This is from the new president: “From this day forward its going to be only America first. Every decision on trade on taxes, on immigration, on foreign affairs will be made to benefit American workers and American families.”
He will also be imposing border taxes on companies that move manufacturing out of the US. One of the things that this does is put the price of goods for the US public. It may also reduce demand for imported goods if there is a viable US produced alternative. But the Donald may not have the concentration span to have thought through that far.
There are different signals coming from China’s President Xi Jinping. One of Beijing’s specific economic offerings to other nations is participation in its ambitious “One Belt, One Road” plan, redolent of the ancient Silk Road.
This is to link Asia to Europe by land – the belt – but also by sea, a maritime “road”. It’s planned to involve multi-trillion dollar infrastructure investments spanning 60 nations. It’s a Xi signature and he made sure to mention it.
He followed this performance by travelling to the Swiss town of Davos, where the high priests of globalisation gather every year to fret, fashionably, about the state of the world.
It was the first time in the 45-year history of the World Economic Forum that a Chinese president had attended Davos. Trump was absent. It was “Hamlet without the prince,” according to a commentator with Britain’s Guardian newspaper.
“The world is looking to China,” said the founder and chairman of the World Economic Forum, Klaus Schwab, in introducing Xi to the stage last week.
With Trump’s America promising to impose drastic trade restrictions, Xi pledged to his international audience that “China will keep its doors wide open”.
Senator John McCain, an Arizona Republican who chairs the Armed Services Committee, ripped Trump’s decision. Obama’s last defence secretary, Ash Carter, once said that the Asia-Pacific trade pact would be more strategically valuable than another aircraft carrier battle group in the Pacific.
Senator John McCain, an Arizona Republican
US withdrawal from the pact “will create an opening for China to rewrite the economic rules of the road at the expense of American workers,” McCain said. “And it will send a troubling signal of American disengagement in the Asia-Pacific region at a time we can least afford it.”