Liberalism Is in Retreat: Uncertainty Is in the Air

By Julio Espinoza, Staff Writer

It’s almost two weeks since the Trump Administration took office and the effects are already felt in the U.S. and abroad. There is uncertainty in the air, and perhaps the legitimacy of our country will diminish even more than when we went to war in Afghanistan and Iraq during the George W. Bush Administration.

Those of us who were living abroad during that time witnessed how the anti-American sentiment gained momentum on a global scale with massive demonstrations against the war. Washington D.C. went to war with two failed states, committed crimes against humanity (combatants and civilians), and sacrificed above 150,000 American lives and between 500,000 to 1,000,000 Iraqi lives. In 2003 we went into the Gulf War II on wrong premises: there were no ties between Baghdad and Al-Qaida and there were no weapons of mass destruction. Former President Obama came to power with the promise of change and he pulled the troops from the Middle East, welcoming back hope to our country. The world reaction to that new U.S. foreign policy and national security stand came to fruition as a Nobel Prize for President Obama and a clean slate for Washington D.C. in terms of global affairs.

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The Obama administration certainly made foreign policy miscalculations, such as the soft approach on Russia and China that are now a sword of Damocles on our heads. The reset of U.S.-Russia relations did not pay off and Moscow found a way to take a more militaristic stand in Europe, occupying Ukraine since 2014 and interfering in U.S. domestic affairs during the 2016 Presidential campaign. Over the last few years, Beijing has been building up its military and increasing its naval capacity in the Pacific so as to back up their territorial claims in the South China Sea while simultaneously fostering its economic interests in new areas of influence (mostly developing countries). So when former President Obama left office two weeks ago, U.S. foreign policy and national security were in retreat, or at least in standby mode.

One of the main concerns now, besides the Trump Administration’s unconventional way of running the country, is an emerging U.S. mercantilist and nationalistic foreign policy stance that could be the straw that breaks the camel’s back in geopolitical terms. A 20% Mexican tariff is not only a contradiction to the liberal democracy efforts of the past Clinton, Bush and Obama Administrations, but also a clear message to the world that Trump and his base want to regress our economy into manufacturing and agriculture. The Mexican wall tab is also a message that, while Trump and his base want the benefits of global trade, they do not want to take any losses. It is fundamental trade theory that any FTA creates disruptions and winners and losers. Countries prepare for an FTA negotiation and for the implementation. They retrain their labor force and foster industry clusters that are aligned with their long-term development goals. Didn’t we do that? Didn’t big government create a safety network for the American casualties of free trade? We should have.  

While the problem is not free trade and liberal democracy, the Trump Administration seems to be in a hurry to lose international legitimacy and isolate the U.S. The real problem for American households is the shift of our economy into services and high tech. Many middle-income families are not capable of engaging in the new knowledge-based economy. The problem is not free trade with Mexico or China per se, but the lack of opportunities at home. America will never be the great factory of the world again and that is more than fine because we are an innovation-based economy. Why do you want to make something in-house when you can buy it from abroad for cheaper?  What the Trump Administration is not telling us is that any new tariffs on U.S. imports have a negative effect on U.S. consumers. Foreign companies are going to pass the tariff off onto the sales price to reach a breakeven point.

In the meantime, while the newbies in Washington D.C. figure out how to comply with our Constitution and values, the world might see a comeback of mercantilism and nationalism as a retaliation to Trump’s uniformed decisions. This dangerous combination of protectionism and isolationism has happened before during intra-war periods. As future decision makers in the public and private sector, Arizona State University students–T-birds included–need to demand accountability of our elected officials and be prepared to engage in mutual gains negotiations with other global stakeholders. It is sad to see the exodus of our career civil servants,  including resignations and terminations of senior officials that are trying to remind us how great America already is and how we are alienating traditional U.S. allies and indirectly supporting our challengers by losing global legitimacy. Liberalism is in retreat and uncertainty is in the air.

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