Our editorial: Want to hurt China? Rejoin the TPP
Donald Trump doesn’t need to carry through with a trade war to pressure China to change its cheating ways on trade. The president instead should bring the United States back into the Trans-Pacific Partnership free trading pact and signal to the Chinese that America intends to be the dominant economic player in their region.
The TPP was negotiated by former President Barack Obama and originally included the U.S. and 11 other nations, including Canada, Mexico and the free economies of the Pacific Rim and South America. The partnership became a flashpoint issue in the 2016 presidential campaign, with both Hillary Clinton and Trump pledging to pull America out. The president did so after he won the election.
It was a poor decision. TPP promised to create a muscular trading alliance to counter China’s Asia Pacific influence. It would have been particularly good for American exporters, giving them access to growing economies and lessening their reliance on the Chinese and the oppressive demands they place on importers.
Trump hinted last winter at the Davos economic summit in Switzerland that he would consider rejoining the TPP if it were tweak in America’s favor, and Treasury Secretary Steve Mnuchin has repeated the statement since then. But the pact already treats the United States well. American wheat farmers, for example, could have expected $5 billion in additional income had the U.S. signed the pact.
Automakers opposed the TPP because it did not do enough to open Japan and other Asian markets to their products. But that is something that could have been worked out with additional negotiations.
For economic reasons alone, Trump should have kept the U.S. in the alliance. The Asian countries are becoming more prosperous and more free, and they have an appetite for American goods.
Japan has been encouraging Trump to rejoin the TPP as a means of gaining leverage over China.
“I was quite surprised by the Davos speech,” said Yorizumi Watanabe of Keio University in Tokyo. “It was the first time he talked about multilateral negotiations. We are all fighting the same war against Chinese imports.”
Rejoining TPP also is an important national security measure. If China becomes the default trading leader in the Asia Pacific, America’s influence will be diminished, even among such stalwart allies as Australia.
The path Trump is choosing to pressure the Chinese will also hurt American consumers. The $3 billion in tariffs he is proposing on a variety of made-in-China goods will drive up prices in this country.
Coming back into the TPP, however, would boost the American economy and open wider those Asian markets that don’t manipulate their currencies or force U.S. manufacturers to share trade secrets and cede operational control to their nationalist partners.
The frustration Trump has with China is understandable. It cheats and steals and doesn’t keep its word.
It also doesn’t want to see the United States grow more influential in its backyard. If Trump wants to send China a strong message, rejoining TPP would get the job done.