The Honourable Joe Volpe, Publisher
TORONTO - Two hundred years ago, the USA, emerging from a successful war of Independence from Mother Britain, fashioned a “Foreign Policy” that, in layman’s terms, claimed all the land between the Atlantic and the Pacific as property of the USA, to do with it as it pleased.
Because God willed it. It was America’s Manifest Destiny. President James Monroe in the early 1820’s refined it to include the entire Western Hemisphere, warning all European Nations that the USA would consider their active presence in the Americas as a threat to its interests, and would react accordingly.
Trump’s version of this Monroe Doctrine may seem less refined. In his inaugural speech, he reminded everyone that he will “renegotiate everything” so that the USA will come out ahead.
In case anyone is confused, this means the USA must come out on top: “we’ll negotiate until I win. You must, therefore, lose. The only issue is by how much.”
None of this is new. He has been repeating that he would renegotiate everything so that America would get its fair – bigger – share. Truth and fact will be the first casualties of the Trump Era. So, on what basis will there be negotiation? His surrogates are already insulating him from any value structure, moral or legal, by saying they will [always] have “alternative facts” to the truth.
Twenty four hours after the pomp and ceremony of his inauguration, women in the USA produced an impressive numerical rejection of his leadership with an unexpectedly - hugely – successful demonstration of opposition to him and what he represents.
Therein may be the clue to how “partners”, existing and potential, need to approach Trump: united and with a game plan. Woe the country that allows itself to be isolated or separated from its military or trading alliances.
The Russians have already cautioned that Trump may need some time before he becomes accustomed to the “nuances” of Foreign Policy. The Europeans – minus England have started to signal that, while they are always willing to discuss issues, their focus is on upgrading relationships for reciprocal improvement.
Even the English are already hedging their bets on what to expect from a potential trade agreement with the USA that may indeed be worth considerably less that what may be lost over time with a Europe restricted to keep England out.
Assuming Trump is serious about addressing the real problem facing the American economy, his target will be China, the Industrial behemoth destined to only grow bigger. China has four times the population of the USA. Its GDP is already on a par with that of the USA, and with Europe. It holds a commanding percentage of the American debt. It already produces about 70% of the world’s manufacturing.
It has become THE biggest player in the global transportation business. Domestically, on a per capita it is still much smaller than its European and American counterparts. But, if its economies of scale are any indication, it will outstrip any and all competitors in the near future.
American businesses, Trump’s included, are locating in China for future growth. 83 countries already have the EU as their largest export market, 28 have the US and 14 have China, according to an international online statistics aggregator, Nation Master.
The European Union is the biggest market for both American and Chinese products. The USA is the biggest market for Europe, as it is for Mexico and Canada. The other nations who rely on the USA are secondary players.
Globalization has so far worked for the Americans. So has the NAFTA, the North American Free Trade Agreement.
Yet, Trump has decided to “squeeze” America’s most important trading partners – Canada and Mexico – to send a signal to its rivals Europe, and more importantly, China.
Tomorrow: NAFTA updates are nothing new