Trade policy must look more to the 21st century, less to the 19th

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The agreement in principle last week that the U.S. and South Korean governments have renewed the Korea-U.S. Free Trade Agreement with some relatively minor revisions is certainly good news.

South Korea is an important ally and trading partner of the United States, and it would have been folly to follow through on Trump’s previous calls to rip up the existing agreement. But without placing this step in the context of a comprehensive national strategy, the Trump administration’s small victory will be worth little. 

{mosads}After all of President Trump’s bluster, threats and antagonism, the renewed agreement preserves nearly all of the existing terms negotiated by the Bush and Obama administrations.


The small change of allowing U.S. auto manufacturers to increase their quota of cars that can be exported to South Korea from 25,000 today to 50,000 is insignificant because no U.S. car manufacturer today exports more than 11,000 cars to South Korea anyway.

Extending a 25-percent tariff on South Korean light truck imports to the United States by 20 years and setting a quota for Korean steel coming into the U.S. could potentially help American and foreign companies manufacturing these trucks in the U.S. and a few steelworkers, but these measures will more likely just increase costs to American consumers for light trucks and products with steel components.

A side gentleman’s agreement between the U.S. and Korea to refrain from currency manipulation is already being denied by the South Korean government.

Keeping this good but imperfect agreement in place is far better than the alternative, helps both the U.S. and South Korean economies and allows the two countries to present a more unified front going into the tense geopolitical times to come.

When the Trump-Kim Jong Un summit, if it happens, ultimately leads to disappointment and greater levels of tension after it becomes clear the North Koreans will not give up their nuclear weapons at any price, it will be important for the U.S. and South Korea to be on something like the same page.

In an ideal world, the U.S. and South Korea coming together could also help build an alliance pressuring China to allow greater market access and stop its organized theft of intellectual property and insidious efforts forcing U.S. and foreign technology companies to share their source code and provide access to their data.

The Trump administration’s recent tough talk on China is appropriate, but the U.S. would have far more leverage if Trump hadn’t jettisoned the Trans-Pacific Partnership at the start of his presidency or threatened our allies and other trading partners to the point of shaking their trust in the United States as a reliable partner.

The U.S. can’t pressure China and every other country at the same time on trade, because pressuring China for meaningful change requires building a coalition of everyone else.

Even more broadly, the most important race we are all in and must focus on is the race to lead the future. It’s great for U.S. steelworkers to have jobs if the U.S. can produce steel close to what it costs in Canada, America’s closest ally and North American Free Trade Agreement partner.

It’s just not true that, as Trump keeps insisting, if the U.S. doesn’t have a steel industry it doesn’t have a country.

It is true, however, that if the U.S. doesn’t lead the development of revolutionary new technologies like artificial intelligence (AI), biotechnology, quantum computing and advanced manufacturing, it won’t be able to maintain its own competitiveness and prosperity or the broader international order that has brought the world unprecedented levels of peace, prosperity and security over the past seven decades.

China has clearly articulated its national goal of becoming the world’s dominant AI innovator by 2030 and the global leader in “comprehensive national strength” by 2050 and is marching determined in that direction.

The United States has the advantages of a stronger technological base, a more diverse and open society and being a place to which some of the smartest and most ambitious people in the world still want to come.

Leveraging these advantages to build the future, standing up to Chinese mercantilism and working with allies like South Korea to promote free, reciprocal and fair trade around the world will position the United States to lead the 21st century.

Antagonizing its friends and fighting battles over 19th-century industries will not.

Jamie Metzl is a senior fellow for technology and national security at the Atlantic Council, a former national security, State Department, and U.S. Senate Foreign Relations Committee official and author of the forthcoming book, “Homo Sapiens 2.0: Genetic Enhancement and the Future of Humanity.” Visit him at

Tags Donald Trump Donald Trump economy International reactions to the United States presidential election International relations International trade Korus Nafta Presidency of Donald Trump South Korea Trans-Pacific Partnership

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