Over the Weekend, A 180 (Anniversary Edition)
May 10, 2019
Scott Miller: I'm Scott.
Bill Reinsch: I'm Bill.
Group: And we're The Trade Guys.
Andrew Schwartz: You're listening to The Trade Guys, a podcast produced by CSIS, where we talk about trade in terms that everyone can understand. I'm H. Andrew Schwartz, and I'm here with Scott Miller and Bill Reinsch, the CSIS Trade Guys.
Andrew Schwartz: In this episode, it's the 50th episode of The Trade Guys, and it's our one-year anniversary. It's going to be a barn burner of an episode because this week, the US-China trade deal is completely breaking down, and there's a lot of chaos.
Speaker 5: The sudden tensions come just as US-China trade talks are set to begin again.
Andrew Schwartz: We're going to talk about the Trump administration, who says that China is retreating from its commitments after the deal looked like it was headed towards the finish line. So what happened, and will the Trump administration wage more tariffs on China? We'll discuss all this and much more on this episode of The Trade Guys.
Andrew Schwartz: Gentlemen, this is an historic occasion. This is the one-year anniversary of The Trade Guys. It's our 50th episode. This is huge, absolutely huge, and we have a barn burner of an episode here because as we speak, the market is down about 571 points as a result of trade volatility between the United States and China. What in the heck is going on, Trade Guys?
Bill Reinsch: We arranged this precisely for our anniversary. We told the-
Scott Miller: We know how to have a party.
Andrew Schwartz: All right, I promise. This is a big shout out to Julie [Hammerie 00:01:39]. I promised Julie Hammerie we were going to have a barn burner of a show today, so we did sort of arrange this I guess?
Bill Reinsch: We told the president we needed a timely tweet.
Andrew Schwartz: And he delivered.
Bill Reinsch: And he delivered the tweet.
Scott Miller: On Sunday, he came through.
Andrew Schwartz: He delivered, man. Boy did he ever deliver. Why did he do that?
Bill Reinsch: Apparently, the story is, which I think I correct, that from our point of view, the Chinese started to walk back on some commitments.
Andrew Schwartz: The media painted this out to be Trump was being reckless, but that's not quite the case, is it?
Bill Reinsch: No. No. Ambassador Lighthizer actually did a press briefing on Monday, which is unusual for him, and he was quite clear. They were in China last week, and the Chinese apparently were saying that there were some things that they had agreed to that they no longer wanted to change their law to reflect their agreements. I don't think he was ever clear about exactly what those items were, but he interpreted that as walking back on commitments they had already made.
Scott Miller: Yes.
Bill Reinsch: Which he then conveyed to the president, who then tweeted.
Scott Miller: There's two pieces of this. First, it's at the end stage of the negotiation.
Bill Reinsch: Right.
Scott Miller: The previous comments by both sides were that there was convergence, they were talking about landing zones.
Bill Reinsch: Right.
Scott Miller: So, this was an end stage disruption.
Andrew Schwartz: So, Scott, didn't we think this was like a done deal?
Scott Miller: Well, look, I still think ... and we can talk more about that. I still think it is in the interest of both the Unites States and China to get to a deal, but what happened, as Bill is describing, is that there was a movement backwards, and this is on the tough part of negotiation. Recall, we split up the discussion of market access from the structural change. This is on structural reforms in China, and I think Ambassador Lighthizer has been leading all the way along to get the greatest degree of specificity in what China actually has to do to comply with the agreement, and that seems to be the area that backed up.
Scott Miller: So, in some cases, a lot of negotiations almost fall apart before they come together. So, it's not a complete surprise, and it tends to happen at the late stage. But that was really the incident that prompted all this.
Bill Reinsch: Well, it's true. If you don't crash and burn two or three times in trade, you really aren't producing anything that's noteworthy.
Bill Reinsch: But I do think that this is a case where there's a lot of peril here for the president. We talked a little bit about this in the past. I think the path to political success, forget about the economics for a minute, the political success for him is very narrow. He has to produce a strong agreement that addresses the structural issues.
Andrew Schwartz: Right.
Bill Reinsch: The subsidies, the IP theft, the [inaudible 00:04:10] transfer, and the Chinese have to honor it. Otherwise, a year from now, we're back right where we started from now. It seems to me what this last episode should be telling the president is "look, you may end up with a choice here that is not a politically palatable choice. You can have an agreement that will not be what you want, in which case the Democrats will accuse you of being a poor negotiator and a [inaudible 00:04:35]. Or, you can walk away, in which case the Democrats will accuse you of failing and causing a lot of collateral damage with the tariffs that you've implemented, and then not getting anything in return."
Bill Reinsch: The president's statement all along has been short term pain, long term gain. If he walks away, there's no gain, and just the pain. I think he's put himself in a very difficult political position.
Andrew Schwartz: Right.
Scott Miller: I agree, and it's because he's framed this as a win/lose outcome for himself. I mean, that's the corner he's managed to paint himself in.
Scott Miller: Really, and the fact of the matter is if you're going to insist on these structural changes, which I'm glad they are, I think that's the most important part of the agreement, China is enough of an economic rival over the long term, it's a management problem. It's not about winning and losing a single deal. It's about how you manage the relationship in a way that you are able to assert the things that are most important to you, and able to keep China from doing the things that are most harmful.
Bill Reinsch: Well, there's one more element, too, to keep in mind, and that is some sense that the current problem arose in part because kind of a dangerous thing happened in negotiation. Both sides got economic good news. The Chinese had a good first quarter. They had a better first quarter they were expecting. We've had a good first quarter too. Unemployment continues to go way down-
Scott Miller: And it's always surprising on the upside, this month's unemployment report. Again, surprised on the upside.
Bill Reinsch: The consequence of that in negotiations is both sides think they are now in a stronger position, and have to make as many concessions.
Andrew Schwartz: But this is a dark incident here between the United States and China.
Bill Reinsch: It's very worrisome, I think.
Andrew Schwartz: Yeah.
Scott Miller: Yeah. It's a fragile situation, so I don't know how it's going to come out at this point. The Chinese chief negotiator is going to be here tomorrow, as I understand it, and whether they can put Humpty Dumpty back together at this point, I don't know, but the president seems very serious about additional tariffs, and that's going to annoy and draw a response from the Chinese.
Bill Reinsch: It's going to be annoying because the assessment of the tariffs imposed so far has ... it's specific cases of people that have gotten direct hits and they're very unhappy, but so far I think in both countries there's been a tendency to say the political impact has been greater than the economic impact. 10% is not ... it's annoying, but it's not huge.
Scott Miller: It's not a deal breaker, yeah.
Bill Reinsch: If you go to 25%-
Andrew Schwartz: What happens?
Bill Reinsch: ... then you have a big problem, particularly on a lot of agricultural items. The Chinese will retaliate probably by increasing their tariffs further-
Scott Miller: Then the supply chain management gets very, very difficult for almost everybody [crosstalk 00:07:12].
Bill Reinsch: Yes, exactly. People are starting to [crosstalk 00:07:14].
Andrew Schwartz: All right, and let's keep in mind, the United States imported more than $539 billion worth of goods from China in 2018. That's a lot of goods.
Scott Miller: And this is of course where the president's message is inconsistent with the real experience of people. Because he insists that China is paying these tariffs, and that we have a big advantage because we import more Chinese goods than China imports US goods. Fact of the matter is consumers always pay the tariffs. It's US consumers.
Andrew Schwartz: Isn't this a bad idea for the president politically going into an election season?
Scott Miller: It's a big risk. He's taking a big risk by escalating.
Bill Reinsch: Exactly. That's why I said the path to success is very narrow.
Bill Reinsch: If there's a deal, and I still think there's a good chance of one, at the moment it'll be a big victory. He'll claim it's the greatest victory ever. The market will go ... All those 500 points will come back, it'll be a big victory. But you've asked the important question, is what's it going to look like a year from now?
Andrew Schwartz: Right.
Bill Reinsch: What's it's going to look like a year closer to the election? I think it ends up looking very much like right where we are now. Not having accomplished very much, but it caused a lot of collateral damage in the meantime.
Andrew Schwartz: Right. As we saw, Joe Biden inartfully articulated something that didn't really come out, I don't think, like he meant it to come out, and he didn't seem like he knew what he was talking about.
Scott Miller: Well, yes. It was a strange statement. It was one that had portrayed at least in the former vice president's mind that China was a little more benign than most people thought it would. What was odd was the Democratic Party that's in power now doesn't agree with that. They actually agree with President Trump.
Scott Miller: There was a great tweet from minority leader Schumer which basically was applauding Donald J. Trump and saying, "Go be tough with China. You have to be tough." So-
Andrew Schwartz: Well, and Biden's always wanted to be tough on China. Biden is four TPP, for instance. Right? Am I wrong?
Bill Reinsch: Well, no, he was. That was the real reason to be for TPP.
Scott Miller: Yes.
Bill Reinsch: But that [crosstalk 00:09:11] wasn't the way the debate played out.
Scott Miller: Yeah. It's hard to pin it down, and it was one comment, so I don't want to take ... And he's new to the campaign trail, and it didn't really last much longer than that news cycle.
Andrew Schwartz: Yeah. He's not new to politics though.
Scott Miller: Exactly. He's been at this for a while.
Bill Reinsch: But he's also not new to making odd comments from time to time.
Andrew Schwartz: Right, and this isn't going to hurt him in the long run because presumably he's going to articulate his trade position with some-
Scott Miller: Yes, and the caravan will have moved on by then.
Andrew Schwartz: Right, but-
Scott Miller: It's not really to worry about it.
Andrew Schwartz: But the fact of the matter is in a year from now, barring any unforeseen circumstances, President Trump is going to be president, and he is going to own this economy.
Scott Miller: Yes, and what we have at the moment is we have unanimity among the political parties here, being on tough on China is the right thing to do. There's really no pushback on that.
Scott Miller: The president has chosen his way of being tough, which at the moment is looking a little risky.
Bill Reinsch: But the Democrats have got to be just frothing at the mouth in anticipation because it's going to be so easy to go after him if this goes south because they can accuse him ... If he walks, he failed, he couldn't close, he's not the negotiator that he said he did, and he hurt all these Americans in the process. If he produces an agreement that really isn't very good, he's a failed negotiator.
Scott Miller: Oh, so this is perfect for the opposition, which is they can cheer him on now, but if he fails, they get to criticize him and not look weak on China.
Andrew Schwartz: Well, they haven't laid a glove on him yet.
Scott Miller: True, and-
Bill Reinsch: No, and-
Scott Miller: ... the week isn't over. The Chinese negotiators are about to arrive, so we'll see if they can put Humpty Dumpty back together.
Andrew Schwartz: All right. What would that look like, if they can put it back together? The market surges back, there's an agreement, everybody makes nice, and the threats evaporate? Is that what it looks like?
Bill Reinsch: Well, yes, until people start reading the fine print and realize that maybe the commitments aren't quite as great as the president said they were, and then the next thing that happens is there will be benchmarks and deadlines, and the Chinese commit to do this by this date and that by that date. Then they're going to start missing some of those, and then we get an enforcement problem.
Scott Miller: Exactly. At the moment, what the markets are reacting to is uncertainty. Earnings are still strong. That's why while the markets are down roughly 2.5% over the last two days, it's from record highs that they're down 2.5%. Not a big decline, but it reflects the uncertainty. Once the agreement is announced, that resolves itself.
Bill Reinsch: And there's certainty.
Scott Miller: And there's a greater degree of certainty until people look under the hood, start to inspect the equipment, and start to look for compliance. At that point, there's still a management problem.
Andrew Schwartz: Okay, but let me ask you guys this: we often give Chinese President Xi Jinping and the Chinese credit for being the smartest economic people, great negotiators, all these things. Are they really as smart as people put them out to be on this? Are they playing a chess game, or are they really playing checkers here? What's going on?
Bill Reinsch: Well, I've always thought we're the ones that are playing checkers. I think they're the ones that are playing chess. I would not give them a very high grade on the management of their own economy. I mean, what Xi Jinping has done is take-
Andrew Schwartz: It's like they got lucky with this growth in the last quarter, and-
Bill Reinsch: Well, I think it's in spite of him. The irony of this is what we are asking them to do is actually good for them, and their economists know it.
Scott Miller: Yeah, well, we've talked about this a couple times that Xi Jinping actually does not do what his economists tell him to do, for the most part. They have a better plan, and you can see it in their treatment of private sector industries. Most of the capital restrictions and the pressure in the Chinese economy has been on the private enterprises, whereas it's the state-owned enterprises that are wasting capital.
Scott Miller: I think that we can help them if they actually follow on the reform plan that the United States would see in its interest, it would benefit the Chinese economy. But at the moment, there's just enough growth there, it's a huge economy, robust in some ways that are hard to measure, and it seems to be performing beyond expectation.
Andrew Schwartz: All right. I want to ask you guys an overarching question because you're not only trade guys, you guys are geopolitical guys. Is the trade relationship with China the key to a successful US-China relationship? One where we get along, one where we don't stumble into armed conflict, one where we deal with a rising China in a productive way, one where we benefit from a productive relationship?
Scott Miller: My first response would be unclear. We had an idea of what might work for the last 25 or 30 years. The idea really from Richard Nixon on was "let's bring China into the world of international institutions, including the rules-based trading system, and help them benefit from those institutions and grow and not constrain them," but in doing so, as Robert Zoellick said when he was the USTR, "help them become a responsible stakeholder."
Andrew Schwartz: Right. They didn't like that too much.
Scott Miller: Well, nobody liked it, but it didn't work. I think what we're realizing now is that theory of the case was pursued for a long time, and didn't play out. What we have now is a greater degree of rivalry and a greater friction than we'd probably like to have given the relative size and importance of the two economies. We got to manage that friction somehow. The institutions aren't really helping us here. For me, that's why I'm unclear about whether we have the recipe correct now.
Bill Reinsch: My answer's a little bit different. I'd say working out our trade differences is a necessary but not a sufficient condition for normalizing the relationship. We can't really have a constructive, positive relationship unless we address these problems-
Scott Miller: That's fair.
Bill Reinsch: ... partly because the economic problems overlap with security issues. I mean, it's not just about whether they're buying enough soybeans. It's about cybersecurity, it's about stealing intellectual property. It's about them-
Scott Miller: [crosstalk 00:15:12] technological [crosstalk 00:15:14].
Bill Reinsch: ... the technological races that have benefits for them that are security-related and military-related that pose conflicts for us. Then it bleeds over into the other part where we compete. We really compete for leverage in the Pacific. The US policy really since 1945 has been to make sure that there's no single Asian power dominates the region.
Bill Reinsch: Initially that meant Japan, that's what the war was about. Last 10 to 15 years it's come to mean more balancing between Japan and China, and now it's increasingly being China because Xi Jinping not only is taking his economy backwards, he's making a much more insertive China on foreign policy, what they're doing in the South China Sea, the way they're pressing countries. The Belt and Road Initiative is an attempt to roll up support in neighboring countries. There's a clear effort here of China to take a much larger role in the region, and that means they bump up against our interests in a number of locations.
Andrew Schwartz: So what do we need to do to get this thing done? You said that talks are going to go on, Liu He is going to be here starting tomorrow. What needs to happen next?
Bill Reinsch: Well, I'm not ... I guess I don't have a satisfactory answer from your point of view for that because to me this is one of those long twilight struggles. This isn't going to get solved-
Andrew Schwartz: Nothing's going to happen this week that's going to-
Bill Reinsch: Well, something may happen or something may not, but I've always maintained that they're never going to do what we want in China.
Bill Reinsch: We played a simulation game yesterday on exactly this subject, and this time I was on the American team. I was on the Chinese team the last time.
Andrew Schwartz: Oh, good to have you on our side.
Bill Reinsch: Well, I was on the Chinese team because I had been on the American team before, and we kept losing, so I wanted to be on the Chinese team, and I think we won.
Andrew Schwartz: Okay.
Bill Reinsch: I'd say yesterday was more of a draw. But the American side began by deciding that they weren't going to do what we wanted.
Scott Miller: Ever.
Bill Reinsch: Ever. So that means the question for the Americans is sure you've got to keep beating on them, because that's what you do, and it's good for them to do what we want, but you don't put all your eggs in that basket. You spend a lot of time thinking about what do we need to do so we can compete with them, and particularly what do we need to do so we can compete with them everywhere else? Because the battleground is third countries. The battleground is not in China.
Scott Miller: That's what's being ignored in the current bilateral. In my vision of what the best thing that could happen next is first for both presidents to resolve this bilateral agreement in whatever form it takes, do your best to enforce it, but in the meantime start to build our alliance structure back so that we are working with allies and partners on developing the long game whether it's in technology or AI or advanced manufacturing or security systems. That keeps us secure and in that larger framework, the one that includes allies and partners, we're in a better position to manage the inevitable frictions that we'll have with China.
Andrew Schwartz: Yeah. The last time I checked, we have some 60 alliances, and the Chinese have one alliance with North Korea, which they can't tell whether that's an alliance or-
Scott Miller: Is that good or bad?
Andrew Schwartz: Yeah, whether it's an alliance or liability. So we should be able to take advantage of our alliances.
Bill Reinsch: Yeah. We have advantages. I mean, for all the difficulties ... I mean, the current president has not enhanced our image or reputation in the region, but-
Andrew Schwartz: Oh, and speaking of which, the IMF managing director Christine Lagarde issued a warning today about the threat that the trade tensions pose, and gave our president a little slap on the wrist, which he probably didn't take too kindly to.
Bill Reinsch: Well, wait for the tweet. I'm sure it will show up.
Scott Miller: [crosstalk 00:19:06] be noticed.
Bill Reinsch: We don't need [crosstalk 00:19:06] the IMF, you know.
Andrew Schwartz: But it's certainly coming if he noticed. We'll see.
Bill Reinsch: The Chinese don't have a lot of friends.
Scott Miller: Right.
Andrew Schwartz: No.
Bill Reinsch: When I was on the China Commission, the Congressional China Commission, one of the things we learned was if you want to know about somebody, talk to the neighbors because the neighbors always have great dirt because they're next door. So we would travel around to literal countries, Japan, Korea, Vietnam. I didn't go on all these, but the Philippines.
Andrew Schwartz: You took a spin around the hood.
Bill Reinsch: Yes, exactly.
Scott Miller: Talked to the neighbor.
Bill Reinsch: My last year on the commission, we were studying the Belt and Road Initiative in particular. We went to Kazakhstan and Uzbekistan, where I'd never been before. Whole nother subject, fascinating places. But we asked both of them how they felt about the Belt and Road, and they're very different countries, but they both said exactly the same thing, which was "we really welcome the Chinese investment. The Chinese people, not so much."
Bill Reinsch: There was a lot of nervousness about this, the Kazaks in particular ... because it's an underpopulated country. There are 19 million in a country that is roughly the size of Western Europe ... have this paranoid fear of the Chinese moving in.
Scott Miller: And them not being able to do a thing about it.
Bill Reinsch: Yes, exactly.
Andrew Schwartz: This is the concept of the ugly American invading the world, but it's the Chinese invading the world, and not being welcome.
Bill Reinsch: Yes. I think there's nervousness about that. I mean, they've done very well with dictatorships because when they give away the money, there are no strings attached.
Scott Miller: Sure.
Bill Reinsch: When the World Bank funds a project-
Scott Miller: They get lectures. Yeah.
Bill Reinsch: Yeah.
Scott Miller: And you get an IMF loan, of course, then the bankers come in and make sure your credit cards are up to date and everything else.
Bill Reinsch: And what the World Bank does, it's ingenious, if you're going to build an airport, what the World Bank does is they pay the contractor. They don't pay the government.
Scott Miller: No. They [crosstalk 00:21:07].
Bill Reinsch: And what the Chinese will do is they'll come in and they'll pay the leader. [crosstalk 00:21:11]. A significant chunk ends up in the Swiss bank account, which makes the Swiss happy, but it-
Scott Miller: And it makes the leader happy.
Bill Reinsch: It makes the leader happy.
Scott Miller: You may not get much of an airport, but, yeah.
Bill Reinsch: It doesn't build a lot of support for China in the country. This is beginning to show up in various African countries, and actually elsewhere where these projects have turned out to be less than what was advertised.
Andrew Schwartz: This is something that we haven't talked a lot about, about how China's sort of outwearing its welcome around the world.
Bill Reinsch: Yes. We should have John Hillman from CSIS. He monitors the Belt and Road cases here because there have been-
Andrew Schwartz: John is our Belt and Road maven, and he runs a micro-website called Reconnecting Asia, which you can find online if you just put in Reconnecting Asia. It'll come right up.
Bill Reinsch: He's done a marvelous job of tracking projects, delving into contracts, reading the fine print, much of which says if these countries can't pay, the Chinese get the asset. They take over ports, they take over railroads, and-
Scott Miller: They're not exactly in the grant business. They're in the loan business. But John would be welcome on the show, and provide an interesting window into this part of policy.
Andrew Schwartz: We shall invite John, indeed.
Andrew Schwartz: All right. So guys, what else? What else do we need to talk about with this acute issue this week that we're facing right now? What do you think is next? What tweet is coming next? What is Bob Lighthizer going to do next? What is Mnuchin going to do next? Is the Trump team properly aligned to deal with the Chinese this week here in town?
Bill Reinsch: Well, Mnuchin, the next thing Mnuchin'll probably do is probably go out for dinner. He's been seen out a lot.
Andrew Schwartz: Where's he going?
Bill Reinsch: Oh, various restaurants. I don't remember offhand.
Andrew Schwartz: Good places in town?
Bill Reinsch: Yes.
Andrew Schwartz: I got to tell you-
Bill Reinsch: He seems a bit of a foodie, sort of like Obama.
Andrew Schwartz: I went to St. Anselm the other night in town, which is in the-
Bill Reinsch: Oh, is it good?
Andrew Schwartz: It's excellent. In the Union Market area. Union Market used to be a neighborhood you just wouldn't go to in northeast. Union Market is fantastic. You can go in there, and there's all the food stands. It's a food hall, but St. Anselm is right over there. You can stop by Politics and Prose and get a book afterwards. Great night out on the town.
Bill Reinsch: Well, Lighthizer was probably not doing that.
Scott Miller: Yeah, they're probably working. But look-
Bill Reinsch: The issue is the tariffs, don't you think?
Scott Miller: The issue's going to be whether the tariffs escalate? If the past is prologue, when negotiations almost appear at the breaking point with this administration, the president will take half the loaf and declare victory. For me, that's the most likely outcome here.
Andrew Schwartz: That's the playbook.
Scott Miller: The new tariffs will never be applied. We'll get the half loaf, and in a week or two we'll look under the hood and see whether it's gotten stale. In the meantime, the markets will be relieved, and [crosstalk 00:23:57].
Bill Reinsch: Yeah, I don't look for a finished agreement this work. I think there's too much stuff undone.
Scott Miller: That's probably right.
Bill Reinsch: The happy ending is the Chinese walk back their walking back, and go back to what they had originally agreed to-
Scott Miller: And the tariffs don't go up.
Bill Reinsch: ... and the president announces "we are now back making progress, so I'll hold off on the tariffs."
Andrew Schwartz: Do you think that this episode may deter President Trump and/or the Chinese from either walking things back and/or making threats going forward?
Bill Reinsch: You mean this episode of the Trade Guys?
Andrew Schwartz: No. Well, [crosstalk 00:24:32] this is the 50th ... this is the one-year anniversary. It's the one-year anniversary, it's our 50th episode, hopefully it will do some good.
Scott Miller: Andrew, it's always my fond hope that my friends who listen to the podcast don't think I'm stupid when I'm done.
Andrew Schwartz: They never do. They never do. Scott, everybody knows Trade Guys, Scott, as to be one of the smartest men in Washington, that is a fact.
Bill Reinsch: The episode, to get to your question, the episode has stirred everybody up. Partly it's stirred everybody up because the whole trajectory was different. We had just had six weeks of positive tweets from the president.
Andrew Schwartz: Right, positive tweets.
Bill Reinsch: We're getting closer, we're converging, everything's going fine, an agreement [crosstalk 00:25:11] soon, I'm meeting with Xi soon. All positive news.
Andrew Schwartz: Happy news.
Bill Reinsch: And then over the weekend, a 180, which shakes everybody up. Probably the kind of thing that he enjoys doing because he loves uncertainty. Maybe we'll see more of this. In [crosstalk 00:25:29] retrospect, we should have said-
Andrew Schwartz: And he loves turmoil.
Bill Reinsch: He loves turmoil. In retrospect, we should have seen it coming.
Scott Miller: Right. Makes sense.
Bill Reinsch: Because these things do crash and burn. But I think it doesn't mean that all is lost by any means.
Andrew Schwartz: This constantly feels like a professional wrestling match.
Bill Reinsch: Where no one is actually hurt? I don't think so. There are people that are-
Andrew Schwartz: Well, no ...
Bill Reinsch: ... actually hurt in this one.
Andrew Schwartz: People are getting banged up a little bit. There's no doubt about that, and if you ask professional wrestlers, they'll tell you that it's not all fake.
Scott Miller: Over the last-
Andrew Schwartz: It's not all fake.
Scott Miller: Over the last-
Andrew Schwartz: Ask George the Animal Steele if it was all fake.
Bill Reinsch: But how much of it was fake?
Andrew Schwartz: Yeah, who knows?
Bill Reinsch: It's not all real either.
Andrew Schwartz: But Donald Trump, it feels like there's just a back and forth, a good and an evil, a constant playing off of each other.
Scott Miller: Yes, we've reached the operatic stage.
Andrew Schwartz: Yeah, and I don't think we've seen the last of it. Do you guys?
Scott Miller: No, the fat lady has not come out for the big finish yet.
Andrew Schwartz: Right.
Bill Reinsch: I can't resist pointing out an irony too. The story is that this problem arose in China because Li Hui made a number of concessions that Xi Jinping vetoed.
Scott Miller: Yes.
Bill Reinsch: So kind of ironic since exactly the same thing happened to Lighthizer.
Scott Miller: Right.
Bill Reinsch: Lighthizer goes in and has Trump tell him, "No, no [crosstalk 00:26:44]. We can't do that."
Scott Miller: Sits in the Oval Office with the TV cameras and gets undermined by the president.
Andrew Schwartz: I mean, maybe they have more in common than they thought.
Bill Reinsch: If anybody should be prepared for this ... Yeah, they do. The two leaders are looking an awful lot more alike, and the two negotiators are looking a lot more alike, actually.
Andrew Schwartz: Maybe they all just get together and sit down and say, "You know, we're all part of the same gang. Why can't we just get along?"
Bill Reinsch: Why can't we just get along?
Scott Miller: Didn't see that one coming.
Andrew Schwartz: Yeah, yeah. Well, I guess to be continued. This is going to be an interesting end of this week, and we'll be back with the results next week for our 51st episode. It'll be our 51st.
Bill Reinsch: Exactly.
Andrew Schwartz: So, Trade Guys will continue. Trade Guys, thank you for this barn burner of an episode. Happy anniversary to both of you. This has been a pleasure to talk today, as always.
Scott Miller: Thank you.
Bill Reinsch: Thank you.
Andrew Schwartz: To our listeners, if you have a question for the Trade Guys, write us at TradeGuys@CSIS.org. That's TradeGuys@CSIS.org. We'll read some of your emails and have the Trade Guys react to it.
Andrew Schwartz: We're also now on Spotify, so you can find us there when you're listening to the Rolling Stones or you're listening to Tom Petty or whatever you're listening to. Thank you, Trade Guys.
Scott Miller: Thanks, Andrew.
Andrew Schwartz: You've been listening to the Trade Guys, a CSIS podcast.