Biden’s ‘radical’ new trade agenda

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Jun 16, 2023 View in browser   By Gavin Bade Presented by American Edge Project U.S. Trade Representative Katherine Tai listens to a reporter's question at a press conference at the Foreign Correspondents' Club of Japan in Tokyo. | Shuji Kajiyama/AP Photo NEW RULES OF THE ROAD — When Joe Biden faced opponents on the campaign trail who wanted deep changes to the global economy, he comforted wealthy donors with a now infamous line: “nothing would fundamentally change.” Four years on, his team is singing a different tune. While it lacks the bluster of Trump’s trade wars, Biden’s economic team is quietly pursuing a revolution in global economics — throwing out the conventional free trade wisdom of the last half century that leaders of both parties now blame for hollowing out the middle class, fueling populist backlash, and making the U.S. economy dangerously reliant on China. U.S. Trade Representative Katherine Tai advanced that agenda Thursday in a major speech at the National Press Club, the latest in a series from Biden’s team laying out his new “worker-centered” trade platform. Instead of incentivizing the “race to the bottom,” where U.S. companies ship jobs overseas for profitability, Biden wants to build a set of economies that agree to higher wages and environmental standards — attracting investment there, rather than adversaries like China. Tai called it “using trade to create a race to the top.” It’s hard to overstate the ambition of that project. In one form or another, the race to the bottom has characterized each stage of modern economic development as businesses continually sought out cheaper labor and materials. Moving away from that “old, colonial, extractive model” of economics is a gargantuan task, Sabeel Rahman, until recently Biden’s head of the Office of Information and Regulatory Affairs, pointed out after Tai’s speech. “What are the ways we can make common cause [with other nations] on moving away from an extractive economy in the U.S. and extractive global economy to something that lifts everyone?” he said. “That's pretty radical, and actually, pretty incredible to have [Tai] put that on the table in a public-facing speech.” It’s a decidedly left-wing outlook on economics, where the administration recognizes a divergence between the interests of workers — regardless of nationality — and the owners of global corporations. Former Biden antitrust adviser Tim Wu made that distinction explicit in remarks following Tai’s speech: “Not to overstate this, but in class terms, there are working classes around the world and there are also large, concentrated producers around the world,” Wu said. “Even through and over borders, you can see that the natural interests of those classes are diverging.” The big question is how the world will react. After decades of Washington pushing pro-globalization policies — and setting up institutions like the World Trade Organization — will foreign governments buy the idea that the U.S. really wants new rules of the road? And will Biden’s new scheme be enticing enough to lure nations away from China and its own model of authoritarian, state-led growth? It’s a credibility gap that Tai tried to address on Thursday, saying that America’s economic history gives it a unique opportunity to shape a new global system. “We, as the United States, have been through our own experiences being the supplier of raw materials and free and cheap labor to more advanced economies,” she said, arguing the U.S. is “uniquely well situated to offer a version of globalization that is built on partnership that isn't built on exploitation or trapping less developed economies upstream.” Still, many global watchers are skeptical. The administration will have to do more than talk if world nations are to buy into its new economic order, said Nabil Ahmed, the economic justice lead at the humanitarian nonprofit Oxfam. “That the USTR is saying it's time to turn the colonial mindset on its head and counter liberalization is to be applauded,” he wrote to POLITICO. “But the question that hasn't been answered yet is will the administration actually throw its weight behind the policy changes necessary to carry out that vision?” Tai says they’re working on it. Early examples include Biden’s Indo-Pacific Economic Framework in Asia, the administration’s talks with Europe and Japan on less-polluting steel, and the U.S.-Mexico-Canada Agreement, the updated North American free trade pact signed under President Donald Trump in 2020. Those efforts represent allied nations “thinking through how do we change the dynamics of the unfettered liberalization?” Tai said. “How do we come together and create a new framework that's going to create different incentives?” “You see us trying to innovate what friend-shoring, near-shoring, re-shoring looks like in real time,” Tai said. “We don’t have the answer right now. But you see the direction of travel. And given the nature of the global economy, these objectives are not things that we can accomplish by ourselves, and so we had better figure out how we can accomplish them together.” Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com. Or contact tonight’s author at gbade@politico.com or on Twitter at @GavinBade.   A message from American Edge Project: How American Values Can Keep The Global Internet Free, Open And Accessible Since the early days of the internet, the United States has led the world in advocating to keep it free and open. America has championed the values of free expression and open trade, of participatory governance, and of technological advancement that promotes freedom, opportunity, and equality. Read our policy report here.   What'd I Miss? — DOJ finds patterns of excessive force, racial discrimination at Minneapolis Police Department: A two-year-long Department of Justice investigation into the Minneapolis Police Department found a pattern of “excessive force, including unjustified deadly force,” racial discrimination and civil rights violations, all of which created the conditions that led to George Floyd’s murder, according to a report released today. The DOJ launched the investigation in April 2021, after Minneapolis Police Officer Derek Chauvin was convicted of murdering Floyd the year prior by pinning his knee onto Floyd’s neck for 9 minutes and 29 seconds. The federal probe found “systemic problems” in the department, including the use of “unjustified deadly force” and unlawful discrimination against Black and Native American people. — FDA recommends updated target for fall Covid boosters: The FDA today selected a specific Covid strain to be used in the next booster that should be ready for the public sometime in September. The agency directed vaccine manufacturers that have authorized or approved Covid boosters to begin gearing up manufacturing of the selected strain, which accounts for about 40 percent of infections in the U.S. currently. The FDA also wants vaccine makers to continue testing the updated booster in trials to demonstrate that it will likely offer protection against severe disease and hospitalizations. — Trump attorney quits another case, cites ‘irreconcilable differences’: Former President Donald Trump’s attorney Jim Trusty, who withdrew from representing Trump in a pair of federal criminal probes last week, pulled out of yet another Trump legal matter today, citing “irreconcilable differences” with the former president. In a filing with the U.S. District Court of Southern Florida, Trusty indicated his intention to withdraw from Trump’s pending defamation lawsuit against CNN. The longshot lawsuit, which Trump filed last October, accuses the network of maligning him as a “‘racist,’ ‘Russian lackey,’ ‘insurrectionist,’ and ultimately ‘Hitler.’”   SUBSCRIBE TO POWER SWITCH: The energy landscape is profoundly transforming. Power Switch is a daily newsletter that unlocks the most important stories driving the energy sector and the political forces shaping critical decisions about your energy future, from production to storage, distribution to consumption. Don’t miss out on Power Switch, your guide to the politics of energy transformation in America and around the world. SUBSCRIBE TODAY.     Nightly Road to 2024 KNOCKING AWAY — This door is filled with opportunity and danger for supporters of Florida Gov. Ron DeSantis, reports the Washington Post. It stands on a pine-board frame, beneath fluorescent lights in an office park conference room — a training tool for hundreds of students who have flown in from across the country this summer as part of the $100 million DeSantis donor bet on the art of knocking. Always be polite, the trainees are told by Joe Williams, who runs the sessions for Never Back Down, a super PAC supporting the governor. Body language matters. Passion counts. Never accept water or go inside. Mention DeSantis’s wife, Casey, her cancer diagnosis and his military service. Never before has a presidential effort invested in doors in the way the DeSantis machine is doing. By Labor Day, Never Back Down aims to have about 2,600 trained canvassers in the 18 early nominating states, many with hotel rooms and rental cars, iPads and evolving scripts, not to mention a paycheck from working in a position that is now advertised on job boards as between $20 to $22 an hour. The work will continue through March, with staff redeployed as the election season proceeds. It is designed to allow the PAC to run a paid-field operation bigger than ever before tried in a presidential primary, on the scale of four simultaneous congressional races in Iowa, two in New Hampshire and seven in South Carolina. STAGECRAFT — The super PAC supporting former New Jersey Gov. Chris Christie ended its first TV ad with an unusual plea to viewers. Instead of a more typical request for support, Tell It Like It Is PAC ended its spot with white text that flashed on the screen: “Donate today, get Chris Christie on the debate stage.” For GOP presidential candidates like Christie who are struggling to break through in national polls, a spot on the debate stage is a critical way to amplify their message and reach more voters, writes NBC News. But candidates have to meet a handful of criteria, from pledging to support the party's nominee and not participate in unsanctioned debates to polling and donor thresholds. Candidates need at least 40,000 unique donors, including 200 unique donors from at least 20 states and territories — helping to explain why Christie's super PAC is using its big money to direct people to give smaller donations to Christie. UNION LABEL — The AFL-CIO officially endorsed President Joe Biden for reelection today, reports The Messenger, giving his 2024 campaign significant backing ahead of his first political event since officially announcing his bid for a second term in April. The general board of the federation met today and voted to endorse Biden. The union said it was the earliest they have ever voted to endorse in a presidential election. It is not a surprise that these unions are backing Biden and Vice President Kamala Harris, but the timing of the endorsement signals that even as polls show some Americans harbor questions about whether Biden should run for reelection, major institutions like the AFL-CIO are not waiting to get behind the Democratic incumbent. The move also gives Biden significant organizing power as his reelection campaign gets off the ground.   A message from American Edge Project:   AROUND THE WORLD Ukraine's President Volodymyr Zelenskyy delivers a statement at the first plenary session of a NATO summit last June. | Gabriel Bouys/AFP via Getty Images ON RAMP — Support for easing Ukraine’s pathway to NATO membership is growing within the alliance, increasing the likelihood that the proposal becomes official during a major gathering next month, writes Alexander Ward and Lili Bayer. NATO Secretary General Jens Stoltenberg has privately suggested that allies agree Ukraine could join NATO after the war without following a Membership Action Plan, which is a series of military and democratic reforms an applicant nation must make before accession. Removing the MAP hurdle speeds up Ukraine’s bid to become an ally, but doesn’t provide any timeline or guarantees that Kyiv will eventually receive unanimous approval for its membership. That falls short of Ukraine’s wishes to join right away but goes further toward making them eventually come true. President Joe Biden is “open” to the plan and told Stoltenberg as much during their discussion in Washington on Tuesday. As NATO’s most important member, U.S. support goes a long way to waiving the MAP requirement during the alliance’s July summit in Vilnius, Lithuania. There are stumbling blocks, however. Eastern European members want Ukraine to have a clear, imminent post-war pathway to membership. But some southern Europeans fear that removing the MAP barrier would further anger Russia, potentially escalate the war and make rebuilding ties with Moscow after the war harder. REINFORCEMENTS — NATO defense ministers wrapped up two days of meetings in Brussels Friday where they pledged billions more in military aid for Ukraine as Kyiv enters the second week of its long-awaited counteroffensive against Russia, write Lara Seligman, Paul McLeary and Lili Bayer. At the same time, officials in the U.S. and Europe intensified plans to build more weapons for Ukraine over the long-term while also working to restock their own shelves at home. The question now is: Can the defense industry keep up? The issue became center stage over the past week as images of destroyed equipment — including U.S.-made Bradley fighting vehicles and German-made Leopard tanks — began surfacing on social media. The need to supply and sustain Ukraine will remain for years, especially if Ukraine joins NATO. At the same time, individual governments are scrambling to increase funding for their own defense industries to ramp up production and work through supply chain bottlenecks that remain from decades of neglect, and COVID-era disruptions.   STEP INSIDE THE WEST WING: What's really happening in West Wing offices? Find out who's up, who's down, and who really has the president’s ear in our West Wing Playbook newsletter, the insider's guide to the Biden White House and Cabinet. For buzzy nuggets and details that you won't find anywhere else, subscribe today.     Nightly Number $930 million The amount of money in grants that the Biden administration announced today in order to expand internet access to every home in the United States. The effort will be concentrated largely in hard to reach, rural areas of Alaska, Texas and dozens of other places where large gaps in connectivity continue to exist. RADAR SWEEP OPTIMIZED FOR WHOM — Have you ever been looking for a simple solution to a problem — or maybe something like a recipe — on the internet, and gotten frustrated wading through what appears to be useless filler or intro text? It’s not for you, it’s for Google. In order to drive traffic to sites, marketing professionals have come up with a host of key words, phrases and even ideal length of content to push results up towards the top of Google search. But as Google and our own needs evolve, these best practices are increasingly doing a poor job of serving users. Mia Sato reports for The Verge. Parting Image On this date in 2011: Democrat Anthony Weiner announces his resignation from Congress during a news conference in Brooklyn, New York. Weiner resigned after a scandal spawned by lewd photos of himself that the New York lawmaker sent online to numerous women. | Seth Wenig/AP Photo Did someone forward this email to you? Sign up here.   A message from American Edge Project: Three Pillars For A Free And Open Internet We need to craft a policy agenda rooted in three pillars: combatting digital authoritarianism, promoting free speech within and across borders, and building a stronger internet to connect people to each other and to their governments. Learn more.     Follow us on Twitter Charlie Mahtesian @PoliticoCharlie Calder McHugh @calder_mchugh Katherine Long @katherinealong   Follow us

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