[CTC] Voters Stung by Chinese Import Competition Turned to Democrats, Economists Say

[Arthur Stamoulis]

http://blogs.wsj.com/washwire/2016/04/19/voters-stung-by-chinese-import-competition-turned-to-democrats-researchers/ <http://blogs.wsj.com/washwire/2016/04/19/voters-stung-by-chinese-import-competition-turned-to-democrats-researchers/>
Voters Stung by Chinese Import Competition Turned to Democrats, Economists Say

But in 2016, GOP front-runners oppose big trade deals

By 
Bob Davis
Apr 19, 2016 9:26 am ET 
Voters looking to blunt Chinese import competition turn to Democrats, a team of economists found, because they want politicians who vote to restrict trade.

In counties most exposed to Chinese imports, the economists found <http://papers.nber.org/tmp/81429-w22178.pdf>, voter turnout increased, as did the votes for Democratic House members or candidates. Democrats in such counties saw an average 3.7% increase in vote share in elections between 2000 and 2010, compared to elections between 1992 to 2000.

Why? Democrats were more likely than Republicans “to support legislation limiting import competition or favoring economic assistance,” wrote the economists. The five economists are Peter Schott of Yale, Justin Pierce of the Federal Reserve, Yi Che of Shanghai Jiao Tong University, Yi Lu of the National University of Singapore and Zhigang Tao of the University of Hong Kong. Their findings were published by the National Bureau of Economic Research on Monday.

In an interview, Mr. Schott said that it wasn’t possible to figure out how many House seats the Democrats picked up during that period because of trade  – or how many fewer they might have lost. Trade “is one thing that affects elections, but it’s not the only thing,” he said.

The economists analyzed data by county, not by Congressional district because the latter changes through redistricting. That also made it difficult to judge the outcomes of particular races, Mr. Schott said.

The question of which party is more likely to take a protectionist stance has changed since 2010, with the election of Tea Party Republicans who oppose trade deals because they believe they infringe on national sovereignty. GOP presidential front-runner Donald Trump <http://topics.wsj.com/person/T/donald,-trump/159> also has made opposition to trade deals one of his signature issues, and he and his rival for the nomination, Sen. Ted Cruz, oppose the Trans-Pacific Partnership, an Obama administration-negotiated trade deal among a dozen Pacific Rim nations.

Still, the Republican party produced the vast majority of votes last year for Mr. Obama’s successful efforts to win the trade negotiating authority crucial to completing the TPP. Mr. Schott says he has been looking at the 2016 race as a way to update his group’s findings

Gordon Hanson, a trade economist at the University of California at San Diego, said he wasn’t convinced of the pro-Democrat findings because of what he called the paper’s “many empirical issues.” He specifically mentioned the difficulty of matching counties to Congressional districts.

He called the finding that voters in trade-impacted areas turned toward protectionist-leaning lawmakers “the most credible findings in the paper.” A paper last year by James Feigenbaum, a Harvard University graduate student and Andrew Hall, a Stanford University political scientist <http://scholar.harvard.edu/files/Feigenbaum_Hall_tradeshocks_0.pdf?m=1430749257>, also found that a big surge in Chinese imports prompt lawmakers “to vote in a more protectionist direction on trade bills.”

The team of five economists analyzed voter behavior before and after 2000, when Congress ended its annual review of China’s trade status and granted what was called “permanent normal trade relations.” Under PNTR, China was entitled to the same tariffs as any other nation in the World Trade Organization—and no longer had to fear a sudden spiking of tariffs if it failed the annual review.

Foreign investment in China soared after 2000, as did the country’s exports to the U.S.

Facing low-cost Chinese imports, U.S. manufacturers slashed jobs. According to a 2012 paper by Mr. Hanson, David Autor of Massachusetts Institute of Technology and David Dorn of the University of Zurich <http://www.nber.org/papers/w18054.pdf>, import competition from China accounted for the loss of about one million jobs between 2000 and 2007, about one-fourth of all the manufacturing jobs eliminated during that period.

The three economists are working on their own study of the political impact of Chinese import competition.
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