Gordon Chang, author of The Coming Collapse of China, said the “Phase One” trade deal with China “does not look like the best deal that President Trump could have obtained from the Chinese” because the United States is giving away more than it gets in return from China.
Chang told Breitbart News Tonight host Rebecca Mansour that the deal is “wrong from a strategic perspective [and] economic perspective.”
“This is a deal — which at least in broad outline — does not look like it is the best deal that President Trump could have obtained from the Chinese,” Chang said. “We’re giving up a lot of our Section 301 tariffs, which were imposed for theft of intellectual property, and we’re not getting that much in return.”
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China’s agreement to purchase more U.S. agricultural products and foodstuffs would have occurred in the absence of a trade deal given the country’s “severe food crisis,” Chang said.
“On currency manipulation, the Treasury Department today removed [China] from the list of currency manipulators,” remarked Chang. “This is somewhat disappointing in the fact that the Chinese have not lessened their control over the RMB.”
Chang continued, “I can’t think of how you can devise an enforceable mechanism on currency [manipulation], and I hope that they’ve done it. Maybe they’ve got something [in the agreement’s 86 pages].”
“I think that we could have gotten a better deal,” Chang said. “I don’t think we’re going to see a Phase Two deal, because Phase Two [has] the more difficult issues, and I think that Xi Jinping, the Chinese ruler, is not going to want to give up on industrial subsidizes [and] policies, which form the heart of his conception of a Maoist state-driven economy.”
Chang believes the U.S. should pursue a decoupling of its economy from China.
“I think we should be pushing for the only way we can protect ourselves in the long run, which is to uncouple, or to decouple … our economy from China,” assessed Chang. “The Phase One trade deal] created optimism among the Walmarts of the world [and] factory producers to stay in China, and that is a really critical benefit [for China], because we have seen a number of big U.S. companies start to lessen their dependence on China in their supply chains.”
Chang continued, “That is something we should continue to do, because fundamentally, we should not be enriching a country which is using the proceeds of trade to build up their military while their senior generals and admirals talk about killing Americans … openly and with glee.”
“This is wrong from a strategic perspective [and] economic perspective,” determined Chang. “We should be uncoupling our economies. We should not be enriching the hostile Chinese regime. We should be trading with our friends rather than with our enemies.”
Chang remarked, “If you look at past history, [the Chinese] have failed to honor their obligations in every prior trade deal, so if history repeats, this will not have been a good arrangement. … This is not a milestone, it’s really just a truce, and that truce is probably only going to hold only until after the November election, because if President Trump is reelected, I think you will probably see a more resolute policy on the part of the administration.”
Chang noted that the full text of the trade deal has not yet been released, and he warned of the challenges presented by having a dual-language agreement in both English and Chinese.
“We’ve only seen a one-page fact sheet from the U.S. trade representative, but [President Trump’s trade adviser] Peter Navarro told Fox Business that it’s an 86-page agreement,” said Chang. “We also know that the Chinese translation has not yet been finalized, which is important if it has equal dignity with the English text. So this is not a big deal if the agreement is only going to be in English, but it’s pretty unlikely that the Chinese would accept that arrangement.”
Chang added, “The agreement [probably] says something like there are two texts, one English and one Chinese, and that both have equal force. If that’s the case, then we don’t have a trade deal, right now, until the Chinese [language version] is actually finished.”
A dual-text agreement would offer China legal advantages, Chang explained.
“Chinese, as a language, is not as precise as English. English as one advantage over many languages in that it is designed for legal agreements. It is technical [and] precise. Chinese is not. I’m afraid that, effectively, the Chinese text will become the controlling document.”
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