- 4 months ago
- #woosays
US President Donald Trump has renewed his threat to slap hefty tariffs on 14 countries, including US allies like Japan, and South Korea. His message? Buy more from us, or pay the price. In this episode of #WooSays Professor Emeritus Datuk Woo Wing Thye and Melisa Idris explore what Trump is trying to convey with his latest round of tariff threats.
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00:00Hi, welcome back to Wu Says.
00:14This is another episode for you where we get real about the US, China and everywhere and
00:19everything in between two superpowers, one global story.
00:24US President Donald Trump has renewed his threat to slap hefty tariffs on 14 countries,
00:32including US allies like Japan and South Korea.
00:37And his message is buy more from us or pay the price.
00:42So we're going to decode today what he means by that.
00:46What is this all about?
00:47Is it about trade or is it about power?
00:50I'm Melissa Idris and joining me to unpack this is Professor Wu Wingtai who has been
00:55studying US-China relations long before tariffs became global headline news.
01:01So Prof Wu, let's start there.
01:03I mean, what is President Trump trying to achieve with this latest round of tariff threats?
01:10I mean, do you think he has a strategy at play here?
01:14What do you think?
01:14Well, there are two reasons which are given back in April 2nd when he declared the National
01:27Liberation Day in which he said he would put tariffs on 185 countries and it would happen
01:37on at midnight, April 9th.
01:41And as we know, 14 hours later, he paused the tariff and declared that we will have 90 days
01:51of truce so that we can get down to the business of negotiating.
01:56The reason he did that, of course, was the US financial markets went into a deep dive, basically showing that smart money thought that this declaration of war on the entire world is going to end very badly for the United States as well.
02:19So he declared a truce and in declaring the truce, he said we'll have 90 trade deals in 90 days.
02:29And what were the chief goals?
02:31The first goal is we will stop these countries from ripping us off as in the last 80 years.
02:40Ripping the United States off means that you run a trade.
02:46The United States runs a trade deficit with the country.
02:50In other words, that country is selling its product to us and not really and keeping our products out.
02:58So it's ripping us off.
03:00So the first goal is to stop them from ripping us off.
03:04The second goal is to bring back manufacturing jobs to the US.
03:11These are the publicly announced goals.
03:15But that's the third one, which is very important, which drives this second round of tax tariff.
03:26And that is, we want you to be better friends with the United States than with other major powers in the world.
03:37Basically, if you want access to the US market, we would want you to join our sphere of influence.
03:47That's the third.
03:48And this will come out very clearly as we talk about this round of threats.
03:53And of course, this was a very ambitious goal to have 90 trade deals in 90 days.
04:06And what have we got?
04:07We've got three trade deals so far.
04:11A trade deal with Vietnam and with the United Kingdom and with China.
04:17But in the case of the UK and China, there are more principles on which further negotiation would be undertaken.
04:29So that is not a done deal yet.
04:31They just have a framework for negotiating.
04:35And why has it been going so slowly?
04:38It has been going slowly because the nature of bargaining is usually it takes three, four years
04:45for countries to reach trade deals.
04:48But more importantly, the United States Court of International Trade.
04:57There is a court in the United States that rules on trade disputes.
05:01It's a US court.
05:03The US court says that the tariffs that were imposed were not justified by the Congressional Act
05:15that allowed Donald Trump to impose emergency tariffs.
05:21That act of Congress is known as the International Emergency Economic Powers Act.
05:31So if the country faces an emergency, the president has the right to respond.
05:37And in this case, he declared war on the entire international trade system.
05:44And the courts in the US rule that it's illegal.
05:48And it is under appeal.
05:51So if you were negotiating with the US, it means that if the US loses the appeal,
05:59then the tariffs are gone.
06:00And if Trump does win the appeal, which looks like it might happen because the Supreme Court
06:10has been ruling in Trump's favor on most of the big things that have come up.
06:15Well, if the Supreme Court rules that he was justified and declared emergency, then we will negotiate.
06:22So the process of negotiation has always been a protracted one.
06:27And the second one is there is this court case hanging, which says that what he's done is against US laws.
06:37So that's part of the reason why it has been moving so slow.
06:41Can I ask you when you said you started the conversation with the premise that the US thinks all these countries,
06:50all the other countries are ripping it off.
06:52And this tariff threat is premised on the fact that you should be better friends with the US, with us, the US,
07:04than you should be with other countries.
07:05And one of the things that I thought was quite interesting was Donald Trump also had warned on tariffs
07:14for nations that aligned with what he called anti-American policies of BRICS, particularly of BRICS.
07:20And I'm curious to know what you think about about that.
07:23What what do you think qualifies as anti-American in this context?
07:27I mean, is non-alignment seen as hostility now to Donald Trump?
07:36He to be to be non-anti-US is to accept US leadership of the global system.
07:45In other words, continue US domination of the United Nations agency like the World Bank.
07:55The World Bank has always been under an American.
07:59And the second highest position at the IMF has always been an American.
08:08And if you go, the US, of course, has been paying a large proportion of the bills of these organizations.
08:20So many other countries have said, why don't you let us increase our contribution to these international organizations?
08:30And because once they increase their contribution, their voting power also goes up.
08:36So the US has so far blocked the expansion of the size of international institutions.
08:45And the US also wants to keep the system of the United Nations, where it has, where it is able to overcome the position of the majority of the rest of the world.
09:06So it is to be friendly to the US, in Donald Trump's sense, is that continue to accept the United States as the global leader.
09:19That would be sensible if the United States are able to play the role of a global leader.
09:28What is the role of a global leader?
09:32It's just like when a boss goes out to lunch with his colleague, he picks up the tab.
09:40Basically, that's part of what the boss's job is.
09:44You all listen to me and I buy you lunch.
09:48So the United States is less capable of supporting the amount of resources to solve the world's problems.
10:07Basically, we need the Chinese, the Japanese, and the other developing countries like India to enlarge the capital base of the international agencies so that the international agencies can do their jobs.
10:27Not only in terms of helping economic development, but in fighting climate change.
10:33To be a leader means that we take the lead on fighting the threats to human existence.
10:42Climate change, biodiversity protection, and keeping peace in the world.
10:49All these are very expensive activities.
10:52And now the US, unlike before, doesn't have the...
10:59Because these problems have increased in size.
11:02And it's gotten more expensive.
11:05And other countries have become a lot richer.
11:08So the US alone is unable to financially bail the world out.
11:16That's the reason why we want a more inclusive leadership.
11:22And I see this as a temporary phase in US behavior.
11:28Because I believe that the rest of the world will be able to talk sense into the United States at some point.
11:40Well, it seems that even if you are friends with the US, you are not spared from Trump's tariff threats.
11:48Because we had Japan and South Korea also included in the receiving end of these threats.
11:55So what do you think, what message do you think Trump is sending to his friends, his allies, his traditional US allies?
12:04I think to his traditional allies, there are two things going on.
12:10One is his assessment that they cannot do without the United States.
12:16For example, look at Europe.
12:21They are after what Putin is doing in Ukraine.
12:25What we saw immediately was Sweden and Finland that were outside NATO, joined NATO.
12:33Because they interpreted that the world, let's not be naive.
12:40The mighty will eat the weak.
12:43And the only way to have to prevent the mighty from eating us is to have another big giant beside us.
12:53And the giant is the United States.
12:56Because the US sees itself as indispensable to their defense,
13:03the US can afford to ask for sacrifice from them.
13:07Because the United States at the very beginning was perfectly happy to bear most of the cost of NATO
13:17so that its allies could spend its money on infrastructure, economic investments to become richer.
13:28Now that they have become richer, they have not been used to spending money to defend themselves.
13:36So Donald Trump sees this unjustified sense of entitlement by them.
13:42But of course, in return for the US protection,
13:47they have always voted with the UN a lot of times in the United Nations.
13:51They have not opposed the US in international forums.
14:01But you look at Australia.
14:02The United States prevented Japan from invading Australia during World War II.
14:10So the Australians know that they will always need,
14:14they are not big enough by themselves to defend.
14:16They need a big brother.
14:17That's why Australia has always gone to war.
14:20Every war that the US starts or participates in.
14:24It's in Vietnam, it's in Iran, it's in Afghanistan.
14:28You said it, the Australians are out on the front line.
14:33So that is one reason.
14:35And the second reason is, Donald Trump wants them to be the pillars of the US sphere of influence.
14:50The goal is to be able to get most of Southeast Asia, for example,
14:59to be in the US sphere of influence.
15:02Like, for example, in the letter that Donald Trump sends our king on the second round of Paris.
15:14The letter is very interesting.
15:17The letter starts, I'm just paraphrasing.
15:20The letter starts off with,
15:21It is my great honor to write to you about the relationship we have with your great country.
15:31The relationship with the extraordinary economy of the United States of America,
15:37the number one market in the world.
15:39And it says, but unfortunately, you've been running trade deficits.
15:45We have been running trade deficits with you.
15:48In the case of Malaysia, we will put only 25% tariff on you.
15:54And, well, and then he goes on to say,
15:59This tariff rate can be adjusted upward or downward,
16:03depending on the relationship between the two countries.
16:08And you will not be disappointed in the United States of America.
16:12That's how the letter ended.
16:14Now, when he talks about the tariff will depend on the state of relationship between our two countries,
16:24it means that it is more than just the size of the trade deficit between us.
16:29It means that if you are too close to China,
16:34if you allow Chinese factories to be set up and export to the United States,
16:43well, then we're going to put up higher tariffs on you.
16:47And if you do not vote with us in the United Nations,
16:51well, then we may put up higher tariffs against you.
16:55So, that letter is, I think it should be required reading for everybody
17:04of how to write a non-diplomatic letter
17:13in the most bombastic manner possible
17:17with a reeking of insincerity throughout the letter.
17:22Basically, it's a threat.
17:25That was quite amazing.
17:28That's why I think that this has to be a temporary phase in U.S. history.
17:37No normal country would...
17:41That's not normal diplomatic communications.
17:46So, that's why I think it is very important
17:48for the rest of us to keep the world together
17:52until the U.S. gets over its populist face,
17:59gets over its present bad mood,
18:02and then it will be a lot...
18:05It can then be a member of the Council of Elders
18:08in running the world.
18:10But until then,
18:12we, the rest of us,
18:15have to hang together
18:19in order to fight climate change,
18:25maintain global prosperity by keeping free trade,
18:28and help to keep the peace in other places of the world.
18:36That's what is important.
18:38And you could see that Donald Trump is very conscious
18:42of that what he's doing
18:44might cause people to gang up against him,
18:49which is why he has reacted yesterday
18:55very strongly against Brazil.
18:59He imposed 50% tariff on Brazil yesterday.
19:06But on April 2nd,
19:09he had only imposed 10%.
19:11But yesterday,
19:13this is one of the few cases
19:16where the number actually jumped.
19:18or in almost every case,
19:20the number that he announced
19:22is smaller than the number
19:23he had come up with on April 2nd.
19:26For the case of Brazil,
19:28it jumped from 10 to 50.
19:30So what has happened?
19:32And the amazing thing is,
19:34what is the trade balance
19:35between Brazil and the United States?
19:38The United States
19:40runs a trade balance surplus
19:43of $68 million
19:46against Brazil.
19:49The United States
19:50sells more to Brazil
19:52than buying coffee from Brazil.
19:57So,
19:58by Donald Trump's definition,
20:01since Brazil is running
20:03a trade deficit against the US,
20:07that means that the US
20:09has been ripping Brazil off.
20:10But by his criteria.
20:14His definition.
20:14His definition, yeah.
20:16So,
20:17you could see
20:18that this 50%
20:20has nothing to do with
20:22Brazil's been ripping off
20:23the United States.
20:25This 50%
20:26comes about
20:28for two reasons.
20:31One is,
20:32Brazil
20:33is brazen enough
20:35to organize
20:36a BRICS conference
20:38which ended
20:40with a criticism
20:41against
20:43the US
20:45wrecking
20:48of the global trade system
20:50and with the US
20:52attack
20:53on Iran.
20:56Of course,
20:57it condemned
20:58not only the US
20:59attack on Iran,
21:00it also condemned
21:01the Israeli
21:02attack on Iran
21:03and the Russian
21:05invasion
21:06of Ukraine.
21:08Albeit that
21:09the invasion
21:10of Ukraine
21:10was mentioned
21:11only once.
21:14So,
21:14it is very,
21:15so the US
21:15is trying hard
21:16to prevent
21:18collective action
21:19by the rest
21:20of the world
21:21to gang up
21:22against its madness.
21:25And
21:25the other reason
21:27why
21:27Brazil
21:29has been hit
21:29with 50%
21:30is because
21:32the former
21:35president
21:35of Brazil,
21:36J.
21:37Bolsonaro,
21:38Bolsonaro
21:39was,
21:40is a Trump-like
21:41figure.
21:42When he lost
21:43his election
21:44to Lula,
21:46he incited
21:46a riot
21:47to try to
21:48take over
21:48Congress too.
21:50And
21:51Brazil,
21:52possibly being
21:52a law,
21:53more law-abiding
21:54country,
21:56has put
21:57Bolsonaro
21:58on trial
22:01and
22:02restricted
22:03his liberty.
22:04So,
22:05Donald Trump
22:05is saying,
22:07I don't like
22:07you putting
22:08this kind
22:09of people
22:09in jail
22:10and
22:11you are
22:13being unfair
22:14to Bolsonaro
22:14who is like
22:15me.
22:17So,
22:17I'm going to
22:18put 50%
22:18on you.
22:19He says it
22:20explicitly.
22:22You shouldn't
22:23be prosecuting
22:24Bolsonaro.
22:25This is
22:26called
22:26interference
22:28in the
22:29political
22:30affairs
22:30of another
22:31country.
22:32It has
22:32nothing to
22:33do with
22:33trade.
22:34It's not
22:34that Brazilian
22:35coffee that
22:37they sell to
22:37the U.S.
22:38is of a low
22:38quality.
22:39So,
22:39you have
22:40something to
22:42complain about.
22:44But,
22:44it was
22:45brazen
22:47enough
22:47to be
22:49part of
22:49BRICS
22:50that call
22:51the U.S.
22:53irresponsible.
22:54for breaking
22:55the WTO
22:56system.
22:57Wow.
22:59Wow.
23:00So,
23:00when you
23:01talk about
23:01this,
23:02so,
23:02Trump really
23:03does not
23:04like it
23:05when countries
23:06band together,
23:08when there's
23:08collective action
23:09is something
23:10that he's
23:10afraid he
23:11is cognizant
23:12or worried
23:13about.
23:14So,
23:15if we were
23:16to look
23:16at this
23:17region,
23:18some of the
23:18smaller,
23:19medium countries
23:19on that list,
23:20places like
23:21Laos,
23:21Cambodia,
23:22Malaysia,
23:22can I
23:24ask you
23:25what this
23:26means now?
23:26I mean,
23:27are we
23:28now in
23:28a world,
23:30the world
23:30of Donald
23:30Trump,
23:31where each
23:32country must
23:33continue to
23:34individually
23:35negotiate its
23:36way out of
23:37being tariffed
23:37by the U.S.
23:38because of
23:39his aversion
23:40to collective
23:42action?
23:43So,
23:43he wants
23:44to keep
23:45every country
23:46separate.
23:47Is that
23:47the way
23:48forward now,
23:49Prof?
23:49I think
23:51that it's
23:52very hard
23:53to have
23:53a collective
23:54ASEAN
23:55bargaining
23:56position
23:56because,
23:58like,
23:58look,
23:59the
24:00Vietnamese
24:01already
24:01have a
24:02deal.
24:03The
24:04Vietnamese
24:04had a
24:05deal
24:05and
24:05achieved
24:06it
24:06very
24:06quickly
24:07because
24:08the
24:10Secretary
24:11General
24:12of the
24:13Communist
24:13Party
24:14is up
24:15for
24:15reappointment
24:16in a few
24:16months
24:17and the
24:18United
24:19States
24:19is its
24:20single
24:20biggest
24:21trade
24:22partner
24:22and
24:24its
24:25biggest
24:27chief
24:28destination
24:29of its
24:30exports
24:30is the
24:32United
24:32States
24:32and so
24:34if
24:35the
24:36economy
24:37tanks
24:38before the
24:39Party
24:39Congress
24:40Mr.
24:41Tolam
24:42might well
24:43be in the
24:44land.
24:44so
24:46that's
24:47why
24:47Vietnam
24:50quickly
24:51entered
24:52into
24:52negotiations.
24:54The
24:54truth
24:55is
24:55we are
24:56not
24:57anti-US
24:57none
24:58of us
24:59are
24:59we are
25:00all
25:00great
25:00admirers
25:01of
25:02what
25:02America
25:03as a
25:04country
25:05and the
25:05values
25:06that it
25:07had
25:07stood
25:08for.
25:09Like,
25:09look,
25:10it's
25:11possibly
25:12the only
25:12country
25:13that fought
25:14a civil
25:15war
25:15in order
25:16to end
25:17slavery
25:17in its
25:18own
25:19territory.
25:20That is
25:21the ultimate
25:22sacrifice.
25:23That is
25:23idealism.
25:24That's an
25:25example,
25:25right?
25:26So,
25:27we should
25:28continue.
25:29We can
25:30negotiate
25:30individually
25:31with the
25:31US,
25:32but at
25:33the same
25:33time,
25:34we could
25:35work
25:35together
25:35to keep
25:36the global
25:37trade
25:37system
25:38together
25:39and to
25:40keep
25:41the
25:41UN
25:41system
25:42together.
25:44In other
25:45words,
25:45if the
25:46United
25:46States
25:47does not
25:47want to
25:48supply
25:48leadership
25:49in the
25:49United
25:50Nations,
25:51let us
25:52work among
25:54ourselves
25:54to keep
25:55it going.
25:56If the
25:56US does
25:57not want
25:57to fight
25:57climate
25:58change,
25:59we will
26:00continue to
26:00fight
26:00climate
26:01change
26:01and wait
26:02for the
26:03day when
26:03the United
26:04States
26:04comes back
26:05and land
26:07its
26:07shoulder.
26:08to
26:09building
26:11green,
26:14being part
26:15of the
26:15green
26:15transformation.
26:16So I
26:17do not
26:17see it
26:18as
26:18ganging
26:18up
26:19against
26:19the
26:19US.
26:21It
26:21is
26:21we
26:22make
26:23up
26:23for
26:23the
26:24absence
26:24of
26:24the
26:24US
26:25in
26:26maintaining
26:27global
26:27prosperity.
26:28We
26:29keep
26:29free
26:29trade
26:30among
26:30ourselves.
26:32So
26:32we
26:34would
26:34definitely
26:35do
26:36the
26:36bilateral
26:37negotiations
26:37with
26:38the
26:38US
26:38because
26:39as
26:40Donald
26:40Trump
26:40assured
26:40us,
26:41you
26:42will
26:42never
26:42be
26:42disappointed
26:43in the
26:43United
26:44States.
26:45And we
26:46do not
26:46want to
26:46disappoint
26:47the
26:47United
26:48States.
26:49No,
26:50no,
26:50it would
26:52be foolish
26:52to be
26:53antagonistic
26:54about it.
26:55It is
26:55to recognize
26:56that the
26:57person is
26:57in a
26:58bad mood
26:58right now,
26:59so we
27:01might have
27:02to yield
27:02a little
27:02bit to
27:04help him
27:05get over
27:05the mental
27:07angst.
27:08The tantrum.
27:10Yeah,
27:11and show
27:13that there
27:15will always
27:16be a
27:16real place
27:19for you
27:19when you
27:20return.
27:21I think
27:22that's
27:23what the
27:24rest of
27:26the world
27:26should do.
27:28And ASEAN
27:28is quite
27:30small,
27:31so we
27:33will not
27:33be able to
27:34hold the
27:34rest of
27:34the world
27:35together by
27:35ourselves.
27:37But if
27:37we work
27:38together with
27:39Japan and
27:39Korea,
27:40Japan and
27:40Korea are
27:40definitely
27:41US allies.
27:43Japan has
27:43all 100
27:44US military
27:45bases on
27:46its side,
27:46so it has
27:47to be a
27:47US ally.
27:48But it
27:49doesn't mean
27:49that it
27:49cannot be a
27:50responsible
27:51global
27:51citizen.
27:53It doesn't
27:54mean that
27:54it would
27:55have to
27:55be anti
27:56international
27:57trade like
27:58Donald Trump.
28:00And it
28:01doesn't mean
28:01that it
28:02has to
28:03give China
28:03the finger
28:04as Mr.
28:06Donald Trump
28:06seems to
28:07want everybody
28:08to do.
28:09So I
28:09think the
28:11rest of
28:12us act
28:13as adults
28:14while
28:16somebody
28:18is
28:19in
28:21rehabilitation.
28:24bravo,
28:26this was
28:26fantastic.
28:27Thank you
28:28so much
28:28for that
28:28analysis
28:29for helping
28:29us put
28:30this into
28:31perspective
28:32and for
28:32getting real
28:33about the
28:34US and
28:34China and
28:35everywhere and
28:36everything in
28:36between.
28:37So thank you
28:37for that.
28:38And that's it
28:39for this episode
28:40of Wu
28:40Says.
28:41I'm Melissa
28:41Idris.
28:42I will see
28:43you same
28:43time next
28:44week.
28:44Bye-bye.
28:45Bye-bye.
28:46Bye-bye.
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30:54
1:08
1:59
1:04
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