Issues, Trade

Enforcing the Deals You Cut

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President Donald Trump became President Donald Trump in no small part because he ran against the very bad deals of all sorts that America has spent the last several decades cutting. He did, after all, write “The Art of the Deal.”

Image Credit: tonynetone CC by 2.0

Trump ran on “America First” – promising to rectify the decades of “America Last” deals Washington, D.C. has delivered.

And even if DC did manage to along the way cut an occasional decent deal – it isn’t any good if all parties don’t hold up their respective ends of the bargain. And, of course, that lack of full-on participation makes bad deals – even worse.

Trump the Businessman certainly understood the import of deal enforcement. Trump the President should follow his own lead.

In some instances, Trump already is. He just returned from his first international excursion – during which he admonished the very many North Atlantic Treaty Organization (NATO) members who have for decades been shorting us on their defense budget dues.

Regardless of your thoughts on NATO and our continued participation therein – it absolutely doesn’t make any sense if we’re just about the only ones adhering to it. There are 27 NATO countries – only four meet their defense budget treaty obligations. And most of them haven’t – for years, and years and years.

One could argue that at that point it isn’t any longer even an agreement. It’s welfare – and yet another instance in a very long line of DC America Last policies.

And so it is with trade. No matter what you think of NAFTA, GATT and a whole host of other trade deals – if you don’t enforce them, they’re awful:

“(I)n 2013,…Mexico – in violation of our existing (NAFTA) agreement – dumped two million tons of their subsidized sugar on us….The U.S. International Trade Commission ruled in 2014 that Mexico was in fact dumping….”

Rulings are one thing – rulings aren’t enforcement. If you don’t enforce…the cheating continues. Is Mexico STILL scamming us?  Of course they are.

And the longer we allow Mexico to get away with their violations – the worse the deal looks. And the worse we look.

Mexico can not be allowed to continue to do whatever they want. Who do they think they are – a NATO member?

But really, is it any wonder Mexico thinks it too can blatantly, serially violate an agreement with us? We have a very long, international track record of being the world’s biggest pushover.

Part of any and every successful negotiation – is being taken seriously by those with whom you negotiate. We’ve spent the last half century – allowing everyone everywhere to run roughshod over us.

That may very well be a contributing factor to the perpetually devolving value of the deals we’ve cut.

It certainly explains why everyone everywhere thinks that no matter what built-in advantages they already have in our increasingly weak deals – they are quite comfortable violating them to press their advantages further still.

Because we have been doing nothing to stop them.

Trump has reminded us with his NATO push – that enforcement matters.

He should do exactly the same with Mexico and NAFTA. And about nine million other things.

This is a guest post by Seton Motley Founder and President of Less Government

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