A version of this post appeared on Edelman U.S. Public Affairs.
Why have free trade and a tariff war with China become the subject of everyday dinner conversation?
Viewed by many as an integral component of a prosperous U.S. economy, pacts like the North American Free Trade Agreement (NAFTA) have long been good fodder for discussion inside the Beltway, but they haven’t generally been “hot-button” political issues.
That was all upended during the 2016 U.S. presidential election. Candidates from both parties challenged the status quo, and skepticism regarding the “free” part of free trade grew with the magnification of the United States’ trade deficit. The public began asking pointed questions:
Did manufacturing jobs leave my hometown because of NAFTA?
Are corporations lining their coffers by using labor in lower-cost markets like Mexico?
What is the impact of the ballooning trade deficit with China on the American worker?
Simply put: If I, as a worker and voter, was left behind, then something had to be responsible. And that something became previous and pending “bad” trade deals.
The sentiment was populist, and it turned trade into a household concern for Americans on both sides of the political aisle— almost everyone in this country has a personal story of a factory or some other sort of business being shut down in their lifetime. While there is some consensus that automation and other advancements in technology have largely spurred the decline in manufacturing in the U.S., it’s much easier, frankly, to be against something.
And in spite of the real culprit, the transition of the American economy from manufacturing to services is a reality—and it has not lifted all boats. That’s why opposition to NAFTA has been louder, and in many cases more compelling. And that’s also why tariffs are popular with many constituencies right now.
Support Drowned Out
Advocates for free and fair trade have struggled to gain traction in the populist debate. It’s been years, or decades, since advocates have had to “make a case for themselves.” Some industries that support free trade, such as agriculture, energy, and retail, have made their case, but the message often comes across as analytical, lacking the emotional resonance of those on the other side of their debate: The displaced worker. In a tough economic environment, the absence of a unified effort to advocate for free trade and trade agreements like NAFTA is noticeable.
Progress on trade and continuing trade agreements cannot be taken for granted. Neither can renegotiations or reforms. In the current environment, remaining silent on the sidelines is not an option unless you are seeking to become collateral damage. The case needs to be clearly made for why certain trade outcomes are important and who will be helped in each scenario. The subject matter needs to be personalized in order for others – from corporate to political leaders – to care.
And equally important as the message is the messenger. Who is best positioned to lead the debate?
The Return of Experts
The 2018 Edelman Trust Barometer found that experts, both technical and academic, are once again those we trust most. In a world where confidence in the media and government is slipping, voices of authority are regaining credibility – and that includes CEOs. We also saw the rise of trust in employers. Despite our tendency to complain about the boss – in reality, we have deep trust in those entities that employ us.
Companies and organizations that stand to be impacted by immediate changes in trade policy have an opportunity to seize this moment and make discussion of international trade and trade agreements less about vague macroeconomics and more about household-level benefits.
Engagement on trade does not need to be combative, or even political, but it does need to be timely, understandable, relatable and true. We saw this with President Trump’s proposed tariffs on steel and aluminum. CEOs and business experts were among the most impactful voices speaking out in opposition. Their arguments weren’t hinged solely on GDP numbers and trade deficits but supplemented with a human take on how tariffs would affect local operations, employees and customers. The opposition was substantive and personal, not bombastic, and the message carried through to employees, stakeholders, lawmakers and the media.
This effort is driving results. President Trump pulled back on slapping steel and aluminum tariffs on Canada, Mexico, and several other trading partners.
Steel and aluminum tariffs have proven to be a quantifiable flashpoint driving business to engage in local and national trade dialogues, grounded with expert data and stories that resonate around the dinner table like the price of a new car or a carton of milk. We can expect the debate on trade to continue for the foreseeable future. But for it to resonate, it has to be personalized and grounded in emotional real-world benefits and challenges.
Jere Sullivan is vice chairman, international Public Affairs. He is based in Washington, D.C.