Here's a tweet from President Trump from a few minutes ago that ought to confirm reality for numerous pundits and other so called experts:
Why would I call China a currency manipulator when they are working with us on the North Korean problem? We will see what happens!
For the last week or so, the talking head have been discussing the "flip-flop" by Trump that had "enraged" his base: he was no longer calling China a "currency manipulator". Now it was obvious that essentially no one in Trump's base was enraged by this. In fact, the average American doesn't care which countries are labeled currency manipulators. That part of the opinion of the pundits was pure BS. The issue of whether or not this was a "flip-flop", however, merits discussion.
During the campaign, President Trump often discussed how China was unfairly trading with the USA because it pushed the value of its currency down to make Chinese goods less expensive and American goods more expensive. Trump said that he would end that, mainly by labeling China a currency manipulator which would put countervailing duties on Chinese products so as to make competition fairer. Then a funny thing happened: the value of the Chinese currency started to rise about a week after Trump won the election. It has been going up by roughly 1% a month since then. That may not sound like much, but for a major national currency, that is a big move. It seems as if the Chinese heard Trump and then decided to end the manipulation (at least in part) on their own. Clearly, China was worried about the possibility of being named a currency manipulator.
Then came the nut job in North Korea with his missile tests and nuclear weapons. We are now no more than a few years away from that crazy guy having the ability to nuke the USA. Unlike Obama who just yawned and watched, President Trump decided that America can not allow that to happen. As with every president before him in the recent past, Trump recognized that the only country with any real leverage over North Korea is China. Clinton, Bush and (to a small extent) Obama all tried with no success to get help from China with NKs. With Trump, however, it has been different. First the Chinese cut off coal imports from North Korea, a major economic blow. Then China sent back the coal already delivered. Now China is threatening to cut off oil deliveries. Remember, China is the main source of petroleum to North Korea, so a cessation of deliveries by Beijing would be a body blow to North Korea. Not only would it cause major problems for civilians (which wouldn't bother the government there), but it would also be a calamity for the North Korean armed forces. If the army is threatened, so too is the regime of Kim Jung Un.
We do not yet know if the moves by China will rein in the crazy man in North Korea. We do know, however, that China has now been helping the USA in that attempt.
It seems pretty clear that when President Trump and President Xi of China met in Florida last week, the made a deal in which China helps with North Korea and the USA does not name China a currency manipulator. There are surely other parts to the deal, but those are the key ones.
That is not a flip-flop. It is a trade off to achieve a very important policy goal. Especially since China has let its currency rise since the election, the pressure to name it a manipulator has lessened. Getting help from Beijing to stop the North Korean threat has been a major goal of the USA. The deal is negotiated diplomacy at its best: both sides get something they really want. Trump confirms all this in his tweet.
Will this stop the pundits from talking about Trump's flip-flops? I doubt it; most mainstream media pundits don't care much about facts or reality. Nevertheless, getting China to help with the NKs is a big win for the USA and the President. Let's hope it continues.
Why would I call China a currency manipulator when they are working with us on the North Korean problem? We will see what happens!
For the last week or so, the talking head have been discussing the "flip-flop" by Trump that had "enraged" his base: he was no longer calling China a "currency manipulator". Now it was obvious that essentially no one in Trump's base was enraged by this. In fact, the average American doesn't care which countries are labeled currency manipulators. That part of the opinion of the pundits was pure BS. The issue of whether or not this was a "flip-flop", however, merits discussion.
During the campaign, President Trump often discussed how China was unfairly trading with the USA because it pushed the value of its currency down to make Chinese goods less expensive and American goods more expensive. Trump said that he would end that, mainly by labeling China a currency manipulator which would put countervailing duties on Chinese products so as to make competition fairer. Then a funny thing happened: the value of the Chinese currency started to rise about a week after Trump won the election. It has been going up by roughly 1% a month since then. That may not sound like much, but for a major national currency, that is a big move. It seems as if the Chinese heard Trump and then decided to end the manipulation (at least in part) on their own. Clearly, China was worried about the possibility of being named a currency manipulator.
Then came the nut job in North Korea with his missile tests and nuclear weapons. We are now no more than a few years away from that crazy guy having the ability to nuke the USA. Unlike Obama who just yawned and watched, President Trump decided that America can not allow that to happen. As with every president before him in the recent past, Trump recognized that the only country with any real leverage over North Korea is China. Clinton, Bush and (to a small extent) Obama all tried with no success to get help from China with NKs. With Trump, however, it has been different. First the Chinese cut off coal imports from North Korea, a major economic blow. Then China sent back the coal already delivered. Now China is threatening to cut off oil deliveries. Remember, China is the main source of petroleum to North Korea, so a cessation of deliveries by Beijing would be a body blow to North Korea. Not only would it cause major problems for civilians (which wouldn't bother the government there), but it would also be a calamity for the North Korean armed forces. If the army is threatened, so too is the regime of Kim Jung Un.
We do not yet know if the moves by China will rein in the crazy man in North Korea. We do know, however, that China has now been helping the USA in that attempt.
It seems pretty clear that when President Trump and President Xi of China met in Florida last week, the made a deal in which China helps with North Korea and the USA does not name China a currency manipulator. There are surely other parts to the deal, but those are the key ones.
That is not a flip-flop. It is a trade off to achieve a very important policy goal. Especially since China has let its currency rise since the election, the pressure to name it a manipulator has lessened. Getting help from Beijing to stop the North Korean threat has been a major goal of the USA. The deal is negotiated diplomacy at its best: both sides get something they really want. Trump confirms all this in his tweet.
Will this stop the pundits from talking about Trump's flip-flops? I doubt it; most mainstream media pundits don't care much about facts or reality. Nevertheless, getting China to help with the NKs is a big win for the USA and the President. Let's hope it continues.
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