As China talks begin, Trump's trade negotiator tries to keep President from wavering

Mr Robert Lighthizer, the United States trade representative, has played down any differences with President Trump and views his role as ultimately executing the directive of his boss.
Mr Robert Lighthizer, the United States trade representative, has played down any differences with President Trump and views his role as ultimately executing the directive of his boss.ST PHOTO: NYTIMES

WASHINGTON (NYTIMES) - In the middle of his crowded dinner in Buenos Aires, Argentina, with President Xi Jinping of China, President Donald Trump leaned across the table, pointed to Mr Robert Lighthizer, the US trade representative whose scepticism of China runs deep, and declared, "That's my negotiator!"

He then turned to Mr Peter Navarro, his even more hawkish trade adviser, adding, "And that's my tough guy!" according to aides with knowledge of the exchange.

Now, with talks between China and the United States set to begin this week in Beijing, Mr Lighthizer, aided by Mr Navarro, faces the assignment of a lifetime: Redefining the trade relationship between the world's two largest economies by Mr Trump's March 2 deadline in a way that tilts the balance of power toward the US.

Their approach will have significant ramifications for American companies, workers and consumers whose fortunes, whether Mr Trump likes it or not, are increasingly tied to China.

First, however, Mr Lighthizer will need to keep a mercurial president from wavering in the face of queasy financial markets, which have suffered their steepest annual decline since 2008.

Despite his declaration that trade wars are "easy to win" and his recent boast that he is a "Tariff Man", Mr Trump is increasingly anxious to reach a deal that will help calm the markets, which he views as a political electrocardiogram of his presidency.

Mr Trump has repeatedly told his advisers that Mr Xi is someone with whom he can cut a big deal, according to people who have spoken with the President.

Last Saturday, Mr Trump called Mr Xi to discuss the status of talks, tweeting afterward that good progress was being made. "Deal is moving along very well," Mr Trump said.

The administration has tried to force China to change its ways with stiff tariffs on US$250 billion (S$341 billion) worth of Chinese products, restrictions on Chinese investment in the US and threats of additional levies on another US$267 billion worth of goods.

China has responded with its own tit-for-tat tariffs on US goods. But over a steak dinner during the Group of 20 meeting in Argentina, Mr Xi and Mr Trump agreed to a 90-day truce and to work towards an agreement that Mr Trump said could lead to "one of the largest deals ever made".

"It's not some subtle shift; Trump has flipped since September," said Mr Derek Scissors, who studies China's economy for the American Enterprise Institute. "He went from saying how he was going to slap tariffs on everything to all this talk about making the greatest deal ever."

Mr Lighthizer - whose top deputy will meet with Chinese officials this week before more high-level talks in February - has played down any differences with Mr Trump and views his role as ultimately executing the directive of his boss.

But the trade representative, who declined to be interviewed, has told friends and associates that he is intent on preventing the President from being talked into accepting "empty promises" like temporary increases in soybean or beef purchases.

Mr Lighthizer, 71, is pushing for substantive changes, such as forcing China to end its practice of requiring American companies to hand over valuable technology as a condition of doing business there.

But after 40 years of dealing with China and watching it dangle promises that do not materialise, Mr Lighthizer remains deeply sceptical of Beijing and has warned Mr Trump that the US may need to exert more pressure through additional tariffs in order to win true concessions.

When Mr Lighthizer senses that anyone - even Mr Trump - might be going a little soft on China, he opens a paper-clipped manila folder he totes around and brandishes a single-page, easy-reading chart that lists decades of failed trade negotiations with Beijing, according to administration officials.

"Bob's attitude toward China is very simple. He wants them to surrender," said Mr William A. Reinsch, a former federal trade official who met him three decades ago when Mr Lighthizer was a young aide for former Senator Bob Dole of Kansas.

"His negotiating strategy is simple too. He basically gives them a list of things he wants them to do, and says, 'Fix it now.'"

Mr Trump's selection of Mr Lighthizer initially spooked markets, which viewed the China sceptic's appointment as an ominous sign. It also annoyed Chinese officials, who had been talking with Treasury Secretary Steven Mnuchin, a more moderate voice on trade and the primary point of contact for Mr Liu He, China's top trade negotiator.

Mr Mnuchin has urged the President to avoid a protracted trade war, even if that entails reaching an interim agreement that leaves some issues unresolved.

Mr Mnuchin, who attended the G-20 dinner, helped Mr Trump craft an upbeat assessment declaring the Buenos Aires meeting "highly successful" in the presidential limousine back to the airport, according to a senior administration official.

The disparate views among Mr Trump's top trade advisers has prompted sparring - both publicly and behind the scenes.

In late 2017, when Mr Lighthizer grew concerned that Mr Mnuchin and Commerce Secretary Wilbur Ross were wading too far into China matters, he enlisted Mr Rob Porter, the President's staff secretary at the time, to persuade Mr Trump to draft a document designating Mr Lighthizer as the main trade emissary to China, according to a person who has seen the letter.

Mr Lighthizer has never used the document to defend his position, the person said, but he considers it an insurance policy of sorts.

During an Oval Office meeting with the trade team in the fall of 2017, Mr Lighthizer accused Mr Mnuchin and Mr Gary D. Cohn, former National Economic Council director, of bad-mouthing him to free-trade Republican senators.

 
 
 

The argument grew so heated that White House Chief of Staff John Kelly quickly pulled the combatants into the nearby Roosevelt Room and away from the President, where the argument raged on for a few more minutes, according to two witnesses.

Ms Emily Davis, a spokesman for the US trade representative, disputed the account.

Mr Lighthizer has since worked to increase his own face time with Mr Trump. He has joked to colleagues that he has more influence with Mr Trump during winter months because he is able to hitch a ride on Air Force One during the President's flights down to Mar-a-Lago, which is several miles from Mr Lighthizer's own US$2.3 million waterfront condo in Palm Beach, Florida.

He used that access to argue to Mr Trump that the US has never had more leverage to extract structural reforms on intellectual property, forced transfer of technology from American companies and cyber crime.

But while Mr Trump has jumped at the chance to claim victory in changing China's ways, experts say what Mr Lighthizer is demanding would require significant shifts in how Beijing's central government and its manufacturing sector coordinate their activities, and that might simply not be possible in the short term.

"Good luck with that," Mr Scissors said.

Those who know Mr Lighthizer say he will try to force concessions through a combination of pressure tactics, like tariffs, and public condemnation.

Mr Lighthizer - who described his own negotiating style as "knowing where the leverage is" during a 1984 interview - typically presents few specific demands during initial talks while publicly bashing efforts by the other side.

He used that approach during recent talks with Canada and Mexico to revise the North American Free Trade Agreement, criticising foreign counterparts as intransigent and characterising complaints by US businesses as pure greed.

Mr Lighthizer's unsparing view of China comes, in part, from his childhood in Ashtabula, Ohio, an industrial and shipping town on the Great Lakes hit by the offshoring of steel and chemical production.

For much of his career, Mr Lighthizer was a lonely protectionist voice in a Republican Party dominated by free traders, alternating between jobs in government and a lucrative private law career representing large American corporations like US Steel in trade cases against China.

Mr Lighthizer found his way into Mr Trump's orbit through his work in the steel industry, where he gained prominence by filing lawsuits accusing Japan and China of dumping metals into the US, in violation of trade laws.

In 2011, Mr Lighthizer caught Mr Trump's eye with an opinion piece in The Washington Times, in which he defended Mr Trump's approach to China as consistent with conservative ideology and compared the future president to Republican icons like Ronald Reagan.

Taciturn in public and self-deprecating in private, Mr Lighthizer sees himself as a serious player on the world stage: Two recent guests to Mr Lighthizer's Georgetown town house were greeted by the stern visage of their host staring down at them from an oil portrait on the wall.

The trade adviser is guarded around Mr Trump, often waiting until the end of meetings to make his points and quietly nudging the president away from actions he views as counterproductive, current and former officials said.

That was the case in mid-2017 when he cautioned the President against withdrawing unilaterally from the World Trade Organisation, adding for emphasis "and I hate the WTO as much as anybody". He does not always get his way.

In the wake of a new trade agreement with Mexico and Canada this autumn, Mr Lighthizer urged Mr Trump to consider easing steel and aluminium tariffs on those countries and replace them with less burdensome quotas. Mr Trump rejected his plan, according to negotiators from all three countries.

A poker-faced Mr Lighthizer broke the news to his Mexican and Canadian counterparts by frostily declaring the proposal was inoperative, one of the officials said.

The President also ignored Mr Lighthizer's advice in early December when he announced that he intended to begin the six-month process of withdrawing the US from Nafta to pressure House Democrats into passing the new US-Mexico-Canada Agreement.

That threat undermined months of quiet negotiations between Mr Lighthizer, labour groups and Democrats like Senator Sherrod Brown of Ohio and Representative Nancy Pelosi of California to try to win their support for the new trade deal.

Mr Trump has yet to follow through on his threat, and Mr Lighthizer continues trying to work with Democrats to get the new trade deal approved.

"Bob is trying to provide stability and focus in a completely chaotic environment," Mr Brown said. "I can't speak for Bob, but I am certain he is frustrated. How could you not be frustrated as the US trade representative for a President who knows what his gut thinks but hasn't put much of his brains into trade?"