The election of Donald Trump may mean a new bridge over the Clark Fork River for Missoula.
After all, the real estate mogul likes to build stuff, and Trump talked about the need for infrastructure during his raucous campaign.
That infrastructure is vital to Montana’s economy and those nurturing growth in the business sector, said James Grunke, executive director of the Missoula Economic Partnership. He said it contributes to the ease of doing business.
“It’s water systems and sewer systems and bridges and roads and broadband,” Grunke said. “All the necessary infrastructure to conduct business in today’s environment.”
On the other side of the equation, the former reality TV show host turned president-elect opposes trade deals, and Montana sends chemicals and grain and machines overseas.
In 2012, the Treasure State exported $446 million worth of goods to eight countries and one territory in Asia, according to data from the Montana Department of Commerce.
“Some of our biggest export markets are Asia,” said Abraham Kim, executive director of the Maureen and Mike Mansfield Center at the University of Montana. “ … All this rhetoric about free trade agreements and things like that should be of a concern for us.”
Likewise, Montana imported some $92 million worth of goods from China alone in 2015, and Trump has threatened to set high tariffs on products coming from the world’s second-largest economy.
The Republican candidate surprised much of the country with his win Tuesday, and the markets rattled in response and then stabilized.
Economic and political analysts agree it’s too early to determine the ways a Trump presidency might affect the state’s economy, although history shows presidents have little direct impact, according to Patrick Barkey, director of the Bureau of Business and Economic Research at UM.
Nonetheless, Trump is a newcomer to Washington, D.C., and economic developers and academics in Montana are on the lookout for the policies that come out of a couple of hot topics from his campaign, infrastructure and trade in particular.
“Montana has exposure as an exporter, and I think one of the things that’s really lost in the very simple-minded discussions of trade is the idea that foreign investment in U.S. capacity is also part of trade,” Barkey said.
“It’s not just Japanese folks buying outfitting gear made by Simms in Bozeman. It’s also things like Asian investors in shuttle loaders in eastern Montana. That’s part of foreign trade.”
Ellen Buchanan, director of the Missoula Redevelopment Agency, said the Trump campaign has not delivered very many specifics, so economic developers are still in a status of “wait and see.”
“I think this presidency is a big question mark on a whole lot of fronts,” Buchanan said.
At the same time, she’s hearing from engineers who believe infrastructure projects might be in the wings, and Missoula and Montana have a history of pulling in federal dollars for highway projects and other large construction.
Currently, Missoula looks to be in a building phase, and investors will monitor the stock market, interest rates, and construction costs as Trump begins his term and makes decisions that affect the local community, Buchanan said.
“The bigger question is how much confidence is the private sector going to have in the economy that they’ll keep investing in Missoula,” she said.
Grunke, with the public-private economic development partnership, tries to help grow businesses that are already here, and also bring new ones to the community. In recruitment, infrastructure and quality of life are key factors, he said.
An efficient airport is important, but so is Missoula’s access to the outdoors, he said.
“There’s potential (that) how our public lands are managed could change in the regulatory environment,” Grunke said. “Whether that is positive or negative, it’s hard to tell at this point. It’s so early.”
Trump has called climate change a hoax, but a report created for the Montana Wildlife Federation and released last December noted the hotter summers and shorter winters put outdoor recreation at risk in the state. In other words, less snow skiing and fishing.
“We have a manufacturing company that relocated from Southern California this year to Missoula because last year, they were tourists,” Grunke said. “And they loved it.”
On the other hand, Grunke said Trump campaigned on using coal and other natural resources: “Those have potentially positive impacts to Montana’s economy.”
Trade strategies are another area economic leaders in Missoula will watch.
“President-elect Trump’s policies have not yet been fully articulated, so commenting on impact is difficult,” said Brigitta Miranda-Freer, executive director of the Montana World Trade Center, in an email. Miranda-Freer pointed to information that the center was receiving in reaction to Trump’s win, including from a global economic strategist.
The BMI Research strategist described Trump’s victory as “a major shake-up of the established order in U.S. politics” and said “the global trade framework is in jeopardy.” Mirdanda-Freer offered her own view as well.
“Generally speaking, my personal opinion is that free trade of goods and services in the global economy is a good thing, and that protectionism is an unsustainable, often counterproductive position,” Miranda-Freer said.
In that regard, the country’s relationship with Asia is critical for Montana, Kim said. Canada is the largest export market, but Asian countries make up a significant portion, and China is “the 900-pound gorilla” as a No. 2 world economy.
As such, the national relationships with Asian countries will shape Montana’s experience, he said.
“If the relationship goes sour, then it could potentially have a negative impact on our relationship with a region like Asia,” he said.
Montana has strong ties to Japan and China, he said. The late U.S. Sen. Mike Mansfield was the U.S. ambassador to Japan, and former U.S. Sen. Max Baucus of Montana is the current ambassador to China.
Gov. Steve Bullock’s recent trade missions have been to Asia, Kim said, and the relationships Montana’s leaders build are helpful. They mean foreign students study in Montana, and Montana sees more international students from Asia than any other region.
“Students mean tuition, and also, they spend money here. A lot of our students go abroad as well,” Kim said.
Montana sees a regular flow of leaders from Asia who come here looking for business opportunities, to invest in technology, do cooperative research, and look to expand trade, he said.
“It’s a globalized world, and Montana is not an island,” Kim said.
Asia has benefited different parts of Montana, Barkey said, helping everything from, “dare I say it,” coal, to higher agricultural prices.
While Trump was brash on the campaign trail, Kim said he anticipates his policies will be more moderate. Typically, politicians ratchet back their rhetoric after they’ve won, and offer more modest proposals once in office.
“I imagine being a businessman, he is very pragmatic as well, and a lot of these relationships are very important from a business and economic standpoint,” Kim said.
“I’m sure he will take a tough stance on a number of issues such as ensuring trade is fair and the U.S. gets … a level playing field in terms of dealing with our trading partners.”
Market fells on election night when Trump looked headed for the White House because markets react to surprises, and Trump’s election was a surprise, Barkey said. Now, he said, the surprise is over because Trump will be president for four years.
Observing the economy over decades shows that the election of presidents “tends to settle things” as opposed to the uncertainty of the campaign, he said.
“When an election is finally settled, for lack of a better way of putting it, trends resume,” Barkey said.
And, he said, you can’t credit or blame presidents for too much.
“Presidents don’t do nearly the good or the damage to the economy that they’re sometimes given the credit for doing,” he said.
In Monday’s Missoulian: How Trump’s views on trade agreements could affect Montana