The 2024 general election cycle has ended, and the pending transition of powers at local, state, and federal levels can affect the global supply chain in more ways than you think. The politics of international trade in North Dakota have always been bipartisan and collaborative, but are not immune to current regulations—or those a new president, class of U.S. senators, and congress members are prepared to implement. State trade policy also isn’t immune to the whims of our foreign partners.
What differences, issues, and solutions will we see?
The Great Trade Divide
Shortages, strikes, rising shipping costs, and production delays have been wreaking havoc on the supply chain all year. A lot of these issues are out of the control of our elected officials, especially where mother nature and foreign conflicts are involved. But party beliefs and policies still have a major influence on trade operations.
For instance, the United States’ ongoing import tariffs on Chinese-made products, first implemented by President Trump and upheld by President Biden, have diversified our nation’s suppliers but increased taxes on the American people by billions of dollars.1 They also forced a decrease of 26.3 percent in U.S. exports to China. Though Trump and Biden are known to have vastly different politics, both agree that this decrease was worth confronting China’s trade fouls.
But the bipartisanship stops there, and in fact, international trade policy has caused a major divide between parties since 2016. Debates have often revolved around whether rewarding our allies and maintaining good trade relations is as important as bringing manufacturing jobs back to our shores and lowering the trade deficit.
Having two one-term presidents in a row has brought about a marathon of back-and-forth changes, made all the more complicated by the ability for a sitting president to temporarily bypass congressional approval and existing trade measures if they deem it necessary to the vitality of U.S. industry.2 It’s unlikely that these changes will halt once the transition of powers is complete. The supply chain could either suffer or thrive, depending on what these changes reap.
Issues At Hand
Heading into 2025, there are a number of issues new leadership will have to confront, including the many obstacles preventing a seamless supply chain.
To start, concerns are mounting regarding the sustainability of manufacturing as we conclude what NASA is warning has been the hottest year on record.3 Some fear attempts to regulate the carbon output of manufacturing plants will topple the United States’ trade supremacy. Others believe that greater sustainability practices can benefit the economy through the trading of clean energy products. All in all, there was little to no discussion surrounding climate change throughout the presidential campaign cycle from either side—despite the fact that it was a hot-button topic in 2020. It remains to be seen what direction our new leaders intend to head in. In North Dakota, our representatives’ sights remain set on mitigating the fallout of different climate emergencies—droughts, flooding, colder winters, and hotter summers to name a few.
Another pressing issue is that of labor regulations and negotiations. These past two years, we’ve seen multiple unions take to the picket lines to strike on everything from unfair wages and poor working conditions to the rising use of automation and AI. Strikes majorly impact the flow of goods across multiple industries. Though the government has limited say in the resolution of these strikes, it can intervene in a few rare circumstances. But what’s often more influential than direct intervention is the government’s endorsement of either the striking union or the company they’re striking against. Whether or not a politician and their party lean more pro-union or pro-corporation can dictate how long pauses in labor will hurt the supply chain.
Lastly, perhaps one of the most widespread concerns coming off this election cycle, is the United States’ ongoing support of multiple overseas wars. Billions of U.S. dollars have gone to allies to fight common enemies—something that’s caused major division in the House and Senate. However, the financial burden doesn’t stop at arms and aid shipments. Many agree the wars are shifting investment away from exports. With these wars already ravaging the operations of a few major suppliers, it could be detrimental to our trade future to continue rerouting funding.
The North Dakota Way
North Dakota is a major contributor to the energy and agriculture sectors. Regarding politics, our House of Representatives has had a great bipartisan record on import and export support since its inception. No matter the party, there’s no denying how crucial global trade is to our state’s economy and national influence.
There’s always steps your business can take to prepare for the changes our new leadership and policies may bring. This includes:
- Diversifying your suppliers. If regulations or conflicts or weather stop your main supplier from getting you the parts or goods you need, have a safety net of others to fall back on.
- Adopt sustainable practices. Get ahead of the potential fight for more sustainable production practices and start planning now. What you’ve already prepared for and implemented can’t hurt you when the time comes.
- Increase transportation timelines and estimates. It’s better to give yourself a wide berth than suffer any unexpected setbacks or financial losses.
If you have questions regarding other preventative measures your business can take, the NDTO is happy to answer them. Plenty of good can come of a fresh cabinet with new ideas. But it’s just as frightening as it is exciting. Take these final few months of familiarity to reflect on how the transition of powers may affect the supply chain, and in turn, your ability to export as you are now. Much is uncertain, but we’re North Dakotans! No one perseveres quite like us.
1Trump Tariffs & Biden Tariffs: Economic Impact of the Trade War
2Trump vs. Biden: Who Got More Done on Trade? | Washington Monthly
3NASA Analysis Confirms a Year of Monthly Temperature Records – NASA