Trump & the China syndrome
There isn't going to be a trade war with China. The risks of a real war with North Korea are now too high.
“It is not unimaginable to have military options to respond to North Korean nuclear capability,” Gen. Joseph F. Dunford Jr., chairman of the Joint Chiefs of Staff, said last month at the Aspen Security Forum. “What's unimaginable to me is allowing a capability that will allow a nuclear weapon to land in Denver, Colo.”
Odds are very high that only a handful of readers have heard of China's Hisense Electric and its connection with North Korea's missile-testing and nuclear-weapons programs. But understanding that connection, and the connection of every commercial dispute to the North Korean crisis, is central to appreciating the dilemma the Trump administration faces in its dealing with China and by extension North Korea.
The long fuse of the North Korean crisis has been burning since the armistice in the Korean War was signed on July 27, 1953. Beijing was a party to that long-ago non-ending of a brutal war, and it is very much a part now of the crisis on the Korean Peninsula.
It also makes TV screens, through the state-owned Hisense Electric.
“The thing is, Hisense is completely owned by a Chinese city, by a subdivision of the Chinese government,” John Yoo, law professor at the University of California at Berkeley, said recently on my radio show.
Yoo and I were discussing the difficulty of achieving workable free-trade agreements with countries such as China with massive stakes in “private” businesses that operate with all the advantages of a state actor. Sharp, a Japanese company now owned by Taiwanese company Foxconn, is suing Hisense in California courts for what Sharp claims is deep damage to its brand via shoddy workmanship by Hisense, a claim Hisense denies. Expect to see a prolonged battle over whether Hisense can even be sued in a state court given its state-owned status.
But if the United States steps into the fray in defense of its own regulatory standards, suddenly yet another disagreement is on the table in the rapidly expanding list of U.S.-China disputes.
These disputes are overshadowed by the North Korean crisis, in essence held hostage by a dictator with scores of weapons of mass destruction of all sorts. President Donald Trump has repeatedly called on China to help disarm its unstable dependent ward, but to no obvious avail, just as previous presidents were frustrated by China's apparent willingness to risk a deadly war on the peninsula rather than risk seeing Korean unification under the leadership of South Korea.
But Trump campaigned on an aggressive trade agenda with China that reaches far down into the complexities of its intricate network of commercial advantages.
The reality is, however, that the U.S. needs China more than we need fair trade. Sharp and the state of California might have to fight for their own interests any legal way they can, and indeed state and local U.S. governments might try to rebalance scales on behalf of non-Chinese companies in such legal battles. But the federal cavalry isn't coming over the hill in the China trade battle anytime soon. The Trump administration needs to tell its grass-roots supporters why.
Hugh Hewitt hosts a nationally syndicated radio show and is author of “The Fourth Way: The Conservative Playbook for a Lasting GOP Majority.”