Sorry, Trump Has No Useful Bargaining Chip Other than TaiwanPosted: December 13, 2016
From his personal experience, Trumps knows that one has to be rich to be influential. Trump is a rising rich tycoon but he knows well that the US is a declining rich family. The country is like a rich family having been run by an incompetent grandson who has been used to boast about the family’s wealth in spite of being heavily in debt.
Trump’s priority now is to make the US rich. For that he knows well that the US has to improve its relations with China to be benefited from China’s huge growing market. Therefore, he certainly does not want to fight a trade war with China that may hurt US economy. Some stupid American media and politicians believe that it is good to hurt China in spite of hurting the US. However, Trump knows hurting China means reduction of the Chinese market for US goods and will aggravate the injury to US economy.
Does the US has any other ways to force China to give it the concessions it wants? No. Some stupid Americans want to put military pressure on China and even fight a war with China. The US cannot even afford a war against a medium sized country in the Middle East. A war with China will make the US bankrupt.
Trump is certainly not so stupid. He knows that Taiwan is the only bargaining chip he has though it is sad for the US that such bargaining chip may not be helpful.
It is interesting that China has promised to give the US what Trump wants for China’s own benefits.
China wants the exchange rate of its currency to be determined by market so as to make its currency a major international currency and reduce the financial monopoly of US dollars.
China has switched to creation and invention-led growth and wants to have patents and trademarks well-known in the world. It has to respect other countries’ intellectual property to ensure its own intellectual property is respected by others.
China has been greatly benefited by its WTO membership. It has to abide by WTO rules as Trump wants it to; therefore, if its tariffs on imports from the US prove unfair according to WTO rules, it will reduce the tariffs. Further reduction will be possible if the US joins the Free Trade Area Asian Pacific (FTAAP) initiated by China.
Incompetent grandchildren of rich people are fond of ascribing their failures to others’ tricks and the circumstances. Quite a few US media have been trying hard to make Americans believe that China has caused US problems.
Trump knows well that the problems lie in the US itself instead of China, but he has to adopt hawkish attitude to make Americans believe that what China will do on its own is the concessions he has won from China. By so doing, he will give Americans a sense of victory that the US has not had for quite a long time and fill them with confidence in his administration and themselves. By so doing, he will be able to win a second term and successfully conduct his reforms to make the US rich.
A rich and strong US may try to control others and interfere in others’ affairs. Trump knows well that history has proved that such moves will not benefit the US.
If Trump refrains from doing that as he promised during his election campaign, China will certainly be benefited if the US becomes rich as the US is China’s most important market.
Some people hate the US and want the US to decline while others hate China want China to suffer. However that will benefit neither the US nor China. Only win-win cooperation instead of confrontation will benefit both China and the US.
Article by Chan Kai Yee