By South China Morning Post | Created at 2024-11-05 07:01:27 | Updated at 2024-11-05 10:56:42
4 hours ago
Globalisation is on its deathbed, which is reflected in the bipartisan disdain for free trade in the United States. Both former president Donald Trump and Vice-President Kamala Harris have seemed tariff-happy in the run-up to the presidential election.
This backlash poses more danger to the rest of the world than it does to America. After the 2008 global financial crisis, the US economy staged a remarkable rebound starting in 2016. Following that year’s fractious election battle between Trump and Hillary Clinton, the US outpaced other Group of 7 countries in growth, productivity and stock-market returns.
Compared to its partners, America looks more vibrant and better equipped – with its enormous internal market of 340 million people – to weather the trade storm. Exports account for just 11 per cent of US gross domestic product, but nearly 50 per cent of German gross domestic product. While China vacuumed up factory jobs in the 1990s, thanks to its massive low-cost labour force, executives across the US are now finding that the country’s harsh regime and rising wages have sullied the “Made in China” brand.
At the same time, America’s vast energy resources and innovation centres in Silicon Valley, Austin and Raleigh-Durham are reinvigorating the “Made in the USA” option.
History puts things in perspective. By the summer of 1944, an Allied victory in World War II was looking more certain: American, British and Canadian troops were storming Normandy’s beaches, while the Pacific Fleet had clawed back nearly all the territory seized by Japan. So, what shape would the world take once the smoke cleared?
The US bestowed an enormous post-war gift upon allies and former enemies alike by promoting free trade. Although America had the military firepower and the manufacturing muscle to assert imperial dominance, it chose economic openness instead.
