Trump Can Bring Jobs To The Rust Belt By Relocating Federal Agencies

Kyle Sammin:

Donald Trump rose to electoral success in 2016 on a tidal wave of support from the Midwest, a region other Republican presidential candidates have struggled in vain to win since the 1980s. His wins in Ohio, Wisconsin, and Michigan did not represent a victory for standard Republican ideas of free trade, low taxes, and smaller government. Instead, they represented faith in his promise to return prosperity to the former industrial heartland, and a lack of trust in Hillary Clinton to do the same. What remains to be seen now is whether Trump can deliver on his promises, or if he will join a long list of establishment politicians who have sworn to revitalize that region and failed.

There is reason to doubt that raising tariffs, Trump’s go-to policy on trade, will return the Midwest to its industrial employment heyday. As Scott Lincicome wrote earlier this year, it is “highly unlikely the Trump tariff would lead to a significant increase in U.S. manufacturing.” Bill Watson of the Cato Institute concurs:

For one thing, trade isn’t actually the main driver behind the decrease in manufacturing employment, which began in 1979, long before China became a major U.S. trading partner.  Part of the decline is due to trade but the vast majority is due to technological improvements that have enabled greater efficiency and automation.  That’s why even as manufacturing employment has decreased, manufacturing output has continued to rise and is now at an all-time high.

Trump Can Help Americans By Moving Jobs Out Of D.C.

But even if tariffs on China and other developing world countries do stimulate manufacturing job growth in the United States, the effects will not be immediate. If Trump wants to increase employment in the states he took from the Democratic column in 2016, there are other ways to do so. Most times, when a President says he created jobs, what he means is that jobs were created while he occupied the White House. Maybe he worked with Congress to make conditions more favorable for job creation, but more often he is just the beneficiary of worldwide economic trends.

The exception to this is in the creation of jobs through actually hiring people to work for the federal government. Here a President can actually affect the number and, more importantly, the location of the jobs the federal government provides. The best way for Trump to enact a better federal employment program that is fiscally conservative enough to satisfy a Republican Congress, therefore, is not to create more federal jobs but to move existing ones away from the Washington area and out into the rest of the country, especially in those areas that have been hurt most by long-term unemployment.

I first wrote about this idea a year ago, when Jeb Bush or Ted Cruz looked more likely to win the Presidency than Donald Trump. The idea of spreading federal jobs across the country fits even better with Trump’s “Drain the Swamp” theme than with any of the other candidates. Trump is not a creature of Washington. The biggest theme in his election was a conflict between the ins and the outs, or as Peggy Noonan called them, the “protected” and the “unprotected.” Many of the residents of Washington and its suburbs feel protected by their secure and steady federal employment and have a sense of safety that is unknown among the residents of cities and towns that have seen factories and mines close down one after the other for decades. Trump could give them a greater sense of security by giving them access to those same federal jobs.

Washington Disproportionately Pleases Washingtonians

As I wrote before, according to Census Bureau’s American Community Survey, in 2012 “the Washington metro area had an average household income of $88,233—the highest in the country, and far in excess of the national average of $51,371. The list of the United States’ highest-income counties confirms the point, with 13 of the richest 30 counties (and four of the top five) being within the Washington metro area.”

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