lighthizer writes. “These new powers must include banning all Chinese investment in critical infrastructure or technologies serving that infrastructure,” he adds, concluding that “companies will never do it on their own.”
TikTok is also on the list of targets, along with other Chinese technology and media companies. Lighthizer “would ban Chinese state actors from buying ads in American newspapers, ban Chinese social media companies from operating in the American market, and strengthen American foreign donation laws to require all nonprofits to publicly disclose the foreign money they receive”.
These policies would undoubtedly increase costs for American businesses and consumers, trigger retaliation from Beijing, and stress relations with allies like the European Union that have deep economic ties to China. But Lighthizer dismisses those consequences, concluding that they are necessary to curb China’s rise and rebuild its own manufacturing.
“The Chinese would presumably find a way to fight back, but to the extent they did, it would also contribute to strategic decoupling,” he wrote, saying “our relationship is so unbalanced that China’s options are limited.”
China “isn’t the only bad actor”: US allies and global trade institutions fare slightly better than Beijing in Lighthizer prescriptions. He calls for trade actions to undermine allies’ industrial policies, writing that China “is not the only bad actor” and that “one of our closest allies and partners around the world is also treating producers Americans unfairly.
“Many of our (free trade agreement) partners manipulate their currencies, provide subsidies to their manufacturers, and maintain broad non-tariff barriers, such as discriminatory regulatory requirements, which are harder to detect than traditional protectionism,” writes- he.
Lighthizer also castigates the World Trade Organization, whose top dispute settlement body he helped cripple by preventing the appointment of new judges under the Trump administration, and offers a multi-point reform plan for the institution. which would imply the removal of this panel. While the WTO can “facilitate” some trade talks between like-minded nations, he writes, “nothing we do at the WTO will solve the major problems we face or change the trajectory of our trade “.
Throughout the book, Lighthizer is careful not only to distance himself from the pro-globalization consensus of the past 40 years, but also to argue that the Trump administration — and then Biden — changed the paradigm for global trade in Washington. He mainly highlights the renegotiation of NAFTA, which became the United States-Mexico-Canada agreement, and gives credit to the former president Nancy Pelosi and current Biden trade chief Katherine Tai, who was a key House staffer during the negotiations, for helping to make it happen.
Lighthizer also supports other bipartisan policies, including a carbon border adjustment, which would raise tariffs on highly polluting imports and has broad support among Democrats, as well as a call to change the de minimis tariff threshold, which allows duty-free processing for imports under $800 and has been criticized by Chinese hawks on the Hill.
Despite bipartisan pronouncements, “No Trade is Free” represents a more hawkish and stridently protectionist stance than that taken by the Biden administration and even some of Lighthizer’s former allies. They fear that Lighthizer’s efforts to decouple the US and Chinese economies may end up hurting the United States more than he and other Trump cronies anticipate.
“I’m more of a risk-buster than a decoupler,” former Sen. Rob Portman (R-Ohio), who served as U.S. Trade Representative under former President George W. Bush, said in an interview on Capitol Hill. Hill last week. . “There’s a lot of business dealings with China that have nothing to do with (national security)… what you’re doing is trying to distinguish between the two, and it’s difficult.
Part of an occasional POLITICO series: The Changing Landscape of Global Trade