Fox News TV || Gatestone Institute senior fellow Gordon Chang dissects President Donald Trump's relations with China and the Chinese economy on 'Life, Liberty & Levin.' #foxnews #fox #news #china #trump
00:00Welcome back, America. We're here with our friend Gordon Chang of the wonderful Gatestone Institute, fantastic Institute, his book Plan Red.
00:10Gordon Chang, I feel the president put all these tariffs in place, specifically on China more than any of the others, to get leverage.
00:20In other words, we have these countries that are ripping us off with massive tariffs, with other things that they're doing,
00:26massive subsidies of their companies, stealing our proprietary information, and the president's there, and he says,
00:32how do I leverage communist China and even our allies that are doing this to our country?
00:38And being somebody who loves our country and wants to help the people of our country, he says, look, I've got an idea.
00:44Other presidents have done it, and it worked. Tariffs. So I'm going to put tariffs in place across the board, pretty much.
00:49China, I'm going to slam the hell out of them, and then they're going to come to the table, and then we're going to have a meaningful discussion.
00:55That seems to have occurred, no?
00:59Well, yeah, the president certainly gave China a lot of relief at a time which was critical for China,
01:05because this is the beginning of the Christmas season for China's export-oriented factories.
01:11And really, the mutual reduction of tariffs helps China's exporters far more than it helps ours.
01:17And, you know, a lot of people say that the president blinked, and he certainly did.
01:21He gave China a temporary win.
01:23And I think that what Trump was doing was he realized the Chinese were on a collision course with the United States and the world, and he gave them an off-ramp.
01:33He gave them 90 days to come to terms with not only us, but with everybody else.
01:38And we're going to see where we are.
01:40Now, if the president gives another delay, another pause in the tariffs, then I get really worried.
01:47But at least for the meantime, I think the president has been quite gracious.
01:51Now, I think it was a mistake, largely because it's made the Chinese arrogant.
01:56And I don't think he should have let them out of the box.
01:58But he's the president.
01:59Well, it's interesting you say that, because I was looking at it quite differently than that.
02:04That is, even though it can hurt us, the supply chains, pharmaceuticals, and all the rest of it that, unfortunately, we've come to rely on with China.
02:13I think what he was doing is he was showing China, we have more power and the ability to affect your economy than you do ours.
02:23And not only that, I believe you've told me, and I've also read, that there's little pockets of unrest in communist China, with workers in different factories protesting.
02:33Some of the, I won't call them opposition media, but some of the information's getting out of China, that they were having serious problems with these factories and so forth.
02:42People weren't being paid for two weeks.
02:43Pensioners weren't getting their pensions.
02:45So it doesn't look like a complete great victory to China for me.
02:50Well, what happened is at a time which was critical for Beijing and for the Communist Party, Trump gave them some relief.
02:57And you're right, there are worker protests across the country, because even before Trump took his second oath of office, export-oriented factories were having real problems.
03:08They were not getting orders, what was necessary to keep them in business.
03:12After the tariffs, a lot of them, in fact, went out of business.
03:16They weren't paying their workers.
03:17Workers took to the streets.
03:19And we're starting to get hints that this is affecting smaller Chinese banks, because smaller Chinese loans are going bust.
03:27That means the banks don't have enough money for depositors.
03:31Depositors are getting angry, and they're taking to the streets as well.
03:34So this is an economy that is fragile.
03:37I think the Chinese economy is contracting.
03:40We can see this from all sorts of price data, especially February, March, and April.
03:45So I wouldn't have given the Chinese relief.
03:48I would have pressed the advantage.
03:50But, you know, the president took the opposite course.
03:53Let me ask you this.
03:54With respect to the Communist Chinese military, if they're having economic problems, does that affect their military capabilities and their payments to the military?
04:05Or is that just prioritized?
04:08It's prioritized.
04:09For some time now, the Chinese military, from all we can tell, is getting a bigger portion of central government revenues than the economy would bear.
04:21They're still able to do it because the generals and admirals formed the most powerful faction in the Communist Party.
04:27But it's going to catch up with them soon because we're seeing all sorts of signs of distress.
04:33And there's a lot of commitments that Xi Jinping has made.
04:36And I don't think he can fulfill all of them.
04:38So the military, I think, is going to have problems with its budget.
04:42That's going to cause even more problems for China's leaders with the generals and admirals.
04:47So this is not a good situation for China's leader.
04:50So they're vulnerable to future tariffs, you're telling me?
04:53Absolutely.
04:54First of all, we're the bigger economy.
04:56China is less than two-thirds the size of ours.
04:59China is the trade surplus country.
05:01They've got everything to lose.
05:03Their economy is contracting, I believe.
05:06You know, you just add it up.
05:08We have all the high cards.
05:10And, you know, for President Trump to give them even more relief right now sort of gets them through a very difficult time.
05:18You know, you keep saying that, and I understand your perspective and so forth, but I'm not fully understanding it.
05:26In other words, our companies needed relief, too.
05:29And they apparently were lining up at the door at the White House begging the president,
05:34particularly companies that produce electronics and so forth and so on, pharmaceuticals, other industries.
05:41And he had to keep that in mind, too.
05:44But he made it clear, in my humble opinion, that when he put the tariffs in place,
05:47that we have the capacity to do maximum damage to what you're calling an economy that's already on its back.
05:53And so I'm not sure about blinking and giving them relief and so forth and so on.
05:58It's 90 days.
05:5990 days in the life of a country is nothing.
06:01And so I suspect there's something more to this, which is we show them what we're capable of.
06:09Their economy sucks.
06:10At some point, as you say, the military is going to be affected by it.
06:15And now we'll go to the negotiation table.
06:17And if we can't come up with some kind of trade agreement that is also beneficial to the United States,
06:24I'll slap those tariffs right back on them.
06:27I mean, I see that as a rational play, don't you?
06:30Yes. And one of the other things that's happening from a broader perspective is that Trump is showing
06:36companies around the world and countries that tension between China and the United States is real
06:43and it's going to get worse, even though there is a 90-day pause on the tariffs.
06:48And I think what he's doing is he's saying to corporate boards,
06:51look, you've got to get your factories out of China, because if you don't, you may end up in a situation where you'll have no goods to sell at all.
07:00So ultimately, I think this will work to our benefit as factories migrate back to the United States or to countries in our region,
07:07which would be good for us, or countries that are friendly.
07:10That's a win for the United States, ultimately.
07:13Well, that's actually a great point.
07:15Hey, Sean Hannity here.
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