Protectionism & Presidential Powers — Are Trade Powers Limited?

Chart.Trade, Exports, Imports and Laws, Treaties, Actions (WSJ March 19, 2016).

 

   Yes, Presidential trade powers are very broad. But they are delegated powers by the Congress. They are limited by the U.S. Constitution Article 1, Section 8, Clause 3. This gives exclusive authority to the Congress to regulate global trade. What Congress gives it can take back.

    In addition to the Constitution’s restriction on the Presidential powers in foreign trade, U.S. actions are also significantly limited by our membership in the World Trade Organization.

      Specifically, the WTO’s dispute resolution process is aimed at restricting unilateral trade restrictions. When such national actions are reviewed they can be found as inconsistent with our trade obligations.  If not removed multilateral trade sanctions by the WTO may be authorized and imposed by a member state who brought the action in the WTO. The U.S., as almost all other countries, have an excellent record of complying with the international review over the last 20 years.

      Here are some additional thoughts:

  • But for the WTO review of protectionist measures of the last 20 years, and potential for such review, such measures would have certainly  been more extensive.  They certainly would have restricted global trade growth.
  • Creating protectionist walls around trade is self-defeating.
  • The growing protectionist sentiment within the U.S. and abroad is disconcerting.
  • But the answer to globalization and technologically-driven trade and investment is better enmeshing  yourself in the global ecosystem. If you don’t you may never work again. This is essentially a question of developing a global mindset and relevant skills. Constant dismay and dissent is not going to help. It’s also self-defeating
  • Better trade enforcement of existing rules and international obligations is part of the answer. The Congress provided for this, in part, in its recent legislation (Trade Enforcement Act 2015). This new legislation puts trade enforcement leadership squarely within the USTR. The U.S. has been very effective in bringing enforcement actions in the WTO. It has been the most aggressive.
  • On the state and federal level policies should be enacted to help particularly in export promotion and increasing foreign direct investment. 90% of the world’s consumers live outside of the United States. Foreign operations in a state drives greater exports. State actions have a great influence in promoting trade and economic development. They are indispensable.
  • In addition universities need to develop programs focusing on the global system and develop the mindset and skills to participate in it. This should be a top priority. This is especially true of public universities that live off state funding and are obligated to residents  and state taxpayers.

 

  ……. “Powerful Pair: Protectionism and the Presidency.” Wall Street Journal (March 10, 2016).

Advertisements

About Stuart Malawer

Distinguished Service Professor of Law & International Trade at George Mason University (School of Public Policy).
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s