In fact, Tusk is quite wrong, for there are, of course, reasons why undermining the “rules-based international order” makes sense from an American perspective. There should be no question that the US is within its rights to reconsider international agreements, alliance and trade deals, which have become uneven or even unfair, and threaten to amend them. For example, the fact that Germany (among many others) is not only falling but will continue to fall well short of its pledge to spend 2 per cent of its GDP on defence that it agreed at a NATO summit in 2014 raises obvious questions about why the US should carry the burden for an organisation that is under greater strain because of a host of threats and potential problems in North Africa, the Middle East, Russia, Ukraine and beyond.67 The fact that spending by other NATO members on defence is so low means that US threats to refuse to carry the burden of others are not so much understandable as entirely logical.68
Striking better terms with China or with the European Union—which has also been threatened with the introduction of tariffs—is likewise hardly an unreasonable aim in itself. On the contrary, seeking to correct asymmetrical terms is not just sensible; it is entirely logical. What is problematic, however, is the fact that so many agreements are being overturned at the same time. This gives the impression that the US is willing to use strong-arm tactics to get what it wants, and to move away from a world built on consensus.
Dennis Shea, US Ambassador to the WTO, for example, bemoaned the fact that the organisation is “not well equipped to handle the fundamental problems posed by China.” Instead of working through a reform process, however, the US was threatening to upset the apple cart altogether—by refusing to allow the appointment of new judges, meaning the court will not be able to rule on disputes. As a result, said Marc Vanheukelen, Shea’s opposite number from the EU, “the multilateral trading system is in deep crisis and the US is at its epicentre.”69
No one is safe from Trump’s gaze: “We love the countries of the European Union,” Trump said at a rally in North Dakota. “But the European Union was set up to take advantage of the United States. And, you know, we can’t let that happen.”70
Asked on Fox News whether he would work with allies in Europe on the question of Chinese trade tariffs, the president was dismissive. “I love those countries, Germany and all of the countries. Scotland—you know.” But, he said, “they treat us very badly.” It was nothing personal, he said. “My parents were born in the European Union,” he claimed, even though his father was born in New York City, and his mother was born in the UK forty-five years before the European Economic Community, the ultimate forebear of the EU, was founded. “The European Union is possibly as bad as China,” Trump said, “just smaller, OK? It is terrible what they do to us.”71
The constant search for targets and opponents does little to make friends—and less to keep the ones the US has worked with so successfully for many generations. “Don’t say I never give you anything,” said Trump to German Chancellor Angela Merkel at the G7 meeting in Canada in June 2018 (to which the US president arrived late and left early), before tossing two sweets onto the table in anger.72
Merkel was more vocal when she met Trump in July 2018 at a NATO summit. “Germany is a captive of Russia,” said the president in an excoriating opening statement that seemed to have his own advisors squirming—although his press secretary said that their grimaces were not because of Trump’s comments but because of their displeasure that they had been “expecting a full breakfast and there were only pancakes and cheese.” Germany knew what it was to be a captive of Moscow, Merkel reminded the president. “I’ve witnessed that myself,” she said in response to his comments, referring to the fact that she grew up in East Germany when it was a satellite of the Soviet Union.73
“The President has first and foremost his own interests at the top of his mind, as opposed to the government,” said one US diplomat, speaking anonymously after Trump spent ten days “shitting on our NATO allies and kissing Putin’s ass”—a reference to the fact that the president overruled US intelligence agencies in the summer of 2018 to claim that Russia had not been involved in rigging the presidential election, and seeming to agree to a “tremendous” offer to allow Russian officials to interview American citizens, including a former US ambassador to Moscow, accused by the Kremlin of “illegal actions.”74 Although Trump later rejected the proposal, Susan Rice, a former national security advisor, said that the White House was effectively “serving a hostile foreign power [and] not the American people.”75
Then there was the way President Trump dismissed Justin Trudeau, the mild-mannered prime minister of Canada, one of the US’s closest allies as well as its neighbour, as “very dishonest and weak” after Trudeau gave a press conference at the G7 meeting in 2018 where he said it was “insulting” that the American president claimed that the introduction of trade tariffs that hurt Canada was connected to US national security.76 That was positively genial compared to what Peter Navarro, director of the White House National Trade Council, had to say about Trudeau: “There’s a special place in hell,” he told Fox News, “for any foreign leader that engages in bad-faith diplomacy with President Donald J. Trump and then tries to stab him in the back on the way out the door.”77
Full-blooded dismissals of allies are set alongside descriptions of others that are not just brutal, but also highly damaging to the reputation of a country once famed for its tolerance and willingness to give people a chance to work hard to fulfil their dreams. “Why do we want all these people from ‘shithole countries’ coming here?” Trump asked senators at a meeting in the Oval Office at the start of 2018 about Haiti, El Salvador and some parts of Africa.78 Then there is the cutting of $25 million of humanitarian funding to the East Jerusalem Hospital Network that provides care treatments including neonatal intensive care, children’s dialysis, cardiac and eye surgeries, primarily—but not only—to Palestinians. These cuts were described as “particularly vindictive” by a former senior US official overseeing aid to the Palestinians, who also warned that the withdrawal of funds might cause the collapse of several hospitals.79
Or there is the acquiescence to marchers the previous summer in Charlottesville, Virginia, who carried placards declaring “Jews are Satan’s children,” and proudly held up swastikas, while others wore symbols such as the Confederate flag, white supremacist logos and even crusader imagery that hark back to supposedly better times.80 Instead of condemning the demonstrators, Trump declared, “You had many people in that group other than neo-Nazis and white nationalists….The press has treated them absolutely unfairly.” In any event, he added, “you also had some very fine people on both sides.”81 This was all made worse when the president shared inflammatory videos posted by the far-right group Britain First a few months later.82
It is easy to get carried away by worrying what people think. After all, today’s newspapers are tomorrow’s fish-and-chip wrappers—that is to say, all gets forgotten in due course. Besides, when it comes to the head of the IMF, United Nations agencies, European Union officials, Canadian politicians or foreigners, one could question the extent to which the president of and officials in the United States should care if others feel they have had their noses put out of joint and spend time complaining about it.
But some go further. According to one (anonymous) senior national security official, the chaos is not just not bad news, but actually a good thing. “Permanent destabilization creates American advantage,” they told Jeffrey Goldberg, editor-in-chief of The Atlantic. Keeping all and sundry off-balance by necessity benefits the United States. Staying friends with people is less important, in other words, than getting things done.83
Another “senior White House official with direct access to the president and his thinking” put it more directly when asked if there was a way of summing up the “Trump doctrine.” Yes, they said. There is a way to sum it up. “The Trump Doctrine is, ‘We’re America, Bitch.’ That’
s the Trump Doctrine.”84
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That sounds like a slogan rather than a plan. It also suggests a confidence that high-fives and rude hand gestures to others can be effective in the long run. It implies a consistency of thought and approach—something that sits at odds with orders apparently given to the head of Strategic Command by then Secretary of Defense James Mattis that not only should he be personally informed of any event that might lead to a nuclear alert being sent to the President, but that the commander should “not put on a pot of coffee without letting him know.” The fact that the President of the United States has sole discretion—and authority—to order the use of nuclear weapons is enough to send shivers down some spines.85
Controlled unpredictability may well bring advantages. But impulsive, unchecked decisions bring high levels of risk—and unknown outcomes. President Trump, said one senior intelligence official on condition of anonymity, is a president “that makes life-and-death decisions by whim, without reading, deliberation, or any thought as to the consequences or risks.” It was fortunate, they went on, that Trump “has not been tested by a major national security crisis. But it will come, and when it does,” they said bluntly, “we are fucked.”86
The frat-room boast of “We’re America, Bitch” also hides the fact that it is hard to square with the parallel desire to put “America first,” for the reality of an interconnected global economy is more complex. For example, 20 per cent of Apple’s revenue comes from mainland China, Hong Kong and Taiwan, which means that tariffs—or an enforced slowdown prompted by US economic policies—will have an impact on the company’s bottom line, its shareholders and employees.87 Or there is Alcoa, one of the world’s largest aluminium producers. Headquartered in Pittsburgh, it informed the market in the summer of 2018 that the introduction of tariffs would cost it as much as $14 million per month—sending its shares down by almost 15 per cent.88
As Eric Zheng, Chairman of the American Chamber of Commerce in Shanghai, put it, American businesses welcomed the fact that President Trump was trying to reset trade relations with Beijing and seeking to “address long-standing inequities and level the playing field.” The problem, said Zheng, is that the way the administration is going about it “is hurting the companies it should be helping” as a result of the imposition of tariffs.89
Many other of the world’s largest companies, as well as young, promising start-ups, either have plans to expand in China, or are already doing so. Trade wars put pressure on their business models, their share prices and on those who have invested in their futures. Historically low interest rates, coupled with hefty corporate tax cuts, concealed the dangers for the first half of 2018—before a sharp down-turn took trillions of dollars off corporate values and resulted in the worst year of the performance for the stock markets since the financial crisis.90 The immediate effects were felt at the time by General Motors. The shares of General Motors and Fiat Chrysler slumped by 8 per cent and 16 per cent, respectively, for example, in a single day after cutting forecasts either on the basis of increased metals costs, reduced expectations in China—or both.91 “We’re America, Bitch” sounds better in the corridors of power in Washington than it does in the boardrooms of North America—or to pensioners whose savings have reduced in value in the process.
This can be shown too by the case for another of the US’s biggest companies, Boeing. Boeing’s corporate research suggests that Chinese airlines will buy more than 7,000 passenger jets in the next twenty years. That represents acquisitions worth $1.1tr.92 Shutting the American door to exports from outside will naturally mean the door being slammed on US corporations elsewhere in the world and create opportunities for others in the process. That will in turn accelerate, rather than slow down, the progress of businesses outside the US, and serve as a catalyst that prompts them to innovate, invest—and win business.
In fact, American companies have done well from China’s expanded international vision: the Belt and Road Initiative is “a very big deal” for General Electric, said Rachel Duan, one of the company’s most senior executives—not surprisingly, since it won business worth $2.3bn in 2016 alone. The New Silk Roads will continue to be. As Duan admitted, “We have a laser focus on winning” more contracts along the new Silk Roads. Other US corporations, like Caterpillar and Honeywell, take similar views.93 Targeting China with tariffs and an economic slowdown could serve to make life more rather than less difficult for giant corporations that compete in global markets for global customers.
The reality that “We’re America, Bitch” can be counter-productive comes from the sanctions imposed in the spring of 2018 by the US on five entities and nineteen individuals because “the [Trump] administration is confronting and countering malign Russian cyber activity, including their attempted interference in US elections, destructive cyber-attacks, and intrusions targeting critical infrastructure.”94 This had the side effect of leading to a surge in metal prices, with prices of alumina, a key raw material for producing aluminium, surging by more than 80 per cent—and leaving 450 workers fearing for their jobs at the Aughinish alumina refinery in Ireland (owned by Rusal, one of the firms sanctioned).95 That means raised prices around the world, including, of course, in the USA—which imports 90 per cent of the aluminium it uses in domestic manufacturing.96
Steps taken against Russia likewise degrade US intelligence capabilities with regard to assessing the Kremlin’s actions, not least regarding potential interventions in elections held in the United States. As it later emerged, detailed reports about likely efforts to influence the presidential election in 2016 were received from a series of informants in Russia. These have fallen silent, probably because of higher levels of counterintelligence from Moscow because of the rising antagonism between the two states—and because of President Trump’s willingness to overlook, excuse or deny Moscow’s involvement in 2016.97
One of the ironies of the sanctions imposed on Russia in 2017, followed by further rounds in 2018, was a sharp spike in the price of oil—which rose by 30 per cent in twelve months. This not only put an additional burden on American pockets filling up at the pump, it served to boost government revenues from hydrocarbons in Moscow—where higher prices are a boon for an economy that gets 50 per cent of its revenues from the exploitation and export of fossil fuels. The introduction of sanctions on Iran in the spring of 2018 was a godsend to oil exporters such as Russia and Iran—where one senior figure taunted Trump that his “frequent and indecent tweets” had added at least $10 per barrel to the price of oil.98 All this, of course, means higher prices at petrol stations and higher energy costs around the world, including in the US.99 This followed on from a sharp jump in the price of steel, with US benchmark hot-rolled steel coil almost doubling in price in the course of twelve months. This led to the US Commerce Department launching a probe to investigate whether producers in the US were using the excuse of tariffs and price rises to create a bonanza for themselves at the expense of customers who had the new costs passed on to them. Putting America First is not as easy as it sounds.100
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The same is the case when trying to work through a response to China’s Belt and Road Initiative. When asked about the initiative by the Senate Armed Services Committee in October 2017, Defense Secretary Mattis declared: “In a globalised world, there are many belts and roads, and no one nation should put itself in a position of dictating ‘one belt, one road.’ ”101 That may well be so. But as the prime minister of Cambodia, Hun Sen, put it when asked about the Belt and Road Initiative a few months earlier, “Other countries have lots of ideas but no money. But for China, when it comes with an idea, it also comes with the money.”102
This sentiment is echoed elsewhere, for example in Pakistan, where the minister of commerce, Khurram Dastgir Khan, gave a direct answer when asked about China. “China,” he said, “is the only game in town.”103 Senior figures in the US have
recognised this issue. “We have watched the activities and actions of others,” noted Rex Tillerson, then secretary of state, “in particular China, and the financing mechanisms it brings to many…countries [along the Silk Roads], which result in saddling them with enormous levels of debt.” Belatedly, he had come to realise “it’s important that we begin to develop some means of countering that with alternative financing measures, financing structure.”104 In a fast-changing world, being slow off the mark does not just mean being at a disadvantage; it means showing a lack of initiative—and a lack of leadership.
This was what General Waldhauser was pleading for when talking about Africa. All the leaders of the states in Africa he had met “want US involvement. They all want US leadership. And it doesn’t have to be large. It doesn’t have to be grand. But they want to know that they have our support. They want to have our leadership. And they want to have a relationship with us. They really do.”105
Being slow off the mark also means having to deal with fait accomplis, which are difficult if not impossible to reverse. Failure to stop China’s expansion in the South China Sea, said Michael Collins, deputy assistant director of the CIA’s East Asia Mission Center, meant that the US was effectively dealing with “the Crimea of the East”—a reference to the annexation of the Black Sea peninsula by Russia in 2014. It is hard to stop a ship that has sailed.106
But another problem is that “permanent destabilisation” might indeed create “American advantage” in some cases and in some situations. But it does not win friends. And, perhaps more tellingly, it can also help crystallise new alliances and new blocks that turn out to be challenging and difficult to deal with—by pushing others to find common ground and solutions that are mutually beneficial.
The New Silk Roads Page 14