WASHINGTON – United States Trade Representative Katherine Tai today will deliver remarks at the Roosevelt Institute’s Progressive Industrial Policy Conference.
In her speech, Ambassador Tai will discuss how the Biden-Harris Administration’s trade agenda can support and advance U.S. industrial policy in partnership with our allies and partners around the world. She will also share how the Administration’s trade priorities aim to grow the U.S. economy and defend the interests of American workers and manufacturers. Following her remarks, Ambassador Tai will participate in an on-stage fireside chat with Mike Kubzansky, CEO of Omidyar Network.
Ambassador Tai’s remarks as prepared for delivery are below:
Good afternoon, everyone. It’s great to be here with you today. Thank you, Mike, for that kind introduction.
You’ve already heard from several brilliant leaders in the Biden Administration, but I want to focus on what progressive industrial policy means for trade.
We’ve been doing FTAs for almost forty years now. And while some sectors of the economy have benefited, many in this room know that the traditional approach to trade—marked by aggressive liberalization and tariff elimination—also had significant costs: concentration of wealth. Fragile supply chains. De-industrialization, offshoring, and the decimation of manufacturing communities.
At the same time, we’ve experienced over two decades of the PRC’s non-transparent, state-directed industrial dominance policies conducted on a massive scale. Traditional trade tools and the multilateral trading system failed to address these distortions, and markets even rewarded them. The global impacts of these policies have profoundly limited the ability of workers and industries in open markets and free societies like ours to thrive or even survive.
This has led many people to view trade and globalization with increased hostility—and to a lack of confidence in our very institutions.
Heightened economic insecurity, the pandemic, and Russia’s invasion of Ukraine have pushed us to re-examine our approach to trade. The need for correction is clear, and industrial policy is a part of that re-balancing effort.
But here’s something I hear from partners abroad as well as from critics at home—that this new focus on industrial policy in economies like ours will result in the global economy devolving into a kind of state of nature—where might makes right. That the most developed economies are working toward a world where countries only look after themselves.
That is not the Biden Administration’s vision.
As I met with my counterparts for the G7, ASEAN, the G20, and other engagements, I’ve heard a lot about the need for trade rules and practices that recognize key domestic economic priorities. And I’ve also heard the need to work together, so that we are building a better future together, to raise the tide for all our citizens.
We believe industrial policy and trade policy must complement each other if we are going to realize this goal.
To get this right, trade has got to be about more than just unfettered liberalization, cheap goods, and maximizing efficiencies. Now, we have not sworn off market opening, liberalization, and efficiency. But it cannot come at the cost of further weakening our supply chains, exacerbating high-risk reliances, decimating our manufacturing communities, and destroying our planet.
We need to update the playbook and bring more people in, so that more get pieces of a bigger pie. We need to address the climate crisis. We need to support workers and working families—ordinary people. We need trade policy to be durable and help us rebuild trust with our communities and rebuild confidence in the fairness of the global economy.
So, what does complementary industrial policy look like in practice?
The EU Ambassador to the U.S. recently told me that when the U.S. and the EU fight, we make headlines. But when we work together, we make history.
In the past 18 months, we found positive and creative ways forward in our longstanding Boeing-Airbus dispute and reached an agreement on steel and aluminum trade.
Then we started negotiations on the world’s first carbon-based sectoral arrangement to address carbon intensity and overcapacity in the steel and aluminum sector. This is historic—it will help us achieve our sustainability goals by reducing emissions and defend key industries and jobs.
We also launched the Trade and Technology Council last June to enhance our competitiveness, foster innovation, and collaborate on pressing issues like labor and the environment that are so critical to sustainable trade policy.
Through the TTC, we are also countering non-market policies and practices that undermine our businesses and workers in the global trading system.
We’re actively exploring ways to improve the effectiveness of our domestic measures that address market-distorting impacts, and also discussing ways to combat the negative effects in third countries.
These topics are more pressing after Russia’s unprovoked invasion of Ukraine, as well as the strains on supply chains we have seen in the wake of the COVID pandemic.
These events have underscored the importance of working together to pursue policies that reflect shared U.S. and EU values, that will drive competitiveness and prosperity.
This new complementary approach can address the challenges that will define the 21st century.
The climate crisis is a great example. As we seek to reduce our carbon footprints and benefit our industries, we’re each going to do things that cause anxiety, whether it’s the Carbon Border Adjustment Mechanism or the Inflation Reduction Act.
But this also creates an opportunity for us to work together, to tackle this existential crisis that threatens all of us.
And we are seizing this opportunity—to partner with each other to achieve our overarching goals for the security of our people and our planet. Our work goes beyond Europe.
We’re bringing this approach to our partners in Asia. That’s why we launched the Indo-Pacific Economic Framework in May.
The IPEF is not a traditional FTA. While it will include some traditional trade agreement elements, there are also separate pillars dedicated to supply chains and decarbonization. It will also include provisions on infrastructure and tax and anti-corruption. Simply put, it will be a model to address the real challenges we face today.
And likewise, I must emphasize that what we’re doing on trade is complementing what we’ve been doing here at home.
President Biden has kept his promise to grow the economy from the bottom up and the middle out, by investing in our industries and workers. His recent legislative accomplishments make us more competitive and help us collaborate from a position of strength.
China and other countries have been investing in their infrastructure for decades. To compete and prosper in the global market, we also need to invest here at home.
You have already heard many of these examples earlier today.
The Inflation Reduction Act is the largest investment in our nation’s history to address the climate crisis. It will create good-paying jobs in wind, solar, and electric vehicle manufacturing.
The Bipartisan Infrastructure Law is the largest investment in our infrastructure since the creation of the Interstate Highway System under the Eisenhower Administration.
And the CHIPS and Science Act strengthens our supply chains by making more semiconductors here in America.
These are down payments on our nation’s future. But we cannot stop here.
Let me close with this.
As President Biden likes to say, we are at an inflection point.
We’re done with the status quo, where the benefits are concentrated—among big corporate actors and in big non-market economies.
President Biden and I are committed to set this country on a new path, one that invests in this nation, creates sustainable growth, and works with our partners to build inclusive and durable prosperity.
Thank you.
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