“Bannon’s particular unique idea was that this is a civilizational challenge,” said Michael Pillsbury, who met with Bannon regularly on China over the past year. “His warning is, if they surpass us, they will have earned the privilege of redesigning the world order.”
.. Bannon believes the United States needs a long-term strategy for maintaining advantage over China similar to what Marshall helped devise for the Soviet Union, while acknowledging that the China challenge is much harder.
.. Behind the scenes, Bannon had been busily operationalizing his plan to win the economic war with China. He spent 50 percent of his time on China, he liked to tell colleagues. Several of his China agenda items will continue to have advocates, including National Trade Council Director Peter Navarro and Commerce Secretary Wilbur Ross.
.. he was opposed by other top officials, including National Economic Director Gary Cohn and Treasury Secretary Steven Mnuchin.
.. The Chinese government has also cultivated close ties with Jared Kushner and Secretary of State Rex Tillerson, with the help of former secretary of state Henry Kissinger.
.. The Kushner-Kissinger view holds that the U.S.-China relationship is too complex and important to risk throwing into disarray. They advocate cooperation over confrontation and integration over isolation. China shares that view and wants to set forth a new model of great power relations based on mutual respect and noninterference.
In Bannon’s view, the liberal international order the United States led since World War II has ceased to work in America’s interests. The theory that bringing China into that structure would transform China has failed and now the Chinese government abuses those systems to siphon huge amounts of wealth, technology and know-how from the United States and its partners, he believes.
He also sees a new China policy as a pillar of his plan to reorient American politics around economic nationalism. He views the rebalancing of the U.S.-China economic relationship as key to returning manufacturing jobs to the United States and vice-versa.
.. One of Bannon’s final acts before leaving the administration was to announce in an interview that to him, “the economic war with China is everything.” He argued the United States must marshal all elements of national power to confront China in various spheres or yield world hegemony.
“Bannon’s particular unique idea was that this is a civilizational challenge,” said Michael Pillsbury, who met with Bannon regularly on China over the past year. “His warning is, if they surpass us, they will have earned the privilege of redesigning the world order.”
Video: Why a Staff ‘Shake-up’ Poses Challenges for President Trump
There are Three Pillars of Political Thought in the white house:
- Economic nationalists: Steve Bannon, Stephenen Miller, Peter Navarro
- Moderate Globalists: Jared Kushner, Ivanka Trump, Gary Cohn, Dina Powell
- Establishment Republicans: Reince Priebus, Sean Spicer
White House civil war breaks out over trade
‘Fiery meeting’ in Oval Office between economic nationalists and pro-trade moderates.. That has led to discussions over moving Mr Navarro and the new National Trade Council he leads out of the White House and to the Commerce Department.. Mr Navarro’s case has not been helped by his interactions with Republicans in Congress. He was criticised for being ill-prepared and vague at a closed-door briefing he held with Senators last month to discuss Mr Trump’s trade agenda and angered some Republicans as a result... Among Mr Cohn’s recent appointments has been Andrew Quinn, a respected former diplomat and trade official who served as a senior negotiator during the Obama administration’s push for a Trans-Pacific Partnership with Japan and 10 other countries... The appointment of Mr Quinn drew a howl of protest from Breitbart, the rightwing web site Mr Bannon used to lead. It labelled the career official an “enemy within”.. “The situation is less worrying than it was two months ago because [Mr] Navarro seems to be more and more marginalised,” said one European official. “His influence seems to be diminishing quickly.”.. “At the moment it appears that the Wall Street wing of the Trump administration is winning this battle and the Wall Street wing is in favour of the status quo in terms of US trade policy,” Ms Lee said.
Trump’s Economic Team of Rivals
The incoming president’s advisers are all over the ideological map.
Summing up his life lessons, he encouraged the students to lean in: “Everything I’ve done in my career, and everything that most of you have done to this point, is to take risks.”
.. During an interview on CNBC the day of his appointment, Mnuchin said his top priorities were tax reform and rolling back the Dodd-Frank Act – not exactly what all those voters demanding the return of lost industries in middle America were clamoring for.
.. Seeing China as an economic paper tiger (or dragon as the case may be), he also believes that the Beijing government is weaker than it seems and susceptible to pressure and coercion. Hence he is supportive of retaliatory tariffs and other measures designed to “level the playing field.”
.. The plan has four pillars: “tax cuts, reduced regulation, lower energy costs, and eliminating America’s chronic trade deficit.” But trade is their real passion: They honed in on the entry of China into the World Trade Organization, which they said “opened America’s markets to a flood of illegally subsidized Chinese imports, thereby creating massive and chronic trade deficits” and “rapidly accelerated the offshoring of America’s factories
.. “Either you believe in markets, or you believe in government,” Kudlow has said.
.. Something’s got to give. How to square deregulation with abiding by environmental standards, as Cohn favors? How to square tariffs on imports designed to boost domestic production (Navarro and Ross) with the free flow of capital (Kudlow)? How to balance deconstructing Obamacare without price gouging and chaos in the health-care system that will surely hurt the working class that supported Trump? How to balance punitive tariffs with affordable goods? How to start mini-trade wars without the costs falling on, say, Walmart shoppers? How to juxtapose tax cuts that will benefit the 1% with the need to boost wages and employment for millions of disgruntled workers and unemployed who see Trump as a best last chance to turn things around?
The answer is that you can’t. If Trump’s goal is to create tension and conflict and see who emerges bloodied but victorious from the fighting, he’s setting up one hell of a battle.
.. Faced with competing and irreconcilable voices, it will be up to Trump to play the referee. That can take the form of active deliberation with his advisers, or passively waiting it out until someone emerges on top of the bureaucratic scrum. It’s certainly a recipe for a White House of conflict; whether it’s a recipe for sound and coherent economic policy is entirely another matter.