By Barbara Slavin
Even before he held a provocative phone call with the president of Taiwan on Friday, President-elect Donald Trump espoused policies that, if implemented, will likely strengthen China’s regional and global influence at the expense of the United States.
Trump’s apparent insistence on negotiating individual trade treaties as a substitute for the Trans-Pacific Partnership (TPP) between the United States and 11 other nations could push many of these countries to join a rival, China-led trade agreement, the Regional Comprehensive Economic Partnership (RCEP).
The TPP excludes China; the RCEP excludes the United States. It includes the 10 members of the Association of Southeast Asian Nations plus Japan, South Korea, Australia, New Zealand and India – all key trading partners of both the United States and China.
The TPP, which was also opposed during the campaign by Hillary Clinton in an effort to compete with Trump for working class votes, is a laboriously negotiated document that actually includes unprecedented protection for U.S. labor. Unlike the much-maligned North American Free Trade Agreement of the 1990s, the TPP has stringent standards for workers that could help keep U.S. companies competitive despite paying higher wages. The agreement also has unprecedented environmental and dispute-resolution provisions.
As a U.S. government website notes, the TPP allows Washington to remain the leader in writing the “rules of the road” for international trade – a position the United States has held since the end of World War II. If the Trump administration completely abandons the TPP, it will be ceding control over much of that trade agenda to China.
China has already bolstered its economic clout by creating an Asian Infrastructure Investment Bank as a rival to Western-dominated multilateral financial institutions such as the World Bank, increasing Chinese influence in developing nations and business opportunities for Chinese companies. If the Trump administration carries out its threats to embrace a more protectionist stance on trade, including possible 35% tariffs, China’s profile is certain to rise further.
In addition to rejecting the TPP, Trump has also vowed to withdraw from the Paris agreement on reversing and mitigating climate change. China, whose acceptance of the climate accords was a key achievement of the Barack Obama administration, could, ironically, find itself a leader in this area as well.
Meanwhile, Trump’s conversation with Taiwanese President Tsai Ing-wen has created a crisis with China even before Trump takes office. Speaking on television on Sunday, Vice President-elect Mike Pence dismissed the event as a “courtesy” call with no policy implications. But the Washington Post reported that the call had been planned for weeks as a show of support for the island democracy and a deliberate provocation of China.
Bending a precedent against a U.S. president or president-elect talking to a Taiwanese leader in effect since 1979, when Jimmy Carter recognized the mainland government in Beijing, Trump may hope to trade a reaffirmation of the “one-China” policy for concessions on trade, North Korea or Chinese military activities in the South China Sea.
But by speaking to the leader of what China regards as a renegade province, Trump risks inflaming Chinese nationalism, which has replaced communism as the country’s predominant ideology. Given China’s importance to the United States as a trading partner and holder of $1.25 trillion in U.S. Treasury bonds, any moves that undermine the relationship could have dire economic consequences for Americans. It would be useful if Trump names a secretary of state with broad experience in Asia to offset already named senior officials with more expertise in the Middle East.
Trump doubled down on challenge to China by tweeting complaints that China has devalued its currency in an effort to boost exports. The president-elect once again demonstrated his ignorance of international economics by suggesting that Chinese leaders should have first asked the U.S. if that sovereign step was “OK.”
Did China ask us if it was OK to devalue their currency (making it hard for our companies to compete), heavily tax our products going into..
— Donald J. Trump (@realDonaldTrump) December 4, 2016
their country (the U.S. doesn’t tax them) or to build a massive military complex in the middle of the South China Sea? I don’t think so!
— Donald J. Trump (@realDonaldTrump) December 4, 2016
While Trump may think his verbal bullying gives his incoming administration more leverage, it is in fact compounding an image of recklessness and unpredictability that is already unnerving foreign leaders and making other countries more likely to hedge their ties with the United States and by moving closer toward China and/or Russia.
The United States retains important advantages over these rivals, including a younger, demographically healthier population, a more vibrant climate for innovation and a higher educational system that remains the envy of the world and a major magnet for foreign students. Of the world’s 20 top-ranked universities, 14 are American. But with the world’s second largest economy and a growing ability to project military power, China is well-placed to challenge U.S. influence in the Pacific and beyond.
Meanwhile, the factory jobs that Trump insists can somehow return to the United States are more likely to be eliminated by automation or to move to other lower-wage countries. The tax break maneuver that he and Indiana Governor Pence pulled last week in convincing the Carrier Corp. to keep a thousand jobs in Indiana instead of sending them to Mexico will be near-impossible to replicate on a large scale.
Throughout history, certain countries have risen to dominance and then seen their fortunes fall, often because of self-inflicted wounds. The United States began assuming the mantle of superpower status from Britain a century ago, intervening decisively in two World Wars and leading a consensus in favor of free-market capitalism and liberal democracy.
Watching the rise of Trump – and similar populist and nativist movements in Britain and continental Europe – it is hard not to feel a shiver of apprehension that the best days of that U.S.-led world order may be over.
China was a major power for thousands of years before the United States existed and when Trump’s ancestors were barbarians living in forests and caves. A man who prides himself on being an expert in the “art of the deal” might think more carefully before trying to outsmart the heirs to Confucius and the great military strategist Sun Tzu.