In recent days the Trump administration has continued its isolation policies and effects. Earlier in the year I wrote an article that explained the potential downsides these isolationist policies could have on the economy and the political base both domestic and abroad as well. It has now become apparent that Trump's "America First" approach has done more harm than good to the United States and has not significantly contributed to job growth or economic growth for that matter as the President has claimed several times.
To begin with, the isolationist policies Trump has championed has led to a significant economic impact in currency values. Currencies abroad have increased relative to the dollar, making foreign goods and services now more expensive to invest in. In addition, the US dollar has devalued, which does not signal US foreign strength. The US dollar is an international reserve currency, meaning that it is held by various other countries in a basket of currencies to hedge against significant currency crises and to hold its use as a remedy for economic crises. This role as an international reserve currency helps to establish US strength and in recent months, nations abroad have been selling their dollar reserves, decreasing the amount of dollars they hold in reserve. In addition, countries like China have been benefiting from the dollar devaluation as their currency gets stronger. China has defied the norm and has managed to increase its imports as well as exports while the US has decreased in both.
In addition, the US has now lost its political and economic advantage as a leader of the free world in terms of foreign affairs. At the UN, the US has begun the process to withdraw from the Paris Agreement, which signals that the US will no longer be the world's leader in renewable energy and climate change reduction efforts. The free world is now primarily focused with reducing the effects of climate change, an approach even China and the Middle East has championed. As a result, the US has lost its edge in this new economic sector and has relinquished significant job opportunities in these sectors at the federal level. The US has also left UNECO at the UN, which displays an innate disinterest in the world's cultural affairs and as such significantly reduces the US' reputation abroad.
These costs were viewed by the Trump administration as necessary to increase US competitiveness abroad as well as fuel domestic production and economic growth. However, interestingly because of failed domestic and foreign policies, the Trump administration has actually caused a net decrease in jobs creation, breaking a several year long trend.
All in all this isolationist approach has netted all of the costs and none of the benifits proposed by the Trump adminitration. This calls into question whether or not the Trump administration is pursuing the most sound economic and political courses of action.
