A Trade Deal with China will require a more comprehensive approach, based on a fundamental shift in mindset say, Andrew Sheng and Xiao


February 23, 2019

trump xi jinping

A Trade Deal with China will require a more comprehensive approach, based on a fundamental shift in mindset, say Andrew Sheng and Xiao

 

https://www.project-syndicate.org/commentary/trump-zero-sum-approach-china-trade-talks-by-andrew-sheng-and-xiao-geng-2019-02

In the ongoing US-China trade talks, considerable progress has been made on several key trade issues, such as intellectual-property rights protection. But to defuse tensions in any sustainable way will require a more comprehensive approach, based on a fundamental shift in mindset.

HONG KONG – Trade negotiations between the United States and China are closing in on the March 1 deadline, after which the bilateral tariff war will resume – beginning with an increase from 10% to 25% on $200 billion worth of Chinese products. While global financial markets are fluctuating wildly, investors seem to assume that too much is at stake for the US and China to fail to reach a deal. Their optimism could prove short-lived.

To be sure, there has been considerable progress on several key issues, such as technology transfer, protection of intellectual-property rights, non-tariff barriers, and implementation mechanisms. But to defuse tensions between the US and China in any sustainable way will require a more comprehensive approach, based on a fundamental shift in mindset.

Over the last 40 years, Sino-US engagement has been largely cooperative, reflecting a holistic approach that takes into account the interests of the entire global system. US President Donald Trump’s administration, however, does not seem to believe that engagement with China (or anyone else for that matter) can benefit both sides. As Trump’s “America First” agenda shows, the US is now playing a zero-sum game – and it is playing to win.

For example, the US has threatened to punish or desert its closest allies unless they increase their defense spending. Under pressure from the Trump administration, South Korea just agreed to increase its contributions to US forces in Korea by 8.2%, to $923 million, in 2019.

Similarly, Trump has repeatedly disparaged fellow NATO members for insufficient defense spending. Most recently, Trump has criticized Germany for spending only 1% of GDP for defense, compared to America’s 4.3%. German Chancellor Angela Merkel responded by condemning US isolationism at the Munich Security Conference, and calling for the revival of multilateral cooperation.

The Trump administration’s myopic approach is also apparent in its preoccupation with bilateral trade imbalances. Any US deficit with another economy is, from Trump’s perspective, a loss. Given this, if China agrees to cut its bilateral trade deficit with the US, other economies with bilateral surpluses vis-à-vis the US – including close allies, such as the European Union and Japan – may find themselves facing intensifying pressure to do the The weakening of trade that could result in this scenario would compound existing negative pressure on global growth, hurting everyone. A global economic downturn is the last thing the world needs at a time when it is already beset with risks, including a possible no-deal Brexit and populist gains in the European Parliament election in May.

Of course, while Trump does not spare his allies, his primary target remains China. After all, the competition between the US and China extends far beyond trade. Although the US maintains military, technological, financial, and soft-power superiority, China has been steadily catching up, leading to bipartisan support in the US for a more confrontational approach.

Last October, US Vice President Mike Pence bluntly accused China of technology theft, predatory economic expansion, and military aggression. Pence’s stance echoed the fears of the US national security community. As former US Defense Secretary Ashton Carter put it, “Because it is a Communist dictatorship, China is able to bring to bear on US companies and our trading partners a combination of political, military, and economic tools that a government such as ours cannot match. This puts us at an inherent disadvantage.”

And yet America’s tools are hardly useless. The US authorities have mobilized a broad range of domestic and international resources – from law and diplomacy to national security measures – to stop the overseas expansion of the Chinese telecommunications giant Huawei. If Western countries allow Huawei to build their 5G infrastructure, America’s hawks and their allies argue, they will be vulnerable to cyberattacks from China in some future war.

All of this has shaken business and market confidence to the core, wiping out trillions of dollars in market capitalization. And the Trump administration’s apparent insistence that countries choose sides in its dispute with China is further heightening fears. As the rest of the world’s trading countries understand, Trump’s approach will fragment business and reverse the globalization-enabled economies of scale that have fueled growth for decades.

“Ending the Sino-US trade war will require considerable statesmanship on the part of Trump and Chinese President Xi Jinping. But, beyond that, both sides need to recognize that supporting global peace and prosperity requires less ideology and more respect for diversity of political, social, and cultural systems. Failing that, the fault lines will continue to deepen – much as they did in the 1930s – potentially setting the stage for full-blown war”- .

More broadly, the Trump administration’s rejection of multilateralism undermines the global cooperation needed to confront a range of issues, including migration, poverty and inequality, climate change, and the challenges raised by new technologies. Trump’s focus on geopolitical rivalry – and the associated rise in security and defense spending – will dramatically reduce resources available for global public goods, such as infrastructure investment and poverty-reduction programs.

 

Trump’s Bizarre, Rambling Announcement of a National Emergency


February 16, 2019

Carlos Barria / Reuters

After failing for two years to persuade Congress to fund a wall on the southern border, President Donald Trump on Friday said he will declare a national emergency and reallocate some $8 billion to build the wall through executive fiat.

Trump announced the move in a rambling, free-associative appearance in the White House Rose Garden that was more MAGA rally than presidential announcement. Even by the standards of this President, his remarks were confusing, untruthful, and often off topic, with strange ad-hominem attacks on other politicians and sharp exchanges with reporters. Despite claiming that the nation faces an acute crisis that requires immediate attention, the president meandered through a long preamble about trade deals and North Korea. When he finally got to the point, he struggled to stay focused.

“We’re going to be signing today and registering national emergency,” he said. “And it’s a great thing to do, because we have an invasion of drugs, invasion of gangs, invasion of people, and it’s unacceptable. And by signing the national emergency, something signed many times by other presidents, many, many times, President Obama, in fact, we may be using one of the national emergencies that he signed having to do with cartels, criminal cartels. It’s a very good emergency that he signed … And what we really want to do is simple. It’s not like it is complicated. It’s very simple. We want to stop drugs from coming into our country. We want to stop criminals and gangs from coming into our country. Nobody has done the job that we have ever done.”

Yet Trump also undermined his own case for the national emergency, effectively saying the declaration was all about political expediency.

“I can do the wall over a longer period of time. I didn’t need to do this. I would rather do it much faster,” the president said, an astonishing acknowledgment that could come back to haunt him in court.

It was one of the least coherent appearances Trump has made in a presidency noted for its incoherence. Yet the circus in the Rose Garden threatened to distract from a major policy announcement.

During a briefing Friday morning, acting White House Chief of Staff Mick Mulvaney said that Trump would take $600 million from a Treasury Department forfeiture fund, $2.5 billion from a Defense Department counter-drug fund, and another $3.6 billion from Pentagon military-construction money. Only the construction funds require an emergency declaration. Trump will not take money from disaster-relief funds, an idea that had been discussed.

The move is sure to draw legal challenges, and might not take effect exactly as Trump described. But the fact remains that the President has declared a national emergency in order to save face with anti-immigration members of the conservative media and his base, having been roundly defeated in a joust with Congress over funding. In essence, the president has created a new crisis to get himself out of a previous crisis—which he also created. And the timing of Trump’s announcement, after months of equivocating and congressional debate, hardly supports the idea of an acute crisis.

There is an irony to Trump’s declaration. Prior to being elected, Trump aggressively criticized then-President Barack Obama, saying that he could be impeached for using executive orders to change immigration policies.

“Now he has to use executive action and this is a very, very dangerous thing that should be overwritten easily by the Supreme Court,” Trump said in 2014.  The following year, Trump said, “The whole concept of executive order—it’s not the way the country is supposed to be run. He’s supposed to go through Congress and make a deal and go and talk to people and get the guys in there and, you know, whether you’re Republican or Democrat, is supposed to all get together. He’s supposed to make a deal, but he couldn’t make a deal, because it’s not his thing.” During the presidential campaign, Trump promised to withdraw Obama’s executive orders and accused him of abuses. Since becoming president, however, Trump has become a prolific user of executive orders.

Yet by declaring a national emergency, Trump is doing something more aggressive still. There is nuance to the situation: As the White House points out, Trump is using powers granted to him under a law passed by Congress in 1976, and not creating powers out of thin air. But it’s not clear that this situation fits within the letter of the law, and it’s all but impossible to say that it follows the spirit of the law.

Any declaration of emergency seems by definition distressing—either the president is announcing a bona fide emergency or the government is creating an opportunity for abuse of power, or both. The very point of emergency provisions is to circumvent standard protections and procedures. While that should be concerning to citizens in any case, it’s especially worthy of scrutiny coming from Trump, a president who has disregarded restraints, procedures, and laws even without claiming extraordinary powers; acted like the ruler of a one-party state; and expressed admiration for authoritarians.

As Elizabeth Goitein explained in The Atlantic recently, the 1976 National Emergencies Act superseded a range of laws that were designed to grant the president leeway to respond to an acute crisis. Congress concluded that there are times when the country needs to respond faster than the standard legislative process can act. Mulvaney said Friday that Trump is simply invoking this law.

“It actually creates zero precedent,” he said. “This is authority given to the president, given to the law already. It’s not like he didn’t get what he wants, so he’s waving his wand.”

This is only half true. The authority does exist, and critics saying otherwise are exaggerating. But it’s also exactly like he didn’t get what he wanted, so he’s waving a wand. There’s a legitimate argument to be had over whether a serious problem exists at the border, though the case that there is one is weak. While illegal immigration to the United States is rising, it remains well below the recent peak, in 2000. Trump allies have argued that recent incidents where the Border Patrol fired tear gas across the border show the menace posed by immigrants; however, as Press Secretary Sarah Sanders pointed out, tear-gassing was common during the Obama administration. The White House has also offered up a bogus statistic about terrorists trying to enter the United States.

But there’s no case to be made that Congress hasn’t had a chance to act. Trump has been asking lawmakers to fund his wall since he took office, in January 2017. He failed to persuade even a unified Republican Congress to give him the money. (On Friday morning, Trump repeatedly criticized those in the last Congress who didn’t push hard enough to fund the wall, a clear reference to former House Speaker Paul Ryan.) Since December, two Congresses—one with unified GOP control, and then another with a Democratic House and Republican Senate—have been extensively considering border funding, and they have decided, clearly, not to give Trump the money. The Constitution grants Congress the power to appropriate, and it has decided at length what it wants—a fact Mulvaney acknowledged.

“They’re simply incapable of providing the amount of money necessary in the president’s eyes to address the present situation at the border,” he said. But it’s impossible to believe that Congress passed the National Emergencies Act for the purpose of the president sidestepping the Constitution simply because Congress decided it disagreed with him.

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This is a fact other Republicans have acknowledged. Senator Susan Collins of Maine has called the emergency “dubious from a constitutional perspective.” Senator John Cornyn of Texas has expressed worry that a future Democratic President could use unilateral power in ways that would make Republicans uncomfortable. Senate Majority Leader Mitch McConnell has said in the past that he hoped Trump would not declare an emergency. Yet on Thursday, Poodle McConnell announced he would support the declaration.

While the President does not need Congress’s say-so to declare an emergency, Congress does have the right to override him after the fact, with a vote of both houses. The House will likely do so, but it’s unclear whether enough Republicans in the Senate would join with Democrats to pass a measure there as well. In any case, Josh Dawsey of The Washington Post reports that Trump would veto such a resolution—which would be the first veto of his presidency.

Trump predicted in the Rose Garden that he would triumph in litigation.

“I’ll sign the final papers as soon as I get into the Oval Office,” he said, in a peculiar singsongy voice. “And we will have a national emergency. And we will then be sued and they will sue us in the Ninth Circuit even though it shouldn’t be there. And we will possibly get a bad ruling, and then we will get another bad ruling, and then we will end up in the Supreme Court, and hopefully we will get a fair shake and win in the Supreme Court, just like the [travel] ban.”

Ironically, even though Trump’s lengthy vacillation on whether to declare an emergency shows that the crisis is not as acute as he claims, it’s also helped inure the public to the declaration. But the declaration is still another huge violation of existing norms and constitutional protections.

The President appears single-mindedly focused on the wall, an unusually sustained focus for him. Given the concrete goal involved, this is probably not a situation in which Trump is likely touse the emergency as an excuse to take other, more extraordinary actions, such as declaring martial law or ordering military action. Moreover, Trump’s biggest projects have been repeatedly bedeviled by failures of execution and follow-through, though even a limited impact in this case could be substantial. The point is that he could do those things. That’s a dangerous tool in the hands of a scrupulous president with great respect for restraints on his power—much less Trump.

We want to hear what you think about this article. Submit a letter to the editor or write to letters@theatlantic.com.

David A. Graham is a staff writer at The Atlantic, where he covers U.S. politics and global news.

DJT And His Team of Morons


January 15, 2019

DJT And His Team of Morons

DJT And His Team of Morons

by Paul Krugman

There have been many policy disasters over the course of U.S. history. It’s hard, however, to think of a calamity as gratuitous, an error as unforced, as the current federal shutdown.

Nor can I think of another disaster as thoroughly personal, as completely owned by one man. When Donald Trump told Chuck Schumer and Nancy Pelosi, “I will be the one to shut it down,” he was being completely accurate — although he went on to promise that “I’m not going to blame you for it,” which was a lie.

Still, no man is an island, although Trump comes closer than most. You can’t fully make sense of his policy pratfalls without acknowledging the extraordinary quality of the people with whom he has surrounded himself. And by “extraordinary,” of course, I mean extraordinarily low quality. Lincoln had a team of rivals; Trump has a team of morons.

If this sounds too harsh, consider recent economic pronouncements by two members of his administration. Predictably, these pronouncements involve bad economics; that’s pretty much a given. What’s striking, instead, is the inability of either man to stay on script; they can’t even get their right-wing mendacity right.

Image result for Kevin Hassett

 

First up is Kevin Hassett, chairman of Trump’s Council of Economic Advisers, who was asked about the plight of federal workers who aren’t being paid. You don’t have to be a public relations expert to know that you’re supposed to express some sympathy, whether you feel it or not. After all, there are multiple news reports about transportation security workers turning to food banks, the Coast Guard suggesting its employees hold garage sales, and so on.

So the right response involves expressing concern about those workers but placing the blame on Democrats who don’t want to stop brown-skinned rapists, or something like that. But no: Hassett declared that it’s all good, that the workers are actually “better off,” because they’re getting time off without having to use any of their vacation days.

Then consider what Sean Hannity had to say about taxing the rich. What’s that? You say that Hannity isn’t a member of the Trump administration? But surely he is in every sense that matters. In fact, Fox News isn’t just state TV, its hosts clearly have better access to the President, more input into his decisions, than any of the so-called experts at places like the State Department or the Department of Defense.

Anyway, Hannity declared that raising taxes on the wealthy would damage the economy, because “rich people won’t be buying boats that they like recreationally,” and “they’re not going to be taking expensive vacations anymore.”

Um, that’s not the answer a conservative is supposed to give. You’re supposed to insist that low taxes on the rich give them an incentive to work really really hard, not make it easier for them to take lavish vacations. You’re supposed to declare that low taxes will induce them to save and spend money building businesses, not help them afford to buy new yachts.

 

Even if your real reason for favoring low taxes is that they let your wealthy friends engage in even more high living, you’re not supposed to say that out loud.

Again, the point isn’t that people in Trump’s circle don’t care about ordinary American families, and also talk nonsense — that’s only to be expected. What’s amazing is that they’re so out of it that they don’t know either how to pretend to care about the middle class, or what nonsense to spout in order to sustain that pretense.

So what’s wrong with Trump’s people? Why can’t they serve up even some fake populism?

There are, I think, two answers, one generic to modern conservatism, one specific to Trump.

On the generic point: To be a modern conservative is to spend your life inside what amounts to a cult, barely exposed to outside ideas or even ways of speaking. Inside that cult, contempt for ordinary working Americans is widespread — remember Eric Cantor, the then-House majority leader, celebrating Labor Day by praising business owners. So is worship of wealth. And it can be hard for cult members to remember that you don’t talk that way to outsiders.

Then there’s the Trump effect. Normally working for the president of the United States is a career booster, something that looks good on your résumé. Trump’s presidency, however, is so chaotic, corrupt and potentially compromised by his foreign entanglements that anyone associated with him gets tainted — which is why after only two years he has already left a trail of broken men and wrecked reputations in his wake.

So who is willing to serve him at this point? Only those with no reputation to lose, generally because they’re pretty bad at what they do. There are, no doubt, conservatives smart and self-controlled enough to lie plausibly, or at least preserve some deniability, and defend Trump’s policies without making fools of themselves. But those people have gone into hiding.

A year ago I pointed out that the Trump administration was turning into government by the worst and the dumbest. Since then, however, things have gotten even worse and even dumber. And we haven’t hit bottom yet.

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Paul Krugman has been an Opinion columnist since 2000 and is also a Distinguished Professor at the City University of New York Graduate Center. He won the 2008 Nobel Memorial Prize in Economic Sciences for his work on international trade and economic geography.

@PaulKrugman

 

A version of this article appears in print on , on Page A23 of the New York edition with the headline: Donald Trump And His Team Of Morons. Order Reprints | Today’s Paper | Subscribe

 

 

 

 

 

The Year of Trump?


January 10,2019

trump

The Year of Trump?

If Trump’s iconoclastic style was merely a breach of traditional presidential etiquette, one might argue that his critics were being too fastidious, or were trapped in old-fashioned views of diplomacy. But crudeness can have consequences.

 

BEIJING – Time magazine did not choose Donald Trump as its Person of the Year in 2018, but it may do so this year. Trump ended 2018 facing criticisms for announcing troop withdrawals from Syria and Afghanistan without consulting allies (resulting in the resignation of his respected defense secretary, General James Mattis) and partially shutting down the government over a Mexican border wall. In 2019, with Democrats having taken over the House of Representatives, he will face increasing criticism of his foreign policy.

Administration supporters shrug off the critics. Foreign policy experts, diplomats, and allies are aghast at Trump’s iconoclastic style, but Trump’s base voted for change and welcomes the disruption. In addition, some experts argue that the disruption will be justified if the consequences prove beneficial for American interests, such as a more benign regime in Iran, denuclearization of North Korea, a change of Chinese economic policies, and a more evenly balanced international trade regime.

Image result for historian Niall Ferguson

Niall Ferguson

Of course, assessing the long-term consequences of Trump’s foreign policy now is like predicting the final score in the middle of a game. Stanford historian Niall Ferguson has argued that “the key to Trump’s presidency is that it is probably the last opportunity America has to stop or at least slow China’s ascendency. And while it may not be intellectually very satisfying, Trump’s approach to the problem, which is to assert US power in unpredictable and disruptive ways, may in fact be the only viable option left.”

Trump’s critics respond that even if his iconoclasm produces some successes, one must assess them as part of a balance sheet that includes costs as well as benefits. They argue that the price will be too high in terms of the damage done to international institutions and trust among allies. In the competition with China, for example, the United States has dozens of allies and few disputes with neighbors, while China has few allies and a number of territorial disputes. In addition, while rules and institutions can be restraining, the US has a preponderant role in their formulation and is a major beneficiary of them.

This debate raises larger questions about the relevance of personal style in judging presidents’ foreign policy. In August 2016, 50 primarily Republican former national security officials argued that Trump’s personal temperament would make him unfit to be president. Most of the signatories were excluded from the administration, but were they correct?

As a leader, Trump may or may not be smart, but his temperament ranks low on the scales of emotional and contextual intelligence that made Franklin D. Roosevelt or George H.W. Bush successful presidents. Tony Schwartz, who co-wrote Trump’s book The Art of the Deal, notes that “Trump’s sense of self-worth is forever at risk. When he feels aggrieved, he reacts impulsively and defensively, constructing a self-justifying story that doesn’t depend on facts and always directs the blame to others.”

Schwartz attributes this to Trump’s defense against domination by a father who was “relentlessly demanding, difficult, and driven…You either dominated or you submitted. You either created and exploited fear, or you succumbed to it – as he thought his elder brother had.” As a result, he “simply didn’t traffic in emotions or interest in others,” and “facts are whatever Trump deems them to be on any given day.”

Whether Schwartz is correct or not about the causes, Trump’s ego and emotional needs often seem to color his relations with other leaders and his interpretation of world events. The image of toughness is more important than truth. Journalist Bob Woodward reports that Trump told a friend who acknowledged bad behavior toward women that “real power is fear…You’ve got to deny, deny, deny and push back on these women. If you admit to anything and any culpability, then you’re dead.”

Trump’s temperament limits his contextual intelligence. He lacked experience, and has done little to fill the gaps in his knowledge. He is described by close observers as reading little, insisting that briefing memos be very short, and relying heavily on television news. He is reported to have paid scant attention to staff preparations before summits with experienced autocrats like Russian President Vladimir Putin or North Korea’s Kim Jong-un. If Trump’s iconoclastic style was merely a breach of traditional presidential etiquette, one might argue that his critics were being too fastidious, or were trapped in old-fashioned views of diplomacy.

But crudeness can have consequences. While pressing for change, he has disrupted institutions and alliances, only grudgingly admitting their importance. Trump’s rhetoric has downplayed democracy and human rights, as his weak reaction to the murder of Saudi dissident journalist Jamal Khashoggi demonstrated. Although Trump has echoed President Ronald Reagan’s rhetoric about the US being a city on the hill whose beacon shines to others, his domestic behavior toward the press, the judiciary, and minorities has weakened the clarity of America’s democratic appeal. International polls show a decline in America’s soft power since he took office.

While critics and defenders debate the attractiveness of the values embodied by Trump’s “America First” approach, an impartial analyst cannot excuse the ways in which his personal emotional needs have skewed the implementation of his goals – for example in his summit meetings with Putin and Kim. As for prudence, Trump’s non-interventionism protected him from some sins of commission, but one can question whether his mental maps and contextual intelligence are adequate to understand the risks posed to the US by the diffusion of power in this century. As tensions grow, reckoning with Trump may well become unavoidable in 2019.

Walls, Partisanship and the Shutdown


January 9, 2019

Newsbook

Newsbook

By Concepción de León

 

Eighteen days into the partial government shutdown, President Trump is preparing to deliver a national address on immigration to make his case for a border wall again. These three books offer perspective on the current shutdown: the inner workings of the government offices affected, the political precedent for the present bipartisanship and the debate over a border wall.

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THE FIFTH RISK
By Michael Lewis
221 pages. W.W. Norton & Company. (2018)

Lewis has a reputation for livening otherwise dry material, and according to our reviewer, “you’ll be turning the pages” of this story about government bureaucracy. The fifth risk in his title (after an attack by North Korea or war with Iran, for instance) is project management, or rather the mismanagement he details within the Trump administration. Key government positions remain unfilled, and others are occupied by nonexperts in their respective offices. “The Fifth Risk” provides insight into how government offices function, particularly under the current administration.

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THE RED AND THE BLUE
The 1990s and the Birth of Political Tribalism
By Steve Kornacki
497 pp. Ecco/HarperCollins Publishers. (2018)

 

In this book, Kornacki argues that the political battles between President Bill Clinton and Newt Gingrich, including a 21-day long government shutdown over budget disagreements, set the stage for the political divisions of today. “The early Clinton era is presented as a parade of confrontations — over welfare, balanced budgets, health care — that, for a time, emboldened Gingrich’s showdown wing of Republicanism,” wrote our reviewer. The government shutdown of 1995-96 is the longest on record, and this book explains the political tensions that caused it.

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WALLS
A History of Civilization in Blood and Brick
David Frye
320 pp. Scribner. (2018)

The idea of building walls to protect and separate societies is not new, and in this accessible history, Frye chronicles walls from ancient Greece to Berlin to China. He explains that early walls were built as protection from neighboring tribes, and how the walls in China assured traders safe passage. In addition to exploring walls’ role in the development of civilization, Frye also reckons with the psychological impact they can have on the migrants and refugees they keep out.

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