This China Deal Isn’t Much to Look At

By Matthew McMullan
Jan 15 2020 |
Official White House photo

Not for American manufacturing workers, at least. The playing field remains unlevel.

Well there it is, folks! President Trump has signed a trade deal with the Chinese government that addresses allof the root problems of unfair Chinese trade: The billions it spends in subsidies on otherwise unprofitable businesses, its overcapacity in key sectors like steel and aluminum, its inadequate labor and environmental standards, and the participation of the state-owned enterprises it keeps feeding. All of that was covered.

Just kidding, none of that was resolved. Instead, China promised to buy a bunch of American goods. The Trump administration promised to lighten up on the tariffs. We’ll see how President Trump sticks to that. And that’s it. But, hey, at least the bankers are doing pretty good! 

It’s January in an election year. The president is gonna spend the next few months touting this Phase 1 agreement as if it’s the culmination of the hopes and prayers of the literal millions of American workers whose economic livelihoods have been negatively affected by the last two decades of the U.S. trading relationship with China. And some of us out there will give him the benefit of the doubt no matter what.

But this can’t be the end of it. Sure, the administration deserves credit for forcing the Chinese side to the table for comprehensive trade negotiations … but that alone is simply not good enough. The Alliance for American Manufacturing has committed that position to paper. In a letter to the White House a few days ago, we wrote:

We appreciate how difficult it has been for U.S. negotiators to secure commitments on access to China’s market, commodity purchases of American exports, and intellectual property protections. However, for American manufacturing and its workers, the phase one agreement is completely inadequate. The agreement does not level the playing field for American workers in the U.S. or global market. With nearly all the major structural issues left unresolved – including industrial subsidies, overcapacity, state-owned enterprises, predatory investment, currency manipulation and misalignment, cyber intrusions, worker rights, environmental rules, and tax policy – we urge an immediate resumption of negotiations and sustained economic pressure.

President Trump needs to hear that. America’s workers deserve a better deal than this.

The administration needs to get back to the negotiating table immediately and address the mountains of Chinese industrial subsidies and guard against predatory investment by its state-owned enterprises. It should maintain the import tariffs it has erected, which brought the Chinese government to the deal in the first place. It should make sure China’s actually living up to its Phase 1 commitments.

And it must know that voters expect more than a limited deal full of one-time purchases Write him and let him know: They want a deal that stops the offshoring of American manufacturing jobs.