America running the risk of self-inflicted economic wound

IN THIS bitter US presidential election campaign, one area of agreement unites the major candidates: trade. Bernie Sanders brags that he has opposed all recent trade agreements; Hillary Clinton now rejects the Trans-Pacific Partnership (TPP), President Barack Obama's signature trade success that she once supported; and Donald Trump blames incompetent US trade negotiators for devastating job losses to China that might be cured by a 45 per cent tariff on Chinese imports.

You should take all this with a boulder of salt. True, a flood of Chinese imports over the past 15 years has cost hordes of US jobs. In a recent paper, three respected economists - David Autor of MIT, David Dorn of the University of Zurich and Gordon Hanson of the University of California at San Diego - estimated the loss of manufacturing jobs at 985,000 from 1999 to 2011.

But this large number needs context. Over the same period, all US manufacturing jobs dropped 5.8 million; the share caused by China was a bit less than one-fifth. When the economists added China's impact on non-manufacturing firms, the job decline more than doubles to 2.4 million. Still, that's less than 2 per cent of total payroll employment of 131 million in 2011 and 143 million now. A more powerful job destroyer was the Great Recession (8.7 million jobs lost over two years).