Even though he is the leader of the most powerful nation in the world, President Donald Trump’s actions will catch up to him eventually. His inability to grasp international relationships and complex economic interactions has caused collateral damage across many more industries, outside of just his anti-China actions (Telecoms.com, published a deeper dive into the numbers around this collateral damage).
One slightly humorous, example of the collateral damage from a stroke of his unilateral ban pen is the case where the editors of PC magazine sent a Huawei phone from the publication’s offices in the United Kingdom to its United States offices only to have it returned because of “U.S. Government Issue with Huawei and China Government.” Well, after a weeklong saga and a lawsuit against the federal government, FedEx did manage to deliver the Huawei phone.
Apparently, Trump did not stop to think about how this would affect FedEx or the U.K.? However, the main point is that it does not matter whether it was FedEx, the U.K. or even Tarbucks. The point is he did not stop to think.
A Turn of Events at G20 Gathering
At the just concluded G20 Summit, Trump and Chinese President Xi Jinping buried the hatchet (and not in each other’s head), clearing the way for U.S. companies to sell their equipment to Huawei. The president said in a press conference that this means only “equipment where there is no great national security problem.” Industry chatter says that these concessions were minor, and more for show, than go. This was the culmination of the noise that Trump was making, last week, about getting trade back on track.
While this may seem to be the end of this trade war and a sign of a more intelligent direction coming out of the White House, do not let this fool you. A more believable scenario is that Trump is worried about the 2020 election. While the Democrats are still a gaggle of quacking geese, eventually they shouldsettle on a candidate that will pose a serious threat to his reelection (if they learned their lessons from their 2016 strategy).
However, there may be more to this than what has been circulated. While Trump appears unconcerned by the fallout of using companies as pawns in this great negotiation, other legislators might not be quite as willing to put their votes on the line. Recall what happened during the ZTE epic.
Might this be the beginning of some intestinal fortitude being shown by the Senate? Perhaps Trump is feeling some pushback by a bullied Senate, as well as anybody else that he takes a dislike to (Silicon Valley). Part of the deal was that he stop hammering on Huawei. That could be a plausible scenario, even if it was spun around security, regardless of the significance of the concessions.
Therefore, if it appears Trump has softened his China stance, will the Republican Senate let him do what he wants? Might there be a repeat of the ZTE scenario?
The Senate does appear to be waking up. A bipartisan tone of defiance was tweeted by Sen. Marco Rubio (R-FL). “If President Trump has in fact bargained away the recent restrictions on #Huawei, then we will have to get those restrictions put back in place through legislation. And it will pass with a large veto proof majority.” Sen. Chuck Schumer (D-NY), agreed, tweeting, “If President @realDonaldTrump backs off, as it appears he is doing, it will dramatically undercut our ability to change China’s unfair trades practices.”
Is this going to backfire on Trump? He seems to have done a great job of convincing Washington that China poses a national security threat. Now he is saying, well, maybe not. Remember that, so far, nothing other than weak, circumstantial evidence has surfaced. In fact, there is stronger evidence against Russia and North Korea when it comes to spying and trying to disrupt our technical prowess.
The China Syndrome
I liken the Huawei theatrics to a 1960s song by the singer/poet Donovan where he penned these lyrics, “first there is a mountain, then there is no mountain, then there is.” Seems like the word mountain can be replaced with “Huawei threat.”
Is Huawei a national security threat, or is it not? It seems once it is, should it not remain one, regardless of what kind of deal national leaders strike? However, was it ever really any more of a threat than any other dictatorial, communist, or socialist nation with an antipathy for the United States?
Anyway, the China/Trump wrestling match is great entertainment while temporarily turning a blind eye to both the ridiculousness of it and the reckless carnage it can produce. Although, it does seem to create a limitless, deep well of dialogs for water cooler musings.