Use the Pacific trade pact to pressure China
In all of politics, but particularly in the politics of trade, the aggrieved are a force to be reckoned with.
For years, as the United States expanded commerce with countries near and far, the Rust Belt seethed. Eventually, it found in Donald Trump a presidential candidate who would tell them what they wanted to hear — that previous trade agreements were bad, and that America needed to start protecting its domestic industries.
As Trump has sought to impose protectionist policies, however, he has created new groups of the aggrieved: farmers, tech companies, drug makers, high-end manufacturers and others who thrive by exporting in a globally competitive world. Of late, amid all the talk of tariffs and trade wars, they have been making their displeasure known.
Trump has also managed to shoot himself in the foot. Among his favorite trade targets is China, which routinely runs a large trade surplus with America. But in renouncing the Trans-Pacific Partnership, a proposed deal with 11 countries not including China, Trump weakened the position of officials who went to Beijing late last week to negotiate over China’s protectionist tech policies and other trade matters.
The talks ended inconclusively, which is not surprising given Trump’s often contradictory and counterproductive pronouncements on trade. Recently, in a meeting with farm state lawmakers, the president said he’d reconsider his decision to withdraw from the TPP. Then he appeared to reconsider his reconsideration, calling the TPP a bad deal in a tweet.
Trump’s vacillation is not the only uncertainty. After Trump’s fact-deficient announcement shortly after he took office that America would drop out of the TPP, the 11 remaining nations renegotiated the deal to their liking, dropping rules designed to help Amer- ican makers of drugs, movies and software. Would they be willing to renegotiate again if Trump concludes that the United States should take part?
Let us make a somewhat facetious suggestion. Perhaps the name of the Trans-Pacific Partnership might be changed to the Substantially Improved Trump Trade Alliance to Make America Great Again.
The SITTAMAGA would be essentially the same as the original TPP but would cater to an important Trump constituency, his ego.
Trump opposed the TPP in part because it was negotiated by President Obama, and much of the 45th president’s agenda involves undoing deals made by the 44th. If Trump could be brought back in by allowing him to claim credit, that is a small price to pay.
Trump can’t be told often enough that the TPP (or whatever it is called) would give him a lot more leverage in dealing with China. To get China to stop subsidizing its industries, Trump needs to have allies while making China feel isolated. There is no better path than creating a trade zone that includes much of East Asia except China, which does not like to be the outsider.