Alarm bell ringing due to Trump’s new pick on trade

Because it is so emotionally charged, populism can be easily guided for a purpose. One example of this is the campaign rhetoric of Donald Trump about how foreigners have “raped” the United States by “stealing” many of its manufacturing jobs. At the time, many Chinese were willing to laugh away such accusations against China as just more of the usual rhetoric — though more extreme — that has come to characterize presidential elections in the US. Now, however, there is real cause for concern as the president-elect has named economist Peter Navarro, known for his anti-China alarmism, as his trade adviser.

Trump in a statement announcing the appointment of Navarro as head of a newly created White House National Trade Council, praised the clarity of Navarro’s arguments. Which is perhaps not that surprising given the University of California-Irvine professor was the mastermind of the rhetoric Trump adopted during his campaign, and it had a similar tone to the apocalyptic language Navarro has used when accusing China of wiping out American manufacturing jobs and waging what he claims is an economic war against the US.

His appointment is another sign of the confrontational approach the incoming Trump administration seems intent on taking in relations with China.

It is an indisputable fact that China has not stolen jobs from the old manufacturing towns in the US, for those jobs were taken elsewhere by US companies who found that US consumers weren’t willing to pay the price for made-in-America products.

A point that was highlighted again on Tuesday in a Bloomberg report, which said American-made Macs have become an “albatross” for Apple since it started assembling them in the US in 2013 to “score political points” and some engineers are now pushing to move production “back to Asia”.

And the so-called economic war Navarro claims China is waging is the competition that has risen as China’s economy has moved up the value chain. Indeed the revelations of Edward Snowden showed that it is the US that has been using unfair means to gain an economic advantage.

That individuals such as Navarro who have a bias against China are being picked to work in leading positions in the next administration, is no laughing matter. The new administration should bear in mind that with economic and trade ties between the world’s two largest economies now the closest they have ever been, any move to damage the win-win relationship will only result in a loss for both sides.

Still, Chinese companies in the US should be on high alert to a more difficult business climate.