Trump’s Tariff Debacle Shows that Democracy Matters

At the end of May, the US Court of International Trade tried to pull President Trump’s new tariffs. The Trump administration immediately challenged it, and at the time of writing, we don’t know what the end point will be: it’s a battle that could rumble on for months.  

However, our instincts were right: the checks and balances of democracy really matter, it cannot be right that hugely damaging trade rules are imposed without any oversight. 

The US Court found that Trump could not impose his tariffs by executive order under the emergency legislation he introduced at the beginning of April. Decisions about what tariffs can be levied have to go through the elected Congress.    

In theory, this means that the wishes of the people who elected people to Congress are represented and questions and concerns can be raised in debate. 

Democratic oversight of trade policy to ensure it works for ordinary people might seem like a basic principle. 

 Unfortunately, it's not a principle that is being applied here in the UK.

After the EU referendum, the Conservative Government promised that one of the big benefits would be the UK having a greater say over its own trade agreements. 
But it turns out that it’s big business that has the greatest ability to shape UK trade policy, not elected MPs or ordinary people.  

The Conservative Government refused to allow parliament and ordinary people to have a say over UK trade policy.  

They refused to publish a strategy that would have set out their plans, including how trade policy would align with important commitments on climate, the environment and human rights.  

New trade deals with countries like Australia and the eleven-country CPTPP (Comprehensive and Progressive Trans Pacific Partnership Agreement) were negotiated behind closed doors. 

 The Government had hundreds of meetings with UK businesses during negotiations, but there was no opportunity for democratic scrutiny to ensure deals would work for people and the planet.  

The Labour Government has been working on a trade strategy that we expect to be published towards the end of June. This is welcome, but in response to a joint letter from organisations including Transform Trade, they told us they are not going to do anything to improve democratic scrutiny. We will be stuck with a rule, the Constitutional Reform and Governance Act (CRAG), is based on text from 1924 and gives Parliament no automatic right to debate or vote on trade deals. 

This matters to people in the UK, but also to the producers we work with. For example, there is no guarantee that the recently-concluded UK-India trade deal will have any parliamentary scrutiny at all.  

Yet trade deals have changed a lot over the 100 years since that basic text was written: they cover far more aspects of everyday life that mean people in the UK and India will see much deeper impacts, from the costs of medicines to the how we can protect the environment. 

The UK Government was proud to announce that the UK-India deal would see the price of garments come down for consumers. 

They said nothing about the price that might be paid for this by manufacturers and workers in India or whether their wages and working conditions would improve.  
 
Our Wearing Thin report shows why we believe manufacturers and workers won’t see the benefits. The text of the deal is yet to be released, but we understand that even if a labour rights chapter is in there, it will not be binding. 
 
This means there is nothing to ensure the deal will bring benefits for the millions of workers that provide clothes for the UK market.   

It is difficult to know what the outcome of the latest twists and turns in US politics will be. However, in a few weeks, the UK has an opportunity to show that we care about proper democratic scrutiny of things like tariffs.  

We will be watching what the Government has to say in its strategy and holding them to account if they fail to uphold such a basic principle.