TWIN FALLS — President-elect Donald Trump spent much of his campaign savaging free trade and trade agreements, saying they have cost jobs and made it easier for businesses to manufacture in other countries.
The North American Free Trade Agreement between the U.S., Canada and Mexico was a particularly frequent target of Trump's — during one debate he called it "the single worst trade deal ever approved in this country" — and he also said the Trans-Pacific Partnership, a trade agreement between the U.S. and 11 other Pacific Rim countries including China and Japan, would not move forward if he won. Some commentators have credited Trump's trade rhetoric with helping him win in several states that have been hit hard by deindustrialization and thus securing his Electoral College victory.
While there have been voices on both the right and left criticizing the country's trade policies for years — unions have traditionally opposed free trade, and the heavily Republican Idaho Legislature has at times called on the U.S. to withdraw from NAFTA — Trump's views do mark a departure from the pro-free trade views that have been common in both parties and have generally shaped American policy for years.
So, if Trump moves forward with trying to translate his views into policy, what could this mean for Idaho?
The value of exports by Idaho companies has more than doubled from $2 billion to $4.3 billion a year from 2003 to 2015, according to the Idaho Department of Commerce. Canada is our largest trading partner, with a little less than a quarter of Idaho's exports going there, followed by China, which is the destination for more than $560 million a year in Idaho exports, and Taiwan at $528.5 million. Sixty percent of Idaho's exports are industrial products, and a little more than a fifth of the $4.3 billion is represented by food and agricultural products, according to the Commerce Department's numbers.
Bob Naerebout, the executive director of the Idaho Dairymen's Association, told the Times-News in November that competition from imports is less of an issue for his industry than being able to access foreign markets — about 15 percent of dairy products produced in Idaho are exported.
“Negotiated trade deals are extremely important to our industry,” he said.
Naerebout said the U.S. could have done a better job with both NAFTA and the TPP. He said the Canadian market, for example, is still closed to Idaho’s dairy exports under NAFTA, and under the TPP's terms the Japanese market is not as open to American dairy as he would like. However, the Dairymen's Association did support the TPP despite these misgivings.
There is a possibility Idaho could have a more direct say in how trade policy changes, especially if Gov. C.L. "Butch" Otter is appointed to the Trump administration. Otter is in the running for secretary of Agriculture, and one of the duties of that job is promoting U.S. agricultural trade. Otter's third choice for an administration position was U.S. Trade Representative, and his first was Interior secretary, and Trump has announced other picks for both positions.
Otter has an extensive background in trade — he traveled the world while he was president of potato giant Simplot International marketing the company's products, and he has led numerous trade missions abroad as governor, most recently to China last month.
Idaho Politics Weekly contributor Steve Taggart wrote a column in September pointing to the role trade plays in Idaho's economy — 9.3 percent of Idaho's gross domestic product in 2014 was related to exports, and a fifth of Idaho jobs were somehow tied to foreign trade — and argued NAFTA had overall been a good thing for Idaho. Idaho's exports to Canada and Mexico have increased 800 percent since 1994, he wrote, and reinstatement of the tariffs that had been in place before would hurt the state's economy.
"But, the facts are that Idaho is uniquely vulnerable to trade policies that harm Idaho market access to Canada and Mexico," he wrote. "Retaliatory restrictions there would put at risk nearly half of our agricultural exports and economic activity that generates and sustains thousands of Idaho jobs."
Others have argued NAFTA hurt the state. A study by the Economic Policy Institute in 2011 projected that NAFTA had cost about 2,400 jobs in Idaho, using a formula based on the growing trade deficit between the U.S. and Mexico since NAFTA's ratification.
One example, said Aaron White, the president of the Idaho State AFL-CIO, is that NAFTA has made it easier for U.S. sugar manufacturers like Nabisco and Mars to move operations to Mexico, flooding the U.S. market and undercutting manufacturers like Amalgamated Sugar. This, he said, leads to fewer jobs in the U.S., because it forces even more manufacturers to move some operations to Mexico to stay competitive.
The Idaho Legislature passed a memorial in 1999 calling on the U.S. to withdraw from NAFTA and again in 2008 calling on Congress to renegotiate the deal and to withdraw if certain conditions weren't met. The 2008 memorial had both Democratic and Republican sponsors, including locally Sen. Clint Stennett, late husband of the current District 26 Sen. Michelle Stennett, D-Ketchum.
One of now-U.S. Sen. Mike Crapo’s early votes in Congress was in his first year there in 1993, when he voted against NAFTA.
“We left in place tariffs that were much more harmful to U.S. producers than to the Mexican producers,” the Idaho Republican said in November. “If tariffs are allowed in a trade agreement, they should be equal. Those kind of negotiations needed to be handled more effectively on behalf of the United States.”
Crapo said Idaho potatoes’ access to Mexican markets has been an issue. Also, he said, competition from Mexican sugar has hurt American producers.
“It’s those non-tariff barriers that, I think, also need to have strong attention,” he said.
Crapo said he wants to see the U.S. “more aggressively enforce the protections we do have under NAFTA in favor of our producers, who are being discriminated against by the actions of the Mexican government.” Also, he said, he hopes NAFTA is renegotiated under the Trump administration.
“Frankly it just (requires) we will not continue to negotiate from a position of weakness,” he said. “And we will insist on parity and fairness in these negotiations.”
White said his big concern is that labor interests are generally left out of the negotiations when it comes to trade deals.
“When we hear about things like negotiations are going on behind closed doors it’s concerning, the lack of transparency,” he said. “We are always concerned about workplace safety first and foremost. As a social matter, we’re concerned about environmental issues. But we think those things get left out of the conversation.”