FINANCIAL TIMES
6-6-18

How Donald Trump is empowering China

In uniting America’s allies against it, the president has done the unthinkable

Edward Luce

Donald Trump is about to make history by shaking hands with an adversary. Indeed, he will greet six of them at the same time. No breakthrough is likely.

Following the G7 summit, Mr Trump will fly to Singapore to meet Kim Jong Un. Expect a triumph. Peace will be declared on the Korean peninsular. Those who think I am joking should mute the sound and study the body language. Then decide for yourselves whose company Mr Trump prefers — America’s partners, or the most lethal autocrat on the planet. You can guess what a visiting Martian would say.

It is hard to decide which event — a failed “G6 plus one” summit in Canada or a successful one with North Korea — is more incredible. But the former wins. By uniting America’s largest allies against the US, Mr Trump has pulled off something unthinkable. The sheep are abandoning the shepherd. Without America, the G7 would not exist. It is the closest thing the west has to a steering committee. That is why China, which is the world’s second-largest economy, was never invited into the club. It was also why a westernising Russia was added to the group in 1998. But Russia was a black sheep. The group returned to seven after Russia annexed Crimea in 2014.

What does a flock do without its shepherd? Fable would suggest that they are picked off by wolves. That is one outcome of a prolonged US absence. Even before Mr Trump took office, countries such as Germany, the UK and France were rolling out the commercial red carpet for China against Washington’s wishes. But they kept unity in Nato. And they stuck to script at the G7. Mr Trump is now making that very difficult. At the G7 finance ministers’ meeting last weekend, Steven Mnuchin, the US Treasury secretary, was in a minority of one. It takes some doing to push Brexit UK into Europe’s arms. It takes even more to browbeat Japan into an opposing camp.

A less fabled outcome is that the sheep stick together and keep the wolves at bay. That may be less unlikely than it sounds. For the time being, Europe, Canada and Japan are united against Mr Trump’s trade belligerence.

Theory suggests that Mr Trump should divide the G7 by playing favourites. That is how he would bring about the bilateral world that he seeks. For example, he might separate Britain from the flock by offering it an exemption from the section 232 national security tariffs after its European divorce is wrapped up next year. Then he could sweet talk the prospect of a UK-US trade deal. He could prise Italy from the group by flattering its new populist government. Germany might waver if Mr Trump simply promised to talk seriously about things.

Were Mr Trump to play such tactics, it would serve his strategic goal. What he supposedly wants — and what his America First doctrine implies — is a post-multilateral world. That is a transactional jungle in which the US has size advantage in every negotiation. It is a series of one-plus-ones in which Mr Trump is always bigger than the other. Almost nobody wants such a world, including most of America’s business community. It would reduce everyone’s growth and fragment global supply chains. But it is not an illogical vision. Size would dictate that the US always had the upper hand.

That is where Mr Trump’s philosophy breaks down. America First requires diplomatic skill. You need knowledge of those you want to divide and rule. Then you pick them off. Yet Mr Trump is doing the opposite. When was the last time the west sounded so united? There are two explanations of Mr Trump’s actions. The first is that he is incompetent. He knows the kind of world he wants — a return to the 1950s — but he is too foolish to figure out how to maximise his chances of realising it. There is evidence to back that case.

The second is that Mr Trump’s id is bigger than his ego. Freud likened the ego to the controlling rider and the id to the wild horse. Mr Trump’s ego wants a mercantilist world. But his id craves revenge. Punishing America’s partners for years of allegedly ripping her off is incompatible with separating them from each other. It is hard to do both.

The result is rolling confusion. On the face of it, Mr Trump’s chief adversary is China. It has by far the largest trade surplus with the US. Yet last week Mr Trump abandoned his biggest leverage over China by giving its telecoms company, ZTE, a reprieve from US law. At the same time he escalated a fight with Canada, which has a minor trade deficit with the US. Can the west survive such divisions? In the short term, perhaps. But the wolves are biding their time.