Club for Growth (in China) Attacks Trump

Trump should welcome the attack by the Club for Growth (in China), as it exposes the group’s anti-American platform in perfect contrast to Trump’s posture as a “patriotic businessman;” a notion alien to the Club’s liberal philosophy which holds national loyalty to be outdated and irrelevant to the conduct of “globalization” and transnational corporatism.

By William R. Hawkins | September 22, 2015

In the wake of the second Republican presidential debate, Donald Trump still leads the pack by a substantial margin. He has done this despite failing to provide much in the way of details involving his plans to “make America great again,” a campaign slogan borrowed from Ronald Reagan. Trump has been called an “outsider.” It is said that voters have lost confidence in the career politicians who inhabit Washington. Yet, this is also too vague a description of what is happening at the grassroots. Trump has challenged the Establishment on two key issues which resonate well with the “51 year old construction worker who is out of work,” whom Gov. Chris Christie argued should be the concern of the party.

The issue that has gotten the most attention is immigration. Trump is correct, up to a point, that his campaign has made this a major issue. President Barack Obama’s amnesty by executive order for illegal aliens caused a strong backlash across the country, as did the sudden influx of asylum seekers from Central America who entered the country illegally but were welcomed and resettled by the Obama administration without regard to the negative impact on local communities. But given the weak positions of most of his rivals for the nomination, Trump’s call for securing the border and deporting illegals – especially criminal aliens – did bring the issue into Republican circles that had preferred to dodge it. Business donors want “cheap labor” to displace American workers in jobs they cannot outsource to cheap labor overseas and candidates want to please these donors.

While Trump has forced his rivals to join the secure borders movement, some have pushed back against the idea of deporting illegal immigrants who are already here on “humanitarian” grounds. On Trump’s other issue, trade policy, rival GOP contenders have remained silent, knowing that any attempt to defend the outsourcing of jobs, particularly to China, would doom their campaigns.

Business groups, however, are starting to push back, revealing loyalties which are not dedicated to the American national economy. On September 15, the Club for Growth announced it would spend $1 million running ads against Trump in Iowa. In its press release, Club president David McIntosh claims “Donald Trump is the worst Republican candidate on economic issues.” Trade policy is cited as one of the issues on which the group disagrees with Trump, calling his views “liberal.” Yet, it is the Club whose views are liberal in the classical sense: promoting extreme “free” trade and hostility to any consideration of national interest in policy making. This is particularly true in regard to trade with China, where the Club’s corporate funders think they can profit from helping the Beijing regime “rise.”

The Club has issued a paper supportive of Sen. Rand Paul’s libertarian candidacy, partly because he has “opposed tariffs on Chinese imports,” as well as any aid for American workers displaced by those imports. The group also praised him for supporting sequestration, a measure imposing huge budget cuts in military force size and readiness, which benefits China in the balance of power.

The Communist dictatorship in Beijing wants to be the largest national economy – not just in Asia, but in the world – and displace the United States in both wealth and power. A certain type of capitalist wants to share in this transformation for their own benefit, feeling that they are above and beyond the geopolitical concerns of national security or the duties of citizenship.

In 2011, the Club rated members of Congress on whether they had voted “NO” on the Currency Exchange Rate Oversight Reform Act. The Club opposed this measure because it “would make it easier for the government to slap punitive tariffs on ‘nonmarket’ economies – in particular China – if an exporting country’s currency is considered misaligned against the U.S. dollar.” Beijing sets its exchange rate to gain a competitive advantage in world markets; it is not “free trade” at all but rather state control on mercantilist principles.

The Club wants Washington to “take unilateral action to repeal the remaining protectionist policies and trade barriers.” Note the term “unilateral,” which means regardless of the actions of trade rivals and their policies. Even Adam Smith was opposed to unilateral trade liberalization, knowing that retaliation was necessary to keep rivals from adopting unfair and predatory policies. But the Club thinks the term “unfair” is what should be dropped.

When China announced last month that it was again devaluing its currency, the Club denounced critics as “China Bashers” and defended Beijing, saying:

“By devaluing their currency, China’s exports are now at a competitive advantage to American products.  That’s true, but is it unfair?  Chinese products will compete more easily with some products made by some American companies, potentially harming those companies.  But what about the American companies that use Chinese raw materials or equipment in making their final products?  They would benefit from cheaper imports.  What about American consumers who would benefit from paying less for the Chinese product?”

What is not mentioned is currency manipulation benefits companies that shifted production (and jobs) to China from America, the real movers behind the Club’s stance. There is nothing done in China that cannot be done (and did not used to be done) in America. The argument that moving factories overseas helps Americans as consumers is to approach the issue from the wrong direction. No one has ever consumed their way to riches. Consumption is what one does with money earned from working. Jobs must come first. Yet, the Club praises imports, while opposing aid to U.S. exporters, domestic industry, displaced workers and farmers. So, whenever the name “Club for Growth” is used, it should be followed by “in China” because that is where this group’s focus has been and remains.

Trump should welcome the attack by the Club for Growth in China, as it exposes the group’s anti-American platform in perfect contrast to Trump’s posture as a “patriotic businessman;” a notion alien to the Club’s liberal philosophy, which holds national loyalty to be outdated and irrelevant to the conduct of “globalization” and transnational corporatism.

William R. Hawkins, a former economics professor and Congressional staffer, is a consultant specializing in international economics and national security issues. He is a contributor to SFPPR News & Analysis.