Oct 28, 2020
The gap between red and blue America has been expanding for decades, and the consequences of this increasing polarization are clear to close oberserves of Washington
But why Americans have grown so far apart in the first place is still a complicated, unanswered question.
Part of the story appears to be the sudden rise of China as an export powerhouse, according to a paper in the October issue of the American Economic Review.
Authors David Autor, David Dorn, Gordon Hanson, and Kaveh Majlesi say that trade competition from China has redicalized many Americans in declining manufacturing towns. Long-term joblessness and insecurity has pushed people in those communities to the far-right and far-left edges of the political spectrum.
But Hanson says in this episode of the Research Highlights podcast that it’s not a failure of trade policy. It’s a failure of America’s safety net to protect the workers hit hardest by Chinese imports.
Hanson recently spoke with the AEA’s Tyler Smith about how economic and cultural insecurity drive hyper partisanship and what policymakers can do to help areas distressed by the China trade shock.