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On his path to the White House, Donald Trump made transforming the way the US does trade with the world one of his biggest policy priorities.
But in his first State of the Union address, he had remarkably little to say about his record on the issue during his first year in office — or his future vision for trade policy.
Trump offered plenty of lofty rhetoric about how under his watch the US would no longer put up with unfair trade deals. “The era of economic surrender is totally over,” he declared. “From now on, we expect trading relationships to be fair and, very importantly, reciprocal.”
But when it came to actually explaining how his new era had begun or what it might look like in the coming years, he declined to offer any specifics.
“We will work to fix bad trade deals and negotiate new ones. And they will be good ones. But they will be fair,” he said in one of just a few characteristically vague sentences on the issue in his speech.
Trump didn’t mention ongoing negotiations over NAFTA; his decision to reopen talks over the US-South Korean trade agreement known as KORUS; the impact of leaving the Trans-Pacific Partnership; or his stance on the World Trade Organization. Nor did he name specific countries that he thinks are trade cheaters that deserve to be punished for taking advantage of the US.
Chad Bown, a trade expert at the Peterson Institute for International Economics, told me he found it surprising that Trump used such vague language to discuss trade, especially when it comes to China policy.
“The Trump administration’s strategy to deal with the serious challenges posed by China remains entirely unclear,” Bown said.
Trump has promised a lot more than he’s delivered on China so far
On the campaign trail, Trump promised to avenge China’s “rape” of the US economy and its “theft” of coveted manufacturing jobs from the American heartland. He pledged to punish China for devaluing its currency to give itself a special advantage in global trade. And he threatened to impose enormous 45 percent tariffs on goods from China to protect American industry from competition.
But after he took office, none of that happened. Trump reversed his position on blacklisting China as a currency manipulator and failed to issue any big tariffs.
Earlier in January, he did make his first more aggressive move toward Beijing by issuing 30 percent tariffs on imported solar panels, which China produces more of than any other country in the world.
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But there are still more questions than answers regarding how Trump intends to fulfill threats he’s made against Chinese steel and aluminum imports. Perhaps most importantly, it remains to be seen how he decides to deal with China’s practice of forcing US companies to hand over their most prized technology in exchange for access to China’s market.
Experts widely expect any major steps Trump takes against Beijing to be reciprocated, and believe that a trade war could unfold as the countries get locked in a tit-for-tat against each other’s economies.
A number of trade watchers expected the president to roll out some major announcements on how he was going to get tough with China during this speech. But Trump instead opted to go with vague rhetoric and leave questions of how he might handle some of his most controversial economic policy to the public’s imagination.
