Trump on China

By Jack Perkowski, Forbes At the State dinner for China President Hu Jintao, Trump said that if he were President, he would just ask the Chinese leader to meet him at his office, rather than holding a state dinner. “For us to be holding state dinners for people who are just totally manipulating their currency…is hard to believe,” Trump was quoted by Liberty News. “You don’t give dinners to the enemy and that’s what they’re doing…I would have sent them to McDonalds if we didn’t make a deal and said, ‘Go home.’…The fact is they’re laughing at our leadership, and we’re letting them get away with murder.” I want to make it clear to all Managing The Dragon (MTD) readers that I have never been, nor will I ever be, a fan of “the Donald,” as Donald J. Trump is often called. Despite the media hype regarding his potential run for President of the United States in 2012, I also don’t believe that he will be taken seriously as a candidate, nor should he be. Nonetheless, Trump is a “personality” who has considerable media access in the United States, and he is causing quite a stir by what he is saying about China. To Wolf Blitzer at CNN, Trump said about the Chinese: They’re manipulating their currency. Intellectual property rights and everything else are a joke over there. They’re making stuff that you see being sold all the time on Fifth Avenue, copying various, you know, whether it’s Chanel or whatever it may be, the brands, and just selling it ad – ad nauseum. I mean this is a country that is ripping off the United States like nobody other than OPEC has ever done before. When asked by Rush Limbaugh what he would do about China if he were President, Trump responded: Now, you asked me before: What would I do? I would tell China that if you don’t straighten out your manipulation of the currency — and I mean fast; I mean really fast — we are going to tax your products 25%. Now, what that will do is two things. Number one: Immediately will start doing our own manufacturing. We don’t have to make toys that are coated with lead paint in China. We can make good toys in Alabama and North Carolina. To Blitzer’s comment that “a lot of the economists, the free trade experts, say if there were a trade war between the United States and China, it could cause not only a worldwide recession, but a worldwide depression, if these two giant – the number one and number two economic powers in the world – went to war against each other,” Trump said: No, it will cause a depression in China, not here. China is making all the money. We’re not making the money. I mean, look at the numbers. Look at the – look at the difference as to what we import compared to what they’re importing…It’s like day and night. I like getting rid of that kind of a partnership. I mean that’s called we’re losing a lot of money. I like getting rid of it. And that has nothing to do with free trade or fair trade. I like to call it fair trade, because free trade is not – forget it. I mean it doesn’t exist between this – these two countries. And I like to say fair trade. And I’m a big believer in free and fair trade. But this is unfair trade. Although most politicians would never be so blunt and indiscriminate to use the words that Trump is using, many may be thinking similar thoughts. More importantly, the sentiments that Trump is expressing on one talk show after another may resonate with many Americans in both political parties, and therefore, may foreshadow more anti-China sentiment in the upcoming elections. With high unemployment and a growing trade deficit with China, I was somewhat surprised that there was not more China bashing by the candidates in 2010. This time around, it may be different. In the face of a still uncertain economy, belt-tightening measures due to growing budget deficits, the high level of U.S. borrowing, and the ever-present trade deficit with China, the Sino-American relationship may be headed for stormy weather. Trump taking China bashing to new levels and fanning the protectionist flames will only add to the negative discourse.