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Kuttner Meets Bannon on War Room Pandemic

Steve Bannon is the conservative populist firebrand fueling the Trump revolution.

Robert Kuttner is the liberal co-founder and co-editor of The American Prospect magazine.

Bannon and Kuttner don’t agree on much. 

But one thing they do agree on is trade with China.

And yesterday, Kuttner went on Bannon’s show War Room: Pandemic to discuss Kuttner’s most recent piece in the American Prospect titled — The Trade War Inside the Biden Campaign.

“The Democratic Party has been divided probably for forty years between a progressive worker labor Congressional wing that wants industrial policy, wants infrastructure investment, wants to get tough with China’s state led quasi-capitalistism — and a Wall Street wing,” Kuttner told Bannon. “On trade and financial deregulation, the Wall Street wing tends to dominate.”

“The Biden campaign is being whipsawed. On the one hand he wants to be pro-labor and he wants an industrial policy. On the other hand it looks like the traditionalist globalist trade establishment — preach free trade but cut China slack as long as Goldman and company get a piece of the action. They seem to be winning.”

“If our guy stands a chance of beating your guy, Biden is going to have to be credible on these issues,” Kuttner told Bannon. “There is what I call a salutary form of economic nationalism stripped of the ethno-racist part where you just want to make America great again, to coin a phrase. And it’s the Democrats to take back if they are willing to take it back.”

Kuttner said that “China practices what economists call mercantilism — otherwise known as state led capitalism.” 

“What does that mean? It means you target every advanced technology there is and you subsidize it. You price below the cost of production. You dump products onto the world market. That is a clear violation of the supposed precepts of free trade. It’s a violation of the WTO. And you coerce American companies who want the benefit of Chinese slave labor, who want to produce in China, into sharing proprietary technology with so-called Chinese partners who are out to take over their market share within a few years as soon as they learn the technology. And you do this across the board. You do it in sensitive national security products, you do it in sensitive biomedical products — you do it everywhere.”

Kuttner said that his hero on China is President Trump’s U.S. Trade Representative Robert Lighthizer. 

“Lighthizer would be a better Democrat than he would be a Republican,” Kuttner said. “Trump doesn’t listen to him except on the rhetoric. Trump does the quick and dirty sloganeering version of this. The serious version is — you say to China — okay guys look, if you want entry to our markets and you want American companies to be able to produce inside China, you’ve got to cut this out, you’ve got to stop stealing technology, you have to stop negotiating coercive agreements with American multinational companies, you’ve got to at least respect the core labor standards of the International Labor Organization which allows for free trade unions, you’ve got to stop all of these national security violations. Above all, you have to stop stealing our technology not just by stealing it, but by pricing below markets, pricing below the cost of production, dumping products on our markets — stuff that we invented like solar panels.” 

“What they do is they either use hedge funds to buy up American companies and move them to China or they price them so cheap that the companies are forced to produce in China. And little by little by little they steal it. And the free trade establishment lets them do it because corporations make a lot of money with the slave labor. And Wall Street makes a lot of money by being cut in on the action.”

“Right now there are $300 billion worth of tariffs and it could be a lot higher. You say them okay — you want those tariffs to go down, let’s take these one at a time. Stop doing x, y and z or we are going to treat you like an international outlaw and we are not going to give you access to your markets. And then meanwhile we are going to have an industrial policy where we recapture and reshore all of this production. We make American manufacturing great again.”

“My qualm with Trump is that he has the music but he doesn’t have the words. He’s got such a short attention span that he gets it at the level of rhetoric, but he doesn’t get it at the level of serious policy.”

Bannon said that Ligthizer was attacked “by the Chamber of Commerce and the Wall Street faction of both parties — both the Republican and Democrats.”

“What is it about Lighthizer specifically in his policies — which are Trump’s at some level — what do you like about them and how would you implement them?” Bannon asked.

“Lighthizer is diplomatically, politically and intellectually serious about this,” Kuttner said. “He’s been doing this for forty years. He was Reagan’s guy when the country that was practicing mercantilism at our expense was Japan. And Japan in a way copied its model from China. He would systematically go at all of the elements of China’s mercantilism and use American diplomatic leverage, including tariffs, to insist that China dismantle it if China wants access to our markets. That is so called phase two.”

“I’m not sure Trump has the coherence or the attention span to focus on phase two,” Kuttner said. “What we are left with is the smile on the face of the Cheshire cat. We are left with the rhetoric, we are left with the very anti-China rhetoric.”

Kuttner said he would have a somewhat different phase two. 

“I would be very specific about the labor rights — I don’t think that’s very high on Trump’s list. I would be very specific about the dumping, about the pricing below markets, about the theft of intellectual technology. And I would simply say — you guys can’t do this if you want access to our market, if you want access to anybody else’s market.”

After the interview with Bannon ran, Kuttner said that it was deja vu all over again.

“The last time this happened, in August 2017, it led to an on-the-record interview that cost Bannon his job as chief White House political strategist, and made me famous for fifteen minutes (well, three days actually),” Kuttner wrote this morning in Steve Bannon Strikes Again.

“This time Bannon was inviting me onto his TV show, War Room. I accepted. Three years after our first encounter, Bannon is the same sly operator, the same ethno-nationalist, having become a global advisor to far-right candidates and regimes. He’s still trying to steal the Democrats’ clothes (which too many Democrats are too willing to give him) on reclaiming American manufacturing and getting tough with China.”

“Bannon still thinks he can make common cause with American progressives on economic nationalism. And bizarrely, even though I helped get him fired, he still sees me as a kind of ally on China policy.”

“Bannon’s latest persona is obsessed with China’s role in the pandemic. He has declared that the Chinese Communist Party would have blood on its hands for the death of millions of people for its initial role in covering up the extent of the illness.”

“But that phase did not last long—and Trump denied the seriousness of the pandemic far longer than China did. And if China has blood on its hands for preventable deaths, how much blood is on Trump’s hands?”

“Bannon has also darkly hinted, without quite making the allegation in so many words, that there may be truth in the thoroughly debunked conspiracy theory that the virus originated in an experiment gone bad in a Wuhan lab. This is also vintage Bannon—going well beyond the facts, but doing it with winks, nods, and innuendo.”

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