Platt Perspective on Business and Technology

China and its transition imperatives 42.5: some thoughts concerning Xi Jinping’s American dilemma – an update

Posted in macroeconomics by Timothy Platt on February 10, 2017

This is my 50th installment, counting supplemental additions, to this ongoing and even open-ended series on China. Basically, what I am doing here is to trace how China has changed under the rule of Xi Jinping, with this series narrative starting approximately one year after he first took leadership of their Politburo Standing Committee, and through that of their entire Communist Party of China and of China as a whole (see Part 1, as written to first go live on this blog on February 8, 2014.) This, I add is also an essentially immediate snap posting update to a fuller series installment that I write a few days ago, to go live just two days ago. And that makes this a first for this series and for my ongoing China-related writings, and for this blog as a whole.

I focused in Part 42 of this progression on uncertainties and risk, and as faced by Xi Jinping and his government and Communist Party in China, and as now suddenly erupting out of the United States and its now three weeks old Trump administration. And as one puzzle piece element of that, I wrote of how Trump and a combination of his politically driven government policy, and his personal business empire-supportive self-interest have come to challenge the United States’ long standing One-China policy.

Then right after that posting went live to this blog, Donald Trump pivoted again, at least in his spur of the moment decisions and pronouncements, and the February 10, 2017 issue of the New York Times arrived with these news stories and the announced policy change they suggest, showing prominently on its front page (this news story broke the evening before in their online edition):

Trump Tells Xi Jinping U.S. Will Honor ‘One China’ Policy and
Trump, Changing Course on Taiwan, Gives China an Upper Hand.

If I were in a position to advise president Xi in matters of dealing with president Trump, I would do so with the following briefly stated note as a matter of suggesting a path through at least part of this challenge. And I offer this supplemental posting update as a platform for offering this note to anyone else why might find my China postings of interest or utility:

Dear President Xi,

As the world has come to learn through just-released new stories and related new analysis pieces, President Trump has now chosen to accept as valid the One-China policy that has formed a foundation element in the relations between our two nations. That is a positive sign that would indicate that the strident rhetoric and threats that have been coming out of the Trump White House and the Trump Twitter account might be coming to an end.

The fact that by all accounts that have been publically shared, you had a more cordial phone conversation with President Trump, and one more oriented towards bridge building than burning is also very positive. And a key consideration in all of this is that Donald Trump’s Secretary of State, Rex Tillerson, and a number of other key members of his administration have also now spoken out in support of this policy change and in support of a rapprochement between China and the US. That is all very positive too. This confluence of supportive context for President Trump’s announced change of mind suggests that this shift in announced approach might represent more than just an easily forgotten Twitter comment, and that it might represent the start to a new, and in this case a renewed positive relationship that can be build from. But I find myself offering you a cautionary note here, even as I offer these hopeful thoughts.

Donald Trump is the President of the United States. But at the same time and regardless of possible US constitutional conflicts or challenges faced by continuing his dual role, Donald Trump is also still the principle owner and manager of a business empire that does and that seeks to do business in both the People’s Republic of China and in Taiwan – and under circumstances where decisions and actions would be taken as if in accordance with a Two-China policy.

President Trump’s efforts to secure a multi-billion US dollar infrastructure development project in Taiwan, where (he and) his business would work with both their private sector and their government there, can be seen as challenging and even violating the so called Emoluments Clause of the US Constitution and related legally mandated restrictions that would outlaw this type of behavior on his part. I am sure you know of that from news and analysis coverage that has come out in the West and certainly since his election. But perhaps more importantly from your perspective, this should raise red flags in your assessment as to what his seeming change of course really means – and particularly if it is one that only holds meaning to President Trump when he is working half-time as the President of the United States, but not when he is working his other half-time job as a still very actively involved business owner who is out to maximize personal profits for himself and at all costs and by any means.

I offer this note in admittedly dire terms, with a goal of provoking you to ask which President Trump you are talking with, and which one you are hearing what might be construed to be policy decisions from. And at the end of the day when US President/Business President Donald Trump finally turns off his Twittering for the night, which half of him holds the view that will predominate in guiding what he actually does the next day?

I am sorry to have to tell you this, but the risk and uncertainties that you have suddenly found yourself facing, coming out of Washington, have not actually fundamentally changed – and you need to stay aware of that on an ongoing basis and certainly in any near-term planning.

Sincerely Yours, Timothy Platt, PhD

As stated at the end of Part 42 of this series, I am going to continue it and its narrative in a next regular installment, that at least as of this writing will probably still go live to this blog in approximately one month from now. Meanwhile, you can find this entire series and all of its postings at Macroeconomics and Business as postings 154 and loosely following for Parts 1-12 and for a supplemental posting: Part 12.5. And see Page 2 to that directory for subsequent main sequence and supplemental installments to this. You can also find other, China-related postings and series at those directory pages, and at Ubiquitous Computing and Communications – everywhere all the time too. (And as a time stamp, I wrote this as a single draft on February 10, 2017 as an immediate-release update.)

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