Zhao Minghao:Trump’s Second-Term China Policy

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Zhao Minghao:Trump’s Second-Term China Policy

2020-09-11

By: Zhao Minghao    Source: China-US Focus    Published: 2020-09-07    



At the recent Republican National Convention in the United States, Donald Trump accepted his party’s presidential nomination and made an acceptance speech. Ignoring objections, Trump chose to conduct election campaign activities at the White House in a bid to appeal to the electorate with the grandeur of the scene topped with inflammatory language.


Recent polls show that former Vice President Joseph Biden’s lead over Trump has narrowed. What’s more, as conservatives are said to be less open about their political inclinations in opinion polls, the polls may tend to underrepresent support for Trump. It may be too early to write off Trump’s re-election chances as the U.S. presidential election campaign enters its final stage.


Based on Trump’s speech and a scanty second-term party platform, it seems “America first” on steroids will aptly describe a Trump second term if he is elected. Trump lambasted Biden on his position on the Trans-Pacific Partnership, and labeled him the destroyer of American greatness. Trump vowed to create millions of jobs, and make America the “manufacturing superpower” of the world.


Compared with his platform in 2016, Trump has taken a tougher position with respect to his China agenda, and integrating Biden bashing with China bashing has become a staple of his political campaign.


In his hour-long acceptance speech, Trump made 15 references to China, and used a malicious slander — “China virus” — multiple times. Trump claimed that Biden, if elected, would outsource U.S. jobs to China and that Biden supports China’s membership with the WTO, thereby brining economic disaster to the U.S. He also said Biden had spoken positively about China’s development and bragged that he has taken “the toughest, boldest, strongest and hardest-hitting actions” against China in American history. Trump claimed that his agenda is anchored by “made in America,” while Biden’s was “made in China,” and he blustered that China would own the U.S. if Biden were to be elected.


Though Biden didn’t mention Trump by name in his acceptance speech, that did nothing to sway Trump, who pulled no punches in his attacks. Trump attempted to paint Biden and the Democratic Party as “socialist” and “radical left.”


“At no time before have voters faced a clearer choice between two parties, two visions, two philosophies or two agendas,” he said.


Given the polarized political dynamics at home, Trump may continue on his path of confrontation and hostility against China. Put another way, Trump is weaponizing the China agenda to fight in an increasingly heated ideological civil war.


If elected to a second term, Trump would continue to push for economic decoupling from China and has promised to “end U.S. reliance on China,” He promised to bring 1 million jobs from China back to America, provide tax breaks for companies moving back and deny federal contracts to companies that outsource work to China.


Decoupling is costly and won’t come without great repercussions. Research by Bank of America shows that foreign companies will have to bear nearly $1 trillion of losses should they move out of China in the next five years. In a second term, Trump may take a step-by-step approach to accelerate decoupling with China in industrial areas such as pharmaceuticals, medical equipment, robots and raw materials key to defense. The Trump administration will resort to the funding of reshoring through tax benefits and fee reductions, among other means, to induce U.S. companies to move out of China.      


Meanwhile, the Trump administration will ramp up pressure on U.S. companies that have second thoughts about leaving China by applying special tariffs and other punishments. An AmCham survey found that 84 percent of American companies do not want to leave China, and 38 percent would like to maintain or increase their investments in the country. So far this year, Exxon Mobile, Honeywell, Tesla, Walmart and other U.S. multinationals have expanded their cooperation and presence in China.


Trump would start with federally contracted companies, leveraging government resources to push their supply chains and industrial chains away from China — an approach that will only lays bare the hypocrisy of U.S. criticism leveled at China for government interference in the economy.


The Trump administration has also stepped up its pressure on China on the technology front. For the past four years, the Trump administration has taken a defensive approach to containing China’s technological progress. But if and when he goes into a second term, Trump is likely to be more aggressive in ratcheting up a technology cold war against China. Trump also set out in his platform bulletin that he would, in a second term, push to establish a permanent manned presence on the moon, send the first manned mission to Mars, win the competition for 5G and a new generation of Wi-Fi technologies and continue to lead the world in providing clean water and clear air. He reiterated these goals in his acceptance speech.    


According to The Wall Street Journal, the Trump administration plans to increase spending on AI and quantum technologies by 30 percent in the 2021 non-defense budget — around $2.2 billion. This may well be just a modest step as part of broader efforts to mount pressure on China in the technology field.


Along with increased investment in R&D, the Trump administration is pushing the European Union, Japan and other allies and partners to pitch in for R&D of advanced technologies and “alternative products” to ease the financial strain on R&D stemming from the pandemic-induced economic recession. The U.S. may leverage the Global Partnership on Artificial Intelligence (GPAI) as a template to promote cooperation among “democracies” on advanced technology research, and develop products and services in line with their shared values.


Meanwhile, Trump has repeatedly mentioned “socialism” as a threat to the U.S. and has proposed promoting American exceptionalism education in schools. It can be expected that an America on Trump’s watch will see conservatism, populism and nationalism gaining strength in the country, and the ideological stance will further harden. A second Trump term will also see intensified ideological attacks on China and its Communist Party, as well as more maneuvers to weed out Chinese influence in the U.S. through more surveillance and restrictions on exchanges in fields such as culture, education and journalism.


Trump’s China policy has been questioned by many. The trade war provoked by his administration did not meet its target, and giving a free rein to China hawks who escalate ideological confrontations and issues related to Taiwan and the South China Sea risks derailing China-U.S. relations. A Gallup poll showed that 57 percent of U.S. citizens do not approve of the Trump administration’s approach to U.S.-China relations. Continued escalation of the trade war will only aggravate the pain for U.S. consumers and farmers.


It’s possible that after Nov. 3 the White House will adopt a more levelheaded China policy. Perhaps the ultimate punishment meted out by voters will deprive Trump of the opportunity to lead the way.



Zhao Minghao is a visiting fellow at the Chongyang Institute for Financial Studies at Renmin University of China.