Mike Pence’s China speech had two messages – and two audiences – along with some good news on the trade war
- The US vice-president’s speech sought to reassure financial markets ahead of the 2020 election while also rousing Trump’s political base. Red meat thrown to the latter crowd made headlines and irritated Beijing, but the speech also left leeway on a trade deal
The earlier speech seemed to have no specific policy objective. By contrast, this time, Pence combined a litany of complaints with some more reassuring words in support of an impending interim truce in the trade war Donald Trump has initiated.
American headlines about Pence’s speech focused on his criticism of Nike and the National Basketball Association. It is not apparent why he chose to dwell on these recent topics, where athletes and executives expressed themselves in a variety of ways on the merits of Hong Kong’s recent protests and violence. But Americans will always be drawn to stories involving sports.
The trouble for Trump and Pence has been that, every time a new measure is taken against China, stock markets have a fit and plummet. Moreover, increasingly, responsible economists and bankers have been saying that the trade frictions are slowing American and global economic growth.
So, Trump has agreed to the outlines of an interim, or mini, trade deal that addresses some but not all of the issues that have kept his fractured negotiating team busy with Beijing.
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Trump says he intends to sign the pact with Chinese President Xi Jinping at the Asia-Pacific Economic Co-operation leaders meeting in Santiago, Chile, next month. Some details remain to be ironed out, including whether Trump will roll back some of the tariffs previously put in place.
Thus, Pence’s speech reassured investors that there is a good chance for a trade war truce. The problem for Trump and Pence then becomes managing the hard-line political base; the leaders have encouraged them to believe much greater results can be achieved from the trade conflict than just an interim agreement.
Much of the remainder of Pence’s speech, then, was an effort to throw red meat at Trump’s political base. Pence claimed the US is responsible for China’s recent 25 years of success, condemned its practices in Hong Kong and Xinjiang, and much more. This Jekyll-and-Hyde approach allowed Pence to straddle both of the administration’s political objectives – reassuring the markets while promising the voter base that more will be done.
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Along the way, Pence managed to make a few backhanded, reassuring noises to his Chinese audience as well. While complaining about Beijing’s pressures against Taiwan, he included the mantra of the basis for Washington’s “one China policy”: the Three Communiqués between the US and China, as well as the Taiwan Relations Act.
This surprised Beijing after a series of actions to upgrade Washington’s relations with Taipei and defend the island against the mainland’s diplomatic inroads against its partners.
Pence probably irritated Beijing by dwelling on Chinese interventions in Hong Kong, but he also supported “peaceful” protesters, implicitly separating the US from the violence that has marred weeks of protest.
Finally, Pence asserted that the US does not pursue policies that many in China and elsewhere believed were at the core of the Trump China policy. In what some might call the “three no’s”, Pence said that Washington isn’t seeking to decouple the two economies, does not pursue containment and is not seeking confrontation.
Beijing will probably take some time to judge whether these steps constitute something that lasts, or expires with the next tweet. But for now, China should see some upside in this speech intended to manage the administration’s political dilemma of how to look constructive to the world’s markets while acting disruptively towards America’s previous China policy.
Douglas H. Paal is a distinguished fellow at the Carnegie Endowment for International Peace