Politics, The Trade War, Uncategorized

No Relief in Sight for the Casualties of Trump’s Trade War

Pssssst: It's not the Chinese.
August 6, 2019
Featured Image
Sid Ready on his farm near Scribner, Nebraska on May 5, 2019. (Photo by Johannes EISELE / AFP / Getty Images)

If you’re just tuning in to this week’s episode of Trade Wars Are Good and Easy to Win, you’d be forgiven for thinking you were watching a rerun. As relations between the United States and China worsened again this week, all the familiar patterns—the recriminations and counter-recriminations, accusations of unfair dealing and broken promises, and pledges to double down again on punitive trade actions—are here. President Trump boasted that America can do just fine with no Chinese trade at all, and Chinese officials pledged to match the U.S. blow for blow.

If it feels like déjà vu all over again, the reality is worse. The White House’s trade relationship with China has vacillated between rockier and calmer periods, during which President Trump has alternated between threats of economic ruin for China and triumphant assurances that victory for the U.S. and its great patriot manufacturers and farmers is right around the corner. But what feels like a flat circle is in fact a downward spiral: Each calm period has turned out to be only a momentary respite, while each rocky period has placed greater and greater economic strain on both superpowers.

In fact, “right around the corner” understates the case—at three different points, President Trump has declared that victory for farmers was at hand. In May 2018, when the trade war was new, Trump tweeted that “China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products—would be one of the best things to happen to our farmers in many years!” Seven months later, in December, the president announced again that a deal had been reached: “Farmers will be a very BIG and FAST beneficiary of our deal with China. They intend to start purchasing agricultural product immediately.” Then, this March, Trump again suggested a deal was at hand: “China Trade Deal (and more) in advanced stages. Relationship between our two Countries is very strong… If a deal is made with China, our great American farmers will be treated better than ever before!”

What has come of these grand promises? On Monday, China announced that, for the first time, it would stop buying U.S. agricultural products altogether. Oh.

The story of how this all came about, which the Wall Street Journal reported Sunday, is as fascinating as it is infuriating. After yet another series of talks between U.S. and Chinese trade representatives last Wednesday proved unproductive in extracting concessions from the Chinese, Trump, angered that his negotiators had been unable to extract a win he could trumpet at a campaign rally that day, made a snap decision that went against the advice of nearly all his advisers:

“Tariffs,” Mr. Trump said to his team, one of the people said. Those present included his national-security adviser John Bolton, top economic adviser Lawrence Kudlow, China adviser Peter Navarro and acting chief of staff Mick Mulvaney.

All of them, save Mr. Navarro, a China hawk, adamantly objected to the tariffs, the people said. That spurred a debate lasting nearly two hours, one of the people said. Beijing insists that tariffs must be dropped in return for concessions demanded by the U.S.

The president said his patience had worn thin and stood by his argument that tariffs were the best form of leverage, the person said.

His advisers eventually conceded, one of these people said, and then helped the president draft the tweet announcing an extension of tariffs to essentially all Chinese imports.

As the trade war has dragged on, American farmers have clung to the increasingly desperate hope that Trump is operating according to some great strategy—that President Deals has an ace up his sleeve that will soon bring China to its knees. Last summer, they were still optimistic—although many were rattled even then that there was no end in sight. When the dispute dragged on into the winter, they were partially placated by a round of emergency farm aid. As long as the thing wrapped up by spring planting, some hoped, they could weather the damage.

But now it’s summer again, and things are still getting worse. All farmers can look to for comfort is the fact that things could be about $25 billion worse—the amount the White House has dispensed or pledged to dispense to hurting farmers. Meanwhile, all the Trump administration can do to reassure them is to say they’ll keep pouring federal money on them to make up for the Chinese business they themselves bungled away, as President Trump did in yet another tweet Tuesday:

And yet even billions in federal aid is not enough to make struggling farmers whole. So far this year, farm delinquency and bankruptcies are at six-year highs.

Donald Trump’s “solution” to this problem is to continue pouring more gasoline on the fire. What’s most remarkable about the Wall Street Journal report is the picture it paints of the president. Trump has no ace up his sleeve. He has no plan at all. Trump is flying by the seat of his pants, preoccupied not with long-term strategy but with his own immediate political prospects and media play, a man who can tear his mind off of his constant daily Twitter fights to consider the problem of an ongoing trade war only long enough to propose more of the same strategy that has been failing for more than a year. “Tariffs,” the president says, and because he’s the president, tariffs are what we get.

One other point bears saying. There is a portion of the Republican chattering class devoted to drawing philosophical lessons from the Trump era—building a sustainable Trumpism that can outlast Trump, you might say. One of this movement’s favorite canards is the former Republican establishment’s preoccupation with free trade—a preoccupation, they argue, that has hollowed out the American working class and created the sort of national malaise upon which Trump has capitalized.

One of the most interesting questions about this sort is the question of whether it constitutes an honest intellectual movement: whether it is actually interested in drawing useful lessons from the Trump era or whether its primary concern is to carry water for Trump himself. If it’s the former, presumably Trump himself ought to be chastised as much as any other politician when his actions result in real devastation for American farmers. Maybe this latest, most catastrophic development may rattle them into objecting.

If it’s the latter, however, we can expect to see something different: strategic silence now, and planning for later. In this case, we already know the arguments they’re reserving for the moment this is all over—the moment this miserable presidency whimpers to a close, with no grand triumph over China having ever arrived, no promised resurrection of the Rust Belt having been carried out, nothing to show for the trade war except higher prices for American consumers and shuttered American farms. They will rant and rage about how the president would have carried the day, would have brought China to its knees—were it only not for those wretched leftists and establishment Republicans who opposed him at every turn. The failure of the trade war—a trade war waged entirely by executive fiat, one that Congress never lifted a finger to censure or oppose—can never be laid at the feet of the man who is singly responsible for it. Trump can never fail; he can only be failed.

Andrew Egger

Andrew Egger is a senior writer at The Bulwark.