Good for Vermont but we need to do more on our own

by Russell Flannery

President Trump’s well-oiled marketing operation was running full blast this morning with the announcement of a “historic” agreement between the U.S. and China to lower tariffs. 

In fact, the action only reverses some of the worst of the tariffs that President Trump himself imposed on business between the two countries earlier this year, and the reprieve is only for 90 days.  Uncertainty in the aftermath of the administration’s big “Liberation Day” push is going to remain due to intense technology, economic and geopolitical competition between the two countries. 

Still, word of the results of the weekend meetings between high-ranking U.S. and Chinese officials has been good news for stock prices globally today and is welcome news for Vermonters.   President Trump himself admitted only earlier this month that “we’ve essentially cut off trade relationships” with China through high tariffs.  The resulting prospect of higher inflation (that President Trump doesn’t like to talk about) and shortages of goods would hurt Vermonters.

And that’s about the last thing we need. High-tax Vermont already is facing numerous economic problems including reliance on federal money for state programs that isn’t likely to be so readily available in the future as the federal government confronts massive national debt. Another state problem: five years after Covid, we’re still housing low-income families in hotels that were built to welcome tourists and travelers. That in turn part of a larger housing problem: excessive government red tape and high costs hurt construction that damages affordability, investment and economic growth.  

To be sure, we’re at something of a disadvantage when it comes to business with China because we’re so far away from that country and the Asia region.  Asian Americans make up a mere 1.8% of Vermont’s population, according to Census Dots.  It is much easier for us to think about ties with Canada and historical neighbors.

Yet economic growth in Asia region is among the best in the world.  The International Monetary Fund predicts Asia-Pacific GDP will expand by 4.4% this year.   India will exceed 6% and China 4%, the financial body says.  How about the U.S.?  Only 1.8%. China today is second only to the U.S. as the world’s largest economy, a global technology leader, and a tough rival that we can’t wish away. 

Vermont can and should do more on its own to build up economic and cultural ties to not only China but the rest of Asia as well.   One way would be creative marketing through powerful social networks in Asia that would help to put our state and our products, services and tourism on the consumer map in colorful ways.  

But short of that, we ought to think how to promote ourselves into Chinese American and other Asian American communities in U.S. cities such as New York that are closer to home.  As we all know, Vermont is blessed with tremendous beauty, food and friendly people, and can do better to offer that to visitors if the cost to them is reasonable.   We can also work to get younger Vermonters in sync with the changing economic flows of the world by offering more Chinese-language courses in high schools and encourage more school and non-governmental exchanges in Asia to improve our ties.  

Many of President Trump’s tariff initiatives have the goal of increasing manufacturing at home – a worthy aim indeed but one that faces cost and political obstacles. We can work to lower dependence on Chinese imports by encouraging its businesses to manufacture more in the U.S., including Vermont.   Green energy hardware in which China is a world leader readily comes to mind; modular home construction could be another. A limitation is of our own doing hovers over those ideas, however:  we are short of workers and affordable homes to house them in part due to excessive red tape and high costs.   

At the end of the day, we need to get out there on our own, try to solve our own problems, and not rely on the changing priorities of the D.C. leadership of the day to keep Vermont going strong.