A radio host friend of mine recently asked: If I were somehow called in to mediate the trade dispute with Communist China and America… what would I do?
I answered: Resign the position immediately, and get another job.
Why am I so pessimistic?
Because, for over two years, when I worked in President Donald Trump’s first term as his National Economic Council director, I was part of the China trade team.
We had seemingly endless meetings with our Chinese counterparts – and that’s when I learned that they are impossible.
Really, the whole exercise came to naught.
Our team leader was the brilliant Bob Lighthizer, who served as the U.S. Trade Representative and taught me so much about unfair trading practices, especially with China, but frankly with the rest of the world as well.
And Mr. Lighthizer also taught me how important it was to protect America’s advanced technology entrepreneurs and their knowledge and their intellectual property.
He produced a book on this that was also an incredible eye-opener for me to see how China was the world leader in intellectual property theft. And the world leader in forced technology transfers.
What so many people don’t understand is that nearly all American companies operating in China are actually run by the Chinese, because boards were controlled by them by 51 percent to 49 percent, or worse. Those were the rules set down by the Chinese Communist Party.
And the Chinese could force the American company to unfold their technology as part of the Communist government’s policy.
Hence, the forced transfer of our family jewels.
I recall in 2018 we journeyed to Beijing for a big powwow with various Chinese leaders, where it turned out there were two honest reformers that I can recall, and the other dozen Chinese players were robots of the Chinese Communist Party.
Commerce Secretary Wilbur Ross took the lead in the commodities negotiations, and deputized me to help him.
We spent an entire day going through raw materials, farming, food, manufacturers, energy.
We set Chinese import targets, and U.S. export targets. And then argued about these targets for the next two years.
Former Commerce Secretary Wilbur Ross breaks down the tariff talks with China on ‘Kudlow.’
Treasury Secretary Mnuchin took the lead on financial companies, and the ability of any American businesses operating in China to actually own and run their own companies.
He had some small successes, but on the whole, we could never penetrate the Chinese Communist guard.
Mr. Lighthizer was our team leader, dealing with big picture items, such as intellectual property theft and a million other things that he and his U.S. Trade Representative team worked on.
We met with Chinese delegates at Washington, D.C. any number of times — never made any progress.
Gradually, over time, we did reach some parameters, which became known as the U.S.-China Phase 1 trade deal.
In late 2019, at the G-20 meeting at Buenos Aires, we had more meetings with the Chinese, and finally a big banquet dinner, where we were led by President Trump and the Chinese by Xi Jinping.
I remember the very first question Mr. Trump asked Mr. Xi: can you stop the fentanyl trade, and would you make fentanyl suppliers subject to capital punishment? And, without batting an eye, Mr. Xi immediately said yes. Of course, he was lying.
The Phase 1 deal was signed in January 2020, amidst much ballyhoo. The Chinese never implemented it.
Even while the signing ceremony was going on in the White House, China was desperately trying to cover the Covid outbreak that plagued their country — starting in a Wuhan lab, before spreading around the world and killing millions. We lost over a million Americans. An awful tragedy.
China has never acknowledged it, and to this day continues to deny the virus was hatched in their Wuhan lab.
But the Chinese proceeded to ignore the so-called Phase 2 trade deal, on the grounds that Covid halted everything.
But Covid has been basically gone for several years. Yet China continues its intellectual property theft, its forced transfer of technology, and they completely ignore all the numerical targets for the various commodities that Mr. Ross and I helped craft.
‘Kudlow’ panelists Elizabeth MacDonald, Gerri Willis and Clay Travis discuss responding to unfair trading practices in China.
Just a week ago, I spent an hour with a good friend, whose companies have operated in China for many decades. He remains in close touch with all the senior officials.
And I offered the view that China was more and more under state communist control, that the whole society had been tightened up oppressively.
What he said to me was: you are right.
And then he added: Xi Jinping is much more than a president of China – he sees himself as an emperor of China. With even greater powers than Mao Zedong ever had.
Mr. Xi has an ironclad grip on all parts of Chinese society and policy. He tolerates no dissent.
That is why I would never even think about mediating between America and China.
And that is why Mr. Trump is absolutely right to put the tariff heat on the economy of the emperor-like Xi Jinping.
An emperor whose lasting legacy will be ruining China.
