The Power Trade Model.

• Author: Atkinson, R.

A key aspect of power trade is that sometimes a power-trading nation must be willing to accept suboptimal or even negative economic results, so long as its adversaries suffer more. As Albert O. Hirscnman notes, "[T]he stoppage of trade [with embargos or trade bans] will also do harm to the economy of the country taking the initiative in bringing the stoppage, but this is not unlike the harm an aggressive country can do to itself in making war on another."

This insight gets at a core difference between the United States and the European Union.

Just as the United States is more willing to expend blood and treasure to advance the goals of national security and global stability, it has long been willing to use statecraft weapons, including trade restrictions, to ensure a more stable world order. Whether one agreed or disagreed with the trade actions Trump took vis-a-vis China, they imposed costs on the United States while helping other nations, both by somewhat limiting China's unfair innovation mercantilist practices and by shifting Chinese imports away from the United States. America's own exporters were also harmed when China subsequently reciprocally raised its tariffs in response to the ones Trump implemented.

In contrast...