The Chinese Economy Is Reeling. President Trump Is the Reason Why.
Even as the coronavirus wreaks havoc on the U.S. economy, we are not alone in feeling the ripple effects of a pandemic. Countries around the world are witnessing economic contractions—and China is chief among them.
Simply put, the Chinese economy is reeling. For the first time in decades, the Chinese government has not set a growth target for its economy. At the same time, China’s communist government recently pledged $500 billion in extra stimulus measures, in hope of creating nine million new jobs. That reeks of desperation.
On the surface, China’s struggles may seem inseparable from the COVID-19 pandemic. But, dig even deeper, and the Chinese economy had been reeling long before the coronavirus emerged in Wuhan. Last year, China’s economy grew at its slowest pace in nearly 30 years, with industrial output and retail sales losing their luster.
It’s also impossible to discount President Trump’s trade agenda, which aims to rejuvenate American manufacturing output and restore millions of lost jobs. While previous U.S. administrations were bowing to Chinese demands, President Trump was warning us about the risks to our national security of having China be the world’s leading manufacturer. Since he announced his presidential campaign in 2015, President Trump has criticized the Chinese government for its unfair trade practices, claiming that U.S. officials are playing checkers while the Chinese play chess.
And, while in office, President Trump has turned rhetoric into action, negotiating a new U.S.-China trade deal that actually benefits American manufacturers. Earlier this year, the White House reached a “phase one” trade agreement with China, with the Chinese vowing to buy an additional $200 billion worth of U.S. goods and services in 2020 and 2021. Even more recently, the Chinese government announced new tariff waivers for nearly 80 U.S. products, aiding those American companies (read: those American workers) that make them.
But, at the same time, President Trump continues to play hardball with the Chinese government. Rather than catering to Chinese interests like the Obama administration did, the Trump administration remains open to killing the U.S.-China trade deal if the Chinese government doesn’t abide by the rules.
Similarly, President Trump is just as open to imposing new tariffs on Chinese exports because of the country’s mishandling of the COVID-19 pandemic in its early stages. In his words: “They could have easily stopped the plague, but they didn’t.”
Trumpian hardball is rattling China’s Communist Party. Last year, Chinese shipments to the United States dropped by more than 20 percent, opening the door for U.S. companies to fill the void. Moreover, President Trump’s adversarial tone is also forcing the Chinese government to rethink its entire economic system: China’s latest five-year plan is weighing the risk of “decoupling” from the United States, hinting at an economic model that is less export-based. By undermining Chinese exporters, the Trump administration is urging American manufacturers to innovate, empowering the “Made in the USA” renaissance, and shifting trade in America’s favor.
Just this week, the Trump administration pledged to welcome back any U.S. company on the Chinese mainland or in Hong Kong by paying the full cost of moving home. When the supply chain comes back to America, it’s our national security and the American worker who benefits—and President Trump knows it.
What President Trump has shown is that he listens to the electorate. He is addressing the concerns of everyday Americans, who understand the threat that China poses—in terms of public health and economic activity. Throughout his leadership, President Trump is acting on his mandate. It is the same mandate that got him elected, and will re-elect him again.
But, most importantly, President Trump’s “America First” policies are working. China has seen better days, while America's best days are ahead.