Picking Mike Pence Creates Trade Split in Trump Ticket


Donald Trump this year single-handedly overturned years of free-trade orthodoxy among Republican political leaders — which is making his choice of a running mate a bit awkward.

[William Maulding| July 15, 2016 |Wall Street Journal

Mr. Trump said Friday on Twitter his vice presidential pick is Gov. Mike Pence of Indiana. Mr. Pence, like many Republicans, has openly backed trade deals, putting him at odds with Trump campaign’s hardline stances on trade barriers and tariffs.

For example, just days ago in Ohio, Mr. Trump argued that the Trans-Pacific Partnership trade agreement the Obama administration is seeking to get through Congress is being pushed by “special interests who want to rape our country, just a continuing rape of our country.”

As it happens, Mr. Pence, as governor, has backed the passage of TPP, and while serving in Congress he voted to approve trade agreements similar to the Pacific pact.

In 2014, when negotiations on the TPP were entering their final stages, Mr. Pence tweeted, “The time has come for all of us to urge the swift adoption of the Trans Pacific Partnership.”

For governors like Mr. Pence, TPP and other trade agreements are often popular because they can help states promote international commercial ties and investment. Japan—the second-biggest economy in the TPP—is Indiana’s biggest trading partner outside North America, according to the Commerce Department.

But in the House of Representatives, most Democrats and quite a few Republicans are wary of trade agreements like the TPP out of concern they could lead to job losses in their districts — and that those losses that would have a greater political impact than any broader gains for the economy at large. On the other hand, many lawmakers representing agricultural districts back trade agreements because they often lower other countries’ tariffs and quotas on American farm-products exports.

Mr. Pence, when he represented Indiana in the House, voted for the bilateral U.S.-South Korea free trade agreement, arguably the most similar to the TPP. He also voted for the controversial Colombia free-trade agreement, as well as the Central American Free Trade Agreement, or Cafta, which he said would promote democracy in countries that have escaped communism.

Mr. Pence has voiced support for the North American Free Trade Agreement, or Nafta—the deal with Mexico and Canada that Mr. Trump has threatened to renegotiate or pull the U.S. out of entirely.

Mr. Pence has led a trade mission to China, the most frequent target of Mr. Trump’s trade rhetoric, and his office backs the “strengthening of ties with our Chinese partners.” Mr. Trump has said he would declare Beijing a currency manipulator and impose unilateral tariffs on the country’s exports if it doesn’t stop behavior that amounts to a trade war the U.S. is losing.

Since Nafta, Indiana has moved deeper into the cross-border auto-supply chain that has lifted some U.S. manufacturers but seen others shift operations to Mexico. Nafta has also boosted the state’s corn exports to Mexico.

But Mr. Trump has used Indiana as an example of companies shifting manufacturing jobs to Mexico due to trade agreements, including air conditioner giant Carrier Corp.

While Mr. Trump has consistently criticized Washington’s trade policy and attacked major U.S. trading partners for years, at least one business group is hoping Mr. Pence will be able to change his mind on the issue.

“We hope Governor Pence, who has supported the Trans-Pacific Partnership, will persuade his running mate that expanded trade will make America even greater,” said Jay Timmons, president of the National Association of Manufacturers, in a blog post Friday.


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