Schumer Says Trump's Phase-One China Deal Is Too Weak
By Timothy Puko
WASHINGTON--Senate Minority Leader Chuck Schumer (D., N.Y.) told
President Trump his preliminary trade agreement with China doesn't
go far enough, warning that the deal could produce little benefit
for American companies and workers, while also emboldening
Mr. Schumer, in a letter to the White House released Tuesday
morning, said U.S. businesses stand to lose billions of dollars if
the administration can't secure concrete commitments from China to
stop subsidizing domestic firms and sponsoring efforts to steal
intellectual property, among other changes. Making a temporary deal
could concede leverage the U.S. needs to pressure China, Mr.
President Trump has enjoyed rare bipartisan support for his
trade war with China, and Mr. Schumer's letter could signal that
period coming to an end. Mr. Schumer has long backed a hard-line
approach to Beijing and sought to discourage trade-friendly
officials in the Trump administration from caving to Chinese
demands. Last May, when Mr. Trump announced a major increase in
tariffs, Mr. Schumer responded quickly with a tweet of support,
urging the president to "hang tough on China."
"From what I understand from reading press reports, the terms of
the agreement will result in very little progress in reforming
China's rapacious trade behaviors and seems like it could send a
signal to Chinese negotiators that the U.S. can be steamrolled,"
Mr. Schumer said in his letter, dated Monday.
Mr. Trump is gearing up for a White House ceremony scheduled for
Wednesday to sign a compromise deal with Chinese leaders. The
accord promises increased purchases of U.S. goods and services,
greater access for American firms to China's banking, insurance and
other financial sectors and an end to tariff threats.
However, the deal leaves out the fundamental changes to Chinese
economic policy sought by many U.S. leaders and prioritized by Mr.
Trump, who has promised further negotiations. Chinese officials,
though, feel they have little to gain from a second deal forcing
Beijing to ease state control of the economy, and Mr. Trump has
already said that a phase-two agreement probably wouldn't conclude
until after the November election.
U.S. Trade Representative Robert Lighthizer defended the deal
Monday, saying on Fox Business Network that it would include "a
variety of real structural changes." He named only one, commitments
to refrain from competitive currency devaluation, which Treasury
Secretary Steven Mnuchin announced earlier in the day in dropping
Treasury's designation of China as a currency manipulator.
Mr. Schumer pressed for more in his letter, foreshadowing what
may become a primary response from Democrats and other critics. He
asked Mr. Trump to detail any commitments China has made to reduce
subsidies to its businesses, on reforming state-owned enterprises,
on dumping products on global markets, and on halting cyberattacks
The trade fight came with costs to the U.S., including lost
exports, higher prices to cover tariffs and taxpayer subsidies to
help U.S. farmers. Farmers and analysts have been skeptical the
preliminary deal can fulfill the administration's promises of
dramatic export growth.
"By giving away leverage with a temporary deal...these
structural issues will only become more challenging to address in
future negotiations," Mr. Schumer wrote. "China pledging to make
short-term purchases of American goods will not address the
fundamental problems that undermine long-term U.S. economic
opportunity, prosperity, and security."
Write to Timothy Puko at email@example.com
(END) Dow Jones Newswires
January 14, 2020 06:14 ET (11:14 GMT)
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