ICYMI – CNN Fact Check: Delaney is Right on Trade

FRIENDSHIP HEIGHTS, MD – On Wednesday, CNN published a fact check of John Delaney’s claim that trade policies proposed by Senator Elizabeth Warren would effectively prevent the United States from having a trade agreement with Germany. CNN confirmed that Delaney is correct.

Delaney pointed out the problems with Senator Warren’s plan during last month’s debate in Detroit, stating:

“President Trump wants to build physical walls and beats up on immigrants. Most of the folks running for president want to build economic walls to free trade and beat up on President Obama. I’m the only one running for president who actually supports the Trans-Pacific Partnership. President Obama was right about that. We should be getting back in that.

Senator Warren just issued a trade plan that would prevent the United States from trading with its allies. We can’t go and — we can’t isolate ourselves from the world. We have to engage with fair, rules-based trade.”The article is copied below and can be read here.

Fact check: Would Elizabeth Warren’s trade plan prevent the US from signing a trade agreement with Germany?

By Haley Byrd and Holmes Lybrand

Democratic presidential candidate John Delaney said on CNN Tuesday that Massachusetts Sen. Elizabeth Warren’s presidential campaign trade plan (laid out in a Medium post) would “prevent us from actually having a trade agreement with Germany.”

Facts First: Delaney is correct. Warren’s trade plan includes a lofty list of requirements for countries to meet as preconditions for entering any trade agreement with the US. For various reasons, Germany, along with a wide array of countries — including the United States itself — do not currently meet her standard.

Warren’s list of nine key requirements seeks to advance progressive goals for labor rights, the environment, human rights, religious freedom and more.

Warren also ruled out cutting trade deals with countries being monitored by the Treasury Department for currency manipulation, the criteria for which includes countries with a significant trade surplus with the US, as well as a large current account surplus of US dollars. In a semi-annual report this spring, the Treasury Department said nine countries were on its currency monitoring list.That includes China, Germany, Japan, South Korea, Ireland, Italy, Malaysia, Singapore and Vietnam — all major trading partners with the US whose cumulative exports and imports added up to more than $1 trillion in trade with the US last year.

Under Warren’s plan, none of these countries would qualify for a trade agreement with the US. That doesn’t mean trade with these countries would stop, but it would add serious hurdles to negotiating any new deals with them.

Trade with Germany in particular would be addressed in a larger deal with the European Union. Former President Barack Obama attempted unsuccessfully to negotiate an agreement with the EU, known as the Transatlantic Trade and Investment Partnership.

President Donald Trump’s trade team has taken preliminary steps to seek a deal with the EU, but major differences between the two sides exist, and an agreement remains out of sight.

In her Medium post, Warren wrote that she would renegotiate existing trade deals, like NAFTA, to ensure trading partners meet her standards.
Warren’s list of preconditions differs from conventional trade policy wisdom, which holds that trade deals, once implemented, encourage economic growth and enable developing countries to then pursue progress in areas like environmental standards, labor conditions and human rights.Warren has called instead for withholding trade deals with the US until countries meet those standards, arguing it would bring about progress on the left’s priorities more quickly and in a more enforceable way. Warren also recognized in her post that the US did not live up to her requirements and pledged to raise the bar as president.

Asked to clarify whether she would seek to withdraw from existing trade deals if renegotiations were unsuccessful, the Warren campaign declined to comment.