Trump raises prospect of ‘decoupling’ US economy from China

September 08, 2020
CPA’s Take: Good to see POTUS start to talk about decoupling from China. Ending federal contracts with companies who offshore is an important idea.

President vows to end reliance on Beijing as he ratchets up anti-China rhetoric in re-election campaign

[Brendan Greeley | September 7, 2020 | FT]

Donald Trump raised the prospect of “decoupling” the US economy from China and claimed that America was experiencing “the fastest recovery in US history”, honing his economic messaging as the presidential campaign enters its final stretch.

Mr Trump, who made China a central focus of his 2016 campaign, previewed a tougher line on trade with Beijing in a press conference held in front of the White House on the Labor Day holiday, with less than two months to go before the election on November 3.

Mr Trump said that “decouple” — which economists have used for a decade to refer to a potential permanent drop in trade between the two countries — was “an interesting word”.

“If we didn’t do business with [China], we wouldn’t lose billions of dollars,” Mr Trump said on Monday. “It’s called decoupling. So you’ll start thinking about it. You’ll start thinking they take our money and they spend it on building aeroplanes and building ships and building rockets and missiles.”

The president also threatened to block companies that outsource jobs to China from receiving federal contracts, and vowed — as he did during the 2016 campaign — to bring manufacturing jobs and crucial supply chains back to the US.

“We will make America into the manufacturing superpower of the world and will end our reliance on China once and for all,” he said. “Whether it’s decoupling, or putting in massive tariffs like I’ve been doing already, we will end our reliance on China, because we can’t rely on China.”

The president promised to get tough on trade with China during the 2016 campaign and secured a limited “phase one” trade deal earlier this year. But the trade deficit with China has remained stubbornly high. Data released by the commerce department on Thursday showed the US trade deficit with the Asian country increased by $1.6bn to $28.3bn in July.

Mr Trump has said the US would hold China accountable for the devastation wrought by the coronavirus pandemic, which has killed more than 181,000 people in the US. In recent months his administration has taken aim at Beijing over a host of issues, ranging from pro-democracy demonstrations in Hong Kong and alleged abuses against Uighurs in Xinjiang to accounting standards for US-listed Chinese companies.

The president painted his Democratic rival, Joe Biden, as a “pawn” of Beijing, saying the former vice-president will “surrender our jobs to China, our jobs and our economic wellbeing”.

Mr Trump and Mike Pence, his vice-president, used the Labor Day holiday to depart from their campaign’s focus on imposing “law and order” and cracking down on civil rights demonstrators to offer an economic message: the virus will be contained soon, and the economy has started to recover.

“The United States experienced the smallest contraction of any major western nation,” said Mr Trump. “Our rise is spectacular and we’re rebounding much more quickly from the pandemic.”

In the US, GDP dropped 9.5 per cent in the second quarter. That is better than Germany or the UK, but worse than South Korea or Japan, where the economy slowed by 7.8 per cent over the same period. Mr Trump also pointed to an encouraging jobs report from Friday, which showed unemployment at 8.4 per cent.

The US has recovered about half of the 22.2m jobs lost during March and April, amid widespread lockdowns.

“We’ve gone through a time of testing,” said Mr Pence, speaking on Monday to about 250 workers and guests at the Dairyland Power Cooperative in La Crosse, Wisconsin. “We’re soon coming to a time of choosing.”

Under Mr Trump, “the era of economic surrender is over”, he added.

Mr Biden and his Democratic running mate, Kamala Harris, also made trips to battleground states on Monday. Mr Biden travelled to Pennsylvania, where he met with union leaders. Ms Harris was in Wisconsin to visit with family members of Jacob Blake, a black man who was shot by a police officer in an incident that has added fuel to anti-racism protests across the US.

Read the original article here.

Showing 8 reactions

  • Brad Johnson
    James Bertolone. I agree that this discussion is over as I have a job to go to in the morning. There is no doubt that capitalism was a God-send to the people of Chile and China. It has been great to see their people being lifted out of poverty. However, the US has given away too much over the past 50 years and it is time to to make trade for for US citizens fair and that is what Trump’s trade policy is all about. Also, the Chinese could be a serious threat in ways other than economically. He has promised to keep Social Security and Trump works to keep his campaign promises. He has also repeatedly said that he will not touch pre-existing conditions either. The only place that you have heard that he has is from the fear-mongers campaigning against him. Getting rid of the FICA tax is not the same as getting rid of Social Security as there has not been a Social Security lockbox in decades.
  • James Bertolone
    You’re killing me Brad Johnson . It is NFL Sunday and I do watch football .
    Wages for Blacks were always anemic compared to whites , regardless of the President .
    The small uptick in real( adjusted for inflation ) Black wages has little to do with Trump and has more to do with 29 states having higher minimum wages , some considerable higher . This affected people of color more because of their collectively lower wages . The Obama care disaster resulted in millions more with health care than under Trump . First millions lost coverage with a right wing court making Medicaid optional . Then Trump killed the mandate , part of the "Individual Responsibility " of the GOP/Heritage Foundation that would become Romney care . Again , Obamacare was the conservative health insurance solution , until the Black guy bought it . It’s been eleven years and no one has seen a Republican health care plan , unless you are talking about the tired idea of health savings account . Middle class and the working poor saving many thousands of dollars for an operation . That will work . I just saw a clip of Trump in Nevada saying Biden will take your social security and take away health care for pre-existing conditions . He’s trying to defund social security as we speak and he and Barr are at the Supreme Court to take away health care from millions , including pre existing condition protection . He attacks Biden as a left socialist extremist who is an extreme threat to the social welfare safety net at the same time . He can’t be both . Is there no number of lies that is not OK ? How many years before we see a GOP/Trump health care plan ? He did not have a filibuster proof majority his first two years , but they agreed on DACA , a path to citizenship , immigrant limits , and $20 billion plus for his wall . It’s on video tape The next day he says he is against it . The Dems beg him to keep his promise on infrastructure , they’d vote for it . Nothing . The new NAFTA , As soon as Dems added Labor protections , they passed it . giving him a victory . The Dems wrote the Cares Act and he took credit , delaying
    the money until his name was on the checks with a letter signed by him as if he has the power of the purse . I am not very tolerant of calling McCain a swamp rat . My paid union job for 44 years was the American Postal workers Union , anywhere from 25% to 40% of my members were vets , including disabled vets . My closest friend and Union Brother , my Sgt AT
    Arms for 30 years,is a Vietnam combat Vet and I opposed the war . You don’t blame the war on the soldiers called to duty , blame the politicians that lied , see the Pentagon Papers circa 1972 .
    John McCain’s Labor Voting record was 90% wrong , yet his beliefs were sincere and he represented a conservative state . And Gold Star families and those that gave their last measure ? Trump is disgusting . Is there no bridge too far ? Attacking real heroes ?
    Lastly , " the implementation of free markets in Chile led directly to a free society " and “much less government control .”? Really ? This was like when all you guys said bringing global capitalism to China would lead to Democracy . Unregulated Capitalism thrives best under Dictators . They had little problem with the Military Industrial complex in Nazi Germany and Japan , including slave labor and genocide . Allende was democratically elected when over thrown by a Military Junta led by Pinochet who declared himself dictator .He was there from 1973 to 1990 when Pinochet was an old man . He was guilty of crimes against humanity , especially students and unions that were outlawed . They were jailed , tortured , and murdered
    without trial . See the Mothers of the Disappeared . He sold public institutions and land for a fraction of it’s value taking kick backs and bribes along the way of over $20 million . This is like saying that Louis the XVI and Marie Antoinette led to a free and democratic France .
    I know you guys in the Financial sector have done well , and the 10% richest have raked in another $450 billion plus just during the pandemic while there is horrible suffering and death .
    Supply Side , or giving the most to those who need it the least has never worked long term for a democracy or an economy fair to all . What did old time Christians say , something like What good to gain the world if you lose your soul ? You have no argument with me , but with your self . I think you are smarter than you indicate . There is no need for further discussion with me . It’s a waste of time . Sell it to the ignorant and the greedy and worse , but not me .
  • Brad Johnson
    James Bertolone. The implementation of free markets in Chile led directly to a free society and, yes, by definition, much less government control. The GOP had a decent bill that was a good starting point to reversing of the Obamacare disaster, but a bitter John McCain cast the deciding vote against it. The best solution to healthcare is to reintroduce free markets and price transparency, not more government control. Trump has tried, but the Dems and a few swamp rats, like McCain, in his own party have resisted. FDR had a very mixed record when it came to blacks and the Civil Rights Act had the intended consequences of most of the Democratic lawmakers of the time, that of keeping the racist structures in place in the cities. You are confusing Trump with Obama: under Obama wages went down for blacks; under Trump wages for blacks went up more than they had in sixty years, until the pandemic hit.
  • James Bertolone
    Well Mr Johnson ,
    I don’t consider Friedman and his Boys from Chicago putting their policies in place with Pinochet in Chile , small government . Dictatorships are usually not considered " Small government “. That was the first 911 , provided by Nixon on 9/11/73 . These principles went around the world during catastrophes , known as Disaster Capitalism thanks to Naomi Kline . When these small government exploiters grab everything for a song and privatize everything not nailed down , even social security in Chile , the do it partnered with the government . We have very different definitions of small government . Obama care’s final passage was by 51 votes with some Dems voting against because they were for the great job the private sector was doing and others voting against because it was from the right wing Heritage foundation and was implemented in Mass. under Romney . It has actually done better in Mass because the individual mandates were attached , which Trump killed on the Federal level . Obama care passed because millions lost their health care with their jobs in the Great Recession, and this was a first step toward affordable premiums not tied to a job . Millions are losing their health care again even though we spent $11,000 PER PERSON on it last year , and have millions with no coverage. I think Trump picked up some workers when he campaigned on Medicare for All and later declared Australia’s Medicare for All was better than our system . Of course he did not call it that , but he said ,” I’m gonna give everyone health care and it’s gonna be better and cheaper than Obama care . " Promises kept . When someone says Trump has done more for African Americans than anyone since Lincoln , the argument is over . There is no intelligent discussion after the drinking of the Kool Aid . Executive Orders from FDR and Truman to end discrimination in the Military , Defense Contractors , and then Federal Employment . The 1964 Civil Rights Act , !965 Voting Rights Act and end to Immigration quotas requiring 90% of immigrants from white (not shit hole) countries . In 1968 an end to Housing discrimination , which Trump violated more than once . Like Trump , you must believe African Americans just don’t know any better because about 90% will vote for Biden . So many are ungrateful for being allowed to work for poverty level wages , with no real wage increases (except states raising the minimum wage for small real increases ) and the fact that the vast majority of Black males with four year college degrees make less than white men with high school diplomas. There is no intelligent discourse when Lincoln and Trump are in the same sentence . I saw the tape of Trump in front of the Lincoln Memorial saying he was treated worse than any President , including Lincoln !
    Maybe you can be the one in the Cult to let him know Lincoln was murdered ?
  • Brad Johnson
    James Bertolone, if you are sorry it is because you are wrong in most of your post. The only way that Obama got Obamacare through was with a filibuster-proof Senate (59 Dems and one independent that always voted with Dems). Thankfully, Obama lost that filibuster-proof Senate, so the damage that he inflicted wasn’t even worse. The Dems from the south have not “often” voted with the GOP for 25 years. Trump is trying to change things so that it would make sense for his daughter and others to manufacture in the US. The most laughable of your statements is that Biden has ever embraced Friedman economics. Friedman was for small government and free trade, which is the opposite of what Joe Biden ever voted for. There has not free trade since 1947. Biden voted for Most Favored Nation status for China which is one of the things that gives them an unfair advantage. Trump would agree to free trade in an instant if the other major economies of the world also did. Trump has done more for minorities than any President since Lincoln. He understands that the way to lift those in poverty and crime-ridden neighborhoods up is to do so economically and has targeted underserved minority communities. He has employed more minorities himself than all of the Democrats in Congress combined. The pandemic is all that the Dems have to campaign on and they would try to use it whether the death toll was 50,000 or 5,000,000. Never mind hat Biden and his people got this thing more wrong than Trump did.
  • James Bertolone
    Sorry Mr. Johnson , Trump has been honest on almost nothing . The big move , Counter Vailing Duties/Tariffs on steel and aluminum were done by George W. and Obama as well . They were upheld by WTO because China peddles millions of tons of state subsidized product that far exceed world demand to destroy these industries in other countries . Your financial industry and Wall Street banks/stock holders have been a huge driver in the search for dollar an hour labor and the destruction of whole communities . By the way , the 2009 Senate had 58 Democrats , some from the South who often voted with the GOP . Not filibuster proof .
    In fact , when trying to aid workers Obama was filibustered well over 400 times .
    In NY we know a nearly 50 year history of Trump and he has been a joke (and his Father ) for that period . If he has been railing against China for 30 years we missed it , but I was never a big fan of Howard Stern , so who knows . Trump does owe millions to Chinese Banks and his daughter does pay Chinese women $65 a week for 53 hour weeks making her very expensive accessories . Yes Biden has a history as a neo-liberal embracing globalization and the Friedman
    embrace of the "magic of the market " to solve all . He , like many politicians , all now get that offshoring for a dollar an hour labor will not sell . I wonder how many lies a person has to tell before you question something ? Authoritarians are plentiful in history and very few have the blood of millions on their hands like a Hitler or Stalin , but they have blood on their hands . Our Checks and Balances were designed to stop that here , but the Cult of Trump has damaged those constitutional walls . That cult not only includes sycophants’ in Congress , but an Attorney General who is as corrupt as his dear leader . I can also tell you as someone who represented workers for over four decades that a lot of white workers whose jobs did not go offshore , including public employees , embraced Trump for his bigotry . The China stuff was a cover for the on going poison of racism . There is a fifty year Trump history on that issue .
    Trump does have the blood of thousands on his hands , from the Pandemic , to the Kurds , to Yemen , Kosshiggi , and the Saudis , and BLM . The last time a majority of white voters voted for a Democrat for President was LBJ in 1964 , and it’s not because the GOP have been champions of workers . Mr. Trump has many felonies to answer for and if he was not born rich and white he would have been in prison long ago .
  • Brad Johnson
    James Bertolone. President Trump has been the most honest president in the last 40 years when it comes to implementing policies that he campaigns on. He has never had a filibuster-proof Senate like Obama did, but he still got much of his agenda implemented. I don’t see a path to getting the filibuster- proof Senate but, if he wins, he should take back the House this cycle. He has been warning us about the dangers of China for 30 years and it has nothing to do with his personal finances… the presidency has cost him money, but he has plenty to spare. Biden, on the other hand, has a history of enriching his family members through his political connections.
  • James Bertolone
    Yes , believe Trump because he doesn’t lie every day and he did not have all three
    branches of government for two years . Also because he does not owe a ton of money to China’s state bank and his family has no manufacturing contracts in China . With Mike Pence’s credibility backing him , what could go wrong ?