Trump on China, Two Weeks In

Negotiation or Escalation?

For its first two weeks, the Trump Administration has decided to take it relatively easy on China, and focus its ire on the greater threat, the people of Canada.

Jokes aside (this isn’t actually funny), the Trump team has been noticeably quiet on China, leading folks to speculate whether there might be some reset of the relationship in the works. I think it’s still a bit premature, and we did see a tit-for-tat this past week after Trump announced an additional 10% tariff on Chinese imports. For the Chinese side, a 10% hike probably does not seem that bad in the grand scheme of things, and it certainly leaves the door open for negotiation.

One of Trump’s “gifts” is that he has accumulated so much power that he does not need to abide by the normal laws of politics anymore. In political science, we define the “Overton window” the set of socially acceptable policies in a given issue space; basically, the range of policy options that are plausibly on the table. Trump seems to have the power to shift the window at will. He can say anything, and people in his party will take it as a serious policy idea. There is now an actual policy debate over whether we should annex Greenland. And the Panama Canal. And Canada. And Gaza.

A two-paragraph primer for those who don’t really follow U.S.-China too closely… It was Trump that originally ended the era of “engagement” with China, who set off this new period of “strategic competition” between the two countries. His China team at the time centered around people like Matt Pottinger, who ascribes to the general worldview that the U.S. and China are locked in a “New Cold War,” the U.S. just doesn’t know it yet. Trump 1.0’s China policy was both maximalist in pressure and unpredictable in nature. The relationship was precarious, rhetoric was intense, and ties between the people of the two countries were collateral damage.

To the surprise of some, the Biden team did not reset the relationship and retained the broader framework of strategic competition between the two countries. Biden focused more on working with allies and partners, and on rebuilding the diplomatic relationship with China on the grounds that “intense competition requires intense diplomacy,” to quote Jake Sullivan. But things were always icy. The U.S. took measures to curb China’s access to advanced chips, and China grew closer with Russia and continued to threaten Taiwan. There were not a whole lot of wins for the relationship, and China did not exactly behave how we wanted.

Frankly I think the Democrats have been so worried politically about being soft on China, that they basically caved to the extremely hawkish Republican position. And now, ironically, they may be being outmaneuvered and outflanked by Trump in the more moderate direction, who could position himself as a “negotiator” that can bring peace and stability between the two great powers. The reversal of the TikTok ban seems to be evidence of that tactic. If there is going to be a reset in the relationship, it’s only Trump that could do it, in the same way only Nixon could go to China in 1972.

So, what can we expect from Trump on China policy this time around? I think the consensus view right now is that the variance in outcomes is extremely high. Could I envision a scenario where Trump and Xi, relying largely on their personal relationship, negotiate some grand “deal” that allows both to look tough and save face, and we get four years of relative calm? Absolutely. Lingling Wei at the WSJ confirms that the Chinese side is actively preparing such a deal already, though it’s unclear what it might include.

Could I envision the case where the Republican national security establishment prevails, we get a trade war redux, escalating tensions over Taiwan, and renewed McCarthyism at home? Yes, and I think this is still more likely. It’s important to remember that the national security establishment has been preparing for war with China for over a decade now, and China remains the “pacing threat” for the U.S. military. In Pete Hegseth’s “Message to the Force”, he only identified one country by name: “Communist China.” There are many people in DC that are convinced that war with China is inevitable, and I doubt some “big deal” would assuage their concerns or convince them that the CCP is somehow benign.

Part of the issue here is that Trump’s broader team has a baked in cleavage on the China issue. Marco Rubio is a bona fide China hawk who is actually banned from entering China because of his sustained attention to the treatment of Uyghurs in Xinjiang. China ambassador Peter Perdue believes China and the U.S. are in a “New War” that is existential. Elbridge Colby is a more typical “peace through strength” hawk. He is well established in national security circles, known for his belief that military resources should be shifted away from Ukraine and towards Taiwan and the Asia-Pacific. In general, these types of thinkers are representative of the Republican national security establishment—various species of China hawks.

But as in Trump 1.0, there is a broader cast of characters running around. The China watching community is a bit disturbed by the recent appointment of Darren Beattie as Under Secretary of State for Public Diplomacy. Beattie is a Xinjiang-denier and has a bunch of Tweets out there that look like this:

He’s also said that the U.S. should abandon Taiwan for concessions on… Africa?

And then of course there’s Musk, who has well-documented business interests in China and has publicly stated that Taiwan is part of China.

China policy will somehow be a product of how these different factions operate and win influence. I have trouble seeing how they can all coexist with one another, Musk and Rubio in particular. My guess is that one of those two will be gone within six months.

Worth noting, again and again, that the unifying feature of the characters I just mentioned is that they have somehow convinced themselves that Donald Trump is fit for office, which to me means they themselves are unfit. And they have all perpetuated Trump’s lies about 2020 and January 6^th, to varying degrees. That is the price of admission into the club.

Thanks as always for your support. My email list has grown to 500 people now, and that’s because of you all spreading the word. I appreciate you reading my stuff.

Rory