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Mr. Trump’s Faux National Security-based Trade Policy (aka ZTE – WTF?)

Summary:
Or, Mr. Trump is a wimp President Xi of China, and I, are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast. Too many jobs in China lost. Commerce Department has been instructed to get it done! — Donald J. Trump (@realDonaldTrump) May 13, 2018 Mr. Trump was the first in decades to actually implement Section 232 trade sanctions based on alleged national security concerns. These sanctions hit our allies much harder than the Chinese that Mr. Trump asserts has damaged our interests. And yet, when sanctions based on real national security concerns actually threaten to substantively punish a Chinese firm, he flinches. Why do we need a process (CFIUS, Section 232) if Mr. Trump is just going to rip up the decisions? Thus far, the trade policies

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or, Mr. Trump is a wimp

Mr. Trump was the first in decades to actually implement Section 232 trade sanctions based on alleged national security concerns. These sanctions hit our allies much harder than the Chinese that Mr. Trump asserts has damaged our interests. And yet, when sanctions based on real national security concerns actually threaten to substantively punish a Chinese firm, he flinches.

Why do we need a process (CFIUS, Section 232) if Mr. Trump is just going to rip up the decisions?

Thus far, the trade policies Mr. Trump has implemented have served to degrade — rather than enhance — our national security. Wavering on punishment for ZTE’s violations of previous sanctions and agreements will only further that degradation.

Menzie Chinn
He is Professor of Public Affairs and Economics at the University of Wisconsin, Madison

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