Trump's Trade Tactics 'Tumultuous' for Economy
Channel: fosha فسحة
Date: 2016-11-17

Trump's Trade Tactics 'Tumultuous' for Economy
Nov. 17 -- Former White House Chief of Staff Bill Daley discusses reports of JPMorgan Chairman and Chief Executive Officer Jamie Dimon being considered for U.S. Treasury Secretary and President-Elect Donald Trump's approach to trade. He speaks on "Bloomberg Daybreak: Americas."
DONALD TRUMP has described his foreign-policy priorities in only the vaguest terms. But he has made very clear that he believes his years in business have equipped him to negotiate better, smarter and tougher deals for America, whether by threatening to slap tariffs on foreign imports or to walk away from decades-old defence pacts. In Mr Trump’s descriptions of world affairs, talk of complexity is a trick, designed to befuddle honest Americans who wonder why the American superpower of their youth now seems less feared by enemies and disrespected by allies. In his telling, America’s problems are simple, self-inflicted and easily reversible, once the right man is sitting in the Oval Office.

Free trade is one of the subjects that first drew him into politics. He has been grumbling about foreign powers cheating America and stealing jobs since the 1980s, when he would appear on television talk shows to tell Oprah Winfrey or Larry King that Japan and others were robbing his homeland blind.

Today there is still a retro whiff to his ideas. Whether addressing grey-haired ex-factory hands in Ohio on the campaign trail, or greeting reporters at his fusty, brass-plated skyscraper in Manhattan, Mr Trump insists that China only sells so many goods in America because it has devalued its currency—even though most independent economists call that charge out-of-date, noting that recently China has been spending to prop up the yuan.

Mr Trump was carried to victory by telling voters that incompetent and corrupt elites either blundered or conspired to send manufacturing jobs out of America, when they could have stayed. He did not just attack such free-trade deals as the NAFTA pact with Mexico and Canada, or the forthcoming Trans-Pacific Partnership (TPP) between America and 11 other Asia-Pacific countries. He claimed—with no evidence—that America had hired “stupid” negotiators who failed to read what was in trade deals, while devious foreign officials “know where every comma is”. Politicians, he added, had colluded in this betrayal of America because “they get massive campaign contributions from others that want to make deals with China, and want to make deals with Mexico”.

Depending on the week, Mr Trump’s stated remedies have included a promise to order his Treasury Secretary to declare China a currency manipulator, promises to put TPP talks on hold, and threats to place tariffs of 5%, 10% or even 45% on imported goods. He has pledged to browbeat the bosses of such giant firms as Ford, Apple and Boeing to make more of their products at home, with the help of tweaks to the tax code.

China is “killing us”, Mr Trump told The Economist in August 2015. “The money they took out of the United States is the greatest theft in the history of our country.” Describing how he would approach Chinese leaders as president, he boasted of hiring smart new negotiators, naming his friend Carl Icahn, a corporate raider, as a prime example. Then, he said, he would tell China that countering its currency devaluation might require a 12% import tax, to level the playing field. “And you know what? They’re going to stop playing games with us. Look, they have taken our jobs, they have taken our money, and on top of that they have loaned the money to us and we actually pay them interest now on money.”

Mr Trump rejects those experts who talk about China as a creditor, with power over America. In May 2016, in a second interview with The Economist, the businessman declared: “We have a lot of power over China economically. Because we are the piggy bank that they keep robbing from.” China needs the American market, he bragged: “Excuse me, they can’t walk, we can.”

Asked in May how his supporters would respond when tariffs lead to higher prices on Chinese-made goods that fill the shelves of such price-conscious stores as Walmart, Mr Trump replied: “I see people buying five dolls for their daughters, maybe buy two dolls for their daughters. But I also say that we’ll start making the product at home.”