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North Korea is a long way from Longmont. But the recent twists and turns out of North Korea this past week are emblematic of the problems with American foreign policy of the past year and a half. If something doesn't change soon, there's a real risk that the negative ramifications of American foreign policy are going to be felt in Longmont, in Colorado, and in small cities across America.
Stick with me, because there’s a lot of moving parts.
Longmont is lucky that its major employers are industrially diversified. This is a strength shared across the Front Range. Agriculture and tourism are big business in the rest of Colorado, generating in excess of $25 Billion economic activity in the state. What makes Longmont and Colorado’s economy strong is that these are export businesses, whose primary consumers are outside the area in which they are produced. This adds money to the local economy both in the form of wages and infrastructure investment funded by the additional tax revenues.
Export businesses require robust trade to thrive. The market for beef is global, with prices set by millions of individual, uncoordinated decisions all over the world. Wind turbines made in Fort Collins, or oil pumped in Weld County, are similarly distributed on the world stage. What happens other places directly affects pocketbooks here at home.
I’m worried that as a nation we’re flirting with trade disaster. Just ask a soybean or corn farmer. Both were already trading at half the price compared to 7 years ago because of oversupply issues. In March, when President Trump announced steel and aluminum tariffs targeting China, China announced reciprocal tariffs against soy and beef, whose prices have fallen an additional 10%. So our relationship with China is a little rocky right now, with bad feelings on both sides.
China is the key to peace with North Korea. Nearly all of North Korea’s trade is with China, which provides it with a critical lifeline of economic activity. And though the Chinese government is not thrilled with the prospect of an unstable state like North Korea having nuclear weapons on its border, China is also not a fan of American influence in the region.
So while we try to make deals with North Korea, which craves American recognition, the power to actually enforce any deal is in China. With the announcement by President Trump that he intends to break the Joint Comprehensive Plan of Action (JCPOA, ‘the Iran Deal’), North Korea has no reason to believe that even if they were to put down their nuclear missiles that the United States would honor its word. And why would China vouch for us? All America has done for the past year and a half is slander and try to initiate a trade war.
Now, credit where credit is due. Securing the safe return of three Americans who were wrongfully held prisoner and placed in labor camps by North Korea is a serious foreign relations accomplishment by the Trump Administration. So maybe it’s possible that Secretary of State Mike Pompeo, who appears to have negotiated the release, can pull another rabbit out of his hat. But now North Korea says they’re having second thoughts because of joint US-South Korean military exercises.
I wouldn’t be surprised if North Korea was backing out because of the JCPOA. Maybe if President Trump hadn’t decided to break the deal, a credible case could’ve been made that Libya was a special case. That the United States wasn’t systematically convincing countries to put down their nuclear weapons before going on the economic and military offensive. Instead, twice now the United States has convinced countries not to build nuclear weapons, and then taken advantage of the opening.
So now it seems we may be losing our chance with peace with North Korea, Iran may start rebuilding its nuclear weapons program, and China will do everything it can to hit Americans in the wallet. These forces together can put pressure on companies to cut jobs, close locations to save on costs, put farms out of business and put American soldiers in harm’s way. And if those things happen, we’ll definitely feel it in Longmont.
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