Trump Vs. NATO: It\'s Not Just About The Money

NEW YORK —As China’s rapid rise presented a challenge to the United States, political leaders in Washington were confident that the American model for prosperity would triumph over the path pursued by their communist rival.

While China sought to win global influence through trans­actional, checkbook diplomacy, the United States offered a fuller package — not just financial investment but also security guarantees and leadership on human rights and the rule of law.

Now, Trump prepares to face world leaders at the U.N. General Assembly this week in the middle of a fast-escalating, head-on trade war with China. It’s one that his critics say is being played on Beijing’s terms, as the president has rattled U.S. allies and undermined partners, looked the other way on human rights abuses and cozied up to authoritarian leaders.

The upshot is a growing consensus that the United States under Trump is going it alone — a sharp break from the multi­lateral approach that leaders of both political parties have pursued since World War II.

Trump believes he is winning the trade dispute with Beijing, contrasting the record U.S. stock market highs with recent sluggishness in China’s economy. Economists warn that he could be underestimating the willingness of Chinese President Xi Jinping, who has consolidated power, to play the long game.

Beyond that, however, the United States under Trump has surrendered ground in other ­areas: engaging in trade disputes with Europe, South Korea, Japan, Mexico and Canada; criticizing NATO; and withdrawing from the Paris climate deal, the Iran nuclear accord and the Trans-Pacific Partnership.

Related slideshow: A timeline of US-China Trade War (Provided by photo services)

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Full Screen 1/25 SLIDES © cybrain/Getty Images

Two of the biggest economies in the world – the U.S. and China – are caught in the throes of a bitter and potentially catastrophic (for themselves and the world) trade war. Take a look at this timeline to understand the progression of the dispute between Washington, D.C. and Beijing.

(Note: All figures in U.S. dollars unless otherwise indicated. Please check out our Currency Converter for the latest values.) 

Click or swipe to view the timeline.

2/25 SLIDES © Artur Widak/NurPhoto/Getty Images

April 2017: Trump investigates steel imports

One of U.S. President Donald Trump’s biggest campaign promises was to bring manufacturing jobs back to the country. In April, after becoming president, Trump directed the Commerce Department to determine whether the scale of import of steel from China (and other countries) posed a threat to national security.

When announcing the investigation, Trump said: "For decades America has lost our jobs and our factories to unfair foreign trade. And one steel mill after another has been shut down, abandoned, and closed. And we're going to reverse that."

3/25 SLIDES © JIm Watson/AFP/Getty Images

August 2017: Trump targets China's 'unfair trade practices'

A few months later, Trump expanded the scope of investigation, calling on U.S. Trade Representative Robert Lighthizer (L) to decide on a probe of "unfair Chinese trade practices" in general. The Executive Order focused on alleged theft of American intellectual property through spying and hacking.

In response, the Chinese Commerce Ministry said: “… any actions of trade protectionism from the U.S. side would be harmful to the bilateral trade and business relationship and the interests of companies on both sides."

4/25 SLIDES © Guang Niu/Getty Images

August 2017: China responds through state media

In a sign of deteriorating relations between the two countries, China’s Ministry of Foreign Affairs hit out at Trump for launching the investigations and trying to use them to pressure Chinese President Xi Jinping into supporting the U.S. in its efforts to control North Korea.

The state-run China Daily newspaper wrote: "His idea of exploiting trade as a bargaining chip in dealings with China dates back to the campaign trail. But instead of advancing the United States' interests, politicizing trade will only acerbate the country's economic woes, and poison the overall China-U.S. relationship."

5/25 SLIDES © Chris Kleponis/Pool/Getty Images

January 2018: U.S. slaps tariffs on solar panels and washing machines

Undeterred by Beijing’s warnings, the Trump administration initiated its first major trade action against China – a 30 per cent tax on imported solar panels (the majority of these come from China). In addition, a 20 per cent tax was levied on large residential washing machines.

In his statement, Lighthizer (pictured) said: “The President's action makes clear again that the Trump Administration will always defend American workers, farmers, ranchers, and businesses in this regard.”

6/25 SLIDES © AFP/Getty Images

January 2018: China blasts new tariffs

On Jan. 23, China’s Commerce Ministry issued a statement condemning the U.S. move to tax solar panels. Part of the statement said: “China hopes the U.S. will exercise restraint in using trade restrictions.” Beijing also aid it would “resolutely defend its legitimate interests.”

The Trump administration’s move to tax the import of washing machines upset South Korea as well. Seoul’s Trade Minister, Kim Hyun-chong, said the move was an “excessive and a clear violation of World Trade Organization (WTO) rules.

7/25 SLIDES © SafakOguz/Getty Images

March 2018: U.S. imposes tariffs on steel and aluminum

On March 9, Trump imposed a 25 per cent tariff on steel imports and a 10 percent tariff on aluminum. The tariffs would impact every country exporting either material to the U.S., with the exception of Canada and Mexico. Trump said: “America will remain open to modifying or removing the tariffs for individual nations as long as we can agree on a way to ensure that their products no longer threaten our security.”

China responded by calling the tariffs “a serious attack on normal international trade order” and said it is “firmly opposed” to the move.

8/25 SLIDES © ShutterStock

April 2018: China hits back with its tariffs

On April 2, Beijing announced tariffs on nearly $3 billion of U.S. imports. These tariffs included a 15 percent duty on products like fruits, wine, nuts and steel pipes. In addition, China also levied a 25 per cent tax on goods like pork and recycled aluminum. The latter move alarmed the U.S. National Pork Producers Council, who claimed the $1.1 billion in exports to the Asian giant would be negatively impacted.

China’s Ministry of Commerce said it hoped the U.S. would withdraw its tariffs “as soon as possible so that the trading of products between China and the United States will return to a normal track.”

9/25 SLIDES © luchschen/Getty Images

April 2018: U.S. taxes 1,300 Chinese products

The two countries continued to trade blows, with the U.S. adding 1,300 more items to the list of taxed goods. The products taxed included those from the aerospace and medical industries, both of whom were the subject Trump’s 2017 investigation into China’s “unfair trade practices.” The sum total of Chinese exports to be taxed was $50 billion.

The decision was criticized by the U.S. Chamber of Commerce, whose executive vice president, Myron Brilliant, said that although the move to restore balance in trade was correct, “… imposing taxes on products used daily by American consumers is not the way to achieve those ends.”

10/25 SLIDES © Anucha Sirivisansuwan/Getty Images

April 2018: China retaliates with tariffs worth $50 billion

China then announced plans to impose a 25 per cent tariff on U.S. exports worth $50 billion. The list of products to be affected included soybeans, chemicals, aircraft and automobiles. At the time, there was confusion over the date on which these tariffs would come into effect. In response, China’s vice finance minister, Zhu Guangyao, said the intervening period could be used as a “time to negotiate and compromise.”

11/25 SLIDES © Li Huisi/China News Service/VCG/Getty Images

April 2018: US threatens $100 billion of tariffs

An apparently frustrated Trump then threatened a further (and steeper) range of tariffs. On April 6, he said: “In light of China’s unfair retaliation, I have instructed the [United States Trade Representative] to consider whether $100 billion of additional tariffs would be appropriate.” China’s response, via Commerce Ministry spokesperson Gao Feng (pictured), was to say: “We are prepared and have already formulated very detailed countermeasures.”

Trump’s announcement was criticized by members of the Republican party, with Nebraska senator Ben Sasse calling it “the dumbest possible way to do this.”

12/25 SLIDES © Johannes Eisele/AFP/Getty Images

April 2018: U.S. bans Chinese tech giant

Washington, D.C.’s next move was against Chinese telecom giant ZTE. The firm was banned from purchasing components from U.S. companies. The U.S. Commerce Department claimed ZTE lied about punishing employees who violated sanctions against North Korea and Iran and slapped a seven-year ban on the company.

Meanwhile, the U.K. government made a similar move, warning its companies from using the Chinese one’s equipment and services.

13/25 SLIDES © Mailson Pignata/Getty Images

April 2018: China's 179 per cent sorghum tax

The following day, China’s Commerce Ministry announced a staggering 179 per cent fee on sorghum imports from the U.S. The grain is used in animal feed but is also popular in the country for making a local liquor. China imported over $960 million of sorghum in 2017, according to data from CNN.

14/25 SLIDES © Brendan Smialowski/AFP/Getty Images

April 2018: Both sides show interest in talks

In the first sign of a potential thaw in relations, on April 21 U.S. Treasury Secretary Steven Mnuchin (pictured) said a trip to China was possible and that he was “cautiously optimistic” a trade deal could be agreed between the two countries.

In response, on April 22, China’s Commerce Ministry said: “China has received a message from the U.S. about its willingness to hold bilateral trade talks in Beijing. China welcomes this move."

15/25 SLIDES © cbarnesphotography/Getty Images

May 2018: First round of talks

Talks between senior U.S. and Chinese officials began in May, in Beijing. They were described by the White House as “frank discussions.” The Chinese were more circumspect, with official news agency Xinhua saying: “Both sides realized there are some relatively big differences on some issues. And more work needs to be done to achieve more progress.”

16/25 SLIDES © Jaap Arriens/NurPhoto/Getty Images

May 2018: Trump tweets in favor of ZTE

On May 13, Trump tweeted: “President Xi of China, and I, are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast. Too many jobs in China lost. Commerce Department has been instructed to get it done!”

A spokesperson for China’s Foreign Ministry responded: “We very much appreciate the positive statement from the U.S. side on ZTE and maintain close communication with them on the issue.”

17/25 SLIDES © Greg Baker/AFP/Getty Images

May 2018: Rumours of Chinese purchases surface up

On May 17, U.S. officials told CNN Beijing had proposed a boost in Chinese purchases of U.S. products by nearly $200 billion, in order to address trade imbalances between the two nations.

The following day, Lu Kang (pictured) responded, “These rumours are not true.” At the same time, China also announced it was removing the 179 per cent tax on the import of U.S. sorghum.

18/25 SLIDES © Win McNamee/Getty Image

May 2018: Mnuchin says trade war 'on hold'

Four days later, Mnuchin told Fox News: “We're putting the trade war on hold. We have agreed to put the tariffs on hold while we try to execute the framework.” The statement came after news U.S. and China had agreed to not impose tariffs while talks were ongoing.

19/25 SLIDES © kokouu/Getty Images

May 2018: China reduces tariffs on imported cars

In response, China then announced, with effect from July 1, a reduction in import duties on passenger cars from the U.S., from 25 per cent to 15 per cent. The decision was one of some promises made by Jinping to Trump and included a significant reduction of fees on imported auto parts as well.

20/25 SLIDES © Chip Somodevilla/Getty Images

May 2018: U.S. revives tariff threats

What followed was a surprising revival of tariff threats against Beijing. On May 29, the White House announced it would go ahead with an earlier plan to levy a 25 per cent duty on $50 billion of Chinese goods “containing industrially significant technology.”

In its statement, the U.S. government said: “The United States will request that China remove all of its many trade barriers, including non-monetary trade barriers, which make it both difficult and unfair to do business there.”

21/25 SLIDES © Ng Han Guan, File/AP Photo

May 2018: China 'not afraid of fighting trade war'

Beijing issued a strong response to the new threats, with Foreign Ministry spokesperson Hua Chunying saying: “We want to reiterate that we don't want a trade war, but we aren't afraid of fighting one. If the U.S. insists on acting arbitrarily and recklessly, China will take firm and powerful measures to safeguard its own legitimate rights.”

Beijing also decried what it saw as U.S. efforts to unsettle China ahead of talks with American Commerce Secretary Wilbur Ross, saying: In international relations, an about-face or constant change of positions is bound to damage or squander a country’s credibility.”

22/25 SLIDES © Andy Wong/AFP/Getty Images

June 2018: Wilbur Ross holds talks in Beijing

Ross met with Chinese vice premier Liu He in Beijing over the first week of June. At the end of that discussion, China said it would purchase U.S. products worth nearly $25 billion in 2018. The decision was seen as Beijing’s attempt to reduce the deficit in trade balances between the two countries – something Trump repeatedly pointed out in his relationship with China.

23/25 SLIDES © VCG/Getty Images

June 2018: U.S. allows ZTE to return to business, if it pays a fine

On June 7, the U.S. government said it had reached a deal with Chinese firm ZTE that would allow the telecom giant to return to trading with American partners. The deal included the payment of a record $1.4 billion ($400 million in escrow) fine and proposed management changes.

24/25 SLIDES © Andrew Harrer-Pool/Getty Images

July 2018: US slaps $34 billion duty

The Trump administration’s unpredictable handling of the trade issue took a new turn on July 6, with the U.S. slapping $34 billion of tariffs on products like farming plows and airplane parts. The government said a further $16 billion in tariffs could be imposed in two weeks or less.

The move was criticized by Robert Holleyman, a senior trade official who served under former president Barack Obama, who said: “Once these tariffs start going into effect, it’s pretty clear the conflict is real. If we don’t find an exit ramp, this will accelerate like a snowball going down a hill.”

25/25 SLIDES © Nicolas Asfouri/AFP/Getty Images

July 2018: China hits back

The latest salvo in a rapidly escalating trade war was fired by China, who imposed a similar $34 billion of tariffs on 545 American products. Lu Kang confirmed the development, saying: “After the U.S. activated its tariff measures against China, China’s measures against the U.S. took effect immediately.”

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The United States had long sought to manage China’s rise by pressuring it to become a more responsible global player and engage in multilateral institutions; now it is the Trump administration that is turning away.

Last week, national security adviser John Bolton eviscerated the International Criminal Court, declaring that the autonomous body founded in 2002 in The Hague is “dead to us.” The White House also announced that Trump would skip three regional summits in Southeast Asia in November, the first time since 2013 that an American president has been absent.

In the past, American leaders believed “we could cede an absolute majority of the pie and trade that relative wealth for dramatically increased influence,” said Danny Russel, an Asia Society analyst who served as a high-ranking Asia policy official in the Obama administration. “But if we really are reverting to a more primitive barter system, then we lose that. Then we are competing on China’s terms — at a moment when China is on the upswing. Very few countries, if any, believe that of the two countries, America’s day is dawning.”

At the United Nations, aides said, Trump is prepared to amplify the message he foreshadowed on the same stage a year ago: a demand for other nations to respect the “national sovereignty” of the United States and one another. Aides said Trump’s presence at the U.N. conference — Xi is not attending — demonstrates his commitment to global partnerships. But the president has consistently sown doubt through his nationalist rhetoric and unilateral actions on trade.

President Trump and Chinese President Xi Jinping are engaged in an escalating trade war. © NICOLAS ASFOURI/AFP/Getty Images President Trump and Chinese President Xi Jinping are engaged in an escalating trade war. “The forces opposing us in Washington are the same people who squandered trillions of dollars overseas, who sacrificed our sovereignty, who shipped away our jobs, who oversaw the greatest transfer of wealth in the history of the world,” Trump said at a campaign rally in Las Vegas on Thursday. “In 2016, the American people voted to reject this corrupt globalism. Hey, I’m the president of the United States — I’m not the president of the globe.”

In many ways, Trump’s “America First” message is one that Beijing understands. Since taking office in 2012, Xi has aimed to return China to a dominant role in Asia, a strategy he touted as the “Chinese Dream.”

In doing so, Xi has sought to elbow the United States and other global powers out of what Beijing considers China’s sovereign claims, which its leaders call “core interests.” Among them are the South China Sea, a crucial shipping corridor over which China has asserted maritime control, and Taiwan, the target of an intensifying campaign by Beijing to isolate the island diplomatically.

At the same time, China has signaled it would do business with other nations without calling for reforms of their style of governance or pressuring them on human rights.

China unveiled a trade agreement in Southeast Asia called the Regional Comprehensive Economic Partnership, which lacks the type of labor and environmental protections that marked the TPP, envisioned as a higher-standard, 12-nation agreement, sans China, to reduce tariffs and establish new regulatory structures.

Chinese leaders also launched an ambitious “Belt and Road” foreign investment program aimed at distributing tens of billions of dollars in infrastructure loans to countries, drawing them into Beijing’s political sphere.

The other countries “do not necessarily want Chinese influence,” said Bonnie Glaser, a China analyst at the Center for Strategic and International Studies. “But if there’s not an alternative, they will take the risk of longer-term economic dependence and maybe even growing debt in order to get the short-term benefits. I worry about that.”

In recent months, nations have wrestled with the consequences of accepting China’s economic largesse. Malaysia canceled two giant projects funded with Chinese cash over fears that they would bankrupt the country. By contrast, El Salvador, eager to cash in with Beijing, severed diplomatic relations with Taiwan — drawing a rebuke from the White House.

“Countries seeking to establish or expand relations with China in order to attract state-directed investment . . . may be disappointed over the long run,” White House press secretary Sarah Huckabee Sanders said. “Around the world, ­governments are waking up to the fact that China’s economic inducements facilitate economic dependency and domination, not partnership.”

But analysts said it will be difficult for the administration to pressure other ­countries into turning away from China.

China has targeted U.S. soybeans in retalation for U.S. tariffs on Chinese imports. © Michael Conroy/AP China has targeted U.S. soybeans in retalation for U.S. tariffs on Chinese imports. Several weeks ago, the State Department temporarily recalled three ambassadors from Latin America countries that cut relations with Taiwan. That came as Xi was playing host to the leaders of 53 African nations in Beijing and pledging a new $60 billion investment and loan package for the continent.

“They’ll have a hard time pushing countries to make a choice,” said Brian Klein, a former State Department official who served in China and India. “China’s throwing around a lot of money.”

White House allies praised the harder line Trump has taken with Beijing. Daniel Blumenthal, an Asia policy official at the Pentagon in the George W. Bush administration, complimented the administration for strengthening security ties with Japan and confronting the North Korean nuclear threat.

On human rights, however, Blumenthal said Trump had missed an opportunity by failing to condemn the imprisonment of an estimated 1 million Uighur Muslims languishing in “reeducation camps” in western China. The president also has said nothing in public about the persecution of more than 600,000 Rohingya Muslims in Myanmar, which the United Nations labeled “ethnic cleansing.”

“The Chinese want to do a lot of business and diplomacy in Muslim-majority countries, and if you highlight a massive abuse of human rights, China would have to answer to that,” said Blumenthal, now a scholar at the American Enterprise Institute.

For countries assessing how to engage with the two economic behemoths, the uncertainty rests in the open question of whether Trump’s trade war is a tactical play to boost U.S. exports or a more strategic effort to punish China and make the American economy less reliant on its rival, said David Dollar, a Brookings Institution scholar.

On Fox News on Sunday, Secretary of State Mike Pompeo said the administration is determined to force China “to behave in a way that if you want to be a power, a global power,” the country must respect “the fundamental principles of trade around the world — fairness, reciprocity.”

But Dollar, who served as a Treasury Department emissary to China from 2009 to 2013, said: “I don’t think the administration knows clearly what it’s doing. Other countries are confused. We’ve launched a lot of trade measures against other countries and sent a signal of withdrawal from the world.”

Also watch: Trump administration proposes more curbs to immigration

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Trump Vs. NATO: It\'s Not Just About The Money


Trump Vs. NATO: It\'s Not Just About The Money

Trump Vs. NATO: It\'s Not Just About The Money


Trump Vs. NATO: It\'s Not Just About The Money