Will Donald Trump really bring down ‘Chimerica’?
Guo Wengui, to use his Chinese name, arrived in the US in or around 2015. Details are murky, but one of the first things he did was to join Donald Trump’s Mar-a-Lago resort, which he used to network his way into the company of powerful men. Roger Stone, the Republican lobbyist, was one. Another was Steve Bannon, Trump’s now jailed master strategist. Guo paid Bannon a million dollars and stuck him on the board of his company, GTV, a Mandarin language news service he said would bring down the Communist Party. Such talk was catnip to the ears of men like Bannon; they closed their eyes, one presumes, to the fact that GTV was also a front to get investors to pay for Guo’s high life: a $US67m Manhattan apartment, a $US37m yacht, a $US4m Bugatti.
The extraordinary thing, though, was that Guo had done it before. Before he pitched up in the US, he spent decades forging connections with China’s Communist Party bosses as he raised funds for development projects. One such boss was the party chief of his home city. Another was the assistant to the minister of state security, the national spy chief, and conveniently leaked Guo a video of a Beijing vice-mayor with his mistress after the municipal government blocked a project near the Olympic park in the early 2000s.
The local party boss, the vice-mayor and the spy chief’s assistant all ended up in prison. In fact, prison is the common fate of many whom Guo encountered in the course of his career, which netted him a billion dollars in China, and a billion again in New York. As others have noted, while America and China have different systems, when it comes to the link between power and money, they often end up in a similar place.
Add to that nationalism, another commonality of China and the US. This deserves special attention, now that Trump has been joined on the Republican ticket by JD Vance, whose “Make America Great Again” acceptance speech played on Middle America’s distrust of China.
There is, of course, no moral equivalence between China’s repressive state and America’s democratic mandate and personal freedoms. Moreover, while “Maga” as a slogan divides opinion around the world, it is also a response to President Xi’s own mission, outlined on coming to power in 2012, to lead “the great revival of the Chinese nation”. Americans take that as a now-realised threat.
What is notable from the presidential campaign, though, is the sharp contrast between the misgivings China’s success arouses in the West. In Britain, we are concerned about China’s arrests of dissidents and tight controls over Hong Kong. Trump and Vance say little about such topics. Vance’s speech focused on what China had allegedly done to the US, saying the Communist Party was “building their middle class on the backs of American citizens”. This is not a criticism of Xi, a man Trump has said he “loves": it is the respect due a competitor, even as you try to defeat him.
America’s feeling of victimhood at China’s expense is not without some basis. American firms have indeed outsourced jobs to China that in theory could have gone to factories in rust-belt states. But that is only as true as all victimhood narratives, including China’s own conviction of the past wrongs it has suffered. The economic reality behind all those iPhone and laptop factories in Shanghai and Shenzhen is that low-priced electronics have fuelled record profits in America, and unprecedented prosperity in China and around the world. And as Apple and the rest are bullied by politicians into abandoning their Chinese factories, they are re-established not in Ohio but in Vietnam and India.
It is not just Republicans threatening to bring down “Chimerica”, as some have named the two powers’ economic interdependence. President Biden’s response has been more targeted, however, with specific security pledges on Taiwan and tariffs on Chinese imports where American competitors are directly threatened – electric cars, for example. Trump is threatening tariffs across the board, which if implemented will come as a shock to shoppers in Walmart who may suddenly realise that they have been paying “China prices” for years. Geopolitical hawks and doves argue about the best way to stop Taiwan becoming the trigger for a Third World War. Inflation is a more humdrum worry but might come quicker if Vance has his way and cuts off cheap imports.
But will Trump really sabotage a relationship that has been so profitable for Silicon Valley and Wall Street? Will he scupper the likes of Elon Musk, who sold $US21bn worth of Teslas in China last year, and who has just donated $US45m to the Trump campaign? For all his talk of “draining the swamp”, Trump has never shown much interest in bringing down the financiers and entrepreneurs who built Chimerica, any more than Bannon stood in the way of Guo Wengui.
The Times
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British readers will mostly be unaware of Miles Guo, New York-based Chinese billionaire, conman, connoisseur of expensive sports cars and purveyor of sex tapes. Even in America, news of his conviction last week for fraud has passed under the radar, given the high drama of the presidential race. That is a shame, because his story is not only jaw-dropping but also has lessons for the US, for China and for the relationship between them. In America, notably, China is an election issue, having achieved a prominence in the political discourse that Guo was able to exploit for his own ends.