Under Trump, TPP Is Dead and U.S. Trade Policy Uncertain

Almost half of voters backed Trump's order on TPP. (Rob Kunzig/Morning Consult)

The victory of President-elect Trump signaled the end to one of President Obama’s top policy priorities — the 12-country Trans-Pacific Partnership trade agreement.

So far, though, world leaders and experts have not indicated that they see Trump’s victory as an indication of the death of multilateral free trade agreements overall.

Trump was an outspoken opponent of TPP, and his surprise triumph on Election Day laid to rest any belief that it could come up in a lame-duck session of Congress. In a call with reporters Friday, senior Obama administration official Ben Rhodes said the administration is “clear-eyed about the current situation, but we believe what we believe about the value of trade and the importance of the Asia Pacific region to the United States.”

House Ways and Means Committee Chairman Kevin Brady (R-Texas), one of the main gatekeepers for TPP in Congress, said in a statement provided to Morning Consult that he will “continue to be a strong supporter for the freedom to trade.” He does not, however, believe that a lame-duck vote on the TPP is possible.

“The administration is working to address members’ concerns about TPP, but it has not completed the work, and significant concerns remain on both sides of the aisle,” Brady said. “As a result, this important agreement is not ready to be considered during the lame duck and will remain on hold until President Trump decides the path forward.

“We will work closely with the new administration on this effort,” Brady added.

That message echoes comments that Senate Majority Leader Mitch McConnell (R-Ky.) made following Trump’s election. Before the election, TPP supporters had hoped that the deal would come up for a vote this year in the event of a Hillary Clinton victory.

World leaders also aren’t confident about the deal’s future in Congress. New Zealand Prime Minister John Key said in a radio interview he expects to experience a “very unsettled landscape” on trade issues in the near term. In a separate interview, Australian Prime Minister Malcolm Turnbill said the “political landscape in the United States at the moment is not very promising for its ratification.”

Simon Lester, a trade expert at the libertarian Cato Institute and supporter of free trade policies, said he is taking a wait-and-see approach regarding the incoming administration. “They seem to think that it’s too hard to negotiate with a group of countries, and the U.S. loses as a result, but that is not my experience,” Lester said in an interview. “If the U.S. has a vision for what should be in a trade agreement, it makes more sense to include more countries in it. It seems like it’s more efficient.”

Trump and his administration might be forced to come to terms with the necessity of open trade policies. Despite Trump’s skeptical rhetoric about the World Trade Organization, Lester thinks the Trump administration will find the Geneva-based organization an effective tool in managing the fraught trading relationship with China.

Key, in his radio interview, said he believes Trump will ultimately come to understand the need for expanding trade in the Asia Pacific region. Engaging with Asian countries was a motivating principle behind TPP, he noted.

“His argument, when you think about it, hasn’t been that trade is bad. He just keeps saying, ‘This is a horrible deal. This is a horrible deal.’ Well, let’s just see their capacity to negotiate a better deal, I suppose,” Key said.

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