Dem 47
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GOP 53
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China Is Not Gaza

Donald Trump, like most bullies, always picks people weaker than himself to bully. Case in point: He ordered Israeli Prime Minister Benjamin Netanyahu to end the war in Gaza. Since Netanyahu is dependent on American weapons and ammo to fight the war, he gritted his teeth and said "Yes, sir." If Trump thinks this approach will work with China, he is in for a rude awakening.

Trump's mindset is stuck in the 1970s. He thinks China is a backward country that does little except make cheap t-shirts. It's not. Its economy has already surpassed the U.S. in some notable ways. One good overall measure of an economy is how much electric power it produces, since power is needed for many industries as well as homes, transportation (e.g., trains), and more. Here is a graph of power production in China and the U.S. since 1985:

Electricity production in the U.S. and China since 1985; the U.S.
has hovered around 4,000 terawatt hours for decades, and is still at that level. China crossed
4,000 TwH in 2010 and is now up to 10,000 TwH.

Trump thought he could bully China with the threat of 100% tariffs and cancellation of a scheduled meeting with Chinese President Xi Jinping. Xi didn't budge. Trump responded by not talking about tariffs anymore and rescheduling the meeting. Trump's playbook works only when dealing with a much weaker player who has few or no cards and who responds to presidential pressure. Xi has plenty of cards and no hesitation about using them. Among other things, he controls the flow of rare earth elements badly needed by U.S. industry, 70% of lithium-ion batteries, many raw materials needed by the pharmaceutical industry, and much more.

The U.S. does (or did) have something China doesn't have, though: allies. The U.S., E.U., Canada, India and Japan together represent over 50% of world GDP. As a bloc, it has a lot of leverage over China, both in terms of what it exports to China and what it imports from China. So has Trump brought the allies closer? No, he has slapped tariffs on Canada, the E.U., India and Japan, threatened to break up NATO, and gotten nothing in return. All the "allies" now understand that the U.S. is an unreliable partner and are starting to see China as a more reliable country to do business with. Xi drives a hard bargain, but when he has made a deal, he fulfills his promises.

Another edge the U.S. has over China is an incredible research network, led by top universities like Harvard, MIT and Stanford. Their discoveries have led to countless important products and services and are a key driver of American technological superiority in the world. So is Trump giving them more money to make more discoveries? No, he is trying to subjugate them and if they won't comply, to destroy them. The most talented students and researchers from all over the world want to come to the U.S.—and Trump is trying to keep them out. Xi probably can't believe his ears when his experts tell him Trump is singlehandedly trying to destroy America's research capacity.

Trump's (temporary?) success in the Middle East may give him the idea that all deals will be as easy as Gaza. Consequently, he is likely to try to bully China the way he bullied Israel and Hamas. He will discover the hard way that when the other side is roughly your equal and has many cards to play, that will not work. He is going to have to learn how to make deals. There is a book we heard about, The Art of the Deal written by Tony Schwartz. Maybe Trump can read it. Truth be told, though, we haven't read it so we don't know if it is any good. (V)



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