Trump backs off China tar­iff threat

Tampa Bay Times - - Opinion -

In barely six weeks, Pres­i­dent Don­ald Trump has gone from threat­en­ing to im­pose $150 bil­lion in tar­iffs on Chi­nese goods to extending a life­line to ZTE, a Chi­nese cell phone com­pany that vi­o­lated U.S. sanc­tions by do­ing busi­ness with Iran and North Korea. The U.S. mil­i­tary re­gards ZTE’s prod­ucts as a se­cu­rity threat.

The pos­si­ble rea­sons for Trump’s about-face are many. They in­clude in­ter­na­tional trade and se­cu­rity con­sid­er­a­tions; China’s govern­ment owns a third of ZTE. That same Chi­nese govern­ment just guar­an­teed a $500 mil­lion loan that will greatly ben­e­fit a project in In­done­sia in which Trump’s real es­tate com­pany has a huge in­ter­est. To say this over­lap of Trump’s busi­ness in­ter­ests with his of­fi­cial du­ties is “trou­bling” doesn’t quite do it justice.

The Com­merce Depart­ment last month banned U.S. firms from do­ing busi­ness with ZTE for seven years. The firm makes in­ex­pen­sive cell phones that con­tain a lot of U.S. ma­te­ri­als and com­po­nents. ZTE fell un­der sanc­tions for break­ing a prom­ise to stop do­ing busi­ness with Iran and North Korea. Trump tweeted last week that he was wor­ried about the pos­si­ble loss of “too many jobs” in China and or­dered the Com­merce Depart­ment to back off.

He could be cur­ry­ing fa­vor with Chi­nese Pres­i­dent Xi Jin­ping ahead of next month’s sum­mit meet­ing with North Korean Pres­i­dent Kim Jong Un. He could be try­ing to pre­vent Chi­nese tar­iff re­tal­i­a­tion against U.S. agri­cul­tural prod­ucts, which wor­ries Repub­li­can mem­bers of Congress from farm states like Mis­souri and Illi­nois. It could be that Trump fi­nally woke up to the fact that a trade war with China would be dis­as­trous.

But the tim­ing points else­where. Trump con­tin­ues to per­son­ally profit from busi­ness deals done by the Trump Or­ga­ni­za­tion, now be­ing run by his sons Don­ald Jr. and Eric Trump. The pres­i­dent claims to have no in­volve­ment in the firm’s day-to-day op­er­a­tions.

Even be­fore Trump was elected, his firm had a deal with the In­done­sian de­vel­op­ment com­pany MNC to build ho­tels and a golf course at a huge theme park in Lido City, out­side the In­done­sian cap­i­tal of Jakarta. Mar­ket­ing ma­te­ri­als for “MNC Lido” de­scribe the Trump prop­er­ties as “flag­ship” el­e­ments of the theme park and show Trump’s sons were di­rectly in­volved.

But MNC had trou­ble fi­nal­iz­ing fi­nanc­ing un­til last Thurs­day, when the Chi­nese govern­ment ex­tended a loan to the state-owned Me­tal­lur­gi­cal Corp. of China, which has part­nered with MNC.

Seventy-two hours later, Trump was or­der­ing sanc­tions lifted from ZTE ahead of a visit from Chi­nese Vice Premier Liu He later this week.

The good part of all of this is that Trump has dropped his blus­ter about a trade war with China, which was al­ways a bad idea. The bad part is that China seems to have fig­ured out that the way to this pres­i­dent’s heart is through an­other un­con­sti­tu­tional emol­u­ment.

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