Patterico's Pontifications

8/23/2019

Trump Orders U.S. Companies To Start Looking For Alternatives To China (UPDATE)

Filed under: General — Dana @ 1:38 pm



[guest post by Dana]

[Ed. Pressed for time, just going to throw this blurb up…]

President Trump is on a wild bender today. After beginning his day by nastily questioning whether Federal Reserve chairman Jerome Powell a bigger enemy than President Xi of China, the President turned his focus on American companies and ordered them to find an alternative to China after Bejing slapped retaliatory tariffs on $75 billion of U.S. goods:

Our Country has lost, stupidly, Trillions of Dollars with China over many years. They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP. Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA. I will be responding to China’s Tariffs this afternoon. This is a GREAT opportunity for the United States. Also, I am ordering all carriers, including Fed Ex, Amazon, UPS and the Post Office, to SEARCH FOR & REFUSE, all deliveries of Fentanyl from China (or anywhere else!). Fentanyl kills 100,000 Americans a year. President Xi said this would stop – it didn’t. Our Economy, because of our gains in the last 2 1/2 years, is MUCH larger than that of China. We will keep it that way!

This brings up the question whether Trump has the legal authority to impact U.S. companies in this way:

Mr. Trump did not say what steps his administration might take to deter companies from operating in China, and it is unclear what legal authority he has to do so. In theory, however, he could impose import and export restrictions that make commerce more difficult.

Also, the market has been impacted by the ongoing tit-for-tat strikes in the trade war:

Investors, jittery over the trade war’s impact on the global economy, sent U.S. markets sharply lower after Mr. Trump’s tweets. The Dow dropped more than 500 645 points, or 1.9%, to 25,742, while the broader S&P 500 and tech-heavy Nasdaq each fell more than 2%.

Trump appears to be unconcerned about the market drop. To the contrary:

There’s just no telling what the Chosen One will do next…

UPDATE: So here is what the Chosen One decided to go with:

….Sadly, past Administrations have allowed China to get so far ahead of Fair and Balanced Trade that it has become a great burden to the American Taxpayer. As President, I can no longer allow this to happen! In the spirit of achieving Fair Trade, we must Balance this very….
…unfair Trading Relationship. China should not have put new Tariffs on 75 BILLION DOLLARS of United States product (politically motivated!). Starting on October 1st, the 250 BILLION DOLLARS of goods and products from China, currently being taxed at 25%, will be taxed at 30%…

…Additionally, the remaining 300 BILLION DOLLARS of goods and products from China, that was being taxed from September 1st at 10%, will now be taxed at 15%. Thank you for your attention to this matter!

(Cross-posted at The Jury Talks Back.)

–Dana

74 Responses to “Trump Orders U.S. Companies To Start Looking For Alternatives To China (UPDATE)”

  1. Welp.

    Dana (fdf131)

  2. One of my favorite bits from Shakespeare is this exchange from Henry IV Part 1
    Owen Glendower: I can call spirits from the vasty deep.
    Hotspur: But will they come when you call them?

    Hotspur’s question applies here, I think.

    Kishnevi (1b8c69)

  3. BTW, it seems John McAfee is using the replies for Trump’s tweets as a way of promoting his campaign, at the moment giving away cryptocurrency.

    Kishnevi (1b8c69)

  4. I noticed that too, kishnevi. I’ve seen him do it several times before.

    Dana (8b25a4)

  5. Well, he did it – after the markets closed:

    ….Sadly, past Administrations have allowed China to get so far ahead of Fair and Balanced Trade that it has become a great burden to the American Taxpayer. As President, I can no longer allow this to happen! In the spirit of achieving Fair Trade, we must Balance this very….

    …unfair Trading Relationship. China should not have put new Tariffs on 75 BILLION DOLLARS of United States product (politically motivated!). Starting on October 1st, the 250 BILLION DOLLARS of goods and products from China, currently being taxed at 25%, will be taxed at 30%…

    …Additionally, the remaining 300 BILLION DOLLARS of goods and products from China, that was being taxed from September 1st at 10%, will now be taxed at 15%. Thank you for your attention to this matter!

    Dana (8b25a4)

  6. Well, he’s guaranteed a rate cut, and a recession. Because he’s…all together now…a moron.

    Even when he’s got an idea that is asymptotic of being right, he veers wildly into approaching it with the dumbest possible way.

    Colonel Klink (Ret) (6e7a1c)

  7. Allahpundit riffs with characteristic verve:

    Just a reminder in case you missed the Greenland episode this week that the president is losing his mind, in full public view, day by day.

    Like a Twitter pal said, imagine throwing a fit because Denmark refused to sell Greenland to you and touting the fact that an ally said Israelis love you like you’re the second coming and having those things *not* be your most alarming statements of the week.

    […]

    The smart move now by China would be to offer Trump a return to the pre-tariff status quo and propose calling it the “Trump Total Victory Accord” or whatever to let him save face. That’s basically what happened with NAFTA and the USMCA; as you long as you let him have a political “win,” you don’t have to make meaningful concessions.

    Read the whole thing.

    Dave (1bb933)

  8. More Allahpundit:

    Prayers up for America’s businessmen and women, who somehow need to plan in an economic environment where tariffs and their timetables can change at a moment’s notice. Will Chinese imports still be facing a 30 percent tax come Monday morning? Tune in to Twitter in 60 or so hours from now and find out.

    Dave (1bb933)

  9. well alan greenspan, that great sage, helped pop the subprime bubble, with his two year marathon of rate increases, in other news, china has started to dismantle their island installations,

    narciso (d1f714)

  10. General paresis. He will be completely catatonic by the end of the year.

    nk (dbc370)

  11. that’s joe biden, who shares a fortune cookie, with whitey bulger’s nephew, and whatever pastry they have in the Ukraine, maybe baclava,

    narciso (d1f714)

  12. OMG $75 billion in US Goods have a Chinese tariff. Will these horrible Trade WAR ever end? How many people must die before Trump stops the MADNESS ?!

    Do you realize that $75 billion is approximately .0008 percent of the $20,000 Billion US economy? No wonder people are panicking!

    rcocean (1a839e)

  13. I’m telling you, he’s lost it. Somewhere in whatever’s left of his coddled egg of a brain, he’s aware that Xi Jinping, Kim Jong Un, and Vladimir Putin rule by ukase (that’s Russian for fiat which is Latin for edict which is also Latin), and he thinks he can too. It won’t surprise me if he orders the annexation of Greenland the way Putin ordered the annexation of Crimea.

    nk (dbc370)

  14. Allahpundit said that about Trump? Well, there’s no one more conservative than him. Remember when he stood against Trump and was A-OK with “Conservative” hillary being POTUS? Remember when he stood against Trump and was A-OK with the D’s gaining control of Congress in 2018? Remember how he wishes someone would run against Trump in 2020, and help “Conservative” Liz Warren or Bernie Sanders get elected?

    No one’s more “conservative” than Allahpundit. Except maybe Bill Kristol or J. Rubin.

    rcocean (1a839e)

  15. Cold War 2… for decades, China has been unchallenged in its theft of intellectual property, made demands of foreign (read US) companies before allowing them access to Chinese markets, outright theft of patents, our universities have been overrun with Chinese students/spies because their administrations would rather take the money before worrying about due diligence. In essence, unfair and unethical business practices.

    Our presidents have done virtually nothing about any of this since China was allowed into the WTO.

    Having said that, Trump does not need to express everything that approximates a thought passing through his head.

    Colonel Haiku (2601c0)

  16. Orange Man bad. Its the slogan that’s sweeping the USA! Repeat after me – and do it every day, for 1,200 days and we’ll win through sheer repetition.

    C’mon Never-Trumpers (and secret D’s) who’s with me?

    rcocean (1a839e)

  17. NeverTrump renews primal scream therapy. Let’s hope it works this time!

    https://www.youtube.com/watch?v=wDYNVH0U3cs

    Colonel Haiku (2601c0)

  18. Rc, can you really not see any reason other than personal animus towards trump to dislike his latest statement?

    Honestly?

    Time123 (c8cb7b)

  19. Cj, I’m fine with taking on China. Just waiting for some of the wining I was promised

    Time123 (c8cb7b)

  20. It’s becoming increasingly clear that Trump is losing his mind, if he ever had one to begin with, which I doubt. To warp paraphrase an old say, “Never attribute to dementia what can be explained by incompetence.”

    Gawain's Ghost (b25cd1)

  21. So is Trump the head of Gosplan or Gossnab?

    Also, what is the trade outcome of his actions, what does success look like, the achievement he wants to accomplish?

    He doesn’t have an end goal, and he’s trying to accomplish that with no plan. Great.

    Colonel Klink (Ret) (6e7a1c)

  22. Orange man deranged.

    nk (dbc370)

  23. unsurprisingly, Michael yon, who’s in hong kong looks at the bigger picture, blame anyone it’s these brokers with their itchy trigger fingered quotrons, or whatever their portable display terminals are these days,

    narciso (d1f714)

  24. 23. Trump’s end goal can be summed up in four words: Make Trump look good. Maybe his campaign gear should read MTLG instead of MAGA.

    Gryph (08c844)

  25. if that were so, he would have surrendered on guns, signed the wto, and stayed on the iran deal, all opinions, favored by the establishment media,

    narciso (d1f714)

  26. much like the diplomats who were subjected to god knows what kind of weapon,

    https://babalublog.com/2019/08/23/cubas-2017-zika-outbreak-ignored-tourirsts-not-warned-new-york-times-shocked-shocked/

    narciso (d1f714)

  27. Orange Julius Caesars The Moment.

    Deeeeeelicious!

    DCSCA (797bc0)

  28. Does he go anywhere without a person with a tranquilizing jabstick within three feet of him?

    nk (dbc370)

  29. Or do they use a remote-control stun belt?

    nk (dbc370)

  30. Sure, he can’t order people to do things, but I remember when Reagan ordered US citizens out of Lebanon, and how much better things would ahve been for them (and us) had everyone left.

    Companies that continue to put all their eggs in the Chinese basket have got a lot of I-told-you-so’s coming.

    Kevin M (21ca15)

  31. One of my favorite bits from Shakespeare

    Well, there is always Dogberry.

    Kevin M (21ca15)

  32. indeed steve Kerr’s father, was one of the first killed by the Iranians, and terry Anderson, sincerely thought you could deal with them, (which cost him six years of captivity) his moonbat daughter trusts Hezbollah more than the Israelis, so they are all certifiable,

    narciso (d1f714)

  33. Strategic tariffing:

    China will place additional tariffs of 5% or 10% on US imports starting on September 1st, according to a statement posted by China’s Finance Ministry.

    The Ministry also announced plans to resume tariffs on US imports of automobiles and automobile parts. The tariffs would be 25% for vehicles or 5% on parts, and would take effect on December 15th. The new tariffs will target 5,078 products, including soybeans, coffee, whiskey, seafood and crude oil.

    Target: Trump voters. China smart. Trump mad.

    nk (dbc370)

  34. Yes, Virginia, we do grow coffee. In Puerto Rico.

    nk (dbc370)

  35. So we began the week with Wall Street and other pundits saying Trump was too soft on China for allowing a 90-day delay before implementing that Huawei (sp?) ban.

    Then We end the week with Wall Street and other pundits saying Trump is too hard on China for the newly announced tariffs.

    I need a neck brace…

    whembly (4605df)

  36. People forget 1982, when Volker was squeezing the ever-loving dickens out of inflation and the country was in a deep double-dip recession. Reagan and the GOP were getting hammered and had a bad mid-term.

    But by 1984, inflation was at 0% and the economy was booming. Trump deserves credit for being willing to go to the mattresses with China. The Chinese strategy has been non-existent environmental and labor laws, government cronyism, and allowing private economic satrapies to be set up — all to move the “means of production” from the first world to China. Companies in the first world cannot compete under the existing laws.

    It would be nice if we could somehow force China to adopt the same rules of engagement that everyone else has agreed to, but we can’t. Next best thing is to given them a time out until they learn to play with others.

    We CRUSHED the Soviet Union with kind of strategy. They should consider that carefully.

    Kevin M (21ca15)

  37. China is utterly dependent upon selling into the US markets. IF they don’t, they die. We don’t have to sell to China. If we don’t, we get by.

    The real question is who blinks first. I know who blinks last.

    Kevin M (21ca15)

  38. So we began the week with Wall Street and other pundits saying Trump was too soft on China for allowing a 90-day delay before implementing that Huawei (sp?) ban.

    That’s not an accurate description of the criticism (there were probably denizens of TrumpWorld who said he was being too soft, but they’re ignorant of economics and should be ignored).

    Dave (1bb933)

  39. 36 Hawaii!

    37 Yes but it’s Trump who is zigging, zagging, and otherwise driving all over the road. He needs a Goldilocks to help him figure out the one that’s not too soft and not too hard.

    Kishnevi (0acdcd)

  40. China is only our third biggest enemy, Kevin. The media and Fed Chairman Powell are worse, they could hurt Trump’s reelection.

    nk (dbc370)

  41. I’ve updated the post with Trump’s comments posted at #5.

    Dana (fdf131)

  42. 8: “Prayers up for America’s businessmen and women, who somehow need to plan in an economic environment where tariffs and their timetables can change at a moment’s notice..”

    -Pray for the benefit of businesses that elected to locate in China? Pray that we should forfeit tariffs designed to bring jobs back here? No thanks.

    Harcourt Fenton Mudd (0c349e)

  43. It may well be processed coffee they are targeting. Several large US companies produce ground coffee.

    Dave (1bb933)

  44. 17: Yes per Dave’s item 8, but pray for the businesses impacted by ending that sweetheart deal. Some, used to seeing Americans only as purchasers of things made cheaply abroad, may have to respond to tariff changes at a moment’s notice. The horror.

    And people who endorse defiance of federal law with Sanctuary Cities, who smeared Kavanaugh, want the 2d Amdt gutted, the First re-written to guy Citizens United, and the Supreme court packed if it does not heel, are worried about trump’s acting all unilateral. More horror.

    Harcourt Fenton Mudd (0c349e)

  45. Pray that we should forfeit tariffs designed to bring jobs back here?

    They may be “designed” to do that, just like rent control is “designed” to make housing easier to get, but the *effect* is a tax that reduces the real income of American workers and the competitiveness of American industries.

    Tariffs cost far more jobs than they “save”, that is established beyond any doubt.

    Dave (1bb933)

  46. So the freedom to spend your own money, or your company’s money, to buy products you want from a producer asking a price you’re willing to pay is now “a sweetheart deal”?

    We have too much freedom! Big Brother knows best!

    Dave (1bb933)

  47. China is utterly dependent upon selling into the US markets. IF they don’t, they die. We don’t have to sell to China. If we don’t, we get by.

    We buy 19% of their exports. They are 21% of our imports.

    If they don’t sell to us, it’s painful for them, but I don’t think they die. It’s painful for us too.

    Also, there’s an old saying:

    If you owe the bank a million dollars, the bank owns you.

    If you owe the bank a billion dollars, you own the bank.

    We owe China over a trillion dollars.

    Dave (1bb933)

  48. R.I.P. David Koch

    Philanthropist, political activist, climate change denier.

    “We will bury you.”- Nikita Khrushchev, 1956

    DCSCA (797bc0)

  49. Pray that we should forfeit tariffs designed to bring jobs back here?

    Even if that was the goal, how does charging American consumers more, force companies to move back from Mexico, Vietnam, Canada, Taiwan, Brazil…you know, all the places those supposed jobs were off-shored too? Like those jobs Trump personally saved at Carrier in Indy, that still went to Mexico, I’m sure those Chinese tariffs will force them to move the factory back across the border.

    It’s not 1955 anymore, much of what we have in the form of commerce doesn’t have a single bolt or weld, it’s at the end of a phone line or internet connection. Just IT offshoring to India is a $100B a year and that’s just the disclosed amount to Indian providers, not the job moves from IBM, the banks, GE, etc.

    So, tariffs, not solving the problem you think exists, but hey, “Donald, stop punching yourself in your Chinese dumplings”, “but I’m figghhttinngg gina, I’m the worlds most accomplished self junk punch champion, watch me punch those ginese dumplings”.

    Colonel Klink (Ret) (6e7a1c)

  50. 48:

    (a) But, but….tariffs seemed to work just fine for about 150 years–before we got the free trading idea from the Brits–the idea that we had to be the market for everyone else’s goods.

    We had very good employment figures.

    And aren’t there hidden costs of the so-called “free trade” you don’t mention? Like the lost industrial base, the lost jobs for kids and blue collar people?

    And who pays for the US defense budget when manufacturing is there not here to pay its share? And when owners base companies in Ireland or wherever to avoid paying corp taxes on their offshore income–while freely resorting to US courts amd safety here?

    And who pays for the welfare and social sec of the people losing jobs to China? And who absorbs the cost of the IP leakage to China from US firms there?

    Its not the free traders. Factor those costs and come back to me;

    (b) love your endorsement of the freedom to buy and sell: does that presume that everyone else–China, Japan, SoKo-has the same “freedom” to sell there? No? Oh so its only here!

    Harcourt Fenton Mudd (0c349e)

  51. Trump is the first president to challenge China and they obviously don’t like it. China has an opportunity to get Trump out of the presidency in the next election and that’s what they are doing. They know that a sizable number of Americans are pain-averse pu$$ies and they – the Chinese leadership – are answerable to no electorate.

    * China sells us a lot more than we sell them
    * China can go after US companies in China, but the problem with that is that it undercuts their reputation of being a reliable member of the global supply chain, which was what made China rise, getting factories into China. Now these are being pushed out of China and going elsewhere.

    It will get worse before it gets better.

    Colonel Haiku (2601c0)

  52. But, but….tariffs seemed to work just fine for about 150 years–before we got the free trading idea from the Brits–the idea that we had to be the market for everyone else’s goods.

    Yes, and in the 100 years since that was true, modernity happened. Now, if you think society is going to magically forget the 20th century happened, good luck with that.

    Colonel Klink (Ret) (6e7a1c)

  53. So what’s your solution to China’s theft of American intellectual property and unethical business practices, klink?

    Colonel Haiku (2601c0)

  54. So what’s your solution to China’s theft of American intellectual property and unethical business practices, klink?

    First, not tariff’s, especially on unrelated products, unrelated in any way, and specifically costing US consumers, directly.
    Second strictly enforce purchase restrictions for technology IP products, the opposite of what Trump did caving to Huawei, that would be a good second step.
    Third, if you want a tariff like solution, implement a currency transaction premium for any Renminbi to USD transactions to influence Chinese currency manipulation.

    Again, what is the outcome you desire? If it’s massive moves of factories back to the US from China, never going to happen, they’d go to Vietnam, Cambodia, Uganda….Mexico, Canada…before the US, that’s a fantasy. If you desire flatter trade between the US and China, until the cost of labor is equal, that’s the maximum you could hope for, then almost anything other than Trump’s solution is better.

    Colonel Klink (Ret) (6e7a1c)

  55. I think in the long run this trade war does indeed hurt China more than it would hurt us. But in the short term, consider this:

    * if the Chinese economy starts to lag, any protests will be dealt with harshly and state media will provide friendly coverage and the Chinese government will be made to look stalwart and heroic
    * if the U.S. economy starts to lag, protesters will be bolstered by state media and the Trump Administration will be made to look panicked and confused
    * Trump runs for reelection in just 14 months.

    I don’t see a scenario where the Trump Administration can wait out Beijing that long, whereas the Chinese probably think they could keep a lid on things until they have a more friendly administration to deal with.

    JVW (54fd0b)

  56. JVW (54fd0b) — 8/23/2019 @ 7:29 pm

    And they know that, if worse comes to worst, the Oval Office will not have Donald Trump as its occupant from January 21, 2025 onwards.

    Kishnevi (0acdcd)

  57. “Second strictly enforce purchase restrictions for technology IP products, the opposite of what Trump did caving to Huawei, that would be a good second step.”

    Do these “restrictions” currently exist and are not being enforced?

    Colonel Haiku (2601c0)

  58. “I don’t see a scenario where the Trump Administration can wait out Beijing that long, whereas the Chinese probably think they could keep a lid on things until they have a more friendly administration to deal with.”

    That is what their game is. They want BAU, what they’ve grown accustomed to. It’s too bad, but they know who they’re dealing with. Short-sighted, short-game Americans.

    Colonel Haiku (2601c0)

  59. 56… this sort of thinking is why the Chinese are confident in their strategy. I suggest you read some Niall Ferguson and Gordon Chang.

    Colonel Haiku (2601c0)

  60. Do these “restrictions” currently exist and are not being enforced?

    Uhh…Yes and No.

    Colonel Klink (Ret) (6e7a1c)

  61. Donnie is so tough and mean on the Chinesers, when the Obama DoC had all but put ZTE out of business for selling US IP to Iran and North Korea, guess who let them off the hook with a fine? Why it was ole’ Wilbur Ross. Huawei was in line for the same treatment, but we did restrict them from using Android, I mean they’re replacing it on their phones with their own OS, Android with a skin.

    Donnie flails about with no finesse with his big clown shoes, but smart sanctions, and espionage are the correct response, but both of those things are beyond his comprehension, and anyone who would have worked around him, or actually rammed it through his dullard head, has quit.

    So, he taxes American’s to make the Chinese pay, Genius!!!

    Colonel Klink (Ret) (6e7a1c)

  62. 63… “all but put ZTE out of business…”

    That’s bullschiff, the Obama administration chose to impose similar sanctions (almost $900 million compared to the $1B under this administration) on ZTE for the same violation, instead of cutting off all its exports.

    Colonel Haiku (2601c0)

  63. The DoC chose to sanction them by withdrawing their ability to import Qualcom chips, forcing them to stop manufacturing anything, hence dead company. Trump DoC withdrew that with the $1B fine and $400M escrow for when they break sanctions again.

    You see if you can’t do the thing that you’re in business for, in the Case of ZTE and Huawei that’s spying for the Chinese and enriching some generals, you’re not in business; if you pay a fine to your target, and go back in the business spying, oh and making some stuff to enable said spying, that is less good for the US than not allowing the Chinese military company to pay to spy on you. But that $billion probably made up for it, oh, and how many new jobs in the US for it?

    Genius. But we’ll make US consumer’s pay more taxes, that will teach those dirty commies. Of course, the genius part is just telling the rubes that China’s paying, who’ll know, Trump supporters are unaffected by facts, it’s only what the dear leader says, it’s so very China 1948, it’s ironic.

    Colonel Klink (Ret) (6e7a1c)

  64. The world is progressing, the future is bright and no one can change this general trend of history. We should carry on constant propaganda among the people on the facts of world progress and the bright future ahead so that they will build their confidence in victory.
    – Mao

    Dave (1bb933)

  65. 65… please provide a link to that contention.

    Colonel Haiku (2601c0)

  66. You mean another one?

    Colonel Klink (Ret) (6e7a1c)

  67. China is only our third biggest enemy, Kevin. The media and Fed Chairman Powell are worse, they could hurt Trump’s reelection.

    I know that’s sarcasm, but the media is pretty much the enemy, yes.

    Kevin M (21ca15)

  68. We buy 19% of their exports. They are 21% of our imports.

    If they don’t sell to us, it’s painful for them, but I don’t think they die. It’s painful for us too.

    Dave, if they had much of a domestic market for their goods, I’d agree with you. But much more of the GDP is exported. It’s WHY they are so focused on artificial advantages for their exports.

    Kevin M (21ca15)

  69. 68… no, I mean a link that doesn’t veer left like BI… from what I’ve read, the Obama admin let China sell w/o proper licenses and run roughshod for 5 or 6 years (intelligence failure, as usual) and then didn’t wrap it up and left it for the next administration.

    Colonel Haiku (2601c0)

  70. JP Morgan: Trump’s tariffs will cost the average American household $1000 per year

    Increasing from “only” $600 per year from the previous two rounds of tariffs.

    Dave (1bb933)


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