Minnesota is a key political battleground this year, with several competitive House seats and two Senate elections because of the resignation of Al Franken after a sexual-misconduct scandal last year. Mr. Campbell said that he was still likely to support Republican candidates, but that he was frustrated by the party’s shift toward protectionism and support for increased government spending.
“I blame Republicans for that,” Mr. Campbell said. “A very significant portion of Republicans in Congress are not really conservative when it comes to spending.”
The re-emergence of trade as a central political issue has scrambled traditional partisan alignments in ways that carry risks for both parties. Mr. Trump won the presidency partly by tapping into voters’ concerns about the impact of globalization on jobs and wages, particularly in the industrial Midwest.
But free trade still receives strong support among business groups, which have historically backed Republican candidates, and among big-dollar conservative political donors such as the Koch network. As recently as 2015, three-quarters of House Republicans voted for a measure meant to open trade even further — so-called “fast track” negotiating authority for President Barack Obama.
Reflecting those tensions, congressional Republican leaders have criticized Mr. Trump’s tariffs as potentially harmful to businesses and consumers while also praising the president’s broader goals on trade.
Representative Kevin Brady of Texas, the chairman of the Ways and Means Committee, opened a hearing on the effects of tariffs on the economy last week by saying the measures “curtail economic growth, discourage new investment, delay new hiring, and put American workers at a huge disadvantage to foreign competitors.”
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But he added, “I remain committed to working with President Trump and the White House on strong, enforceable trade policies that will target bad actors and encourage economic growth here at home.”
Democrats face their own challenges on the issue. As Republicans have shifted away from supporting free-trade agreements, Democrats have embraced them: In the Times poll, 73 percent of Democrats said they thought free-trade agreements helped the United States, compared with 51 percent of Republicans. But union members, long a key source of mobilization and support for Democrats, retain the party’s longtime skepticism of free trade.
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“It’s not an ideal issue for either party,” said Robert J. Blendon, who directs the Harvard Opinion Research Program at the Harvard School of Public Health. “It makes the issue slightly more complex because their voters’ views don’t correspond to their interest groups.”
For Republicans, Mr. Trump’s trade battles pose an additional risk of undermining the party’s core economic message. Republicans have tried to emphasize the tax law they passed in December, which cut taxes on businesses and most households. But trade has largely pushed the tax law from the headlines, and support for the law, which rose early in the year, now seems to be ebbing.
“You’re starting to certainly complicate the message,” said Jon Cohen, chief research officer for SurveyMonkey.
The trade fight has also roiled financial markets, which had risen steadily during Mr. Trump’s first year in office. If that volatility continues, it could erode consumers’ confidence in the economic recovery. There are hints that could already be happening: The University of Michigan’s measure of consumer sentiment dipped slightly in April, with many respondents citing trade as a source of concern. SurveyMonkey’s consumer confidence index also ticked down in April, with the largest declines coming among higher-earning households, which are much more likely to own stocks.
“It’s possible the war of words over trade, tariffs and sanctions, and the financial market turmoil we had has led to some setback in consumer confidence,” said Chris Rupkey, chief financial economist at MUFG Union Bank.
Losing Confidence?
SurveyMonkey’s consumer confidence index, which combines five questions on Americans’ financial and economic outlook, ticked down in April after holding steady earlier in the year.
Note: Partisan categories include people who lean toward a particular party. | Source: SurveyMonkey
Consumer confidence remains high over all, however, and there is little evidence that the tariffs have hurt the economy so far. Retail sales rose in March, according to data released by the Commerce Department on Monday, and the job market continues to make steady progress. Economists say an outright trade war could derail the economy, but the tariffs announced so far fall well short of that.
Ethan Brackenbury, a cost estimator for the federal Department of Energy in southeastern Washington State, said that he didn’t like the idea of a trade war, and that he hadn’t noticed any gain from the tax cut in his paycheck. But the economy seems strong in his area, he said, and he views any declines in the stock market as an opportunity to buy, not a signal to sell.
“I’m certainly not worried, nor am I excited,” Mr. Brackenbury said. “I don’t see long lines of unemployment or those kinds of things. Everyone seems to be gainfully employed.”
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Article source: https://www.nytimes.com/2018/04/17/business/economy/trade-midterm.html?partner=rss&emc=rss
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