In a marked departure from decades of trade policy, the Biden administration has firmly rejected the full-throttle globalization stance of its predecessors. This shift underscores a deliberate move to prioritize American workers over consumers, symbolizing a break with both Republican and Democratic administrations of the past.
President Biden has taken a tough stance on China, restructuring U.S. cross-border business and providing generous federal subsidies to selected companies. This has garnered support from labor unions but raised concerns among business groups that rely on traditional trade treaties for market access.
Despite initially criticizing Trump's tariffs on Chinese goods, President Biden has retained them, highlighting a clear departure from his earlier stance. As tensions with Beijing escalate, he has even imposed restrictions on the sale of advanced U.S. computer chips to China.
Biden's trade policies, halfway through his first term, align more with those of his Republican predecessor than those of his Democratic counterparts. This pragmatic shift places a greater emphasis on workers, wages, and national security, reflecting a significant departure from the trade liberalization paradigm that ruled for nearly three decades after the Cold War.
The administration's approach also extends to subsidies for the domestic semiconductor industry, sustainable energy projects, and public infrastructure—all controversial moves that set him apart from his predecessors.
The Inflation Reduction Act, CHIPS Act, and bipartisan infrastructure bill are expected to inject trillions into the U.S.economy, with the aim of correcting market failures and driving economic growth in strategic sectors.
Manufacturing, a critical sector for job creation, has received substantial attention. The administration's focus on making supply systems resilient to various challenges, from illness to extreme weather and geopolitics, has spurred a “manufacturing boom” and led to a surge in investment.
The Biden team has also implemented measures to reduce job outsourcing, including provisions in trade agreements to protect workers' rights and wages.
While some pro-trade Democrats express disappointment with the departure from traditional negotiations and the embrace of industrial policy, the administration remains resolute in its pursuit of a new narrative on trade.
As the administration prepares to face various trade challenges in the coming months, including negotiations with Europe and an Indo-Pacific Economic Framework, it is clear that Biden's trade policy represents a substantial departure from the past. Whether this shift in priorities towards a worker-centric approach will prove successful in the long run remains to be seen, but it marks a significant evolution in U.S. trade policy. President Biden's commitment to this new course is resolute, signaling a paradigm shift that may redefine U.S. trade relations for years to come.