Grope’n Joe Biden spoils Bernie’s party

Via the FT:

Joe Biden took his newly cash flush presidential campaign to Pittsburgh on Monday, making the case in his first speech as a candidate that he would fight for American workers and not corporate bosses.

“This country wasn’t built by Wall Street bankers, CEOs, or hedge fund managers. It was built by you,” Mr Biden said, just days after entering the presidential race as the 20th Democrat running for the White House.

“I make no apologies. I am a union man,” he told a largely working-class audience of several hundred people that included dozens of members of the International Association of Fire Fighters union.

The former vice-president chose the Pennsylvania city to emphasise his pitch that Democrats must win back states with large working-class populations to beat Donald Trump in 2020. In 2016, Mr Trump won because he took states such as Pennsylvania and Michigan, partly by appealing to Democrats who felt they had been left behind by both globalisation and their own party.

Groping Joe isn’t exactly a clean skin. He has has one of the sleaziest reputations in American politics, for touching sheilas and on policy compromise.

At least he has kicked off with the right message. The Dems must win back the US working class which put Trump into power. Groping Joe is an insider, though, if not a Clinton spoiler.

His record on China may make him vulnerable, via CNN:

Trump is sure to argue — if he closes a mammoth trade deal with China — that he has mastered relations with the Asian giant, a potentially useful 2020 reelection argument.

But his attack may backfire — because the former vice president knows Xi as well, if not better, than Trump does.

He was tasked during the Obama administration with courting then-Vice President Xi during his apprenticeship for China’s top job.

“I’ve spent as much time with Xi Jinping as anybody has,” Biden boasted on the midterm election trail — as he polished globe-trotting credentials that also saw him serve for years as the chairman of the Senate Foreign Relations Committee.

Biden and Xi traveled together in China. Then in 2012, they lunched together in Washington on soy-marinated Alaskan butterfish and gingered Swiss chard before hitting the road for Los Angeles.

…With their buddy boasts about Xi, Biden and Trump may be offering a taste of a testosterone heavy general election race should the veteran Democrat win the nomination.

But the banter underscores the new political significance of the increasingly acrimonious relationship between the world’s most powerful nation and its emerging challenger.

Whoever eventually emerges as Trump’s Democratic opponent will have no choice but to have a robust China policy to compete with the President’s own aggressive approach.

The next election will take place after one of the most significant shifts in US-China relations since President Richard Nixon’s historic trip to China in 1972.

For years, the goal of US policy was to manage China’s entry into the global economy in the hope of heading off a hegemonic confrontation between Washington and Beijing.

Under Xi, China has been acting with increasing self-confidence in Asia, building up its military and is spreading its economic and diplomatic wings in Europe and Africa.

US efforts to frame a competing US-friendly regional trade and regulatory network were hampered by Trump’s decision to exit the Trans-Pacific Partnership pact soon after taking office.

In its new National Security Strategy document, the Trump administration branded China, along with Russia as a “revisionist” power that uses “technology, propaganda and coercion to shape a world antithetical to our interests and values.”

On the campaign trail, he slammed China for “raping” US workers and blasted previous Presidents as soft touches who had let Chinese firms steal millions of US industrial jobs.

In office, Trump has escalated tensions by slapping $250 billion in tariffs on Chinese goods, drawing reprisals from Beijing. The two powers have been on the verge of a trade war for months. And he claim to have secured significant help from China into pressuring North Korea over its nuclear program.

…Trump is not the first President to complain about Chinese currency policy, the vast trade deficit and intellectual property theft and cyber espionage.

But if he can forge a breakthrough with China on those issues he could deliver a significant diplomatic achievement that eluded his predecessors.

Many in the US business community however expect a more limited agreement — perhaps including large Chinese purchases of US goods to narrow the trade gap — that Trump will hail as historic nonetheless.

A significant number of grass roots Democrats and lawmakers back Trump’s populist approach to trade with China — one of the ways in which Democratic Party politics have changed since Biden left office.

Biden might have no choice but to adopt a similar duality to Trump in relations with Xi — on the one hand touting his close ties to Asia’s most powerful man while at the same time adopting a strong set of policies designed to counter Chinese action on trade, human rights and territorial disputes with US allies in the South China Sea.

But neither Trump nor Biden doubt the stakes.

“The history of the next 50 years is going to be largely based on how well our two countries, the United States and China, navigate this relationship,” Biden told Xi in 2015.

Trump told Xi in the Great Hall of the People in Beijing in 2017 that “a great responsibility has been placed on our shoulders.”

An early guess is Sanders would intensify Trump’s tariff approach while Biden would dust off the TPP. Neither is going to be nice to China.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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