Tags: larry kudlow | china | trade | donald trump

Kudlow: China Can Expect a Tough US Response on Trade

By    |   Wednesday, 14 Mar 2018 05:49 PM

Larry Kudlow, the newly appointed director of the National Economic Council, said China can expect the United States to take a tough stance on international trade.

"I must say as somebody who doesn't like tariffs, I think China has earned a tough response not only from the United States," Kudlow said on cable channel CNBC, where he has worked as an anchor and contributor since the 1990s.

President Donald Trump on Wednesday appointed Kudlow to be the top adviser on the economy. He replaces Gary Cohn, the former president of Goldman Sachs who had worked for the Trump administration since inauguration last year and stepped down as director of the National Economic Council last week.

Kudlow is entering the White House at a time when Trump is fulfilling his campaign pledge to renegotiate trade agreements that he blamed for hollowing out the U.S. industrial base and sending jobs to China and Mexico. While Trump’s pro-business agenda includes cuts to taxes and regulation, his stance on trade is worrisome for multinational businesses that depend on cheap imports.

Like Cohn, Kudlow is a strong proponent of free trade. But he recognizes Trump’s frustration with the massive trade imbalance with China, which joined the World Trade Organization in 2001 but has found ways to discourage competition from U.S. companies that seek freer access to its market.

“Chinese government officials, acting without fear of legal challenge, at times require foreign enterprises to transfer technology as a condition for securing investments approvals,” the U.S. Trade Representative said in a 2017 report to Congress. The report said major areas of concern also include inadequate enforcement of intellectual property rights, policies that favor state-run companies, government subsidies, limits on U.S. agricultural products and a general lack of transparency.

"A thought that I have is the United States could lead a coalition of large trading partners and allies against China, or to let China know that they're breaking the rules left and right," Kudlow said. "That's the way I'd like to see. You call it a sort of 'a trade coalition of the willing'," echoing President George W. Bush's "coalition of the willing" in the invasion of Iraq.

Kudlow has said that he opposes blanket tariffs, like the ones that President Trump last week placed on steel and aluminum imports. But Kudlow said he softened his stance when White House appeared willing to offer exemptions to Canada and Mexico, and to other countries that are willing to negotiate.

"I don't think you should punish your friends to try and punish your enemies in international affairs," Kudlow said.

Kudlow also said he likes a strong dollar, which is an indicator of a stable environment for investment in the U.S. and gives Americans an incentive to work hard and enjoy solid spending power.

"If you keep rates minimal, if you keep regulations and government spending minimal, if you keep the dollar sound and steady, you're going to have a terrific economy, if government has a modest approach and lets people do what they need to do and allows the freedom to do it, we will do great in this country," he said.

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Larry Kudlow, the newly appointed director of the National Economic Council, said China can expect the United States to take a tough stance on international trade.
larry kudlow, china, trade, donald trump
Wednesday, 14 Mar 2018 05:49 PM
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