Politics

Trump: Not Business as Usual in Asia

trump xiIn his seminal book Why I Am Not a Conservative (1960), F.A. Hayek contended that conservatism—at least the British and European version of conservative politics at that time—did not “offer an alternative to the direction in which we are moving”. While the British Tory party, for example, might “succeed by its resistance to current tendencies in slowing down undesirable developments”, it “could not prevent their continuance” since it failed to “indicate another direction”. The populist-nationalism of President Trump, I suggest, is emancipatory to its core, not the least reason being that he has clearly articulated and is now pursuing “another direction” in Asia.

The “current tendencies” and “undesirable developments” in America—and we could extrapolate to most Western nations—have to do with a dynamic and mutually fortifying relationship between politically-correct ideology and the development of a new power elite. Today’s ruling class, to borrow from James Burnham’s Managerial Revolution, is not the old-time family entrepreneur in league with a national parliament, but a managerial elite of “operating executives, superintendents, administrative engineers, supervisory technicians … administrators, commissioners, bureau heads, and so on”. This evolving ruling class, warned Burnham, would not necessarily be committed to economic freedom, personal liberty, parliamentary sovereignty and patriotism, their interests being monopolistic rather than market competitive, oligarchic rather than parliamentary, transnational rather than local, global rather than patriotic.

The America First creed is in obvious conflict with the globalist worldview. President Trump’s nationalist insurgency exists on a number of fronts, with each serving the same populist goal: to push back against the “insiders” or power elite who have hijacked the nation to serve their own agenda; an agenda which is at odds not only with the interests of the “outsiders” but also with the long-term viability of American self-determination. Take Trump’s tariff initiatives, for instance. His argument was not advanced simply on economic grounds but also in terms of national security. Tariff announcements on steel and aluminium imports have made Wall Street jittery, and yet President Trump expressed the obvious in one of his tweets: “When our country can’t make aluminum and steel … you almost don’t have a country. We need great steel makers.”

This is not to suggest that America should or would go to war against the People’s Republic of China. As Donald Trump the businessman explained in a tweet all the way back in February 2013: “China is not our friend. They are not our ally. They want to overtake us, and if we don’t get smart and tough soon, they will.” Commentators such as Kim Beazley, former Labor Opposition leader, have appeared on Australia’s mainstream media to lambast President Trump as a “moron”—and yet Trump’s grasp of geopolitics appears to be more on the money than our former ambassador to the United States. Maybe the bellicosity of Xi Jinping, who occupies Mao Zedong’s former digs in the Zhongnanhai compound immediately adjacent to the Forbidden City, can be constrained by leveraging on the tariff front. Perhaps America does need to allow its intellectual property to be appropriated holus-bolus by Beijing in order to maintain the peace of the world. Gary Cohn, the investment banker chosen to be chief economic adviser in the White House, disagreed—and so Donald Trump replaced him with Larry Kudlow, a Reaganite, big on free trade and other conventional Republican orthodoxies, but prepared to work for this White House.

President Trump’s enlightened patriotism is something other than a standard pro-business position. He relished burning down the House of Bush, furnished as it was with a jumble of neo-conservative foreign policy initiatives, PC-light bromides and neo-liberal economics, during the 2016 Republican primaries. Donald Trump is an economic nationalist who owes his job to a groundswell of right-wing populism; there was little chance he would fail to target the vulnerabilities of China’s top-down version of capitalism (for example, the “One Belt, One Road” grand strategy) and exert every kind of leverage available to him. Kudlow, a highly respected economic commentator, was not known for supporting tariffs, and yet ultimately he recognised their necessity in the context of China’s $275.8 billion annual trading surplus. Finally, Kudlow came to see—as Trump grasped long ago—that the PRC’s Zhongnanhai-devised artificial economy is decidedly dependent on the rest of the world and, consequently, something of a house of cards. Although China has responded with tariffs on a number of American agricultural products, calling its bluff is not likely to initiate the trade war that so many experts are predicting. The communist regime would be committing suicide. Already we hear of high-level trade talks between Washington and Beijing involving negotiations based on the necessity of bilateral mutuality and reciprocity.

This scenario of Trump-style leveraging has already been played out—albeit on a smaller scale—with South Korea. In March 2018, according to Treasury Secretary Steven Mnuchin, the Republic of Korea agreed to a new bilateral economic arrangement with the US that supplants the problematic 2012 Obama–Clinton deal. On the provision that Seoul be exempted from Trump’s proposed 25 per cent import tariffs on steel, the import quota on American-made automobiles not meeting South Korea’s quirky safety rules would be raised from 25,000 each year per US car-maker to 50,000.

Underwriting all of this, of course, is not just the threat of steel tariffs but the costly retention of 35,000 American troops in South Korea—and President Trump’s assurance that the US will look after Seoul in any future confrontation with Pyongyang. Foal Eagle, a joint military exercise between the United States and South Korea, commenced on Easter Sunday, having been delayed a month while the Obama–Clinton trade deal was being upended. Even then, President Trump has spoken of not officially signing the deal until he meets with Kim Jong-un by the end of May: “I may hold it up until after a deal is made with North Korea. Because it’s a very strong card, and I want to make sure everyone is treated fairly.” Christina Wilkie and Mike Calia, writing for CNBC, could not comprehend why “holding up the trade deal with South Korea, one of America’s closest allies, could aid the US in its dealing with North Korea”. The simple answer, obviously, is that the White House is leveraging everyone in Asia—the PRC, Afghanistan, the Philippines, Taiwan, North Korea, Japan, Australia, Pakistan, India and, no less, South Korea—to achieve its main ends, which include (a) denuclearising North Korea, (b) challenging China’s nascent hegemony, and (c) establishing fair trade rather than “free trade” mechanisms throughout the region.

The February 2018 issue of the Australian National University-associated Australian Foreign Affairs, titled “Trump in Asia: The New World Disorder”, is disappointing because so many of its expert writers seem entirely clueless about President Trump’s strategy. For instance, Michael Wesley, in “The Pivot to Chaos”, argues that Trump’s “rhetoric on China may have been tough, but his actions have been accommodating”. This, as we are discovering, turns out to be erroneous. Wesley’s claim is that Trump’s America First creed is so myopic in its insistence on bilateral trade agreements favourable to the US that we cannot speak of a “Trump Doctrine” in the moral terms of previous presidents. The upshot of Trump’s faintness on China and reluctance to lead from the front elsewhere in Asia, contends Wesley, Dean of the College of Asia and the Pacific at the ANU, allows for the possibility that Australia and its “complicated neighbourhood” will co-operate more closely, especially with regard to China flexing its military muscle: “The relationship will need to be more intimate, which will allow the communication to be more direct.” Thus, the chaos created by the Trump era, according to Wesley, could be the harbinger of a post-America world: “Finding a new American role in Asia, where the US works alongside its allies but doesn’t take responsibility for ensuring regional order, is a deal that the Donald might make.”

Michael Wesley’s gentle fantasy is only outdone as a false prophecy by the hysteria evoked in Kim Beazley and Gordon Flake’s “North Korea’s Missile Stand-Off: Prepare for War”. To be fair to Beazley and Flake, and also Wesley, they wrote their anti-Trump pieces before the tariffs, the South Korea trade deal and the Donald Trump–Kim Jong-un summit were announced. Nevertheless, one of the two premises for their ruminations on President Trump is that he is a “moron”, at least when it comes to international relations, and specifically when it comes to Asia. Their other supposition, and equally critical, is that a business mogul such as Donald Trump cannot possibly comprehend the subtleties and nuances of effective diplomacy. To Beazley and Flake, for instance, “Trump’s grasp of most matters in international politics and military affairs is rudimentary.” Still, it is Beazley who might have miscalculated Kim Jong-un’s relationship with his nuclear-weapons program: while it has been important to his legitimacy, as Beazley says, it is also a bargaining chip, a bargaining chip that can be traded—at a very high price and with enormous force brought to bear.

Beazley is, of course, right to warn of the horror of a new war breaking out on the Korean Peninsula. Nobody wants that—not even Kim Jong-un—and yet offering the Pyongyang regime, or any rogue regime, wiggle room is a recipe for failure. Michael Rubin’s Dancing with the Devil: The Perils of Engaging Rogue Regimes (2014) is a fine study of all the times America and the West in general went to the negotiating table with rogue regimes, including Bill Clinton’s disastrous 1994 nuclear deal with Kim Jong-il, which John McCain accurately described: “[President Clinton] has extended carrot after carrot, concession after concession, and pursued a policy of appeasement based … on the ill-founded belief that North Korea really just wanted to be part of the community of nations.” He could be describing President Obama’s 2015 Iran nuclear deal. Playing the war card is a risky business, but not playing it at all, not even bringing it to the table, is even more perilous.

Donald Trump will, I am sure, be given little credit by the mainstream media if he brings about the denuclearisation of the Korean Peninsula. He will be designated the reckless punter who bet all on brinkmanship and miraculously scooped the pool. Perhaps the 2019 Nobel Peace Prize could be awarded to Kim Jong-un and Xi Jinping, two communist statesman who made great sacrifices for world peace. In reality, nevertheless, the America First doctrine will have pushed President Xi to force President Kim to make a deal with President Trump so that, in turn, President Xi achieves a less bad tariff deal with President Trump. Politics, as Donald Trump acknowledged on election night 2016, can be a complicated business.

Trump’s cut-and-thrust dealings might be too crude for our modern-day academics or diplomats to apprehend, but you would at least expect America’s wheeler-dealer political class to have worked out—before the arrival of Trump—how to make America great again. If, as David Kilcullen argues in his missive for Australian Foreign Affairs, Donald Trump is full of “louche, swaggering ignorance”, why might he be able to correct the behaviour of China, South Korea, North Korea and so on when every other politician has failed? Peter Schweizer’s Secret Empires: How the American Political Class Hides Corruption and Enriches Family and Friends (2018) goes some of the way to solving that mystery.

The families and friends of prominent American politicians, Democrat and Republican alike, from former Vice-President Joe Biden to current Senate Majority Leader Mitch McConnell, all have done spectacularly well thanks to their private financial dealings with China. The wives and so-called “princelings” of prominent American politicians have become enriched beyond anyone’s dreams while the US dramatically softened its stance towards China in the post-Tiananmen Square massacre era. McConnell, once very tough on Beijing, changed his tune during the 1990s, to the extent of being “ambiguous” about whether the US would defend Taiwan if it were invaded by the PRC: “I think we’re purposefully ambiguous. I think that’s the place we ought to be.” The McConnell family, including his wife Elaine Chao, have done very well from their China connections. One worry is that Chao, a cabinet member of George W. Bush’s government, happens to be the Secretary of Transport in the Trump administration.

America’s power elite, or James Burnham’s managerial class, were apoplectic when President-elect Trump phoned Taiwan’s democratically-elected President Tsai Ing-wen before calling Xi Jinping. Donald Trump, opined the mainstream media, was a blundering fool who might not even know the difference between the People’s Republic of China and the Republic of China (Taiwan). MSNBC went one better by claiming the phone call was about Trump wanting to “build luxury hotels in Taiwan’s Tao Yuan”. We now know, surely, that the call to President Tsai Ing-wen was the first move in a comprehensive strategy to bring the PRC to heel. Even the visit of Ivana Trump to India, not to mention India’s investment of $500 million in America’s regenerated steel industry, sent a message to China: India, too, can be the source of low-priced items filling Walmart’s shelves.

Donald Trump’s goal, then, is to reject a business-as-usual approach to world trade—having deemed it unfavourable to America’s long-term interests—and launch a whole “new direction”, dismissing the consensus of economists with the wave of a hand. Conservative and neo-liberal economists with a high regard for the orthodoxies of Milton Friedman remain appalled that President Trump would risk an international trade war. Mitch McConnell, and 106 of his fellow Republican Congressmen, also have “genuine concerns”. We must not threaten the new normal in global commerce—normal at least since Deng Xiaoping committed China to “the Four Modernisations” in 1977, and even more normal after the PRC joined the World Trade Organisation in December 2001.

The reality, however, is that despite the best hopes of the liberal-minded West, the globalisation (and modernisation) of China has made its communist rulers less democratic at home and, on the international stage, more belligerent. Dictator-for-life Xi Jinping continued the military build-up on man-made islands in the disputed waters of the South China Sea while Vice-President Biden’s son, Hamilton, made a financial killing in 2013 when his private firm sealed a highly unusual $1.5 billion deal with funding from the Chinese government. The American political class, according to Peter Schweizer, has been “offshoring” its corruption. Trump’s emancipatory conservatism, we can but hope, offers “an alternative to the direction in which we are moving”.

Daryl McCann wrote on Turkey in the April issue. He has a blog at http://darylmccann.blogspot.com.au, and he tweets at @dosakamccann.

6 comments
  • ianl

    > “Trump’s cut-and-thrust dealings might be too crude for our modern-day academics or diplomats to apprehend …”

    Perhaps “comprehend” is meant, rather than “apprehend”, but nevertheless it is not the diplomatic class’ comprehension that is at stake. Rather it is their vanity, their ego, that is being trampled on. The article here clearly outlines how.

    Whether Trump will be successful or not I cannot predict. However, he is playing the Pingpong man at his own game (concession, retreat, belligerence … concession, retreat, belligerence …) and this is different in concept and texture to the failed attempts of Obama, Bush. Clinton and so on back to the 1950’s. (Did Obama ever really try ?) Such a difference will shift the outcomes. The result is not for me to predict but Beazley et al are overt failures here.
    A change is obviously needed, else we mired in the Einsteinian definition of lunacy.

  • en passant

    Daryl,
    One of the best articles on the MAGA Trump that the stunned elites still cannot believe won the election by defeating the Wicked Witch. I must watch again my favourite YouTube of the reactions of the media to his win. It never fails to cheer me up.

    So how does this apply to Oz where we still have Andrew trying to Robb us by continuing to encourage trade deals favourable to China. An Oz where we have a political class taking money and willing to kow-tow to their new master in Beijing for a few dollars more?

    Our manufacturing sector has passed the point of no return without an Oz Trump – and that giant is nowhere on the horizon.

    So, we now have engineers, former senior executives and highly qualified and skilled people working as handyMEN (take that Morrison!), mediocre baristas and cleaning offices overnight.

    The future for today’s brainwashed kids is to learn to say in Mandarin: “Would you like another coffee?”

  • HowieS

    I do wish that this article could be included in an edition of the Australian’s Inquirer in the very near future. Alas, it may be too clear and intelligent to appear. Thank you for writing and publishing.

  • Keith Kennelly

    The Chinese economy is a house of cards. It is built on transferring wealth from the west to China through unfair trade, currency manipulation and theft of technology.
    A trade war with the US would totally destroy it.

    Any military showdown with Nth Korea would occur in Nth Korea … in China’s backyard. Xi cannot afford that

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