U.S. president blames his predecessors, not Beijing, for ‘unfair’ trade relationship
In Beijing on Thursday, Mr. Trump spoke in unusually conciliatory tones during joint appearances with Mr. Xi, hailing their “very good chemistry” while also expressing hope for forceful action from Beijing.
Mr. Trump blamed past U.S. administrations, rather than Beijing, for what he described as a “very one-sided and unfair” trade relationship, adding, “but we’ll make it fair and it’ll be tremendous to both of us.”
.. Mr. Trump did include tougher talk in his pledge to tackle imbalances: “We must immediately address the unfair trade practices that drive this deficit,” he said. “We really have to look at access, forced technology transfer and the theft of intellectual property, which just by and of itself is costing the United States and its government at least $300 billion a year.”
.. “I told President Trump that the Pacific Ocean is big enough for both China and the U.S.,” he said.
.. “It appears Trump opted to publicly play down U.S.-China differences, praise the Chinese people for what they have achieved, and give Xi Jinping face,” said Bonnie Glaser,
.. Beijing’s strategy appeared to be to flatter Mr. Trump into easing up on pressure over trade and North Korea and acknowledging China’s territorial interests and ambitions for a leading role on the world stage.
.. Mr. Trump had told the Chinese president: “You’re a strong man—you can, I’m sure, solve this for me.”
.. However, he acknowledged that on trade, “the things that have been achieved thus far are pretty small.”
.. Mr. Xi is expected to use his speech to the same forum to press the image of China as the new champion of global free trade, and to encourage other countries to participate in his Belt and Road plan for wide-ranging trade and transport links.
How China Swallowedd the WTO
Rather than fulfilling its mission of steering the Communist behemoth toward longstanding Western trading norms, the WTO instead stands accused of enabling Beijing’s state-directed mercantilism, in turn allowing China to flood the world with cheap exports while limiting foreign access to its own market.
.. Now it is coming to a head under the first American presidency of an open free-trade skeptic, in a case just starting to wend its way through the Geneva process. The issue: whether China has graduated to a “market economy,” a change of status that would make it considerably harder for other nations to block imports they believe are improperly aided by Chinese government distortions.
.. both the U.S. and European Union demanding the change, calling it “nonnegotiable,” and Chinese officials are likely to reiterate that demand when they talk trade next week with President Trump during his Beijing visit
.. “This is without question the most serious litigation matter we have at the WTO right now,” Robert Lighthizer, the Trump administration’s trade representative, told Congress in June. A China victory, he added, “would be cataclysmic for the WTO.”
.. Under Geneva’s guidance, tariffs world-wide have plunged nearly 80% and trade’s share of the global economy has more than doubled. More than 160 countries representing 98% of world commerce are now WTO members, and most of the few remaining nonmembers—like Belarus and Timor-Leste—are negotiating to join.
.. the director-general of the WTO, credits his organization with preventing a recurrence after the 2008 financial crisis of the trade wars that exacerbated the Great Depression.
.. Since 2007, China has been party to more than a quarter of all WTO cases, as trading partners scrambled to erect barriers protecting their industries while demanding better access to China’s markets.
.. China sought out disputes in which it had no direct stake and joined more than 100 as a “third party,” giving officials access to proceedings as observers. The Chinese offered large stipends to prominent American and European trade-law scholars to teach seminars in China for young bureaucrats. They retained top U.S. law firms.
.. Steptoe & Johnson LLP became the go-to firm for combating a new American policy imposing extra-steep duties on Chinese imports aided by allegedly illegal subsidies
.. WTO defenders note the U.S. has still won the vast majority of cases it has filed in Geneva, and say it should be pleased that China has chosen to pursue its trade grievances through global arbiters.
.. Commerce Secretary Wilbur Ross in April launched an official study of “the structural problem” of the WTO and its courts, arguing the body has “an institutional bias…toward the exporters rather than toward the people that are being beleaguered by inappropriate imports.”
.. A looming challenge to the WTO is the pending case determining China’s official status in the world trading system—whether members are now required to treat it as a “market” economy.
.. Beijing reads the pact as having automatically guaranteed it market status 15 years after its December 2001 accession. The U.S., Europe, Japan and others say the change was intended to be a privilege contingent on liberalization promises Beijing has yet to keep.
.. The “nonmarket” designation makes it easier for trading partners to impose inflated tariffs on goods they conclude have been “dumped”—or sold below “fair” value. That’s because prices and costs are seen as so distorted in a “nonmarket economy” that other countries are given wide latitude to determine on their own what they consider “fair.”
.. A flip from “nonmarket” to “market” would boost EU imports from China by as much as 21%, or $84 billion
.. The study concluded that Washington applied an average duty of 162% against Chinese goods, compared with a 33% rate for market economies.
.. . The study concluded that Washington applied an average duty of 162% against Chinese goods, compared with a 33% rate for market economies.
“That gray zone is the key point of tension,” says Chad Bown, a WTO expert at the pro-free-trade Peterson Institute for International Economics. “How you deal with that is ultimately going to determine whether the WTO system in its current form can hang together or not.”
As G.O.P. Bends Toward Trump, Critics Either Give In or Give Up
Despite the fervor of President Trump’s Republican opponents, the president’s brand of hard-edge nationalism — with its gut-level cultural appeals and hard lines on trade and immigration — is taking root within his adopted party, and those uneasy with grievance politics are either giving in or giving up the fight.
.. The Grand Old Party risks a longer-term transformation into the Party of Trump.
“There is zero appetite for the ‘Never Trump’ movement in the Republican Party of today,” said Andy Surabian, an adviser to Great America Alliance, the “super PAC” that is aiding primary races against Republican incumbents. “This party is now defined by President Trump and his movement.”
.. Many of those who remain will have to accommodate the president to survive primaries from the pro-Trump right.
.. governor races in Virginia and New Jersey and a special Senate race in Alabama — Republican candidates are mirroring Mr. Trump’s racially tinged campaign tactics.
.. Many of their voters prefer the Trump way.
“We’re not an element,” said Laura Ingraham, a pro-Trump talk show host. “We’re the party.”
.. Ms. Ingraham .. the conservatism of market-oriented internationalism simply has little mass appeal.
“There’s no constituency for open borders, endless war and these international trade deals that are skewed against the United States,” she said.
.. As for the limited government pitch that defined Mr. Flake’s career, Stephen K. Bannon, the president’s former chief strategist, scoffed.
.. “It’s very nice. But it’s a theoretical exercise. It can’t win national elections.”
.. “We have a leader who has a personality disorder,” said former Senator Tom Coburn, Republican of Oklahoma, “but he’s done what he actually told the people he was going to do, and they’re not going to abandon him.”
.. “I don’t think the rank-and-file Republican believes that corporations are people,” said Sam Nunberg, a former adviser to the Trump campaign who has also worked with Mr. Bannon.
.. For now, though, the vision for a more populist-nationalist party sketched out by Mr. Bannon is being won as much through intimidation as through actual purges in Republican primaries.
.. “The message they’re sending is: The way to survive is by accommodating him, changing their tone and professing loyalty to Trump,” said William Kristol.. former Representative Tom Tancredo, who was shunned by the Bush-era Republican Party for his harsh anti-immigration views, is considering a comeback bid for governor in 2018... Mr. Graham believes that the president is not as wedded to some of his nationalist policies as his supporters want to believe.
“The best thing that could happen to Trump and the future of the Republican Party is for Trump to fix a broken immigration system,” Mr. Graham said.
.. Establishment Republicans are attempting to convince Mr. Trump that “if you join with Bannon, you cut your own throat,” Mr. Graham said, because it could lead to an impeachment effort by a Democratic-controlled Congress.
But these arguments cause the early Trump enthusiasts only to roll their eyes. The party establishment, these Trump backers say, wants to govern as if the election never happened.
“They still think the election was about Trump’s personality,” Ms. Ingraham said. “It wasn’t. It was his ideas.”
George W. Bush comes out of retirement to deliver a veiled rebuke of Trump
Bush offered a blunt assessment of a political system corrupted by “conspiracy theories and outright fabrication” in which nationalism has been “distorted into nativism.”
.. “Bullying and prejudice in our public life sets a national tone and provides permission for cruelty and bigotry. The only way to pass along civic values is to first live up to them.”
.. Just hours after Bush completed his speech, Obama also made a veiled critique of the Trump era, calling on Democrats at a New Jersey campaign event to “send a message to the world that we are rejecting a politics of division, we are rejecting a politics of fear.”
.. That Trump’s two most recent predecessors felt liberated, or perhaps compelled, to reenter the political arena in a manner that offered an implicit criticism of him is virtually unprecedented in modern politics, historians said.
.. George W. Bush was taking aim at Trump’s “roiling of the traditional institutions of the country and, in particular, demeaning the office of the president by a kind of crude or vulgar bashing of opponents,”
.. “I think this is Bush throwing down the gauntlet and feeling that this is a man who has gone too far,” Dallek said. The discretion former presidents traditionally afforded their successors “is now sort of fading to the past because of the belligerence of Trump.”
.. McCain’s critique prompted Trump to warn him to “be careful” because he is prepared to “fight back.”
.. The common thread among Bush’s and McCain’s words was a defense of the post-World War II liberal order
- which supported strong security alliances,
- a defense of human rights and an
- open economic system of free trade
.. “The hallmark of McCain’s and Bush’s speeches was to try to re-center us on what have been, since 1945, these traditional ends,”
.. He cautioned at the time, however, that he would speak out if he saw “core values” at risk.
.. the unifying themes between Obama and Bush are “humanity and empathy towards the American public.”
.. Bush opened his remarks by speaking in both English and Spanish and noting that refugees from Afghanistan, China, North Korea and Venezuela were seated in the audience.
.. Bush also warned that “bigotry seems emboldened” in a passage that evoked the aftermath of the white supremacist rally in Charlottesville
.. “Bigotry or white supremacy in any form is blasphemy against the American creed,” Bush said in a line that drew the most applause.
.. “Politics are now about discrediting people by ad hominem attacks, not by argumentation,” Cohen said. Those who opposed Bush’s wars have a fair point of view, he said, but their constant “demonization does help make it easier for Trump.”