In the News
Trump team spurns adam smith with its trade stance
By Former U.S. Representative C. Donald Johnson, Opinion Contributor
The Hill (4/17/19)
Europeans usually carry a sophisticated interest in Washington affairs, but they currently greet American trade politics with perplexity, especially in the trade power centers in Geneva, Brussels and London.
The Executive Council of the American Society of International Law announced on December 14, 2018, the selection of The Wealth of a Nation: A History of Trade Politics in America (Oxford University Press, 2018), by C. Donald Johnson, to receive the 2019 Certificate of Merit for High Technical Craftsmanship and Utility to Lawyers and Scholars (Honorable Mention). Based on the recommendation of a committee of Society members, this honor is awarded annually to a recent work that represents a distinguished contribution to the field. It will be presented at the 113th Annual Meeting of the Society, bringing together over 1,200 scholars and practitioners of international law from throughout the world, on Thursday, March 28, 2019 at 4:45 P.M. at the Washington Hilton in Washington, D.C.
Vol 80, Issue 4, Pages 832-834
Book Review
The Wealth of a Nation: A History of Trade Politics in America. By C. Donald Johnson.
Thomas W. Zeiler, University of Colorado (07 December 2018)
An unabashed believer in economic liberalism, C. Don Johnson warns us of the dangers of Donald Trump’s protectionist policies. By exploring the history of protectionism since the nation’s founding, the rise of the modern-day liberal order, and its potential demise under Trump, this former congressman, trade negotiator, and lawyer lays out a story designed to reach a wide audience. . . .
Johnson makes his case that free trade benefits workers, as well as businesses, although in the last few decades the government could have been more responsive to labor’s (as well as the environmental movement’s) protests over market forces. Claiming that trade affects politics, not just economics, the author traces the history behind the “visible hands” of people and agencies who made policy. He zeroes in on the interests behind policy and whether their own self-interest, the public good, or political payoffs drove their decisions. The politics of protectionism oftentimes undermined the working class by denying labor the right to a fair wage. The key is that there has always been conflict over trade, but it was political and not economic in nature. . . .
The second part of the book [which details the trade liberalization that shaped the post-World War II history] is superb at capturing trade politics, including propaganda on both sides of the debate.. . . .
Part three finishes off this last bit of history and . . . makes the case for NAFTA and the WTO as institutions . . . covers the drama of textile negotiations, NAFTA, and especially the Seattle protests of 1999. . . . Johnson reminds us that the liberal economic order is an unappreciated tool of American prosperity, leadership, and sound politics, a thought oft-heard today.
Read More : The full review is available by subscription, in most libraries, and on the Wiley Online Library
China Currents
A Journal of the China Research Center
2018: Vol. 17, No. 2, October 30, 2018
Commentary: Making China Great Again
C. Donald Johnson
Centuries before President Donald Trump began withdrawing from multilateral trade agreements and retreating from international leadership roles, while promising to build a “big, beautiful wall,” there was another great world power that chose to abandon global engagement and seek chauvinistic refuge behind a Great Wall. It involves a critical period of Chinese history that offers some insight into the politics of trade wars emerging today.
The Fall of a Great Power
During the reign of Zhu Di, who became Yongle, the third emperor of the Ming Dynasty in 1402, the sphere of Chinese culture and influence expanded far beyond its traditional territories. Although Zhu Di’s tactics were often ruthless, his reign is considered one of the most brilliant in Chinese history. He moved the capital permanently to Beijing from Nanjing, reconstructing the 2,000-mile Grand Canal to transport grain from the fertile Yangtze River valley in the south to Beijing and building the majestic monuments known to most tourists visiting China today, including the imperial palace of the Forbidden City, the Temple of Heaven, and the palatial Ming Tombs. Zhu Di personally led five successful military campaigns north of the Great Wall against the Mongols, who had ruled China for the century preceding Ming rule under the Yuan Dynasty beginning under Kublai Khan. He fought the Mongols his entire life as they continued to be the greatest threat to Ming rule. . . .
In trade war, US has economic edge, but China has political advantage
By Former U.S. Representative C. Donald Johnson, Opinion Contributor
The Hill (8/15/18)
. . . With China, the United States' largest trading partner and its third-largest export market, we are now engaged in the first stages of a full-fledged trade war. Both countries -- representing the two largest economies in the world -- are destined for damage if this war lasts very long.
President Trump, who thrives on chaos, moving from one distraction to the next, promises that in the long run the trade war will somehow bring an end to the U.S. trade deficit with China.
Most economists have declared that Trump's trade policies make no sense as a tactic to reach that goal with out adopting macroeconomic policies addressing the domestic fiscal debt now headed to historic levels under Trump's tax cuts.
GOP MUST find courage to stand up to trump's ruinous trade tactics
By Former Ambassador C. Donald Johnson, Opinion Contributor
The Hill (6/14/18)
As President Trump rebuffed and insulted our closest allies before, during and after the recent Group of Seven debacle in Quebec, his craven apologists have attempted to rationalize this blatant attempt to undermine our postwar economic and strategic alliances and to dismantle the rules-based world trade system that has prevented trade wars from becoming shooting wars ever since the devastation of World War II and the Great Depression.
It dangerous nonsense,, and they know better. Yet, congressional leadership is largely silent, though many know that something is badly wrong here. . . .
Georgia Journal of International and Comparative Law
Vol.46, No.3, 691-714, Spring 2018
a return to bilateral agreements: An end to the nondiscriminatory multilateral trading system?
By C. Donald Johnson
. . . In the political economy of the post-World War II era . . . , the United States has been the principal architect of the nondiscriminatory multilateral trading system in an effort to promote and sustain economic stability among scores of state actors with economies engaged in rules-based, free market trade. A critical question immediately comes to mind from the Trump administration's decision to terminate multilateral trade agreements and direct USTR to focus engagement on bilateral, country-by-country trade agreements: Is this the beginning of the end of the rules-based liberal economic order created in the post-war years to settle disputes and reduce discriminatory trade barriers through a multilateral trading system?
Read More - For those interested in reading this article describing the threat to trading system presented by the Trump administration in its first year, it is available in most university or law school libraries or please contact the author for a copy at Johnsocd@uga.edu.
Congressional Power over Trade authority
Marketplace with Kai Ryssdal (6/12/2018)
Congress is considering reclaiming its legislative constitutional authority over trade in light of recent events [Trump tariff hikes on steel and aluminum against European and North American Allies] . . . .
At around the 7:40 minute mark, former U.S. Ambassador C. Donald Johnson explains to Marketplace's Nancy Marshall-Genzer the legislative authority claimed by the Trump administration for its unilateral trade actions.
Trump's latest actions effectively declare a global trade war
By Former Ambassador C. Donald Johnson, Opinion Contributor
The Hill (6/5/18)
Last week’s decision by the erratic Trump trade team to raise steel and aluminum tariffs amounts to declaring a trade war on effectively every major trading partner in the world market.
It presents an enormous economic threat to domestic industries that use steel and aluminum — that will have to raise prices, no doubt — and to sectors that will suffer from trade retaliation, such as agriculture and other political targets. But these losses are not the only damages that may result from these wars.
Treasury, USTR Send Mixed Messages Over Tariffs on Chinese Imports
Wall Street Journal (5/20/18)
C. Donald Johnson, a former USTR negotiator and trade lawyer in the Clinton administration, said conflicting statements from Washington’s negotiators don’t help U.S. negotiations. “I know where [Chinese President] Xi Jinping and Liu He are coming from,” said Mr. Johnson. “But our side is so confused.”
China talks test Trump’s dealmaker reputation
Financial Times (5/18/18)
C. Donald Johnson, a former congressman who has written a new history of the politics of US trade policy, argues that landmark trade deals have usually been the result of unpopular presidential interventions.
“The only real deals that have survived are the ones where leaders have displayed courage,” he says. Mr Johnson highlights the case of President Harry Truman, who in the run-up to a tight re-election race vetoed a tariff on wool that had threatened to derail the General Agreement on Tariffs and Trade — which today continues to govern the rules of global commerce.
The economy is weird right now
Marketplace with Kai Ryssdal (5/4/18)
On the currently proposed congressional expansion of the powers of the Committee on Foreign Investment in the United States (CFIUS) headed by the Treasury Secretary, former U.S. Ambassador Don Johnson expressed concern about giving CFIUS too much indiscriminate power to block trade and investment deals in an interview with Marketplace senior reporter, Nancy Marshall-Genzer. "When we start using it purely as a protectionist tool, I think we need to slow down some." Marshall-Genzer noted that Johnson said that if Congress isn't careful the US will fall behind other countries that do not have such strict trade barriers.
Johnson's quote begins around the 12-minute mark.
TRUMP, TRADE WARS, AND THE FORGOTTEN MAN
America’s Trade Policy Blog (4/17/18)
In a tweet that reads like “Newspeak” from Orwell’s 1984, President Trump declares: “Trade wars are good, and easy to win.”
In truth, of course, both assertions are dangerously wrong, though emblematic of the president’s contempt for the system of trade rules built under American leadership out of the wreckage of war to bring economic stability and prevent trade wars. Trump’s take on trade is an old refrain. On election night 2016, he promised: “The forgotten man will never be forgotten again.” His populist rhetoric isn’t original. He has borrowed an old fraud used on the working class for political purposes and simply repackaged it for a modern sale…
FORMER CONGRESSMAN DISCUssES NEW BOOK…
WUGA Radio (4/16/18)
Is America better served by a free trade agenda or protectionist measures? That’s a question being addressed in a discussion at the Russell Special Collections Library on Tuesday afternoon.
Author, Director Emeritus of the Dean Rusk Center and former U.S. Congressman, Don Johnson is discussing his new book, "The Wealth of a Nation: A History of Trade Politics in America.” Johnson says two and a half centuries have shown that a liberal economic system, or open market, works best for the nation.
"The reason it covers such a long period is because the subject doesn't change that much and the politics haven't changed that much. Throughout the last two centuries it's been a very populist argument. It's a war quite often between industry and the working class. And that's what it is to this day," said Johnson.
The Wealth of a Nation:
A History of Trade Politics in America
Foreign Policy (4/9/18)
DURING THE U.S. CIVIL WAR, in the midst of one of the country’s many protectionist benders, a man named Joseph Wharton successfully lobbied for high tariffs on imported nickel. It made sense for him: He owned the nation’s only working nickel mine. He also got Congress to mandate a new 5-cent coin so there’d be a market for his monopoly. But Wharton is perhaps best known for endowing the world’s first business school, to which he assigned a clear mission: “to advocate economic protectionism unequivocally,” writes C. Donald Johnson in The Wealth of a Nation.
Perhaps it’s due to a certain Wharton graduate that protectionism has stomped back so noisily into the center of American politics. Or perhaps it’s a national design flaw. After all, American colonists initially rebelled because of British mercantilism and then turned around and did the mother country one better by becoming masters of the tariff wall and government coddling of industry, nearly starting their own civil war decades ahead of schedule.
Johnson, who worked as a trade official in President Bill Clinton’s administration and then as a lawyer, set out to chronicle the central role trade politics have always played in the United States. He largely succeeds, bringing the historical debates to life with a cast of characters from Henry Clay to Cordell Hull, though at times he wades too deeply into the minutiae of congressional horse-trading and international trade talks.
From the outset, Johnson stresses, U.S. politics have been a variation on a theme. Economic nationalists such as Alexander Hamilton wanted high tariffs to shield certain domestic industries. Free traders warned that farmers and workers would end up paying the price of that protection. Time and again, most memorably with the infamous Smoot-Hawley Tariff Act of 1930, Republican Congresses gleefully ignored the cries of farmers, merchants, big exporters, and laborers and gave a few well-connected firms steep tariffs to hide behind. Now, thanks to expanded presidential trade authority, Republican presidents get to do the same thing.
With the Trump administration starting trade wars and bringing protectionism back, the book couldn’t be timelier. But then, as The Wealth of a Nation makes clear, the wonder isn’t that protectionism returned—it’s that free traders ever won a few rounds along the way.
COMPANIES BRACE FOR TRADE WAR
The Hill (4/4/18)
"[U.S. Trade Representative] Bob Lighthizer is interested in scaling back what’s happening at the WTO and the international trading system. That’s what frightens me. I see the actions that are being taken right now are going to have a major impact on that international trading system,” said Ambassador C. Donald Johnson, author of “The Wealth of a Nation: A History of Trade Politics in America.”
While trade groups say they have regular dialogue with the administration, they aren’t sure that their calls for a different approach will be heeded.
“Everybody that’s affected by trade is on the administration’s doorstep right now. The question is whether it’s getting through to the Oval Office,” said Johnson, who served as a U.S. trade representative adviser under former President Clinton.
“Right now you don’t see that evident in the tweetstorms coming out every morning. I think they should get their sound bite on ‘Fox & Friends’ if they want to be heard,” he added.
TRUMP CLOSES ERA OF CONSTRUCTIVE ECONOMIC ENGAGEMENT WITH CHINA
Bloomberg News (3/23/18)
“This is a very dangerous course. We’re in uncharted territory,” said C. Donald Johnson, a former congressman
from Georgia who worked at USTR under Clinton. “Whether they’re just doing this, like many things President Trump does, as a way to get leverage in negotiations, we’ll see. But if it’s not a bluff, we’re going to see a trade war."
Densely detailed study of trade agreements across the span of American history, written by a former U.S. trade representative.
As Johnson (Director Emeritus, Dean Rusk Center for International Law and Policy, Univ. of Georgia) wryly notes at the beginning, Donald Trump is not the first leader in world history to dream of a “big, beautiful wall.” Long before Adam Smith limned the workings of the world economy, Chinese emperors decided to wall themselves off, too, and “to withdraw from engagement with the world and its markets.” Isolationism and protectionism have long been themes in America’s engagement with the world’s markets, from both left and right, with advocacy of open-door free markets frequently coming from the Republican side of the aisle—or at least of tariff reduction.
At the dawn of the Gilded Age, as now, “the public views on the increasingly unpopular protectionist tariffs had no effect on the Senate” even as practical-minded presidents maneuvered around the legislature to strike favorable agreements with favored trading partners. A long-standing argument, Johnson notes, is whether tariffs and other protectionist measures have any actual result in regard to better wages and living standards for American workers, though politicians such as Cordell Hull grimly noted that they did seem to have the effect of transferring wealth “from one class to another without affecting the Nation’s total.” Guess which class benefits.
The author’s account of the formulation of the Bretton Woods and subsequent financial and trade agreements is exhaustive—and a touch exhausting, for it seems that no detail could possibly elude this overstuffed narrative. But for students of international trade, macroeconomics, and governance—another theme is the struggle among various branches of government to regulates foreign trade—this will be a useful reference.
Timely, given the resurgence of a protectionist, closed-door trade policy and all its likely negative consequences—but not a book for the faint of heart or the short of attention span.
Johnson draws on his experience as a former U.S. Trade Representative for President Bill Clinton in this lucid and distinguished examination of the history of trade in America.
Johnson provides reassuring evidence that the country’s current politico-economic climate is not unique, or even new, reminding readers that trade debates date to the founding fathers, as do protectionist movements.
Johnson also knowledgeably describes current trade agreements between the U.S. and other countries, and makes a case that abandoning them is contrary to American interests and harmful to American workers.
Regarding America’s trade imbalance, the experts Johnson cites attribute it to the country’s low domestic savings rate and longstanding federal budget deficit, not nefarious foreign trading partners. He notes how the Trump administration, in trying to withdraw from multilateral trade agreements to forge bilateral ones with individual countries, had to be repeatedly reminded that bilateral agreements with Germany, an EU member, were impossible, as they are with the U.K. until Brexit is complete.
Through this and other illustrative examples, Johnson demonstrates why trade cannot be understood in isolation, but as part of other economic and political considerations. This thoughtful, eloquent history also doubles as a plea for improved public understanding of a vital issue.
CHOICE
Book Review
Johnson offers numerous biographical sketches and a readable historical narrative with an increasing focus on movements, legal battles, and political pressure groups as he moves toward the present. Readers looking for current topics will take interest in his detailed discussion of labor issues as a central concern of trade politics in the late 20th and early 21st centuries and the attempts by pro-trade politicians to satisfy the interests of an anti-trade labor movement."--J. Gerber, emeritus, San Diego State University, CHOICE