Right target; wrong tactics: the trump administration upends East Asian order

Abstract

President Donald Trump initiated a tariff war claiming that the ultimate target was mercantile Chinese economic practices. Numerous countries share such concerns about China. Yet the Trump administration’s approach is wrong for at least three big reasons. First, tariffs avoid addressing the most fundamental complaints about China while they undermine the longstanding and beneficial global liberal trade order. Second, the U.S. approach has been unilateral rather than multilateral, weakening America’s bargaining position while alienating close allies. Third, the Trump administration escalates what is an economic challenge into an existential threat, ignoring numerous benefits from Chinese policies as well as ignoring multiple areas where China has been a powerful global partner. Middle powers in Asia have acted collectively and individually to bolster the global trading system and avoid the worst consequences of the Trump actions while seeking to avoid making permanent binary choices between the United States and China. Beyond the immediate problems, the Trump tariff wars are creating, they also generate damaging second order effects that are undermining domestic and regional policies conducive to enhanced American strengths and an economically less mercantilist China.

Keywords:

• Trump
• trade
• tariff war
• China
• middle powers
• existential threat

Notes

1 My calculations from: Nicholas R. Lardy, Markets over Mao: The Rise of Private Business in China, Washington, D.C., Lardy, 2014; Daniel Bell, The China Model: Political Meritocracy and the Limits of Democracy. Princeton, Princeton University Press, 2015; ‘A Lesson from China on Poverty Reduction and Inequality:

How China provides a great example of why it's bad to focus on inequality,’ Foundation for Economic Education. June 23, 2017 at https://fee.org/articles/a-lesson-from-china-on-poverty-reduction-and-inequality.

2 This theory’s first major articulation is in A. F. K. Organski, World Politics (New York: Knopf, 1958). For a review and its potential application to China today, see International Interactions special issue 29:4 (2003), and that of International Area Studies Review 18:3 (2015). For an argument on the power transition beliefs of both countries’ militaries see also Michael Pillsbury, The Hundred year Marathon: China’s Secret Strategy to Replace America as the Global Superpower (New York: Henry Holt & Co., 2015). A popularization of power transition can be found in Graham Allison, ‘The Thucydides Trap: Are the US and China Headed for War?’ The Atlantic, Sept. 24, 2015, at www.theatlantic.com/international/archive/2015/09/united-states-china-war-thucydidestrap/406756/ (accessed Dec. 3, 2015). Christopher Layne has a similar view: ‘Throughout the history of the modern international state system, ascending powers have always challenged the position of the dominant (hegemonic) power in the international system—and these challenges have usually culminated in war. ‘China’s Challenge to US Hegemony,’ Current History, 107, 705 (2008): 16.

Additional information

Funding

This work was supported by Global Research Network program through the Ministry of Education of the Republic of Korea and the National Research Foundation of Korea (NRF-2017S1A2A2041060).