The Changing Political Context for Trade

Wednesday, September 28, 2016
Toru Hanai/Reuters

Bruce Stokes, director of global economic attitudes at Pew Research Center, Vin Weber, parter at Mercury LLC and CFR board member, and Robert B. Zoellick, chairman of Goldman Sachs’ international advisory board and former president of the World Bank, join Financial Times’ Edward Luce to discuss the changing political context, including this year’s presidential candidates and their constituency, for trade in the United States.


Bruce StokesDirector, Global Economic Attitudes, Pew Research Center

Vin Weber, Partner, Mercury LLC; Member, Board of Directors, Council on Foreign Relations

Robert B. Zoellick, Chairman, International Advisory Board, The Goldman Sachs Group, Inc.; Former President, World Bank


Edward Luce, U.S. Columnist, Financial Times

11:00 a.m.–12:00 p.m. Meeting

This symposium, presented by the Maurice R. Greenberg Center for Geoeconomic Studies, is made possible through the generous support of the Bernard and Irene Schwartz Foundation.

LUCE: Good morning. I’m Edward Luce from the Financial Times. It’s always a great pleasure to be invited to do something with CFR, particularly by my former colleague, Ted Alden. So thank you, Ted. I couldn’t think of a better week. I mean, it’s always good to talk about the future of trade. (Laughter.)

But this week, I think, is an optimal week for discussing not just because of what was said in the debates, which we’re going to get into a little bit, but also because this is the week where the World Trade Organization has projected that for the first time in 2016 global trade growth is going to be lower than global income growth. Now, normally trade growth is double, sometimes even triple global income growth, which obviously indicates a globalizing trajectory. Well, there’s great concern—and I think, as we speak, Christine Lagarde is giving a speech on this subject—there is now great and very evidence-based concern that we’re seeing de-globalization, at least in terms of trade and economic integration, some of which might be to do with efficiencies, which is a positive force; some of which might be to do with protectionism, which is obviously not a positive force. So this week is a good week to look at the overall global trade picture.

But in terms of the U.S. political scene, I don’t think we’ve ever had a presidential debate where both candidates have opposed the trade agenda of the day, one of course a little bit more adamantly than the other—(laughter)—and perhaps a little bit more sincerely.

MR.     : Because he actually believes it. (Laughs.)

LUCE: Because he actually believes it. But nevertheless, both of them—both of them opposing it.

We’re also in a situation where the big trade deals that this administration has been negotiating, namely TTIP and TPP, are both in jeopardy—TTIP because of my own country’s exit or impending exit from the European Union, Britain’s, you know, being the most pro-trade voice in the EU; and TPP because of politics in this country. Just this morning, Paul Ryan said that he didn’t think a lame-duck session could accommodate a TPP bill, so we’ll see. But this is not the most optimistic moment if you’re a pro-free-trader, I think it’s safe to say.

So I couldn’t think of three better people on the panel here with me to talk about the politics—the political context for trade—than Vin, Bruce, and Bob. They don’t need any introductions. I am acutely aware of the fact that with Ed, Vin, Bruce, and Bob we have four monosyllabic while males—(laughter)—so I apologize for that. Let me start with you, Bruce, director of Global Economic Attitudes at Pew and therefore the best person to talk about American public opinion. Let’s start with public opinion.

Now, trade is a notoriously difficult question to pose to people—it depends how you frame it—and the same surveys can get both pro- and anti-trade answers. I know that you’ve got some very interesting data to share but the picture that I generally get—if you look at one of your rivals, Gallup—is that support for trade has not been cratering. In fact, it’s actually been growing by some measures if you look at American public opinion at large.

The gap between those who see trade as a threat and those who see trade as an opportunity is actually quite strongly in favor of opportunity, whereas in 1992, the height of Ross Perot, it was quite strongly in favor of threat. So, you know, we’re not—we’re not at a nadir by any means in terms of the American public’s overall attitude to trade and yet politics has never been worse. Can you—can you connect—can you connect those two up?

STOKES: That’s a great question. It’s a –it’s a pleasure and a privilege to be here with two people whose opinions I really respect and who are both sources of mine when I was a journalist. So if I—if you don’t agree with something I say it’s their fault. I mean, I get—

WEBER: You promised you’d never tell. (Laughter.)

STOKES: Yeah. Exactly. Yeah. Yeah. As someone who covered trade for a quarter of a century, I always wanted trade every four years to be the key issue in the—or a major issue in the election and every year I was disappointed that my issue wasn’t the key issue. Well, actually the debate the other night suggested this is a probably more important issue in this election, at least because of the advocacy of one of the two candidates, than it has been ever in my lifetime.

But you’re right. I mean, I think it—the debate is somewhat disconnected from the general attitude in the population. It is very important how you ask the question. If you ask a very principled question—is trade good for the country, period—we have historically gotten about two-thirds of the public to say yes.

Now, when you begin to qualify that a bit—how about free trade agreements, which is an act of your government—then the support tends to go down, and it has gone—it’s 50 percent today—it’s gone down about eight or nine points in the last two years. So that’s not necessarily going in the right direction if you’re pro-free trade but it’s still half the population believe that free trade agreements are good for the country. And the most recent way we’ve actually qualified that is actually to put a price tag on it—to say they could cost you your job or they could lower wages but they also could stimulate growth and create opportunity. So the more qualifiers you put on it, you tend to drive down the support because people begin to think, oh, I hadn’t thought about it that way.

Nevertheless, you’re right. I think the population isn’t—people have drunk the Kool-Aid. They understand that trade is good for the country. They believe that trade is good for the country. When you ask them a more personal question—do you think trade creates jobs or destroys jobs, do you think it raises wages or lower wages, do you think it raises prices or lowers prices—I can tell you those first two instances economists don’t tell you that trade creates jobs or raises wages. Politicians tell you that. People don’t buy it, in America and in many other countries.

But we don’t—and no one around the world except the Israelis believe that trade lowers prices. So it’s not just a question of well, if you listen to the economists, people get it. People are telling us, I think, through the public opinion surveys that they don’t feel the impact of this on their own lives, and that’s the challenge.

Now, if you look at it through another prism of the support of the candidates, two-thirds of Trump’s supporters believe trade is bad—trade agreements are bad for the country and a majority of Clinton’s supporters believe trade agreements are good for the country. Also, in the primaries, a majority of Sanders’ supporters believe that trade agreements are good for the country, which is a reminder to us while people have an opinion on trade, it’s not necessarily the issue they care much about.

When we do every January a list of about 24 different priorities for the country—what do you think should be the priorities of Congress and Washington—this year trade has for years—two decades—been the lowest priority or the second lowest priority, sometimes higher than global warming, but the point being that it’s not a priority issue for Americans even though they have an opinion if you ask them.

And, finally, the question is who is it who supports trade or doesn’t support trade, and we all carry a narrative in our heads, based on experience of the ’80s and debates in Congress, that Republicans are free traders and Democrats are protectionists. It’s not just our surveys. It’s the Gallup surveys. It’s The New York Times’ surveys. It’s the Wall Street Journal’s. It’s—I’m not at all sure of those things in public opinion.

This is something I’m really sure of. The people who self-identify as Democrats today are free traders. The people who self-identify as Republicans are protectionists. And then the question, of course, is why and that is, it seems to me, because the demography of the two parties has changed. The Republican Party is increasingly a party of old white men like us. If you think about the demographic in the American—

ZOELLICK: Like two of us. (Laughter.)

STOKES: You know, when I think of the guys I went to high school with who went into manufacturing, and they’re going to vote for Trump because their life didn’t work out the way they expected it to, and the congressman from my hometown is a Trump-endorsing Tea Party Republican, the people who support trade now in our society disproportionately are young people, minorities, and women.

Think about their life experience. Minorities and women on the margin never had those manufacturing jobs to lose and young people—Millennials—came of age after the turn of the century. Frankly, asking them about globalization is about like asking them about the sun coming up in the morning. It just is, and they never had those jobs in manufacturing to lose.

But one of the challenges we will face politically is they will probably face global competition in the services sector, jobs that they now have, sometime in their future and do we put—have in place as a—do we learn from our manufacturing experience and make sure that we are able to deal with the challenges they face going forward in the services sector.

LUCE: Thanks.

Vin, what’s happened to your party? (Laughter.)

WEBER: It’s Bob’s party, too. (Laughter.)

LUCE: Well, I have a strong suspicion it’s both of you are temporarily expats.

WEBER: And I have to say in this—in this campaign I am frequently introduced as a former Republican congressman and I have to say it’s former congressman. (Laughter.) I’ve never had to clarify the other part before but I’m a former Republican. Let me just—let me just read the Republican Party platform from 1980 on this topic. It begins, a Republican administration will emphasize a policy of free trade, and the current Republican Party platform says, we need better negotiated trade agreements that put America first—a little difference there. That’s been a change over a long period of time and I think that Bruce has identified what’s happened there and Trump has simply pushed it to a—to an extreme.

I really believe the growth of the anti-trade segment of the Republican Party began with Pat Buchanan’s candidacy and Perot outside the Republican Party appealing to certain Republican-oriented voters in 1992 because we’ve never really had a serious protectionist candidacy aimed at conservative voters at the presidential level prior to that time. And since then—you know, they didn’t prevail but since then we’ve seen that as a legitimate position in the Republican Party when it really wasn’t when I first got into politics.

Free trade was—granted, people would tweak it to their own concerns—the textile folks, the agriculture folks—so, basically, everybody on the Republican side said yeah, we really believe in free trade. After 1992, there was a legitimate anti-trade sentiment in the Republican Party, and then I think Bruce has accurately described what’s happened to the Republican Party as we’ve shifted demographically around that issue. I would say—add one other thing to think about when we think about the polling and the political impact of trade as an issue.

All of the numbers that you gave me are important and interesting. It’s also kind of important to remember on specific issues it doesn’t matter really what 100 percent of the people think. It matters who’s actually going to vote on those issues. The example that I use, which is no longer, by the way, valid, but when I got into politics 75 percent of the people favored gun control laws and yet we’ve never passed a gun control law. Why? Because the 75 percent of the people that care about gun control laws never voted on it. But the people that belong to the NRA and were against gun control laws did and so the anti-gun control folks, even back when it was a 75 percent issue, always won.

Now, that’s shifted over time. It’s become a bigger issue and today it’s not a 75 percent issue anymore. But it—even back then—look, there’s a lesson in all that. What matters is who actually votes on these issues and who cares about these issues, and protectionism had sort of a vague constituency which began to gel, as I said I think, because of Buchanan and Perot and which has grown because of the demographic shift that Bruce talked about.

But what’s frightening to me, and I’m not totally pessimistic about but I’m very nervous about, it looks to me like the anti-trade position among Republicans particularly is becoming a voteable issue with a specific constituency and that’s—and if that’s the case, it’s a real danger to us because it almost doesn’t matter if, you know, you got 60 percent of the people that’ll say, we believe trade is good for America and, by the way, I don’t vote on it.

But you got 10 or 20 percent of the people that think this is the most important issue. The last point I would make, and then I’ll go back to you, Ed, is to say it’s not—and I’ve spent a lot of time in London prior to and subsequent to the Brexit vote and one of the things that occurred to me in watching that and comparing it to the trade issue in this country, all of us who talk about this issue report on this issue, write about this issue, really think of it as an economic issue primarily.

It’s not entirely an economic issue. What struck me about the Brexit debate was how much of it was about sovereignty and culture and things that didn’t necessarily relate to whether—I mean, obviously, yes, the manufacturing guys that have lost their jobs it’s very specific to them. But to a lot of other people it represents a broader loss of culture and something going away that they can’t control, and that’s much harder for us to deal with.

I mean, we can talk about trade and we think we have policy levers we can push—you know, Trade Adjustment Assistance, minimum wage, things that we think we can do that—or at least we can argue about. But if it’s a question of a sense of loss of culture or of a culture out of control, we don’t know how to deal with that and I think as we think about it and think about strategies for trying to rebuild a trade consensus in this country, we have to think about that constituency that’s developing as not being entirely an economically-motivated constituency.

STOKES: Can I jump in?

LUCE: Please do.

STOKES: I totally agree with that. I think that, look, we are all economically literate people. We all took Economics 101 and we believe that economics can explain almost everything and, certainly, if we were growing at 4 or 5 percent a year, this would be much easier to deal with.

WEBER: Absolutely.

STOKES: But the reality is those old white men who are going to vote for Trump because of his trade position also have in their lifetimes had to deal with the feminist revolution, the civil rights revolution, rising immigration of people who don’t look like us, and those two little old ladies down the street who are cute roommates and now we found out they’re gay and they want to get married.

WEBER: Yeah. Yeah.

STOKES: This—there’s a broad cultural thing. It’s a stop the world, I want to get off sentiment.

WEBER: Right. Right. Right.

STOKES: And we—I don’t know how we deal with it. I get—

WEBER: And by the way, they’re—now they’re being told the world is warming.

STOKES: Yeah. Yeah.

WEBER: All right. (Laughs.)

STOKES: Yeah. Yeah. And the elites are telling them this and they don’t want to hear—yeah.

WEBER: They’re telling them this and it reverberates with the people you’re talking about.

STOKES: Yeah, and I do think that we have to be careful here that we don’t just focus on only the economic solutions to this populist challenge because I think it won’t—it’ll be—it’s necessary but not sufficient.

LUCE: So, Vin, you told me before the session you were worried that you haven’t prepared enough but I can assure you you’ve prepared dramatically better than Donald Trump did on the debate. (Laughter.) Bob—I’m sorry. (Laughter.)

WEBER: I don’t know how I feel about that comment. (Laughter.)

LUCE: It’s a backhanded compliment.

WEBER: I was—I was going to compliment Ted Alden, by the way, because he moved up from the FT to the Council on Foreign Relations. (Laughter.) But I—but I didn’t—but I reserve—

LUCE: (Inaudible.)

WEBER: —that until this comment. (Laughter.)

LUCE: You’ve got nothing to end with now. Bob, I mean, one of the things that Vin said Trump sort of frames this as Americanism versus globalism. Clearly, there is a backlash going on amongst very vocal people against globalism in America of which trade, immigration also, are subsets. As a former USTR, as somebody, you know, better qualified than anybody on this panel to talk about how to sell and push through trade deals on the Hill and with the political climate, what would you do to reboot trade in this context?

ZOELLICK: Well, first, let me just pick up on this point that Vin and Bruce made and say, you know—to bring Ted in again—I think he’s got a double-barreled responsibility here because he has the immigration and movement of people—and I’ll just add this. What I’ve seen in Europe, Australia, the United States is probably the issue that gets communities most scared is when people come in they feel they lose control of their community and I think trade gets conflated into this.

And I think if you think about what really first drove Donald Trump it was the immigration issue and particularly for an audience like this one, you know, what I saw—and I’ll give this in a European context—in—you know, in many metropolitan European capitals people wanted to be open to refugees or workers or so on and so forth.

But one Swedish politician (struck in mind?)—you know, when communities can have such an influx and the kids no longer speak Swedish in the schools and those people don’t have any options, OK, that’s what really gives people a sense of whether you call it sovereignty, or loss of control, or other. So I do think these issues get interconnected. On the—so over to you, Ted.

So on the trade side, one thing about the debate that struck me, and I’ll just mention this more broadly, particularly more for the TV or the Internet news as opposed to some of the print, is that you can almost feel a new conventional wisdom come in here, which is, you know, trade is gone, trade is hopeless. The way people—the commentators were talking about that first segment of the debate it was almost like how does Hillary get out of this hole because you can’t be for trade.

You know, trade is definitely a loser, OK, and in that sense, the poll numbers are interesting and I think Vin—you know, we could focus more on those but the numbers are definitely showing that this is a debatable topic but it’s a question of intensity, you know, in these issues. And so, you know, frankly, it’s pretty bleak.

But my own sense is one needs to resist a defeatism here, OK, and just to give you a feel of kind of what one could do, look, if Trump’s elected, you know, it is hopeless—(laughter)— because, you know, what he’ll do with NAFTA or raising tariffs and the retaliation it’ll be a nightmare. OK. One of the things to watch if Clinton is elected is that, you know, I can honestly say most people aren’t focusing on the USTR job as sort of the big Cabinet job. (Laughter.)

In this case, that appointment will be very important because she could go one of two ways. She could have a seat warmer, and we can name some of those, or she could have somebody that basically we all know is kind of energetic, creative, trying to figure out how to put this together sort of politically. That’ll be a very important sort of appointment.

Second, the business community, and Vin sort of touched on this, you know, the way CEOs and others operate they can’t just be talking about general issues. They need a focus, which is one reason I used to focus on multiple agreements because it allowed their Washington reps, it allowed the CEOs to come to town, it allowed people to score a victory.

So in this case, I think that method of just focusing on visits to the Congress will no longer be enough and the key will be sort of a big effort, whether led by the Chamber or something, to help executives talk to their workers about what trade means to them.

So my classic example was, you know, I could never understand why the Boeing or aerospace workers were against trade when 95 percent of their product was abroad. There’s an interesting story today in one of the papers about the Ford because of the comments about Ford and how Ford has now got employees—union employees—defending the movement to Mexico because it’s part of an overall strategy in what they’re sort of building and things like that.

There will have to be a much bigger effort to explain this. Along with that is the tech community. OK. So I was talking about this with Mike Froman recently as I was trying to help him with TPP. Neither he nor I could ever get the two congresswomen from Silicon Valley to vote for trade. You know, you figure it out, OK?

Now, part of it is that—and we were talking about this—this issue wasn’t a priority for the tech community. My sense is in the 10 years since I’ve been USTR some of those companies might recognize the rules around the world do matter to them, whether tax or privacy or a set of other issues, and this brings right back to the Millennial point.

In fact, I wrote a piece online in the Harvard Business Review and I mentioned this issue and one of my former colleagues who’s connected to the tech community has actually talked to some of the firms and said, look, you could even do an interesting big data exercise, which I’ve used in other parts of my business life, to say what really matters to young people—what sort of gets their focus. And you could actually turn this a little bit, particularly on the Democratic side but if the Republicans are smart, so that will be important.

Then, you know, you can’t beat something with nothing. Vin knows this in politics. So I was struck—I wrote a piece in the Wall Street Journal a month or two ago talking about Brexit and one of the ideas I said is, look, North America should negotiate something with Britain. It wasn’t anti-EU. It was, in fact, to give them some optionality as they go forward.

I got a lot of positive response from Congress, OK, and it was quite interesting because, you know, most Americans like Britain. They want to help Britain. If I were the next president or USTR, I’d be trying to maneuver that so I was on offense on something. And, you know, you’re going to have Sandy Levin here. Ask him whether Britain’s labor and environmental standards meet our level, OK, because, frankly, a lot of Democrats have used that as an excuse and a rationale and you kind of beat that one with that. OK.

Then TPP, if it’s not done in the lame duck—and I’ve always felt this is a very low probability but you have to sort of keep open the option—I think what will happen with a President Clinton is I don’t think she can move promptly on this. It may take a year, two years, if ever. OK. Likely to have a Republican Senate in 2018. That may help.

But what will drive it is the following. One, that you’re going to get more and more messages like you got from Prime Minister Lee of Singapore or Australia, Japan, to say the U.S. is just leaving us out here, you know, and this is going to have implications for security, your cyber policies, maritime. You know, as Prime Minister Lee said, this is a basic test of U.S. credibility and whether those messages come back.

Second, she’ll need something, OK, and what I would focus on—Fred Bergsten at the Peterson Institute is kind of refining this question of how do you really deal with the—sort of the nub of currency manipulation, OK, and, obviously, there’s a concern of how this affects monetary policy. He’s going to have a book coming out later this year that, frankly, without kind of getting into too much detail, says, look, you can define cases based on kind of their reserve level, their current account surplus, and whether they intervene directly on a currency, and then the problem has been what do you do because there’s terms in the WTO and IMF and but they’re non-enforceable.

Well, what you now have and what he’s suggesting is you have a counter currency intervention, OK, and you could get Congress to help you to do this to kind of authorize this. In some ways, it’s like the way the U.S. has prodded the international system with Bretton Woods and post-Bretton Woods in ’71 and others. The international system should come around to recognizing this as a need but they won’t off the bat. But you could use a counter currency intervention which you couldn’t have used with China 10 years ago, but now you could and you could use it with Japan.

But she’ll need something like that that sort of shows she’s sort of changing the rule of the game. And the last thing, which you’ve asked about in other contexts, is you got to help people adjust, OK? So the whole change agenda—you know, frankly, when I was USTR I tried to do some things on wage subsidy and others but people were concerned about entitlements. You know, the Trade Adjustment Assistance, as Bruce knows, you know, the unions consider it (burial?) money.

We spend about $18 billion a year on this, and it’s poorly spent. And, you know, the GAO did this study of the 47 different programs, rarely analyzed. What you find on the Republican side—so the reform cons—you find some very interesting ideas. You know, not only the earned income tax credit but helping people with ability to relocate, the wage subsidy idea, which is basically if you’re making $50,000 a year the best thing to do is get people back in a job, and if they take a job at $40,000 a year that’s a change of 10(,000 dollars)—and so you make up some percentage of the difference, say, 50 percent—$5,000 difference—for some period of time—two or three years—and you could put some cap on it.

There are other things—I mean, from my point of view, I’ve always wondered why we tax wages. That doesn’t strike me as probably the smartest thing to do if you want people in the labor force. You could—you could have a—and this, obviously, also goes to kind of how we look at the educational system and certification and how people sort of make a constant process of change.

So to wrap that together, this will not happen unless, frankly, a president decides to lead it, OK? Now, the good news is—I mean, Paul Ryan, you got one of the best free traders you’ve ever seen. You would have not gotten that TPA vote if you didn’t have Paul Ryan and, frankly—because I know a lot of them quite personally, as does Vin—the Republican senators are still supportive of trying to do something like this—the vast mass of them—and you’ve got Democrats in the Senate that will support that too and you’ve got 28 courageous House Democrats.

But here’s one of the key parts, and I’ll close with this. Look, you know, if you look at what President Obama said about trade in 2000 and what he didn’t say about trade for five or six years, when he went to try to get his own caucus in the House to vote for TPA, it’s not a shock to me that he couldn’t turn them on a dime. He wasn’t preparing the ground on any of these issues and part—if you look at the TPA vote, if he had been able to move that just one year earlier, and his other mistake was they bought into this idea you could do TPP without TPA and that totally ignores—I was blown away by this—Congress wants to play, guys, OK? I’m an executive branch guy, but Congress wants to play. You are not going to skip TPA. If they’d gotten that done a year earlier, TPP would have been passed in 2015 when TPA was.

So it all comes back to the president and, you know, in the scintilla of hope I have to be careful because with the election going on, you know, who knows what Hillary will say and she’ll get pounded on this and she’s not comfortable. She’s been secretary of state. She’s got to know that as a matter for our economic performance and efficiency and our position in the world and others, you do not just want to abandon this tool. But that’ll be the big test to watch.

LUCE: Vin, I know you wanted to jump in but—so do that first. Then I’ve got a question for all of you.

WEBER: Well, I just wanted to amplify something that Bob said and reinforce that I still am a Republican. The—but the concern that we’ve expressed here about the Republican Party, which I share and I agree with Bob and it’s—it wouldn’t be quite so acute if support—if any support for trade remained in the Democratic Party. Twenty-eight votes—I mean, you sort of passed over the 28 votes for TPA. Only 28 Democrats in Congress would vote to give us authority to a president of their party? That’s nothing. You know, I mean, it’s a real problem and the only—the only optimistic thing I’d say about—

ZOELLICK: Although I’d have to—to be honest, those guys are so courageous. (Laughter.)

WEBER: Well, I—I’m glad we’ve got courageous guys, but I wish we had a few more of them. And the other thing I’d add, Mike Froman, who’s a good guy doing a good job, but he misjudged that. He thought they were going to get 50 to 60 votes. The fact that they didn’t know what this—the weakness of their own position indicates what Bob said, which is that they hadn’t worked the ground on this appropriately in the years leading up to that.

The only other thing I’d say on this, maybe on a more optimistic note, if—I think you’ve laid out well, Bob, what could—the course that could lead Hillary Clinton to want to make this happen. But if that’s the course, sooner rather than later makes more sense. It doesn’t make sense to wait until after the Republicans almost surely increase their numbers in the 2018 election. If you want to get some of the concessions that the Democratic senators who would vote right on this would want to have, if you’re—if you’re concerned about environmental labor standards and Trade Adjustment Assistance and all that stuff, better to have a at least marginally Democratic Senate and it may—by the way, it’s not impossible that Hillary Clinton could get elected and have both Houses controlled by the Republicans. In any rate—event, it’s better to do it sooner rather than later, as difficult as it—she’s got to pivot from the position that she’s taken throughout this campaign. But the Clintons have been flexible in the past.

ZOELLICK: But she’ll need—but she’ll need—if that’s the case, and it may be—I’m just sort of trying to deal with political realities that she has to deal with—she’ll need something big, I suspect, like this currency issue to be able to justify—

WEBER: Well, I agree with that.

LUCE: And she’s promised—

STOKES: For me, it seems to me some kind of reinvention of the social safety net to convince people that we’re serious because you’re right, Trade Adjustment Assistance doesn’t work and it’s not—it doesn’t buy union support anymore. And the one hopeful sign and it’s—this is anecdotal—is in talking to some of the foreign policy people around Clinton for the first time in my life I’ve heard them bring up the issue of the social safety net.

They could have cared less about it, didn’t know anything about it. They still don’t know anything much about it. But they, clearly, have taken the message from this election season that it could get in the way of their grander schemes on foreign policy and now they have to take it seriously. So that’s a—that’s potentially a—something to work with.

ZOELLICK: Well, just to give people a little insight on this, having been on the front lines—and Vin is well aware of this—part of the challenge is committee jurisdiction. You see, the reason why people keep putting money into TAA is that belongs to the jurisdiction of the Finance Committee and the Ways and Means Committee, which vote on trade. OK.

The other programs are in the Labor Committee, OK, and you might ask, well, gee, you know, should we only help people adjust if they lose a job to trade or technology. So the logic, obviously, should be broader based and that’s why you get this splitism in different types of systems. But so, you know, that will be a reality people will have to deal with. You’ll have to help those key committees.

WEBER: And it goes to constituencies because business wants their best people on Ways and Means and Finance, and Labor—AFL-CIO wants their best people on the Labor Committee.

LUCE: So one of the things that’s been raised recently as a potential USTR for Hillary is to have somebody very much from an unconventional background—I don’t know, somebody like Jared Bernstein, who’s been writing a lot about this—Joe Biden’s former economic advisor—that the USTR—and you’ll, I’m sure, have a different view, Bob, but the USTR is like a revolving door for the corporate CEOs of America. They come in. They say, this is our agenda, this is what we want from trade and, essentially, you take orders from them and that’s it—you go—you go ahead and negotiate—that it should be a completely different open system and seen to be open, all kind of stakeholders from society giving as much input as a CEO of IBM or Boeing. Do you think that could help change the politics or do you dispute the characterization?

ZOELLICK: Well—look, I hear Jared every once in a while talk about something. He’s always crapping all over trade. It’s hard to be an advocate if—you know, and remember, most of your votes are going to have to come from Republicans.

LUCE: Mm-hmm.

ZOELLICK: OK. So whether it’s Barshefsky or whether it’s Froman or whether it’s others, they got to get along with the Republicans on these issues. So I don’t—I don’t—that’s often a, sorry, but a very sort of flip idea. What you really need is somebody that really is committed to trade that really believes that this is important, you know, for the country and economics and others but has some sense of how the politics are going to have to be able to work, has some sense of being able to work with colleagues and the rest of the administration because it’s got Agriculture and Commerce and the State Department.

Remember, USTR is about 250 people. Has the support of the White House. So notice a slight difference in the—in the Obama administration between Froman, who is close to the president and part of the White House staff and so on and so forth, and Ron Kirk, who is kind of out there doing I don’t know what. OK. So that’s the reality and the other thing is if you’re a trade representative you’re going to have to push.

So what I described in this, just think about it. It’s Ways and Means, it’s Finance, it’s different committees, it’s business, it’s tech, it’s—so and remember, you still have to negotiate with people abroad. And the other thing about the trade job is you got to know something. It gets a little detailed. OK. But, you know, so a Bob Strauss—a Bob Strauss, who is good politically and smart and savvy and could understand the details, you know, that would be fine for me. (Laughter.)

LUCE: Then let me just pick up—(laughter)—something Bruce said.

ZOELLICK: By the way, Bob Strauss, I have to say—

WEBER: That’s a quote, know something to be president? (Laughter.)

ZOELLICK: I have to share this. Bob Strauss—I went to see him when I was USTR. He said, well, you know, I got two pieces of advice for you, young man. He said—he said, one, just remember there’s horses’ asses in both parties and you have to figure out the ones you can work with, and he said, and the second is if you’re going to trade something, trade it as many times as you can and he used—(laughter)—and he used the idea of something that kind of was in this constituent, that constituent, which, by the way, is a smart lesson to learn. (Laughter.)

LUCE: Vin, Bruce said something very interesting about a social safety net. There’s a number that’s always struck me is we’ve got 77,000 steelworkers left in America. Good jobs, but not many of them—pretty highly-skilled jobs—and we talk about them a lot and we keep wanting to bring them back a lot.

We’ve got 810,000 home health aides. These are BLS numbers. We don’t talk about them at all, and I think what Bruce was alluding to is having a safety net that enables them to actually have a middle class standard of living. Is there any possibility that by some accident of—the accident of Trump’s nomination that the Republican Party could look afresh at economic insecurity and the case for free trade?

WEBER: Maybe. That’s an interesting question because up until the Trump candidacy the things that people were concerned about in the Republican Party were the Tea Party phenomenon and the Freedom Caucus phenomenon, whatever you want to call it, and those were people who were—are very much ideologically on the right. I would compare them more to Goldwater, if you want to go historically.

You can predict where they’re going to stand on every issue because they’re very ideologically conservative and they’re against government, in some cases irrationally against government. But that’s their philosophy. They’re against government. Trump is not like that. I mean, Trump is not a Goldwater-style right-wing candidate. He’s a populist right-wing candidate. We talk about trade and immigration, which are offensive to me where he stands, but he doesn’t want to touch entitlement programs. He wants to establish a new entitlement program on child care.

I mean, this is not a Tea Party position and—but the Tea Party Republicans in the Congress are—at least many of them are among the most—the strongest supporters of Trump because they’re sort of anti-establishment, and if one of the residues of this campaign is Republicans thinking we’ve got to be able to appeal to the Trump constituency you might see some changes in attitude. But it’s hard to say.

LUCE: It’s also worth noting that most of those 77,000 steelworkers are male and most of the home health aides are female. Maybe it’s just that men are louder than women—(laughter)—and Monday night might have demonstrated that.

ZOELLICK: Do you know the head of the steelworkers union in the United States is a Canadian? I always used to point out to him that he was a little multinational on some topics.

LUCE: I’m not sure Ted identifies as a Canadian, do you? OK. I know you were pointing at Ted. Questions, please. We have mics. Please give your names and keep them—make sure they’re questions, not statements. The lady—the lady there in the middle of the room.

Q: Hi, there. Krista Berry (sp).

Just touching on something that you guys talked about earlier. The Democratic Party has always been the party of unions. Last year, 28 Democrats voted for TPA and the unions threatened to primary them out of their seats. They all won their reelections this year. And you look on the other side and the Republican—people that are going to vote for Trump, a lot of union members. I’m just wondering if, after this election, you guys anticipate any changes—I mean, shifts in political associations with the unions.

WEBER: You mean unions—

LUCE: Becoming Republican.

WEBER: —becoming more Republican?

Q: Yeah. Yes.

WEBER: Well, Trump has gotten some support from union members. I still think, though, that the union leadership in the country is—you know, it’s integral to the Democratic Party, and there may be an occasional state union here and there that strays for various reasons. But I don’t see the unions themselves moving toward the Republican Party. I don’t know what you guys think.

STOKES: And I think we also got to realize—and the union movement in the United States is a dying institution and so whatever its influence in this election, four to eight years from now probably even less just because the shrinking membership. And so, you know, I’m not making a value judgment about whether that’s good or bad for the country but it’s just—I think it’s—the data suggests that it’s—their influence is going to ebb over time even though they provide a lot of money and they provide—even more importantly, they provide workers who can make—man the phone banks and go door to door. That’s just going to continue to shrink.

ZOELLICK: Yeah, let me differ a little bit on that, OK, in that—yes, they’re small. But if you talk to any Democratic member for a vote, as I would try to do, they’re very important on the things about money and sort of turning things out. OK. Now, Republicans, particularly at the presidential level, have tried to get union workers, even if they can’t get sort of union leaders. You could go back to Nixon. This was a big part of Nixon’s strategy. This happens periodically.

And then, in addition, there will be issues like pensions at the state level. So, you know, the former Chris Christie, when he was—(laughter)—governor of New Jersey, was very shrewd at getting construction worker and other unions to say, what sort of health and pension plan do you have as private sector unions versus government unions. OK. So I honestly think the private sector-government union issue might be a little bit more driven by the pensions, which is another sort of huge problem out there.

What I do see happening, however, is you have to create a counter force so that’s why I was saying in technology, you know, and using my Silicon Valley, the Silicon Valley executives didn’t care about it so—about trade so that’s how their congresswoman voted. I think—and so you have to create a counter force with some of these ideas of young people in technology and others on the Democratic side.

And that’s why I’m saying it’s not enough to be for openness. You really only need some research to say, you know, what will motivate people. Is it the ability to travel, open ideas, deal with poverty? What kind of grabs them?

I’m not the person to be able to answer that. But the last point that you mentioned that related to it—Vin and I talked about this—you know, one of the interesting things to see coming out of this on the Republican side will be what Republicans kind of draw lessons from Trump, and one friend of mine in the House, a Republican, said to me, look, Bob, he said, you know, politicians are imitative animals. OK. They’re going to see what works and what plays.

And so I’m a little worried that one of the factors, not just on trade but on kind of the style of campaign that comes from this Trump phenomenon, will be that sort of dimension. And just as an interesting test—something else I posed to Vin—you know, as I finished watching the Great Debate this week—I have been involved in a lot of debate prep and been involved with these debates for 25, 30 years—is that if I can imagine any other Republican candidate in a prior debate that wouldn’t release his taxes, that interrupted people all the time, that, clearly, was unprepared about the substance, that didn’t know about nuclear weapon policy—I mean, we could go on and on and on—the press would have destroyed them. OK. If that had been Romney, if that had been Bush, anybody else, they would have been wiped out. Look at how the press treat him now.

We’re at a different level. They say oh, well, you know, it’s kind of, well, how does he perform, you know, blah, blah, blah, blah, blah, blah. They accept things, and remember, you know, the news business is a commercial business. OK. It’s something I learned in watching in the Republican primaries and how this was covered. Trump is good news business, OK—

WEBER: Yeah.

ZOELLICK: —and this has now affected—you know, how this will affect politics at other levels, you know, we’ll have many other CFR sessions to see. (Laughter.)

WEBER: That’s right.

LUCE: Yes, the gentleman just here. Sorry, I’ll get to you. I’ve seen your hand. The gentleman in the front. You are the second. The mic is nearer, that one.

(Cross talk.)

LUCE: Whoever the mic is nearest to.

ZOELLICK: I didn’t mean to suggest the FT is a commercial news business. (Laughter.) I’m sure it’s a public service, generous—

LUCE: We’re a charity. We’ve always been a financial—

Q: Thanks. Andy Olson, Senate Foreign Relations majority staff.

Seems to me that trade agreements these days are more about rules than tariffs anyway, and we seem to do better with FTAs in place than countries with whom we do not have FTAs. And all of the anti-trade rhetoric seems to lump everybody together: you know, trade is bad because our terms of trade with China—you know, which is WTO baseline—isn’t working. And I’m just wondering, why the argument of saying, well, if we had a trade agreement in place we’d actually be doing a lot better—why does that argument not resonate more?

LUCE: Good question.

ZOELLICK: Want me to take a shot?

LUCE: Bob.

ZOELLICK: This is partly learning how to argue the case and it requires going a little bit beyond the—sort of the emotional sovereignty of the response. You know, so, Andy, I know you know this but it’s striking, which I’ve written and now, given the members of Congress and they’ll probably start to say it more, is that, you know, our FTAs are with countries that represent 10 percent of the world’s GDP and about 50 percent of our exports.

Now, part of that is Canada and Mexico and the geographic area. But what you’ve also seen is that our rate of export increase with free trade partners in the first five years after agreements is three times faster than it is with other trade partners. We have a manufacturing surplus with our FTA partners, and you watch the farm goods. By the way, we haven’t talked about farm constituencies and remember, this is something you got to learn in politics—in the Senate you’ve got a lot of farm states. They may not have a lot of farmers but you got a lot of farm states. And I was talking with the head of the American Soybeans Association this week and he said, if it weren’t for China, he said, soybean prices would be where corn prices are. Now, that may not mean much to this audience—(laughter)—but I’m telling you that there’s a difference. OK. (Laughter.)

So I think part of this will be sort of how you make the case and what, you know, Vin or Bruce or Ed and I tell you are kind of, well, this is sort of in the weeds arguments—yes and no. When you’re in a constituency—you know, I was meeting the congressman from Peoria recently—is that, you know, for Caterpillar and soybeans, that matters. OK.

So part of it will be how you make the case about this. But at the end of the day, it has to get sort of broader-base support and that’s why I come back to the idea that if we don’t get the business community doing two things—one is explaining to their workers how important this is, OK—my Boeing example—and also, you know, one of the points that Vin made as we were coming in, the unions are very good about saying, you know, well, this is not only for us, it’s the country. Well, businesses are going to have to explain the importance of this for the country. That won’t happen unless there’s a there out there. That’s why in trade I was always a big believer of being on offense. If you’re not on offense you’re on defense, and so that really does come back to on offense you need a president that wants to push stuff.

LUCE: Gentleman.

Q: Irving Williamson, the U.S. International Trade Commission.

You all have all talked about sort of what I call short-term things are the politics of trade. But I think that just because—in the middle had raised originally this—fundamental things, concerns about cultural change, you know, foreigners coming in.

I think one of the problems that’s been in the EU for a long time is a lot of people that felt that they—they used to call it subsidiary, trying to bring decisions down to the lowest level so that people become involved. And what I want—and the question I’m really asking, Professor Krauss (sp) talked about a lot of things about trying to grow the economy so, you know, everybody gets involved and get benefits from it.

And so I’m wondering aren’t those things like infrastructure funds, other things that have—are going to get broad-based support, also things that maybe get people tied in. Like, I saw a study someplace that said union members are less likely to be subject to demagoguery than somebody who’s kind of, like, alienated. And so—

LUCE: That’s a good question to everybody.

Q: Good. Yeah. You got it.

LUCE: And if there’s a demand deficiency in there for an investment—there’s a sort of drought going on—if we get that up maybe we can get a broader-based sort of—

ZOELLICK: Well, you won’t—I think Vin and—

LUCE: Vin, sorry.

ZOELLICK: —maybe Bruce also touched on this, which is that all this is easier if you’ve got good strong growth, OK, and all the things that you’re talking about sort of, you know, whether it’s productivity increases from investment, whether it’s infrastructure, jobs, wages, all the things that—you know, in my view, tax systems and others—that contribute to a stronger economy undoubtedly sort of make this easier.

I mean, Hillary Clinton made the point, you know, for all of, you know, Trump’s buffoonery about—with NAFTA is that, you know, manufacturing jobs were increasing, OK, in the ’90s, end of point. So but that wasn’t just because of NAFTA. That was because of the overall state of the economy. But I do think—

Q: It seems like there’s a governance issue that Bruce was getting at.

STOKE: Yeah. Irv, I think you were hinting at something, at least I think, that we haven’t even confronted yet with our publics what the Europeans are beginning to wrestle with, which is, for want of a better word, sovereignty but I think the better discussion is trade agreements and, more importantly, global economic integration is increasingly about regulations, it’s about rules, it’s things that publics think are domestic in orientation but they aren’t anymore because of globalization.

And there’s this sense of wait, that used to be under my control, and it was probably never under their control but they thought it was, and now it’s going to be decided in Brussels or now it’s going to be decided at the WTO or somehow we’re going to lose control. And I think one of the problems that TTIP faces is we’re beginning to wrestle with those kinds of issues and I don’t think we even know yet what kind of blowback we’re going to get once it dawns on people that because we import so many of the things we consume we better have international rules on food and health and safety that we all agree on because we’re all subject to this now in ways that we were never—our grandparents weren’t. And the Europeans are confronting that, I think, a little bit more than we are and they don’t like it. I mean, this is—this is what’s feeding the anti—

ZOELLICK: OK. This gives us a little basis of debate. I’m not sure I’d look at the EU as a model in how to move towards—(laughter)—you know, for their agreement with Canada, Ted, you know, they now want to have this approved by 36. It’s not enough to go to the 28 countries.

STOKES: But, Bob, that’s a consequence of the debate in Europe, not—

ZOELLICK: Yeah. But there’s a little bit of a quality of this. This is—oh, I’m pushing back and the woe is me—oh, we have to get all the economy going first—oh, we have to do this first. Let me tell you from experience, whether it’s this issue or others, if you don’t push it in your area it’s not going to happen, OK, and so people who care about trade, the types of things I talked about, you’re going to have to push.

Now, I take the point about the fact about, A, broad economic growth or, certainly, the sense about whether people have sort of control over things that affect their lives. So in the TTIP issue one of the problems from the start with TTIP was that it was sold on the wrong basis. OK. It needed to be sold that it’s not primarily a tariffs issue—it’s primarily a question of can you have either if not agreed standards but harmonized or mutual recognition or others to reduce costs, and the reason the TTIP has been so unpopular in Europe was that people thought it would lower the standards of regulation.

Pascal Lamy and I have talked about this from the European and U.S. side ad nauseam. In reality, what you had to try to say is, look, there’s about a third of the regulations—the U.S. might be tied, or a third in Europe; you know, there’s sort of a third in between—but the standards and regulations issues are extremely complex to deal with because you’re dealing with regulatory agencies and independents, as you probably know from the ITC, and if you mishandle them they’re politically difficult.

So what I would have done with TTIP is I would have taken the five or six most transatlantic sectors—you know, autos, you know, pharmaceuticals—there’s some of the consumer goods, machinery—and you’ve got companies on both sides and I would have worked with them to say, OK, you know, what could be the things with car crash tests or others and seatbelts or so on and so forth that wouldn’t reduce the standard of protection, OK, but would allow us to cut costs. And there was some work done on that and there was actually some work that was started before. But people lost control of the debate on this one. And then the other big issue which is connected to this is investment. So the investment issue has killed it in Europe.

WEBER: I just want to—I just want to comment on one of the last points you made. This is a little off your point but not entirely. You talked about the fact that union—unionized people were less subject to demagoguery. Michael Barone wrote an interesting column about six months ago talking about the Trump phenomenon and saying that the Trump voter is correlated with connected or lack of connectedness, and unionization was one part of it but religious community was another part of it—the whole set of variables there.

One of the things, as we think about going forward, how do we try to rebuild a consensus for trade liberalization is that whole sector of mediating institutions we talk about. Unions are—I’ve always been against trade for economic reasons. But go and look at what the church councils say. Look at what most NGOs say at the local level.

They’re just as much anti-trade as anybody and they have credibility with people in ways that politicians don’t. So part of our job has to be it’s not—this is not just a fight between business and labor. It involves sectors in society. That’s what I was trying to get at a little bit on the cultural side and you touched on it at the end there. I think that’s a very important piece as we try to put together a strategy going forward is to not ignore the players that don’t seem to be directly involved but have a voice.


LUCE: I want to get a couple of questions more in, Bob. The lady there in the middle.

Q: Thank you. Oh, thanks a lot. Paula Stern of the Stern Group, Incorporated.

And, Bob, I just want to echo your point about TTIP, and the focus that, had we stayed on the work that the transatlantic business dialogue had done in the Clinton administration on those key—harmonization in certain sectors, something I spent six years working on, and I think we just dropped the ball.

But—and trade, you know, is a four-letter word that everybody is trying to avoid. (Laughter.) Got it. But I would like to ask your advice. Do you think Hillary, in her answer on the questions dealing with that four-letter concept, did an adequate job? How would you have changed in the next debate or the next debate? I thought she moved it on to, you know, a very positive competitiveness agenda—you know, investment in R&D, investment in growth, et cetera.

LUCE: So let’s hear—let’s hear their answer. Did Hillary do a positive job?

Q: Should they do—could she do more in terms of addressing the arguments?

WEBER: I’ll answer the first—I’ll answer first one quickly. I think she did a good job on that answer of keeping some options open when she becomes president. Unfortunately, I don’t think she did a good job for herself politically in the course of what’s going to happen in the next 45 days.

Q: Yeah. OK. Sorry to hear that.

LUCE: Couple more questions. Sorry, you—the one further back, the gentleman there with the hand up with a pinkish tie. Is that pinkish? Yeah.

Q: Thank you so very much for the fascinating discussion. My name is Winslow Robertson of Cowries and Rice, LLC, which is a China-Africa strategic consultancy.

I have an impolite question but I wanted to see if you could answer—

WEBER: Oh, good.

Q: Perfect.

ZOELLICK: Debate prep.

Q: In terms of political context, and you’re talking about culture and demographics, but I’m wondering is the issue, and especially for a certain segment of the U.S. population, that they’re anti-trade and happen to be racist or that they’re racist and just happen to be anti-free trade. And I say racist in a very specific term. If you are a birther, I think it’s fair to say that you are politically motivated by racism, and if that’s the case how can any of this discussion address that in a way that’s different than broader discussions of cultural context? And, again, I apologize for the difficult, impolite question.

LUCE: Trade and racism. Who’d like to take that? (Laughter.) Well, Vin—(inaudible)—

STOKES: Well, I mean, I was—I mean, to follow up on Vin’s thing, I was—I was the one who said this is broader, I think, than just trade. It’s about race. It’s about diversity. It’s about—you know, I—we have no data to prove this. I don’t know of anyone that does. But my guess is when some people hear make America great again it’s not make us, you know, the supreme, you know, undisputed military leader or the supreme economy. It’s also make America white again. Make America straight again. Make America male again.

These are really deep-seated and I think we have to step back and say there’s a portion of the population, and it’s not anybody in this room, who is having real trouble dealing with the pace of change in modern life and the globalization that drives that. Globalization is change on steroids. Publics have never liked change.

We can—I think we can stipulate that. But I think we can also stipulate that the pace of change and the internationalization of change through globalization has stressed out a whole group of people, and the economics of it may be the simplest part to fix. Not that we are very good at it but—

ZOELLICK: I’d like to—sorry. Go ahead.

WEBER: I just want to—that’s true. I just want to say I’ve talked about this issue very recently with a group that I run back in Minnesota at the Humphrey School, and young African students involved are very—African and African-American—very concerned about this and concluded that—one young woman asked me, how do we get a bye in a country where well over a third of the people are overt racists. And I said, you know, I understand your concerns. I don’t like anything that’s going on in the Trump campaign.

But it’s a horrible mistake for us as Americans to proceed on the assumption that a third of our fellow countrymen are racists. That’s not true. I mean, they weren’t racists when George Bush was president. They weren’t racist when they elected Barack Obama. There are racists in America, to be sure, and there are some people if you have bad leadership you can appeal to their darker side. No question about that.

But if we proceed under the assumption that there is an intractable racist base in this country of 25, 30, 40 percent of the population, then all really is lost.

ZOELLICK: Let me give you three more micro points on this. One, when I was USTR and we pushed AGOA—the African Growth and Opportunity Act—it was quite striking the broad base of support you could get from Republicans and Democrats. OK. Now, that—the Republicans were more free trade and that was one where Democrats were a little bit more supportive. But it’s sort of interesting, and also bringing in church groups and some of the other things about sort of broader civil society.

I just don’t want to forget on this—on the environment issue, TPP would probably do more for sort of fishing subsidies and sort of fishing conservation than anything in the international environment realm. Second sort of point, however, you know—and this is a little bit more what Vin is saying—you know, I attended a political event recently, sort of a fundraiser, and it’s just like going up to the Hill or going to visit members in their district.

It’s really useful to kind of see what people are hearing and kind of what—how they deal with it, and with the issues of domestic terrorism, you know, whether it’s Somalis or sort of Afghans or other, people are scared. OK. So these people were talking about—in this case it was a refugee issue. OK. They’re not racist. They’re just frightened, OK, and, you know, there’s a certain logic to it when Islamic radicals are killing people.

Now, I feel so bad talking about Minnesota for the—all the other Somalis in sort of Minnesota that I’m sure are, you know, part of their community. But as Vin said, if you don’t address that concern it’s like, frankly, for those of us that, you know, generally favor open immigration I think we missed something by how that built up over time and we didn’t address that sort of concern. OK.

But the third point that maybe underscores a variation of what you’re saying, one of the things that I find so objectionable about Trump is that whenever there’s a problem in America or himself there’s always somebody to blame. OK. So, like, in the debate now it was the microphone, it’s the—a question or so on and so forth. But the bigger problem is who does he blame? Mexicans, Chinese, so on and so forth.

Now, this is a deep American tradition, you know, where we kind of blame people around the world for our problems. OK. But, you know, it does at times have racist elements to it, OK, and his comments about Mexicans, which I just found totally offensive, certainly had some of those elements, OK, and I think that’s why it’s important, frankly, to really stand up to some of those issues. But I think the core issue there is not so much those other parties. It’s whether politically as a country we say these are problems we have to fix or are we going to blame everybody else, and that’s one of the big issues in this election.

LUCE: We’ve kind of run out of time but I did promise—there was one more question here—a very quick question, please, madam, and a pithy answer, if possible.

Q: Understood. Jessica Matthews of Carnegie Endowment. In Ted’s paper that was distributed this Figure 2 shows this astonishing demographic flip on trade and what strikes me is both how big it is in the Republican Party—59 percent to 39 percent—and how fast it is in just seven years.

So it seems as though something was happening big time before, which I’d love to have you address, but the other question is after the election, no matter who wins, it seems like we have one more issue on which there is a huge divide between public opinion and voting behavior. And even given Vin’s comments about how strongly people feel is more important than how many feel a given way, I just wondered, A, how sustainable is it.

Is it indefinitely sustainable to have that enormous break between what Democrats believe and how Democrats vote and vice—and with Republicans? And if there is such a division, it ought to—it ought to offer some way in to break it. and I just am asking whether any of you has ideas about how you go about breaking that. Is it campaign finance laws? Is it—what are the options?

STOKES: I mean, one of the issues—

LUCE: Quick answer, please.

STOKES: —it seems to me, is that you do see in some of the data—public opinion data—that Democrats trust a Democratic president more on trade and Republicans trust a Republican president more on trade. So we don’t—we have no idea. If Trump is elected, would Republican attitudes on trade flip because oh, our guy will take care of this in the way we want him to. I assume if Clinton is elected, the Democratic favorability of trade probably won’t change very much because a Democrat will be in the White House. So it’s conceivable this could change because of that might—that might trump the other underlying demographic issues. But I think it’s really hard—it’s really hard to tell.

WEBER: I think that’s right, and the only thing I would add is I think it’s driven by the demographic change of the Republican electorate that Bruce talked about. But I also think beside the fact that we have a Democrat president or have had a Democratic president for the last seven years there is this theme running through the last seven, eight years which we can argue about endlessly is America really in retreat from leadership around the world. Republicans believe that broadly that, oh, President Obama, regardless of his many virtues, has not wanted to project strong American leadership around the world and this plays into that. It probably should play into it in exactly the opposite way.

But I don’t think that that’s the way it works. I think people think, you know, we’re being taken advantage of around the world. We’re not projecting our leadership. And the fact that this president has negotiated for this trade agreement, which is going to give more away to the rest of the world, is a storyline that resonates with people—with Republicans.

LUCE: Bob, I’ll give you the last word.

ZOELLICK: I think they summarized it well.

LUCE: OK. Well, I feel like we’ve just begun the discussion. Very lively, couldn’t have had a—asked for better. Thanks to all three of you.

WEBER: Thank you. (Applause.)


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