Donald Trump said in an interview with Fox Business that he was very disappointed in China’s response to the coronavirus, claiming that the pandemic had cast a pall over his January trade deal with Beijing.
“They should have never let this happen,” Trump said. “So I make a great trade deal and now I say this doesn’t feel the same to me. The ink was barely dry and the plague came over. And it doesn’t feel the same to me.” As far as suggestions that he should talk to Chinese President Xi, the president dismissed them. “But I just — right now I don’t want to speak to him,” Trump said in the interview, which was taped on Wednesday.
Trump even suggested that the rift could lead to a cut off in trade.
“There are many things we could do,” Trump told Fox Business Thursday morning. “We could cut off the whole relationship.”
“Now, if you did, what would happen?” Trump asked. “You’d save $500 billion if you cut off the whole relationship.”
The president questions whether China has been holding up its end of the trade deal.
Trump criticized China last week for failing to uphold the “phase one” trade deal signed in January and said he was “very torn” about its fate, even as his top trade advisers signaled that the agreement was on track. China was expected to purchase more than $200 billion in U.S. goods and services by the end of 2021 as part of the deal. However, exports to China will likely only total $57 billion this year due to the shock to supply and demand from the coronavirus pandemic.
What this is about, of course, is holding China accountable for its actions — and non-actions — in the initial stages of the pandemic. Treasury Secretary Steven Mnuchin put it succinctly.
“The president is concerned. He’s reviewing all his options. Obviously, we’re very concerned about the impact of this virus on the economy, on American jobs, the health of the American public and the president is going to do everything to protect the economy and protect American workers,” Mnuchin said.
“It’s a difficult and complex matter and the president has made very clear, he wants more information. They didn’t let us in, they didn’t let us understand what was going on.”
Trump must be cautious that he doesn’t do something out of spite or emotion that he would regret later. And cutting off U.S.-China trade would be a monumental mistake. The disruption to U.S. supply networks would be severe and would take years to repair.
Like it or not, it’s a global economy. And China is a pivotal player on which most of the world depends. Cutting off trade would make the coming recession even worse and add to U.S. unemployment. The U.S. should work the international angle on holding China accountable and only put the economic screws to China later — after our economy has recovered.