Trump Forms Trade Council Led by China Critic Peter Navarro

  • UC-Irvine economist says China breaking global trade rules
  • President-elect ‘impressed by the clarity of his arguments’

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Peter Navarro, a University of California at Irvine economics professor and a frequent critic of China’s trade practices, will lead a newly formed White House National Trade Council as an assistant to U.S. President-elect Donald Trump.

The fresh set of personnel inside the White House was tasked to “advise the president on innovative strategies in trade negotiations, coordinate with other agencies to assess U.S. manufacturing capabilities and the defense industrial base, and help match unemployed workers with new opportunities in the skilled manufacturing sector,” the transition team announced in a statement Wednesday. Navarro would be “director of trade and industrial policy” and an assistant to the president.

The announcement puts in place one of the final pieces of the incoming administration’s economic policy team. Navarro was one of the leading economists on the Trump campaign, co-authoring a report on growth plans in September with Trump’s pick for Commerce Department chief, Wilbur Ross. Steven Mnuchin, the co-founder of Dune Capital Management LP, was nominated to be Treasury secretary and Goldman Sachs Group Inc. President Gary Cohn was picked to be National Economic Council director.

“This is a negative message, and we should be concerned” as the appointment will disturb China-U.S. trade relations, said He Weiwen, deputy director of the Beijing-based Center for China and Globalization, and a former business attache in the Chinese consulates of New York and San Francisco. “If there’s a trade war breaking out between China and the U.S., both would be affected, but the U.S. side would lose more.”

A trained economist with a doctorate from Harvard, Navarro has spent much of his career criticizing China. Over a span of more than 15 years, he has written books and directed a documentary on the U.S.-China trade relationship that helped form the backbone of the Trump campaign message on a pivotal election issue that played to globalization fears.

For a quick explainer on why trade has become a campaign issue, click here

“I read one of Peter’s books on America’s trade problems years ago and was impressed by the clarity of his arguments and thoroughness of his research,” Trump said in Wednesday’s statement. “He has presciently documented the harms inflicted by globalism on American workers, and laid out a path forward to restore our middle class. He will fulfill an essential role in my administration as a trade adviser.”

Navarro has blamed Nafta and China’s 2001 entry into the World Trade Organization for much, if not all, of a 15-year economic slowdown in the U.S. The world’s largest economy grew an average 1.8 percent during that span, down from 3.4 percent growth from 1986 through 2000.

China’s transgressions in the international trade sphere have amounted to an undeclared trade war on the U.S., the Trump team has argued. Navarro frequently points to what he calls four major violations: illegal export subsidies, currency manipulation, intellectual-property theft, and lax worker safety and environmental standards.

The exact nature and process of trade deal renegotiation remains unclear at this point. Some of Trump’s campaign talking points focused on slapping tariffs on trading partners and scrapping trade deals deemed to be unfair. The executive branch of the U.S. government has the power to introduce short-term tariffs and narrowly focused duties without congressional approval.

Asked about the appointment at a regular briefing in Beijing on Thursday, Chinese Ministry of Foreign Affairs spokeswoman Hua Chunying said the country was paying close attention to Trump’s transition effort. 

“What I want to stress here is that China and the U.S. are two big countries and have a lot of common interests,” Hua said. “Cooperation is the only correct choice for both nations.”

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