During his campaign, Donald Trump said the words “we’ll get tough on trade with China” almost as much as he said “we’ll build the wall and have Mexico pay for it.” Plans to fund and build the wall are meeting obstacles at ever turn, but now it looks as though President Trump is ready to fulfill his promise to crackdown on trade with China.
His first step has been to call for an investigation into allegations that the Asian nation violated U.S. intellectual property rights and forced technology transfers, according to news reports on Friday. Trump administration officials have estimated that theft of intellectual property by China could be as high as $600 billion.
Trump had been delaying the move at the urging of United Nations and State Department officials who did not want to put a potential resolution imposing sanctions on North Korea in jeopardy.
China voted in favor of the sanctions against North Korea for its recent intercontinental ballistic missile tests, in what turned out to be a unanimous vote by the U.N. Security Council. However, because China and Russia usually resist punishing North Korea, they may not actually enforce the sanctions.
U.S. Trade Representative Robert Lighthizer will open the investigation against China under Section 301 of the Trade Act of 1974, which will be used to investigate China’s behavior on intellectual property rights.
On Monday he promised a “thorough investigation” of China’s actions relating to copyright and intellectual property following President Trump’s directive.
“The United States has for many years been facing a very serious problem. China industrial policies and other practices reportedly have forced the transfer of vital U.S. technology to Chinese companies. We will engage in a thorough investigation and, if needed, take action to preserve the future of U.S. industry. Thousands of jobs are at stake for our workers and for future generations. This will be one of USTR’s highest priorities, and we will report back to the president as soon as possible,” Lighthizer said.
Long before he ran for POTUS, Trump has been an outspoken critic of China’s trade practices, accusing the Communist regime of manipulating and otherwise violating international rules on trade and commerce. He now has the legislative muscle to address those actions with tougher trade policies.
In a press event held on Monday, President Trump told Lighthizer that he was “empowered to consider all available options at your disposal.”
Lighthizer, 69, was picked by President Trump in January to head the trade representative’s office after having served as deputy trade representative during the Reagan administration and “negotiated about two dozen bilateral international trade deals during the Reagan years.”
Lighthizer was also a Senate Finance Committee Chief of Staff and has extensive experience in international trade law, spending over thirty years working for the law firm Skadden, Arps, Slate, Meagher, and Flom.
When he was President-elect, Trump said this about his new pick: “Lighthizer will work closely with Secretary of Commerce-designate Wilbur Ross and White House National Trade Council head Peter Navarro on policies to ‘shrink our trade deficit, expand economic growth, strengthen our manufacturing base and help stop the exodus of jobs from our shores.’”
Trump added, “Lighthizer is going to do an outstanding job representing the United States as we fight for good trade deals that put the American worker first. He has extensive experience striking agreements that protect some of the most important sectors of our economy and has repeatedly fought in the private sector to prevent bad deals from hurting Americans. He will do an amazing job helping turn around the failed trade policies which have robbed so many Americans of prosperity.”
Lightizer said, “I am fully committed to President-elect Trump’s mission to level the playing field for American workers and forge better trade policies which will benefit all Americans.”
The Chamber of Commerce, the nation’s leading business lobby, called on the White House to be “prudent” and for the two governments to work together. “If the U.S.-China relationship is to deliver mutually beneficial growth, U.S. firms must enjoy the same broad, secure access to the Chinese market that Chinese firms already enjoy to the United States. Equally important, China must end forced technology transfer and protect foreign-owned intellectual property rights within China,” said Myron Brilliant, the Chamber’s executive vice president and head of international affairs.
The Communists leaders of China have repeatedly rebuffed attempts by previous U.S. administrations to take action.
“I’m sure they will formally reject this if an investigation is launched and there is an implication this is going to require negotiation to resolve it,” said Matthew Goodman, a senior adviser for Asian economics at the Washington-based Center for Strategic and International Studies.
Lighthizer will have a year to look into whether to launch a formal investigation of China’s trade policies on intellectual property, which the White House and U.S. industry lobby groups say are harming U.S. businesses and jobs.
Trump dubbed the inquiry “a very big move” and experts on China trade policy said the long lead time could allow Asian leaders to discuss some of the issues raised by Washington without being seen as caving into to pressure under the threat of reprisals.