Paul Ryan's Trade Policy

Paul Ryan is refusing to advance legislation that would curtail Trump's unilateral control over U.S. trade policy. His stated reason is that he's not going to push for legislation that Trump wouldn't sign anyway. Of course overriding a presidential veto is hardly unprecedented in U.S. politics, and Ryan might even have the votes for it, but in truth I am sympathetic to Ryan here. (To be clear, I despise him, but on this particular issue I can see why he is taking this stance.)

First, I just don't think trade is a very big deal. It's important to distinguish between the theoretical stakes and the actual stakes. The theoretical case for trade is very strong, and it is especially strong when it comes to rich, democratic allies like Canada. (I think it is also very strong for countries like China and Indonesia, but it is certainly more complicated in those cases.)

But the practical import of Trump's actions so far is negligible from a macroeconomic perspective. And that would be true even if the "trade war" escalated to several times its current magnitude. I am sympathetic to the people whose livelihoods are being ruined, but people's livelihoods are ruined every day by any number of government policies (and by random chance). Also, there is at least some possibility the status quo ante will be restored, in which case the soybean farmers will return to normal (though a few may have been wiped out in the meantime, and again, I really do feel bad for these people).

Now there is another consequence of the trade war, which is that it is a boon for lobbyists and the people within the administration who stand to benefit from their attention. When fortunes are made and lost on the president's whim, it becomes highly profitable to have influence within the administration. So for instance, after the steel tariffs went into effect, the manufacturers of beer kegs requested protection (they are squeezed because their foreign competitors are paying a low price for steel while they pay the new, elevated domestic price). The same story will unfold across hundreds of industries, and fortunes can be made by Trump's advisers.

But that's no concern of Ryan's. And frankly Trump's advisers were already profiting handsomely from his erratic administration.

Second, and more importantly, Paul Ryan's job at this point is to get as many Republicans elected to Congress as possible in November. He would not advance that goal by creating what amounts to a wedge issue in favor of the Democrats. (Technically it's not quite a wedge issue, because I assume quite a few Democrats would vote against the legislation, but they would do so to their own electoral advantage, whereas Republicans would generally be trapped between their ideology and Trump's popularity within their electorate.)

This gets to an important point that I think is underappreciated. Paul Ryan is not a popular man, and within the Republican Party's base Trump is hugely popular. In those circumstances blaming Ryan for failing to override Trump's veto is like blaming someone for the laws of physics.

Now I realize there's a complication here, which is that the Republican Party has cultivated a base of horrible people. This is part of why I despise Paul Ryan! So my defense of him is meant to be very narrow. At this juncture, I don't really think it would make any sense for him to oppose Trump on trade, and I think trade doesn't even make the top 100 list of Trump's threat to the U.S. To that extent, and that extent only, I think Ryan is exculpated.