The everfading hope that aBiden administration would look fondly on free trade is becoming more of afree traders dying wish than arealistic expectation. The problem with this narrative, of course, was the Trump administrations embrace of alaundry list of ideas long held by Congressional Democrats, which made them more likely to agree with him than to oppose him on these measures. Instead of confronting the dangers of the Trump administrations trade agenda, embracing a progressive case for free trade, and aligning its campaign with aDemocratic base that increasingly views free trade more positively, the Biden campaigns newly released supply chain resilience plan shows more interest at besting Trump at his own protectionist game. Thats bad news for those who held out hope that aBiden administration would be different.

Within the plan sits amess of protectionist and counterproductive policies that would have been associated with the political fringe less than adecade ago and certainly aplan with enough trade restrictions to make the Trump administration blush. In fact, the plan has managed to win the approbation of former Trump advisor Steve Bannon. Thats not agood sign. Lets take alook at five big issues with the Biden camps proposal.

The myth that never dies. Worse, it continues to buttress poorly conceived campaign proposals such as Bidens new supply chain plan. The United States manufacturing sector is not dead. Just last year, before being devasted by the pandemic, U.S. manufacturing output set arecord high. And the sector once again proved itself an attractive destination for investment in 2018 when FDI stock in American manufacturing rose by 10% to $1.77 trillion. Decline in American manufacturing employment, however, has long been astory of American progress, as the sector has stayed competitive by learning how to do more with less. Using the decline in employment to tell astory of sectoral decline, not progress, is amistake and its amistake that permeates the rest of the proposal.

My colleague, Inu Manak, and Irecently dissected the pervasive and misdiagnosed idea that our supply chains are fragile and in need of saving. By several objective measures, the United States is one of the least dependent countries in the world. Trade accounts for asmaller share of domestic output than every country in the world other than Cuba and Sudan. Amongst the worlds largest economies, the United States also ranks near the bottom in import penetration of goods and services, indicating that America is less reliant on other countries to satisfy domestic demand than many of our peers. Shortages of needed medical products, on the other hand, was much more afailure of government than it was afailure of supply chains or domestic production. Along list of domestic regulations, documented by my colleagues at the Cato Institute, shows how onesizefitsall regulations, and restrictions on services such as telemedicine and barriers to the free flow of labor such as occupational licensing laws, kneecapped recovery efforts. Using the government to reshape supply chains would be amistake especially when it was so instrumental in Americas uniquely slow response.

The most puzzling claim in Bidens plan is that his proposals would avoid costs and bureaucracy. Monitoring supply chains alone would demand amassive expansion in government capacity and, as Professor Henry Farrell argues, this would require new bureaucracies, extensive reporting requirements, and the transformation of network analysis into atool of security analysis. Forging publicprivate relationships and monitoring supply chains means the government would need the ability to effectively pick the right winners and losers. Picking correctly is difficult. Picking correctly without an expansion of costs and bureaucracy is unimaginably arrogant and outright impossible.

Yes, over 70% of the API manufacturing facilities that supply the U.S. market are located in foreign countries, but the same statistics the Biden proposal cites also say the United States houses 28% of the worlds API facilities. Using his own statistics, America has more API manufacturing facilities than any other country in the world. For aproposal that makes an effort to reprimand the Trump administration for not working with U.S. allies (and rightfully so), its worth mentioning that the European Union ranks second at 26%, and China the country that typically tops the list of U.S. traderelated security concerns is home to only 13% of the worlds API facilities.

Some libertarians have entertained the idea of reforming and expanding the federal stockpile. After all, preparing for apandemic, most libertarians would agree, is alegitimate and necessary role for government. But the Biden plan neuters one of the stockpiles most important advantages. Instead of using the stockpile to subvert protectionist demands, the Biden campaign seems more inclined to use it as atool to further entrench protectionism through federal procurement policies. Needlessly limiting sourcing options for the stockpile would limit competition by requiring that the government discriminate against equally effective foreign products. That, in turn, makes it more expensive to replenish the stockpiles inventory by limiting supply. And more expensive products translate to more funding demands and funding battles over the stockpile were part of the reason we were having supply issues to begin with. The stockpiles inventories were depleted fighting the H1N1 virus and other natural disasters during the Obama administration, but funding became a political football and neither the Trump administration nor the Obama administration were willing to expend the political capital necessary to secure the proper resources. Making the stockpiles contents more expensive will only make matters worse. The recent funding history exposes protectionism and stockpiling as aparticularly dangerous combination but its also plainly apoor public health decision.

Of course, there is more in this plan thats bothersome. But free traders better hope the Biden plan was solely an illconceived campaign tactic, and not an indication of how he would govern. Biden was given an opportunity to embrace free trade and distance himself from Trumps disastrous trade policies. Choosing this path just means more of the same.

Read more:

Five Issues with Biden's Supply Chain Plan - Cato Institute