American Protectionism Is Impeding Liberal Democracy

The Biden administration’s “America First” approach is meant to contain China, but in the long run, it could hurt allies, putting free trade and democracy at risk.

The Biden administration has been pursuing protectionist trade policies that encourage domestic production of goods and discriminate against foreign businesses in the biotechnology, battery and semiconductor chip industries. It has introduced the Inflation Reduction Act, which only subsidizes electric vehicles manufactured in the U.S., and put in effect the “Made in America” executive order to support companies producing goods in the U.S. These protectionist policies come from an “America First” perspective, based on a hard-line stance that China’s rise must be halted. The problem is that while the U.S.’ trade protectionism may be useful for keeping China in check in the short term, it will cause great damage to its allies in the long term, leading to a global setback for liberal democracy.

The United States has believed in and maintained the value of freedom since its founding. In 1773, the British Parliament enacted the Tea Act, which imposed a 10% tax on all tea sold in American colonies. Americans responded with the slogan “no taxation without representation,” and Samuel Adams, one of the Founding Fathers, and his associates, attacked a British East India Company ship docked at Boston Harbor and threw 342 boxes of tea into the sea. The Boston Tea Party of 1773 was the beginning of the American independence movement. The U.S. became an independent country in protest against the British government’s one-sided taxation. By engaging in a protectionist trade policy, the U.S. is opposing its own founding ideology.

The Biden administration announced that “America Is Back” and emphasized that its foreign policies would be entirely different from those of its predecessor. However, it worries me that the administration’s current protectionist trade policy seems to be another form of Trumpism that will overturn an international order based on free trade. Since the end of World War II, the U.S. has rallied Western countries, led the international order, and won the Cold War through two political and economic principles: liberal democracy and free trade. The fact that many countries were able to achieve economic development and democratization by being granted access to the U.S. market shows that free trade is necessary for liberal democracy to flourish.

It may be detrimental to U.S. leadership if the Biden administration insists on a “rules-based order” founded on rules it does not follow. Initially, the Biden administration’s plan to reorganize the global supply chain was based on the logic that Chinese unilateralism would undermine global prosperity and lead to security threats. Indeed, China took retaliatory trade measures against its opponents on a range of issues, including Terminal High Altitude Area Defense, territorial disputes and attempts to investigate the origin of COVID-19. Because of these measures, the U.S.’ supply chain reorganization received much attention and support. However, the protectionist trade policy put forward by the Biden administration now is no more than U.S. unilateralism. The European Union and Japanese governments have also expressed serious concern over the passing of the IRA while discussions on building supply chains are in progress.

It is difficult to hold on to freedom amid the craze for populism, but we should nonetheless consider ways to protect and nurture it. The Biden administration’s protectionism betrays the trust of its allies, and there is no guarantee that this weakened trust in commerce will not affect problems in security. Mistrust of the Biden administration, incited by trade issues, could intensify, especially in the Indo-Pacific region, which is central to both the U.S. and China. China will seek to attract countries struggling to choose between the U.S. and China, pointing to U.S. unilateralism. This might impair the Biden administration’s “Free and Open Indo-Pacific” initiative.

South Korea is relying on the U.S.’ policy of deterrence for protection from the North Korean nuclear threat. But the U.S.’ current attitude toward trade raises questions about whether Washington is willing to risk its own security to protect Seoul.

In the May summit, the U.S. and South Korea agreed to strengthen public-private cooperation in the semiconductor, biotechnology and battery industries. However, the Biden administration’s protectionist trade policy shows no respect for the agreement; all that is visible is a hint of unilateralism reminiscent of Donald Trump. The Biden administration should note that trade protectionism can shake up the military alliance between the U.S. and South Korea, not to mention its effect on the two countries’ economic and security alliances. There will be no guarantee of liberal democracy in a place where the principle of free trade is broken.

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