The 535 | December 2019

The world of Trump trade policy has been turbulent and unrelenting. After an anxious summer in trade affairs, Europeans are able to breathe easier now that the Trump Administration missed its own deadline to impose auto tariffs.

Trades and Tariffs

Trump’s decision against the tariffs resulted from a complete lack of support for the idea, even among his staunchest supporters. What does remain a real threat to stable trade relations, however, is that the Trump Administration is considering tariffs on $2.4 billion of French goods in retaliation for France’s digital tax, which the Trump Administration believes specifically targets American firms. While it is unusual for Trump to defend Amazon (he is quick to criticize CEO Jeff Bezos, who purchased the Washington Post), the president is nonetheless keen on taking advantage of any opportunity to be seen as a supporter of big tech and big business. However, a move to implement 100 percent tariffs on French goods, including champagne and Roquefort, is likely to hurt small and large companies on both sides of the Atlantic, especially during the holiday season. President Macron, meanwhile, maintains that the proposed taxes do not specifically discriminate against U.S. firms.

On the North American side of trade, Democrats and Republicans have at long last made progress on bringing the United States-Mexico-Canada Agreement (USMCA) to fruition. Just this week, House Speaker Nancy Pelosi (D-CA) agreed that the USMCA would receive a vote as early as next week. In response to the left-wing, which regards this as handing Trump a victory in an election year, Pelosi said that the decision to move forward with this deal is not political—it simply is a deal that benefits Americans.

Stalemate

The Republicans, including the president, refer to the House majority as the “Do Nothing Democrats,” but since the Democrats took office in January the House has passed nearly 400 bills. Their bills have in large part stalled in the Senate, where Republicans hold the majority. Due to ongoing partisan disputes, it is unlikely that there will be groundbreaking legislation ahead of the 2020 election since both parties are reticent to give the other one a substantial victory. This stalemate is likely to continue through the 2020 election, placing a greater policy burden on states – rather than the federal government – to pass meaningful legislation, including privacy protections, gun sales rules, and cybersecurity regulations.

Impeachment

Democrats in the House are teeing up an impeachment vote by Christmas. While the testimony of Gordon Sondland, U.S. Ambassador to the European Union, shifted the debate favor away from Republicans, stalwart Trump supporters remain convinced that the impeachment is a “witch hunt” and vow to hold up the process at every step.

On December 10, Democrats unveiled two articles of impeachment, a key step which helps clear the path for a Senate trial to begin in January. The first article of impeachment relates to abuse of power, namely that the president sought assistance from a foreign power for personal political gain in the 2020 election. The second centers on obstruction of Congress. The second article of impeachment reads: “Donald J. Trump has directed the unprecedented, categorical, and indiscriminate defiance of subpoenas issued by the House of Representatives pursuant to its ‘sole Power of Impeachment.’ President Trump has abused the powers of the Presidency in a manner offensive to, and subversive of, the Constitution…” It remains to be seen whether or not these articles will compel current and former members of the administration to comply with their subpoenas and begin participating in the congressional inquiry. While public opinion on the impeachment process has been static along party lines, it is possible that the introduction of these articles will sway public opinion in favor of the impeachment process.

Elections Update

Following a busy summer and fall, presidential campaigns continue to gear up for an even busier 2020. The top three Democrats are currently, in order, former Vice President Joe Biden, Senator Bernie Sanders, and Senator Elizabeth Warren. Senator Kamala Harris, once seen as one of the most serious contenders for president, dropped out of the race in early December, citing in large part her inability to raise enough funds. In her speech to supporters, she took direct jabs at billionaires Tom Steyer and Michael Bloomberg, both of whom have less rote political experience than she does. She said, “I’m not a billionaire. I can’t fund my own campaign.”

However, it is rumored that Michael Bloomberg is running in large part to assist other candidates. Once someone is an official candidate, she/he legally qualifies for 30% off advertising costs. Bloomberg is expected to spend $30 million in advertising in the month of December alone. If Bloomberg’s initial ads turn out to be more anti-Trump than pro-Bloomberg, then this will valid the theory he is largely running to help secure a Democrat victory regardless of the candidate. For reference, the 2016 election is estimated to have cost a whopping $6.5 billion, and 2020 spending is likely to outpace that number by far.

What remains to be seen is how the progressive wing of the Democrats will color the Democratic primaries. Perhaps the most sought-after endorsement arrived in October, when Alexandria Ocasio-Cortez (D-NY) announced that, after a lengthy period of indecision between Senators Sanders and Warren, she had chosen to support Senator Sanders. In early 2020, the early caucus states go to vote. The first two and therefore most important are Iowa (February 3) and New Hampshire (February 11). The results of these caucuses tend to be early indications of popularity, strength, and weaknesses among candidates. For example, caucus results can indicate a specific candidates’ ability or inability to attract support of key demographics, such as minorities and suburban women, both of which will be among the most sought-after voting groups in the 2020 election cycle.

A Fresh Transatlantic Perspective?

Trump’s December NATO meeting in London did little to assuage international fears that Europe and the U.S. are on a crash course. Bulgarian political scientist Ivan Krastev recently wrote a searing op-ed for The New York Times, in which he wonders, “Will Europe Ever Trust America Again?” Krastev notes that “Until recently, most European leaders’ hopes were bound up with the outcome of America’s presidential elections. If Mr. Trump were to lose in 2020, they believed, the world would somehow return to normalcy….All of that has changed.” Having President Trump in the White House has indeed forced the European Union to become more introspective on a number of issues, including collective defense. However, while Trump’s relationship with the likes of Chancellor Merkel and President Macron may be rocky, there is ample opportunity for a fresh start with newly elected EU Commission President Ursula von der Leyen, a potential conservative ally, who could help rebuild the bridge between Brussels and Washington.

What to Follow in 2020

As candidates’ stump speeches reflect voter desires, tuning into their speeches can be an on-the-ground way of ascertaining where Americans’ views on various issues fall. Perhaps the biggest takeaway for Europeans as this Congressional season comes to an end is that the level of inactivity in Congress leaves open a broad set of opportunities for Europeans to become standard-setters on numerous policies, whether on autonomous vehicles, artificial intelligence, or old fashioned trade policy.

The 535 is a publication of the Bertelsmann Foundation from our offices in Washington, DC. It connects the European Parliament and German Bundestag to U.S. Congressional policy and politics and contributes to a common transatlantic political culture. The 535 is a quarterly publication that highlights issues, legislation, and policymakers relevant to transatlantic legislative cycles.

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