BUTLER: Is China Betting On Joe Biden?

Joanne Butler Contributor
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Would Joe Biden’s victory in the 2020 presidential election be a win for the People’s Republic of China?

Donald Trump has been working to correct problems rooted in decades of neglect by previous administrations toward China on basic issues such as intellectual property rights. Meanwhile, the PRC (a command economy) is using U.S. farmers as a punching bag to get the president to back off.

The expectation may be that Biden would bring back President Obama’s trade team — the same one that negotiated the (now discarded) Trans-Pacific Partnership (TPP). An Obama-style trade team likely would take the traditional view towards intellectual property rights violations: express “deep concern” but take no further action.

Plus, Biden has said he would renegotiate  President Obama’s TPP deal. Although the PRC is not a party to the TPP, it would bring significant benefits to China.

Under the TPP, the PRC could make deals with neighboring TPP participants to allow for illegal transshipments to the United States. Simply put, this means a Chinese manufacturer would ship products to a TPP re-packager. The goods would be labelled “Made in [Not China]” and shipped from the TPP country to the United States at a low-or-no import tax.

In 1999, President Clinton assured us that by granting the PRC “normal” trade status it would cause China to “play by the rules.” We all know how that worked out. It’s reasonable to expect the PRC would manipulate the TPP to further expand its manufacturing capacity.

It would be easy to cheat because there is simply no way the U.S. Customs Service could verify the status of a product that appeared to originate from a TPP country.

Consider a laserjet printer. It would take a detailed audit to learn whether the majority of its parts were sourced in a TPP country or not. A related question would be how much assembly was done in the TPP country; there’s a continuum of assembly ranging from full manufacture to simply popping the final product (from the PRC) in a box.

The bottom line is there’s plenty for the PRC to like in an Obama 2.0 trade team. But are they wise to bet on a Biden win?

What if someone else gets the nomination instead? (Former Defense Secretary Donald Rumsfeld would call this a “known unknown.”)

Suppose the nominee is Massachusetts Sen. Elizabeth Warren? She might recruit some trade staff from Capitol Hill, but she would lean heavily on environmentalists — those who would view trade deals with the PRC as a way to get that country to curb its pollution and carbon emissions.

Further, environmentalists in a Warren administration would not stand for meaningless diplomatic “statements of concern.” They would demand measurable reductions in areas such as greenhouse gas emissions, with the measuring done by the United States or the United Nations, not the PRC.

While the incumbent in the White House is indeed a mercurial man, he has his methods and the Chinese know them. Chatter about PRC foot-dragging on trade talks seems to indicate that the state central committee’s willingness to place a triple bet: (i) Biden wins the Democratic nomination and (ii) the presidential election, with (iii) a more PRC-friendly trade team in tow.

With many outcomes possible, it would be wiser for the Chinese to strike a deal today with a president they know.

Joanne Butler was an international trade specialist at the Office of the U.S. Trade Representative and at the Foreign Agricultural Service at USDA in the George H.W. Bush administration. In the George W. Bush administration, she was a senior adviser and speechwriter at the Department of Labor.

The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.