Friday, July 7, 2023

What Trump’s second-term trade policy looks like

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Jul 07, 2023 View in browser
 
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By Gavin Bade

Former U.S. Trade Representative Robert Lighthizer (center) watches as former President Donald Trump shakes the hand of Japan's U.S. Ambassador Shinsuke Sugiyama.

Former U.S. Trade Representative Robert Lighthizer (center) watches as former President Donald Trump shakes the hand of Japan's U.S. Ambassador Shinsuke Sugiyama. | Brendan Smialowski/AFP via Getty Images

MISSILE MAN — Robert Lighthizer, former President Donald Trump’s former trade chief, has always had a flair for humor, even in the dull confines of international economic policy. Once as a trade negotiator in the 1980s, he reportedly sent a Japanese proposal flying back across the room as a paper airplane to signify his distaste, earning him the title “missile man” in Tokyo.

For clues to Trump’s second-term trade policy agenda, there may be no better place to look. While it’s unclear if the 75-year-old would be reappointed to U.S. Trade Representative should Trump win again, Lighthizer has continued to advise Trump’s campaign on trade — including two hawkish videos aimed at China — and keeps in regular contact with trade leaders on Capitol Hill and in industry.

His new book, No Trade is Free, can be viewed as an elaboration of what Trump’s “America-first” trade policy would look like over the next four years — and it’s a rhetorical projectile aimed at Washington.

Lighthizer’s prescriptions are both radical — pushing U.S. policy to protectionism not seen in a half century — and surprisingly aligned with many of the policy agendas pursued by the Biden administration and congressional trade leaders. In fact ,Lighthizer frames them as the natural extension of protectionist policies pushed by both Trump and Biden, breaking with decades of free trade orthodoxy.

“[T]he Biden administration—with a few important exceptions—has continued along the path President Trump and I laid out,” Lighthizer writes, noting that “Biden’s team has continued to buck [World Trade Organization] rulings against America, refused to draw down the Section 301 tariffs on China, and enacted the beginnings of an industrial policy.”

But Lighthizer would go further. On China, he advocates what he calls a “strategic decoupling” — a bigger break with the Chinese economy than the “de-risking” platform pushed by Biden and European leaders. That would involve raising tariffs on Chinese goods until the U.S. achieves “balanced trade” with China — or the elimination of trade deficit — by repealing its normal trade status and raising tariffs.

That would be a sea change for Washington’s orientation toward Beijing, putting the Chinese trade relationship on similar footing to that of Russia or Cuba. But Lighthizer would push beyond that, dramatically restricting American investments in China’s high-tech sectors and putting limits on Chinese nationals from owning U.S. farmland and companies in critical sectors. While that would undoubtedly mean higher costs for American consumers and businesses, Lighthizer brushes those consequences away.

“The Chinese presumably would find a way to retaliate, but to the extent that they do, that would also contribute to the strategic decoupling,” he writes, arguing that “our relationship is so unbalanced that China’s options are limited.”

Lighthizer’s trade targets are not limited to Beijing. In the book he also calls for tougher treatment of many American allies — a throwback to his time as trade czar – and some novel ideas for resetting the World Trade Organization. We’ve got more on that here, the latest edition of our occasional series on reshaping global trade. 

Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com. Or contact tonight’s author at gbade@politico.com or on Twitter at @GavinBade.

 

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What'd I Miss?

— Former NYPD colleague of Mayor Eric Adams at center of alleged straw donor scheme: An acquaintance of New York City Mayor Eric Adams is at the center of an alleged straw-donor scheme, announced by the Manhattan District Attorney Alvin Bragg today, that funneled tens of thousands of dollars in illicit contributions to the Democratic mayor’s campaign. Dwayne Montgomery is a retired deputy inspector with the NYPD, where he overlapped with Adams before the mayor retired to pursue a political career. In addition to donating to Adams’ 2021 campaign for mayor, Montgomery gave $2,000 to Adams’ 2013 reelection bid for Brooklyn borough president.

— Disciplinary panel calls for Rudy Giuliani’s disbarment: A Washington, D.C.-based bar discipline committee concluded today that Rudy Giuliani should be disbarred for “frivolous” and “destructive” efforts to derail the 2020 presidential election in support of former President Donald Trump. “He claimed massive election fraud but had no evidence of it,” the three-member panel declared in a 38-page decision. “By prosecuting that destructive case Mr. Giuliani, a sworn officer of the Court, forfeited his right to practice law.”

— Texas gunman in Walmart shooting gets 90 consecutive life sentences but may still face death penalty: A white gunman who killed 23 people in a racist attack on Hispanic shoppers at a Walmart in a Texas border city was sentenced today to 90 consecutive life sentences but could still face more punishment, including the death penalty. Patrick Crusius, 24, pleaded guilty earlier this year to nearly 50 federal hate crime charges in the 2019 mass shooting in El Paso, making it one of the U.S. government’s largest hate crime cases.

Nightly Road to 2024

FRIENDLY SKIES — Air DeSantis keeps flying — and questions keep mounting about who is paying for it, POLITICO reports.

This week, Ron DeSantis flew to New Hampshire for a campaign swing that coincided nearly exactly with the path of a private plane connected to a wealthy supporter. Daniel Doyle, Jr., who runs a printing company in Central Florida, owns a plane whose flight path lines up with DeSantis’ July 4 trip to the Granite State, according to public records. Neither DeSantis’ presidential campaign nor representatives for Doyle would say if DeSantis was aboard.

It’s a recurring pattern where DeSantis and the organizations assisting him remain quiet about who is bankrolling his travels and his frequent use of private charter jets.

DEBATE SCRAMBLE — Saturday marked the opening of the Republican National Committee’s poll qualifying window for its first presidential primary debate, giving candidates the next month and a half to hit the thresholds required to make the August debate stage in Milwaukee, writes NBC News..

Candidates don’t just have to pledge to support the eventual nominee (which might be a sticking point for some candidates who are at risk of falling short on other criteria), but they have to hit both polling and fundraising criteria too.

Donald Trump, Florida Republican Gov. Ron DeSantis, South Carolina Sen. Tim Scott, former United Nations Ambassador Nikki Haley and businessman Vivek Ramaswamy are almost guaranteed to qualify because their strengths match up perfectly with the criteria: All three are fundraising juggernauts and consistently register in polls (albeit with very different shares of support).

 

STEP INSIDE THE WEST WING: What's really happening in West Wing offices? Find out who's up, who's down, and who really has the president’s ear in our West Wing Playbook newsletter, the insider's guide to the Biden White House and Cabinet. For buzzy nuggets and details that you won't find anywhere else, subscribe today.

 
 
AROUND THE WORLD

An aerial view of a roofless Centre Court and the outside courts during the Wimbledon Lawn Tennis Championships.

An aerial view of a roofless Centre Court and the outside courts during the Wimbledon Lawn Tennis Championships. | Glyn Kirk/AELTC via Getty Images

BREAK POINT — Ukrainian players have a message for world tennis: You cannot be serious, writes Daria Mescheriakova.

Just as the world’s top stars are battling their way through the first week of Wimbledon, tennis is grappling with how to handle all the Russian players near the top of the game. Ukraine’s players, for their part, reckon the sport is failing them.

There is staunch locker room support among some Russian players for President Vladimir Putin’s war on Ukraine, as well as links between a top Russian star and a company which finances the Kremlin’s aggression — and even a family connection between a Russian Olympic tennis gold medalist and a tournament in honor of a Wagner Group mercenary fighter.

The war has triggered fervent, heated discussion between Russian players behind closed doors in the men’s locker room.

At a tournament in Belgrade in April 2022, Russian player Karen Khachanov — currently the men’s world No. 11 — rounded on compatriot Andrey Rublev, who had professed some desire to see peace between his country and Ukraine, and had written “No War Please” on a TV camera lens in February, just as Putin sent his forces toward Kyiv.

The previously unreported contretemps exposes some of the depth of support among some top Russian tennis stars for Putin.

Wimbledon, the iconic grass court tournament in southwest London, is now in the spotlight, having this year reversed a 2022 ban on Russian and Belarusian players provided they sign a waiver pledging they don’t support the Putin regime. While Khachanov isn’t in the championship, having suffered an injury at the French Open, 18 players from Russia and Belarus were there in the singles draws.

“The biggest stress for us was the fact of the invasion itself, so seeing representatives of these countries nearby has been difficult,” Lesia Tsurenko, Ukraine’s world No. 60 who is into the third round at Wimbledon, told POLITICO.

STAYING LOCAL — France is holding up a deal to expand NATO’s reach into Asia, opening a split in the Western security alliance on the eve of a vital summit next week, write Stuart Lau and Laura Kayali.

For months, NATO officials have been discussing plans to open a liaison office in Japan, which would represent the allies’ first outpost in the region at a time of growing tension between the West and China.

Next week’s annual leaders’ summit in Lithuania —taking place against the backdrop of Russia’s war in Ukraine — was earmarked as a moment for making progress on the plan.

But French President Emmanuel Macron has put his foot down, insisting such geographical expansion would risk shifting the alliance’s remit too far from its original North Atlantic focus.

“We are not in favor as a matter of principle,” an Elysée Palace official told reporters today. “As far as the office is concerned, the Japanese authorities themselves have told us that they are not extremely attached to it.”

The plan by NATO to open its first Asian office comes amid heightened concern over China’s aggressive maritime and sea behavior toward Taiwan and U.S. troops in the region. Like France, China is also opposed to the idea.

Macron has been opposed to an increased NATO focus on China for years. In 2021 he said after a NATO meeting that “we shouldn’t confuse our goals,” arguing that “NATO is a military organization, the issue of our relationship with China isn’t just a military issue. NATO is an organization that concerns the North Atlantic, China has little to do with the North Atlantic.”

Nightly Number

209,000

The number of jobs that the United States added in June, lower than in recent months but still a sign that the economy’s resilience is confounding the Federal Reserve’s drive to slow growth and inflation. The latest evidence of economic strength makes it all but certain that the Fed will resume its interest rate hikes later this month. The unemployment rate fell to 3.6 percent from 3.7 percent, and is near a five-decade low.

RADAR SWEEP

ON DISPLAY — For the first time in 134 years, the public can see a renowned, award-winning painting up close. In 1889, Filipino painter Juan Luna won a bronze prize for the work at the World’s Fair marking the 100th anniversary of the opening of the Eiffel Tower. He stashed it in his private collection until his death in 1899, at which point its whereabouts were lost. But in 2014, an art dealer was allowed into the home of a noble European family — and there it was. He purchased the painting, and has now lent it to a museum in Manila. It’s a fitting display for Luna, considered one of the greatest painters in the history of the Philippines. Read about the painting’s journey and what it means for it to be on display now from Romano Santos in Vice.

Parting Image

On this date in 1988: Iranian mourners in Tehran carry one of 72 caskets to the Cemetery of Martyrs after attending a mass funeral and "Death to America" rally in response to the downing of Iran Air Flight 655 by the USS Vincennes four days earlier.

On this date in 1988: Iranian mourners in Tehran carry one of 72 caskets to the Cemetery of Martyrs after attending a mass funeral and "Death to America" rally in response to the downing of Iran Air Flight 655 by the USS Vincennes four days earlier. | AP Photo

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