Based on the data collected thus far, there appears to be some disconnect between the political debates taking place on the national stage and those playing out in communities across Colorado and Ohio. At the national level, key political figures on both sides of the aisle have pursued or proposed significant changes in U.S. foreign policy in the name of helping America’s middle class. These include:
- overhauling past trade policies to “bring back” manufacturing jobs;
- decoupling the U.S. and Chinese economies;
- significantly reducing or increasing defense spending;
- cutting foreign aid; and
- taking dramatic steps on climate change and energy, ranging from drastically curtailing fossil fuel extraction on the one hand to reviving the coal industry on the other.
However, these moves go well beyond or run counter to the thinking of Coloradans and Ohioans, who viewed these issues in less categorical terms and expressed concerns about the trade-offs involved. As such, members of Carnegie’s task force believe that U.S. foreign policy could work better for the middle class if its elements were more balanced, along the following lines:
- Take a much wider view about what it means to make trade policy work for the middle class—to include but go well beyond the impact on manufacturing employment.
- Employ a multifaceted strategy for pushing back against unfair trading practices and enhancing U.S. competitiveness with China, rather than overrelying on the blunt instrument of tariffs; protect certain technologies and subsectors on national security grounds, but do not pursue widespread decoupling of the U.S. and Chinese economies.
- Recognize how reducing or increasing the defense budget can adversely impact the middle class, and consider ways of spending the defense budget differently to simultaneously advance national security interests and the economic well-being of the American middle class.
- Stop proposing cuts to foreign aid as a substitute for the domestic policy solutions required to address the economic challenges confronting the middle class.
- Increase investments in the workers and communities likely to suffer most as a result of measures to combat climate change, and, in the process, explore the desirability and feasibility of a comprehensive approach to economic adjustment assistance for communities most vulnerable to energy-, trade-, and defense-related transitions.
These ideas, and others put forward in the Ohio report, will be revisited and developed further in a final report to be issued in mid-2020, after the final state-level case study on Nebraska is completed in early 2020.
Few interviewees argued for overhauling past trade policies to bring back manufacturing jobs. They were more interested in looking at how current trade policies intersect with Colorado’s middle class now working in a wide range of jobs (in goods and service sectors and tradeable- and nontradeable sectors). They were also far more preoccupied with increasing exports than they were worried about losing jobs due to import competition and offshoring. And from that perspective, those familiar with the agreements (only a minority) largely viewed the North American Free Trade Agreement, TPP, and the United States-Mexico-Canada Agreement positively.
This could be because of the small portion of Colorado’s middle class employed in manufacturing—which, by most recent estimates, accounts for only 5 percent of the workforce—and the positive effects globalization has had for Colorado over the last several decades. The state has productive and competitive agriculture, advanced manufacturing, high tech, professional business service, and tourism industries, among others, that rely on the export of goods and services to grow their business and create well-paying jobs. In comparison to Ohio, Colorado has lost far fewer jobs as a result of import competition or offshoring. Thus, while Colorado is not an export-powerhouse like Ohio and many other U.S. states, those interviewed almost uniformly saw trade as a net plus. They wanted to build and expand on trade policies and relationships forged to date, especially with Canada, Mexico, and several Asian countries with rapidly growing economies, rather than throw them into question by escalating the use of tariffs and threating to or actually withdrawing from trade agreements.
Even in Pueblo, the state’s historic steel town and home to the largest concentration of blue-collar manufacturing workers, community members recognized the limits and trade-offs associated with trying to bring back certain manufacturing jobs through the imposition of steel tariffs. For example, a few metal production facilities in the state, such as the EVRAZ facility in Pueblo, have seen only a marginal near-term benefit from steel tariffs, while metal-consuming facilities have borne increased costs from the tariffs, including Vestas, the wind turbine production facility that employs almost as many workers as EVRAZ. Additionally, Colorado’s exporters of precision medical instruments and agricultural products are all exposed to retaliatory tariffs that could cut into their profits or cost them market share. If the subsequent volatility and uncertainty over trade policy continues, it could undermine the efforts of communities across Colorado to attract foreign investment. Virtually all of the Coloradans interviewed for this report—in urban and rural counties and progressive and conservative areas—expressed some or all of these fears.
Similar views were expressed in Ohio, with far greater vehemence and frequency, given that Ohio has a considerably greater percentage of export-dependent jobs than Colorado. Therefore, our partners at The Ohio State University went a step further in preparing a dedicated report on the economic impact in Ohio of the Trump administration’s recent trade actions.1 While the authors recognized that there are not enough data and too much uncertainty to make a definitive judgment, they saw ample reason to conclude that these actions would have net negative effects.
To be clear, steel and other manufacturing industries are vitally important for the U.S. economy and national security, they still provide a pathway to the middle class, and they ensure the economic survival of many smaller cities and towns across the industrial Midwest. Manufacturing now accounts for approximately 13 percent of Ohio’s workforce and 9 percent nationally.2 There has been a slight uptick in manufacturing employment levels across the country over the last nine years as the economy recovered from the recession and continues to grow.3 That is a welcome development. Past administrations underappreciated the importance of manufacturing employment in various communities, the havoc that certain trade policies would wreak on them, and the inadequacy of trade adjustment assistance programs to offset the blow. The previous report on Ohio stressed these points.
However, there are serious limits and significant trade-offs associated with using trade policy to bring back certain manufacturing jobs. Manufacturing’s share of the labor market has flattened. The longer-term trends suggest an eventual and steady decline in manufacturing employment levels, as capital investments in labor-reducing technologies accelerate.4 Manufacturing no longer serves as the proxy for the middle class that it once did, especially not in states like Colorado, Arizona, Florida, Nevada, and New Mexico, where it represents a relatively small percentage of the workforce.
To put things in perspective, according to the Bureau of Labor Statistics, there are now approximately 90,000 steelworkers in the country with annual median incomes of approximately $54,000. The numbers of steelworkers could potentially grow by an additional 11,000 by 2026.5 In comparison, there are now 2.9 million nurses, with registered nurses commanding an annual median wage of roughly $72,000. Their numbers are anticipated to grow by over 400,000 by 2026.6 And contrary to perceptions otherwise, many of these nursing jobs will require an associate’s degree, not a bachelor’s.7
Thus, policymakers looking to make trade policy work better for the middle class cannot simply focus on redressing the past negative effects of trade policy on manufacturing employment. They must also consider how trade policy impacts a rapidly evolving middle-class workforce in the service sectors and how it intersects with top middle-class concerns, such as the costs of healthcare and housing.
For example, in the health sector, rapid evolutions in telemedicine could potentially create a new avenue of service export growth. And provisions on intellectual property protection in trade agreements directly relate to the production of generic drugs globally and the cost of prescriptions drugs. While the Trump administration has weighed in on this issue through developing a plan to enable more Americans to import certain prescription drugs, more can and should be done to advance the interests of patients in future trade negotiations.8 But these are just a few examples of how trade policy and health intersect. A detailed study is required to identify all the ways trade policy could be leveraged to generate higher-paying middle-class jobs in the health sector and help lower healthcare costs.
Although not a major driver of housing and infrastructure costs, the impact of trade policy on the housing sector should also at least be contemplated whenever taking actions to help the middle class. Those interviewed cited rising housing costs and inadequate infrastructure investment as major middle-class concerns, after healthcare costs. City planners in Columbus and Denver expressed fears that the steel tariffs, among several other factors, were contributing to rising construction costs in their cities. Increased tariffs on imported lumber would likewise make it more expensive for builders to construct new, affordable single-family homes—the cost of which would be passed on to home buyers.
America’s middle class will also be impacted by evolutions in international trade and investment over the coming decades due to quantum leaps forward in e-commerce, the Internet of Things, 3-D printing, artificial intelligence (AI), blockchain, and other digital technologies. According to a World Trade Organization (WTO) report, advances in digital technologies will be a significant contributing factor in services accounting for 25 percent of all global trade by 2030 and will ultimately blur the line between goods and services.9 This will have important implications for middle-class jobs and where they are concentrated. For example, technological advances will continue to eliminate blue-collar jobs in the manufacturing sector, but they could also usher in a new wave of reshoring. Multinational corporations may relocate key production activities back in the United States, where they can find qualified engineers and technicians to manage increasingly complex tasks requiring higher levels of education and training.10
Finally, an explosive growth in service exports could be a boon for places like the metro Denver area, given that its growing tech and professional business sectors are major employers of Colorado’s middle class. However, without appropriate transitional policies and measures in place, a windfall gain for well-educated, urban professionals could coincide with major disruptions for lower-skilled workers and exacerbate urban-rural divides. And a quantum leap forward in digital trade could raise a new host of issues related to privacy and data security, which will affect middle-class households.
In sum, while the impact of trade policy on manufacturing employment is important, many other aspects of trade and international economic policy deserve attention in connection with the economic well-being of America’s middle class. This includes areas generally not mentioned by those interviewed, such as international standards and regulations related to data flows, data analytics and AI, international currency and exchange rates, international tax policy, and international coordination on the regulatory environment for banking and finance. Carnegie’s task force will further examine some of these issues in its final report.
When it comes to trade and investment policy, those interviewed in Colorado and Ohio put China in a category of its own. On the one hand, they saw China as an important trading partner and vital market for their exports. In the case of Ohio, they had been actively courting Chinese investment for manufacturing activities. Virtually no one in Ohio or Colorado favored decoupling the U.S. and Chinese economies. To the contrary, they saw various opportunities for the United States to benefit even more from China’s economic success. Therefore, they worried about the opportunities and markets they would lose to foreign competitors if the U.S. trade war with China did not end in the near future. On the other hand, some did express sympathy for playing hardball with Beijing to stop its theft of intellectual property, curtail its state subsidies to industries, and ultimately make it easier for American businesses and workers to compete with Chinese enterprises. They criticized past administrations for not doing enough on this front. Thus, it is too early to say how they will feel about the tariffs in the long term, without seeing how their imposition ultimately alters China’s behavior.
Carnegie’s task force members fully support pushing back against unfair trading practices and leveling the playing field for American businesses and workers to compete more effectively, especially in light of Beijing’s commitment to protecting and dominating certain industries in the twenty-first century. However, serious questions remain about whether the Trump administration’s current approach will meaningfully alter China’s long-term behavior, even if it can reach a deal with Beijing that addresses some of the immediate concerns. It is also unclear whether any results will justify the toll the escalating trade war and mounting uncertainty will have taken on American businesses, workers, farmers, and consumers in the near and long term.
There is a need, therefore, to distinguish between the objectives of pushing back against unfair trading practices and leveling the playing field and the strategic approach employed to pursue those objectives. Carnegie’s task force members intend to lay out key elements of an alternative approach in the project’s final report. It will include a role for unilateral actions and bilateral negotiations, but put more emphasis on working with U.S. allies and partners. It will additionally emphasize enhancing national competitiveness, including through increased government investment in research and development. It will also address the need to protect certain technologies and subsectors, on national security grounds, as opposed to pursuing widespread decoupling of the U.S. and Chinese economies on economic grounds. In developing the proposals, task force members intend to offer ideas for reframing the debate around industrial policy in ways that might enjoy greater bipartisan support.
After trade and economic competition with China, those interviewed generally pointed to defense spending as the next U.S. foreign policy element that most affects the economic well-being of Colorado’s middle class. As in Ohio, more people viewed defense spending positively than negatively. Carnegie’s task force members see the potential to reframe at least part of the debate by focusing on how the defense budget is spent—to simultaneously advance national security interests and the economic well-being of the middle class.
The Case for Sustaining or Increasing Defense Spending
Many people interviewed in Colorado believe that sustaining or increasing defense spending is crucial. Military service provides a pathway to the middle class for those without a college degree and can help subsidize the costs of acquiring one. Defense spending creates well-paying middle-class jobs in the private sector (in areas such as manufacturing—for military aircraft, ships, tanks, and weapons systems—and the delivery of logistics and other services). Military bases and related installations create tremendous economic demand for local goods and services and help anchor the economies of smaller cities and towns. And the defense (and veterans’ affairs) budget supports military retirees and their families, especially through pensions and healthcare.
All of these positive economic impacts were discussed in Colorado, especially in El Paso County (Colorado Springs).11 And there are certainly more, including the indirect economic benefits that result from deterring war among major powers, preventing attacks on the homeland, keeping the key arteries of commerce open, and maintaining the flow of energy critical for the growth of the U.S. and global economies.
Those who recognize these economic benefits think that cutting defense spending would be counterproductive. They fear that instead of returning the money to taxpayers or reinvesting it in their communities to offset the loss of defense-related economic activity, it could end up subsidizing programs less beneficial to them elsewhere in the country.
They also point out the national security risks, arguing that it makes little sense to weaken the nation’s defenses when China (which has increased its military spending by over 83 percent in the last decade), Russia, North Korea, and Iran are posing more significant geopolitical and security challenges.12 Therefore, they are favorably disposed toward the United States increasing investments in new, high-end capabilities, especially in the air and space industries, where Colorado is strong.
At the national level, some military leaders and national security professionals have long questioned why defense spending is even in the crosshairs, given that entitlements constitute a far greater share of the federal budget and entitlement reform could free up more resources for needed domestic investments.
The Case for Reducing Defense Spending
However, some in Colorado, particularly in more liberal parts of the state than the staunchly conservative Colorado Springs area, have a diametrically opposing view. For example, a number of people interviewed in Boulder, Denver, and Durango said upfront that they want the United States to have a strong military to protect the nation. But they believe that the amounts spent on defense far exceed what is required. At $649 billion, the United States remains, by far, the largest spender in the world, accounting for 36 percent of global military spending in 2018.13 By one measure, the United States spent almost as much on its military in 2018 as the next eight highest spenders—China, Saudi Arabia, India, France, Russia, United Kingdom, Germany, and Japan—combined.14
To its critics, defense spending appears to be excessive and wasteful and has a massive opportunity cost for the U.S. economy and the middle class. Remaining dependent on defense spending will continue to prevent the type of economic diversification smaller cities and towns across American desperately require. The critics therefore argue that it would be far more productive for the United States to reduce defense spending by $100–$200 billion per year and instead invest in badly needed infrastructure, including broadband connectivity, and in cutting-edge research at American universities and federal laboratories. Given that Colorado is home to more federal laboratories than any other state outside of the Washington, DC, metro area, it would likely benefit from this redirection of money. Economists frequently contend that, in comparison to defense spending, such investments would make the United States more competitive in the global economy, as well as have a greater impact on long-term, broad-based productivity that, in turn, pushes up wages for the middle class.
Some Coloradans, similar to critics of defense spending elsewhere around the country, further argue that spending too much on the military is a moral hazard. They say it contributes to an overly militarized foreign policy, especially given that many threats in the world cannot be solved by military might. They add that the astronomical amounts of money spent make it harder to resist the temptation not to use it, including in places where military intervention may actually do more harm than good.
Thus, for all these reasons, people looking to free up more resources for domestic investment have their eyes on defense spending. They consider cutting entitlements instead to be antithetical to middle-class interests. Notably, presidential candidates on both sides of the aisle have already firmly committed to protecting social security and Medicare, so this debate may be moot for now.
Changing the Conversation on Defense Spending
Carnegie’s task force members see valid arguments in both views. And clearly many politicians on both sides of the aisle do, too. After all, former U.S. senator Gary Hart (Democrat, Colorado) was one of the most eloquent critics of what he considered to be Reagan’s excessive defense spending. But he was also one of the fiercest champions for sustaining or increasing spending on Colorado-based defense activities and bases.15 Likewise, Ohio senators Robert Portman (Republican) and Sherrod Brown (Democrat) advocate different foreign and domestic policies at the national level, yet they continue to join forces in Congress to preserve or increase defense spending that supports the Wright-Patterson Air Force Base in Dayton and the tank production facility in Lima.16
The positions of these senators are understandable—many other politicians have taken the same view when a military base closure could spell economic disaster for their constituents. They are fighting for their communities, and it is unfair to expect them to do otherwise. Yet it is also unfair to continue putting military leaders—many of whom are aware of and sensitive to the different arguments—in the position of having to continually ask for big increases in the defense budget. They currently lack the flexibility to spend less on some things and more on others as the nature of national threats evolve.
Carnegie’s task force will aim to offer recommendations in its final report. It may be possible for politicians and policymakers on both sides of the aisle to think beyond binary choices on defense spending and arrive at a more constructive place. Perhaps defense spending levels could be kept constant for the next decade, but major shifts could be made within the top-line numbers. For example, a far greater percentage of the defense budget could be allocated to supporting state and local community efforts to diversify their economies. The DOD’s Office of Economic Adjustment already manages various important programs and grants, but they may benefit from more resources and/or modifications to yield even greater dividends and faster results.
Another idea would be to expand the definition of a substantive defense requirement to include supporting the education and training of the civilian national security workforce in critical areas. For example, in his executive order dated May 2, 2019, Trump referred to America’s cybersecurity workforce as a “strategic asset that protects the American people, the homeland and the American way of life,” and that “whether they are employed in the public or private sectors, they are guardians of our national and economic security.”17 Yet there are almost 300,000 cybersecurity positions in the U.S. public and private sectors that remain vacant and difficult to fill, and that number is expected to climb as high as 1 million.18 Perhaps more of the defense budget could be used to address that critical national security vulnerability and, in the process, prepare Americans for well-paying middle-class jobs in the cybersecurity field.
More of the defense budget could also be applied toward activities aiming to enhance economic competition with China, especially those that involve dual civilian and military applications. Relevant areas might include robotics and automated machinery, aircraft and maritime vessels, and electrical generation and transmission equipment.
More exploration is required to determine whether these are the best ideas. The point in mentioning them now is simply to illustrate that a change in defense spending does not have to involve a binary choice. A more fiscally responsible and sustainable approach is possible—one that will advance both national security interests and the economic well-being of the middle class.
Carnegie’s task force members agree that it is important to regularly review the levels, priorities, and methods of delivering foreign aid to ensure that taxpayers’ money is being used efficiently and effectively. However, based on what was said or not said in Colorado and Ohio, there does not appear to be widespread popular demand for cutting foreign aid for the purposes of helping America’s middle class. To the contrary, only a minority of those interviewed volunteered any view at all about foreign aid, and when they did, it was often to highlight the ways it has advanced U.S. economic interests, values, and/or global standing.
In comparison to defense spending, the amount the United States spends annually on foreign aid (less than 1 percent of the federal budget) is simply not large enough to have a significant, visible impact on the American middle class—either in terms of the jobs it creates or the resources it diverts away from domestic efforts. The Trump administration’s proposed budget for FY 2020 would have widened the gap between defense spending and foreign aid even further, given its request of $718 billion for the DOD and only $40 billion for the Department of State and U.S. Agency for International Development combined.19
Several focus group participants were aware that foreign aid accounts for less than 1 percent of the federal budget. And a recent national poll by the Pew Research Center found that 35 percent of the American public want to increase foreign assistance (up 14 points since 2013), 33 percent want to keep it the same, and 28 percent want to decrease it (down 20 points since 2013).20 Members of Congress (Democrats and Republicans alike) appear to be acting consistent with those attitudes, having appropriated $15.4 billion more for foreign aid in FY 2018 than the Trump administration had requested.21
Foreign aid did not appear be to a partisan issue in Colorado; for some people, their defense of foreign aid was based on self-interest. One rancher (who identified himself as conservative) strongly supported any aid that helped lift people around the world out of poverty and, in turn, increased demand for the meats and meat-related products that Colorado exports. The owner of a business that supplies seafood to the tourist industry saw benefits to the U.S. contributing to global health and health security. He recalled how the price of salmon imports went up considerably following the outbreak of infectious salmon anemia in Chile, one of the top three sources of salmon for Colorado. Others whose livelihood depended on Colorado tourism believed that a positive U.S. brand abroad could only help to increase the number of foreign visitors to the state and that U.S. foreign aid contributed to that end. Even some interviewees whose business interests were not affected by foreign aid nonetheless saw its connection to their own self-interest. For instance, those concerned about the flow of illegal immigrants into the United States saw the value of providing aid to Central America to diminish the likelihood of people fleeing.
The views expressed in Ohio were similar. For example, Honda is now Ohio’s top manufacturing employer. Its supply chain was disrupted following the 2014 tsunami, which affected Ohio workers. It was in the company’s best interest that the United States help Japan recover quickly. Even a local labor representative in Ohio defended foreign aid, as he sees the benefit of helping other countries’ workers climb into the middle class: it would make it easier for American workers to compete with them on a fairer footing.
That said, only a few people were able to illustrate how foreign aid directly benefits their industries. Most were not able to make such connections and instead noted less quantifiable reasons for supporting foreign aid, such as “it is the right thing to do” and it is emblematic of the kind of global leader they want the United States to be.22 They want the nation’s foreign policy to be consistent with American values and to project a positive global image (for example, when the United States takes the lead in responding to a catastrophic natural disaster overseas).
However, the defense of foreign aid for any reason should not be taken as unconditional or equated to giving a blank check. Several of those interviewed would favor cutting foreign aid if it were not achieving the desired objectives or falling into corrupt hands. They certainly had questions about the results of aid dispensed over the last few decades during “nation-building” efforts in Afghanistan, as distinct from other forms of aid. Others had a clear preference for private sector solutions or charitable giving through nongovernmental channels, primarily because they were wary of government bureaucracy. Most also expect other nations to be doing their fair share. They do not want the United States to be shouldering the burden alone.
Carnegie task force members see room for a more informed public debate about the benefits and challenges related to foreign aid. This would be far more constructive than perpetuating misperceptions about current foreign aid spending and implying that drastic cuts would obviate the need to make tough domestic policy decisions related to advancing America’s middle class. It will be interesting to see if the Nebraska case study confirms or contradicts this judgment.
Climate Change and Energy
One key theme arising from the Colorado and Ohio studies is the expectation that policymakers will sufficiently weigh the economic trade-offs associated with foreign policy changes—not just for the nation as whole but also for specific categories of workers and entire communities. Generally, policymakers have long been examining the trade-offs related to trade and defense spending, but only very recently those associated with combating climate change. These trade-offs may be as or more challenging to manage, if this Colorado case study is any indication.
Colorado is among the nation’s leading producers of crude oil, natural gas, and coal, with areas in the Front Range and Western Slope particularly dependent on energy production. In Weld, the oil and gas industries account for more than half of the county’s property taxes.23 In Grand Junction, business leaders believed that a foreign policy decision to export more LNG to Asia could be a real game-changer for the area.24 Communities dependent on the energy sector stand to be left behind if their base industries are restricted or abandoned.
Meanwhile, in many other parts of the state, people, especially millennials, said that climate change was the foreign policy issue they cared about most, because it poses a grave security threat to the United States and world at large. They want the United States to be a global leader on climate change, including by leading by example at home and leveraging cutting-edge research and high tech industries across the state to create new “green jobs.”
Two diametrically opposed arguments are now unfolding in Colorado on energy and climate change, as is much the case across the United States. The one thing those on both sides of the debate might agree on is the need to front-load significant investments in the workers and places that could suffer most as a result of measures to combat climate change. There is clear need and scope for prioritizing attention to this issue. In doing so, policymakers should learn lessons from where past trade- and defense-related economic impact assessments and adjustment assistance programs have fallen short. This includes where they relied on overoptimistic assumptions about how easily or quickly affected communities could reinvent their economic bases or affected workers could be retrained for new, equally well-paying jobs. A case could also be made for radically rethinking and scaling up, in a comprehensive and holistic manner, the current patchwork of relatively small “economic adjustment assistance” programs applicable to defense-, trade-, and energy-related dislocations, and now technology-related displacements as well, as some Washington, DC–based scholars have proposed.25
Concluding Thoughts: The Importance of Rebuilding Trust
Those interviewed commented on just a small fraction of U.S. foreign policy. By their own admission, they were unfamiliar with much of what U.S. diplomats, soldiers, aid workers, international economic experts, trade negotiators, and other foreign policy professionals do in Washington, DC, and around the world. Nor could they imagine how all that activity affected their economic well-being. With their primary focus being their families and local communities, they need to trust foreign policy professionals to make the right decisions about the U.S. role abroad and to consider the welfare of the American middle class as they do so.
The problem, however, is that trust in the foreign policy establishment and elite institutions, in general, has steadily eroded over time. The reasons are subject to debate in academic circles. But one reason might be that international trade agreements and the opening of trade with China ended up causing significant hardship for certain categories of blue-collar workers and entire communities. Meanwhile, the nation’s top earners that seem to have disproportionate influence on international trade and economic policy continue to benefit disproportionately from globalization and growth. It has not helped that those on Wall Street considered to be responsible for the 2008 financial crisis are seen as closely associated with, if not a part of, the foreign policy establishment. On top of that, while confidence in the U.S. military remains high, civilian leaders and foreign policy experts are blamed for starting and keeping the nation engaged in costly, long-running wars that lack a clear path to victory. And increasing political polarization has led to intensified scrutiny, criticism, and mistrust of the foreign policies pursued by the administration of an opposing party.
Against this backdrop, it is unrealistic to think that the handful of policy changes flagged in this report alone will reassure the American public that the foreign policies developed in Washington, DC, will truly work for the middle class. Thus, alongside policy changes, there must also be significant changes in attitudes, processes, and external communications.
Ultimately, foreign policy professionals should continue to seek to advance national economic interests through the policies they develop, but they must be, and be seen as, advocates for defining those economic interests in ways that better reflect the concerns and aspirations of the middle class. That means better familiarizing themselves with the economic realities American families and communities confront, and to that end, engaging far more frequently with governors, mayors, and other key stakeholders outside of Washington. It requires being more sensitive to the suspicions that can arise when foreign policy professionals work closely with senior executives in major multinational corporations but hardly engage with small business owners and labor leaders. It is worth exploring how to ensure that those people in domestic agencies and departments most attuned to the concerns of working families and households can weigh in more often on foreign policy. Regardless of the approach, foreign policy professionals will need to be able to answer questions more clearly and candidly about the potential impact of major foreign policy changes on the broad range of middle-class jobs and concerns across the country.
If foreign policy professionals can demonstrate that they are aware of, and are prioritizing, the economic interests of the middle class, they will be in a better position to explain how foreign policy does and does not affect those interests. There is clearly room and a need to think through adjustments in trade policy, defense spending, foreign aid, and climate change and energy leadership, in order to better advance the economic well-being of America’s middle class. Yet such adjustments on their own cannot substitute for the domestic policy solutions that ultimately lie at the heart of the challenge.
Carnegie’s task force members look forward to revisiting and elaborating on the above themes and, following the Nebraska study, will ultimately offer detailed recommendations. They hope the recommendations will be useful to foreign policy professionals seeking to promote the well-being of the middle-class and better integrate foreign and domestic policy.
1 Edward (Ned) Hill and Fran Stewart, “The Economic Impact of the Trade Skirmish of 2018 on the Nation and Ohio,” The Ohio State University, 2019, http://glenn.osu.edu/trade-skirmish/TS-attributes/Trade%20Skirmish%20-%20%20EXECUTIVE%20SUMMARY.pdf.
2 Bureau of Labor Statistics, “Colorado Economy at a Glance,” March 2019 data seasonally adjusted, data extracted May 29, 2019; and Bureau of Labor Statistics, “Ohio Economy at a Glance,” March 2019 data seasonally adjusted, data extracted May 29, 2019.
3 “Manufacturing Jobs Are Defying Expectations,” Economist, October 20, 2018, https://www.economist.com/united-states/2018/10/18/manufacturing-jobs-are-defying-expectations.
5 Bureau of Labor Statistics, “Occupational Outlook Handbook: Ironworkers,” April 12, 2019, data extracted June 2019, https://www.bls.gov/ooh/construction-and-extraction/structural-iron-and-steel-workers.htm.
6 Bureau of Labor Statistics, “Occupational Outlook Handbook: Registered Nurses,” April 12, 2019, data extracted June 2019, https://www.bls.gov/ooh/healthcare/registered-nurses.htm.
7 Eduardo Porter, “Where the Good Jobs Are.”
8 U.S. Department of Health and Human Services, “HHS Announces New Action Plan to Lay Foundation for Safe Importation of Certain Prescription Drugs,” July 31, 2019, https://www.hhs.gov/about/news/2019/07/31/hhs-new-action-plan-foundation-safe-importation-certain-prescription-drugs.html.
9 World Trade Organization, “World Trade Report 2018,” 2018, https://www.wto.org/english/res_e/publications_e/world_trade_report18_e.pdf.
10 Dennis Spaeth, “Automation and Reshoring: The True Impact of Automation on Manufacturing Jobs,” Maker’s Row, August 7, 2017, https://makersrow.com/blog/2017/08/automation-and-reshoring-the-true-impact-of-automation-on-manufacturing-jobs/.
11 Summit Economics, “The Economic Impact of Department of Defense, Veterans and Military Retirees, and the Department of Veterans Affairs Activities in Colorado.”
12 Aude Fleurant, Pieter D. Wezeman, Siemon T. Wezeman, Nan Tian, and Alexandra Kuimova, “Trends in World Military Expenditure, 2018,” SIPRI Fact Sheet, Stockholm International Peace Research Institute, April 2019, https://www.sipri.org/sites/default/files/2019-04/fs_1904_milex_2018.pdf.
15 “Gary Hart: Reduce Reagan Spending Level” Washington Post, April 5, 1983, https://www.washingtonpost.com/archive/politics/1983/04/05/gary-hart-reduce-reagan-spending-level/a2cf941a-eaf6-4a54-b94c-a4d7e043f9ba/?utm_term=.c5341d0187a6.
16 Salman Ahmed, et al., “U.S. Foreign Policy for the Middle Class: Perspectives From Ohio,” 70; U.S. Senator Rob Portman, Ohio, “Portman, Brown, and Jordan Host Army Under Secretary at Lima’s Joint System’s Manufacturing Center,” October 27, 2018, https://www.portman.senate.gov/newsroom/press-releases/portman-brown-jordan-host-army-under-secretary-limas-joint-systems; U.S. Senator Sherrod Brown, Ohio, “Brown and Portman Bring Army Under Secretary to Lima’s Joint System’s Manufacturing Center,” October 27, 2018, https://www.brown.senate.gov/newsroom/press/release/brown-and-portman-bring-army-under-secretary-to-limas-joint-systems-manufacturing-center.
17 The White House, Executive Order: “Executive Order on America’s Cybersecurity Workforce,” May 2, 2019, https://www.whitehouse.gov/presidential-actions/executive-order-americas-cybersecurity-workforce/.
18 Natasha Cohen and Peter Warren Singer, “The Need for C3: A Proposal for a United States Cybersecurity Civilian Corps,” New America, October 25, 2018, https://www.newamerica.org/cybersecurity-initiative/reports/need-c3/2-introduction/.
19 The White House, “A Budget for a Better America,” 2019, https://www.whitehouse.gov/wp-content/uploads/2019/03/budget-fy2020.pdf.
20 “Little Public Support for Reductions in Federal Spending,” Pew Research Center, April 11, 2019, https://www.people-press.org/2019/04/11/little-public-support-for-reductions-in-federal-spending/.
21 Joe McCarthy and Sakshi Mahajan, “Foreign Aid Was a Big Winner in the Budget Trump Signed Last Week,” Global Citizen, March 29, 2018, https://www.globalcitizen.org/en/content/foreign-aid-victories-in-trumps-2018-budget/.
22 S. Ahmed, A. Gelman, B. Lewandowski, and R. Wobbekind, focus group, Durango, February 25, 2019.
23 S. Ahmed and B. Lewandowski, focus group, Greeley, April 1, 2019.
24 S. Ahmed, A. Gelman, and R. Wobbekind, focus group and interview with chamber of commerce and city manager, Grand Junction, March 4, 2019.
25 Mark Muro and Joseph Parilla, “Maladjusted: It’s Time to Reimagine Economic ‘Adjustment’ Programs,” Brookings Institution, January 10, 2017, https://www.brookings.edu/blog/the-avenue/2017/01/10/maladjusted-its-time-to-reimagine-economic-adjustment-programs/.