Trump will ‘hang tough’ on China, political fallout be damned

Senate Minority Leader Chuck Schumer (D-N.Y.) wants President Trump to “hang tough on China.” Of course he does.

Schumer knows full well that “hanging tough” on the contentious effort to reset our trade agreement with Beijing could torch our booming economy, which is the best and perhaps only way that Democrats will unseat Trump in 2020.

With Gallup showing the president’s approval rating at an all-time high for his presidency and with the country giving Trump especially high marks for his handling of the economy, Democrats would rejoice to see the trade talks stall.

If the president follows through with his threat to sharply hike tariffs, markets will sell off, and economic growth could slow.

{mosads}Let’s be honest: The number of Beltway insiders who actually want the president to succeed in redrafting our trade alliance with China could fit in a shoebox.

Democrats don’t make the cut; they know that those blue-collar workers in the Midwest who elected Trump will flock to the polls to vote for him again if he concludes a deal that protects American workers.

Joe Biden in particular doesn’t want Trump to win the trade battle with China. The former vice president and today’s frontrunner for the Democratic nomination wants to pretend the problem doesn’t even exist.

Biden might then have to explain to voters why he and his “buddy Barack” — as he recently described President Obama — failed to tackle China’s misdeeds during their eight years together in the White House.

During that time, China steadily extracted manufacturing jobs from the American workers whom Biden is now courting.

At a recent campaign stop, Biden said about the Chinese, “They’re not competition for us.” That’s how clueless the leading Democratic contender is. 

Establishment Republicans aren’t so sure they want the White House to win on this front either. Most align themselves with big business; the Chamber of Commerce, which represents that group, has steadfastly opposed Trump’s trade approach.  

America’s big corporations, after all, have for decades benefited from cheap Chinese labor. They have also worked feverishly to access China’s growing middle class and burgeoning consumer market.  

For the past 20-30 years, America’s CEOs were content to play along with Beijing’s rulebook; they would take in local partners as required and ignore the copying of their patents and designs as long as they got their foot in the door.

It was a costly bargain, and more recently some have come to realize the extent of their firms’ sacrifices, but the damage has been done.

To be sure, Republican legislators know they have a better chance of reelection in 2020 if the economy, and Trump, remain strong. And, for sure, many Republicans in Congress represent farming districts; those folks have been hurt by the tariff tit-for-tats and would welcome the increased exports the talks promise.

But, GOP backers in corporate America are not convinced the White House is putting their interests first.

Opinion makers of all stripes appear hopeful the talks will end in failure. After all, those on the right have expressed horror at the very idea of tariffs, and embrace the concept of free trade with the desperation of a drowning man clinging to a twig.

Everyone knows there is no such thing as free trade and that commerce between nations is subject to all kinds of rules and stipulations. But because President Trump has dared to challenge Beijing’s flagrant cheating and thievery, exposing our “free trade” arrangements as corrupt, he is the intellectual villain in the piece.

On the left, editorial writers cannot tolerate the thought that Trump’s blunderbuss and unilateral approach might work. Globalists would have the White House rely on the World Trade Organization (WTO) to penalize China for cheating, even though the essential rules of that organization fall drastically short of getting the job done.

Members of the global institution undertook a spirited effort to re-write the WTO’s regulations nearly two decades ago once China’s misuse of state-owned enterprises (and other abuses) became apparent, but the talks were abandoned after seven futile years.

Trump would not depend on the WTO.

In the past couple of weeks, there have been leaked reports that President Trump is backing down from his tough demands in order to secure a quick deal, nervous about reelection and wary of upsetting markets.

Consequently, the story goes, White House negotiators have dropped their requirements that China swear off intellectual property theft and also end subsidies of state-owned enterprises.   

That has been the spin from the liberal media, which, as a deal appeared imminent, has been attempting to soft-pedal what would be an extraordinary achievement. Taking on China in a bruising trade negotiation was a bold move on the part of President Trump, and another way in which he fulfilled campaign promises.

{mossecondads}If Trump were to succeed, America’s farmers and industries will benefit; it would be another major win for this unlikely president. Better for his critics to portray any agreement that emerges as weak or insufficient.

The truth is just the opposite. The Chinese were apparently trying to wiggle out of commitments already made, and the U.S. negotiators were having none of it; hence, Trump’s renewed threat to raise tariffs.

There may yet be more delays in the talks; markets may swoon as a result. Make no mistake, a hefty increase in tariffs and retaliatory measures by China could slow growth and in the short term hurt American consumers. The White House appears ready to pay that price to curb China’s cheating and stealing.

They appear willing, in short, to “hang tough,” despite the political consequences. That’s a measure of President Trump’s commitment to put America’s workers first.   

Liz Peek is a former partner of major bracket Wall Street firm Wertheim & Company. For 15 years, she has been a columnist for The Fiscal Times, Fox News, the New York Sun and numerous other organizations. Follow her on Twitter: @lizpeek.