Commentary
Evaluating President Trump’s tariff policy involves examining it from two different perspectives: completing the shift from post-Cold War containment of the Soviet Union to addressing the next challenge, from China, and the assurance that Trump is sincere in his desire to negotiate new fair-trading arrangements to effectively eliminate America’s anachronistic trade deficit.
Soviet leader Joseph Stalin, U.S. President Franklin Roosevelt, and British Prime Minister Winston Churchill all promised that they would swiftly evacuate the liberated countries of Western Europe, except for Germany, and hold in all of them completely democratic all-party elections. The Western allies scrupulously observed this commitment, including in Italy and France, even though the communist parties in those countries gained over 20 percent of the vote. The Soviet Union violated its promises, however, and no such elections were held until the communist bloc and international communism itself disintegrated 45 years after the end of World War II.
The United States also extended generous economic reconstruction assistance to Western Europe (which Canada emulated with more than proportionate generosity, and for which it has given itself little credit), and led in the formation of NATO, whose principal feature was the American military guarantee for all member states, though it was formulated as the principle that an attack upon one would be an attack upon all but each would determine how it chose to respond to such an attack.
NATO has been the most successful alliance in the history of the world, and it and the Marshall Plan assisting the recovery of Western Europe were the primary foundations of victory over communism in Europe. The disintegration of the Soviet Union and the reunification of Germany as a fully fledged member of the Western Alliance and of the European Union ended the long era in which it was not clear if Germany was an Eastern- or Western-facing country.
Because the United States never feared a united Germany, President Eisenhower brought West Germany into NATO over the reservations of Churchill and the Fourth Republic French governments. President Reagan and President George H.W. Bush, assisted by Canada’s Prime Minister Mulroney, helped West German Chancellor Helmut Kohl reunify Germany, over the reservations of British Prime Minister Thatcher, French President Mitterrand, and Soviet President Gorbachev.
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Vladimir Putin’s Russia has less than half the population of the old Soviet Union and a GDP smaller than Canada’s. It does not possess a quarter of the economic strength of the main Western European powers, and it certainly does not possess—as it has demonstrated by floundering about in Ukraine—the military power to intimidate the major Western European countries. This is especially so given that France and the United Kingdom are nuclear powers, and given the continuing commitment of the United States to defend Western Europe in the event of attack.
In these circumstances, it is natural that the United States, having designed and conducted a successful containment strategy against the Soviet Union, is now applying a modified containment strategy to deal with the challenge posed by China.
After World War II, many former Western European colonies were vulnerable to communism for its promise of equality for all and its perceived lack of racial bias, but the American strategy was to incentivize these countries to keep their distance from the USSR, and give them generous access to sell cheap goods in the American market. So desirable was the United States as a place to invest and so overwhelmingly economically powerful was it, that the money that thus departed America soon returned as investment in that country, but not in amounts that undermined U.S. control of its own economy.
All of these threats died even before the Cold War. And whereas 10 years ago it was commonly believed that the Chinese economy was about to pass that of the United States, China’s economy today is less than two-thirds of that of the United States, and it is still 40 percent a command economy in a totalitarian state that is profoundly corrupt. China is not a rich country, it has a large aging population because of its insane former one-child policy, and several hundred million Chinese still live as they did 1,000 years ago.
The only credible threat that China could pose to American (and Western) pre-eminence in the world would be if it could somehow make an arrangement with Russia to ship tens of millions of its surplus people to Siberia to exploit its resources in exchange for a royalty paid to the Kremlin. Russia is not a serious threat to Western Europe but it could, if it was so rebuffed and humiliated by the West, conceivably become so rancorous that it was prepared to suppress the imperishable pride of Holy Mother Russia in a comfortable subordinate relationship with China.
This is why the Trump administration has recognized that in addition to assuring that Russia does not succeed in undoing the largest single element of the Western victory in the Cold War by re-absorbing Ukraine, it must seek to revive a relationship with Russia, a country with which the United States no longer has any fundamental disagreement. And in assembling a containment strategy against China, the principal desirable associated countries are Japan, India, Russia, and in the second echelon, Vietnam, South Korea, Australia, Indonesia, and the Philippines. This is essentially why the United States has not assessed any new tariffs on Russia, because it is in the latter stages of negotiating a comprehensive resolution of outstanding issues with that country.
In these circumstances, there is no reason whatever for the United States to be running a trade deficit. And as long as President Trump is sincere about renegotiating more equal arrangements and no longer carrying on the broad back of America a raft of regimes that are perfectly competent to fend for themselves in an alliance where everyone pulls their weight and pays their way for a refreshing change, everything will be worked out quite quickly and satisfactorily.
Fifty countries have already expressed their desire to negotiate tariffs with the Trump administration. Unfortunately, trade adviser Peter Navarro has implied that the United States wants to use tariffs to force all those who wish entry to the United States to invest in the country. This is not what the president has been saying, and once binational agreements start to emerge, the nervosity of the financial markets, the most cowardly element of all principal segments of society, will be alleviated.
Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
