A Worker-Centric Trade Agenda Needs to Focus on Competitiveness, Including Robust IP Protections

While U.S. trade policy has long been contentious, until recently, the orthodox view was that it should prioritize U.S. consumer interests. But the significant decline of U.S. manufacturing jobs and output due to unbalanced trade (and weak U.S. competitiveness) has provided an opening to rethink this policy. Because of this and other factors, President Biden and key administration officials have spoken about the need to shift to a worker-centric trade agenda, turning away from the traditional approach.

But while such a pivot is overdue—for too long, trade policy prioritized lower prices for imported products over workers’ welfare—it is critical for the administration to make the right move; one that would boost U.S. global competitiveness and help U.S. firms and their workers compete in global markets. This may be difficult because significant forces in the Democrat party advocate for a trade policy that would ultimately hurt U.S. competitiveness, firms, and workers.

Many progressives see the administration’s reassessment as an opening to advance their long-standing antiglobalization and anticorporate agenda. They equate almost any trade provision or policy, including foreign intellectual property (IP) protection, that helps large U.S. corporations as inherently counter to U.S. workers’ interests. To be sure, some provisions in trade agreements that protect U.S corporations’ economic interests don’t do much to help U.S. workers, but the majority of provisions do in fact create an alignment of corporate and U.S. worker interests. This is because many trade provisions lead to greater U.S. sales, which in turn benefits U.S. jobs. For example, strong IP rights in trade agreements support workers in the many U.S. sectors that depend on IP for increased global revenues.

As such, the Biden administration should reject the anticorporate, antitrade counsel and not go down this dead-end path. Rather, it should articulate, advance, and work for a new competitiveness-focused trade approach. This agenda would not reflexively prioritize consumer interests, especially when doing so would hurt companies and workers in the United States because of unfair foreign trade practices. But it would prioritize market opening and trade enforcement to advance the interests of traded-sector firms in the United States, especially those in key, strategic industries that pay above-average wages. This approach would include, among other things, ensuring the inclusion of strong IP provisions in trade agreements.

This report discusses the debate over trade policy, articulating the three main potential plans: 1) maintaining the current approach; 2) rejecting the current approach in favor of one that views large-firm interests as antithetical to U.S. worker and national interests, and 3) evolving to a competitiveness-focused approach that works to align U.S. corporate interests with national interests. It then focuses on one aspect of such a new trade policy—IP protection—analyzing arguments made by proponents of weak IP in U.S. trade policy. It then provides a summary of the arguments and studies showing that advancing the interests of U.S. companies in trade policy, including in IP protection, usually benefits U.S. workers.

To read the full article by the Information Technology and Innovation Foundation, please click here.