Youngkin’s China Trade Deal Falls Apart
Normally, an announcement by the United States Trade Representative wouldn’t impact an election in Virginia. Of course, these are not normal times, as the Republicans chose to nominate Glenn Youngkin – a political novice whose lone policy “achievement” was helping the Trump Administration get a trade deal with the Chinese Communist Party.
On Monday, USTR Katherine Tai declared what nearly everyone knowledgeable about CCP behavior had predicted: Beijing was not keeping its promises from its trade deal with the Trump Administration (CNBC).
During her address, Tai confirmed a CNBC report last week saying that the Biden administration believed that Beijing has not complied with the phase one trade deal.
According to the deal, which was brokered under then-President Donald Trump and signed in January 2020, Beijing agreed to buy at least $200 billion more in U.S. goods and services over 2020 and 2021, compared with 2017. However, according to U.S. export data compiled by the Peterson Institute for International Economics, China has only reached 62% of that target.
Tai also detailed how the Youngkin-Trump trade deal with the ChiComs was doomed from the start.
But the reality is, this agreement did not meaningfully address the fundamental concerns that we have with China’s trade practices and their harmful impacts on the U.S. economy.
Even with the Phase One Agreement in place, China’s government continues to pour billions of dollars into targeted industries and continues to shape its economy to the will of the state – hurting the interests of workers here in the U.S and around the world.
In other words, Youngkin and Trump made a bad deal with our leading geopolitical rival with “benefits” depended upon that rival keeping its word – which didn’t happen.
This was no surprise to anyone who wasn’t naive enough to take Xi Jinping at this word. Indeed, this isn’t the first time Beijing has been found to be out of compliance. As Scott Kennedy (Center of International and Strategic Studies) noted in blistering detail, the deal…
… left China, Inc.—and its array of industrial policy tools—fully intact. Equally problematic, the deal’s highlight, the $200 billion purchase agreement, was a disaster: it endorsed managed trade and Chinese state interventionism, all the while setting unrealistic targets that China predictably never came close to meeting.
Chad Brown (Peterson Institute for International Economics) also weighed in.
But attempting to manage trade with purchase targets and an intention to reduce the bilateral deficit is the wrong approach. It distracts from the engagement necessary to address the costly incompatibilities of the Chinese economic system with the more market-oriented economies of the United States, European Union, Japan, and other like-minded countries.
In fact, about the only people who drank the Kool Aid on this trade deal were Trump himself and his partner, Glenn Youngkin.
“I am the only candidate running for Virginia Governor who was thanked by President Trump for helping him stand up to China to get a better a trade deal for American workers.”
Indeed, Youngkin was cited by Trump, but we now know – again – that this trade deal wasn’t “better” for Americans at all.
Keep in mind, Glenn Youngkin is now asking Virginians to entrust him with leadership of the entire government of the Commonwealth, including all sorts of policy decisions, negotiation efforts with the legislature, and of course, support for Virginia exporters in their attempts to get new business around the world. In the policy realm, Youngkin’s only “accomplishment” was this trade deal – a deal which has been exposed once more as a failure.