Peter Navarro, the White House trade adviser, ripped into those who blame sluggish global growth on “trade tensions” or “uncertainties,” arguing that the policies of China and Germany are the real source of economic drag.
Navarro, a populist who was one of the most prominent critics of China before joining the Trump White House, said that there is little uncertainty in Asia.
“In fact, there is little investment uncertainty, at least in Asia. Much of the new foreign direct investment that otherwise might be going to China is now going elsewhere. Much of it across the rest of Asia. Some of it to American soil and Europe,” Navarro said Wednesday at a forum hosted by the Economist magazine, founded as a bastion of free-trade thinking in the 19th century.
Navarro, echoing the words of Vice President Mike Pence, said that the U.S. was not decoupling from China. Instead, China is decoupling from the rest of the world. The result, he said, would be a stronger global economic order.
China’s recent efforts to curtail freedom of speech in the U.S., most prominently by punishing the National Basketball Association for remarks supportive of Hong Kong protestors, has revived worries in the U.S. about China’s role in the global economy.
“Ultimately, the Chinese government’s increasingly brazen actions to leverage its commercial influence and stifle free expression should be a wake-up call for the United States,” Federal Communications Commission chair Ajit Pai said in a speech on Tuesday to the Council of Foreign Relations.
“After this adjustment runs its course, the global supply chain will be far more diverse and resilient – and multinational corporation intellectual property and technologies will be far safer,” Navarro said in his speech.
Navarro did not, however, reserve his criticism for China. He also pointed the finger at Germany as a source for sluggish economic growth around the globe.
“As for the slowdown in Europe, all roads lead inexorably to an export-dependent German economic model that is as deeply flawed in its own peculiar ‘Black Zero’ ways as that of China’s zero sum state capitalism,” Navarro said.
Navarro recommended that Germany embrace a more expansive fiscal policy and that Europe look to the U.S. for its model.
“As a final observation on Europe, and in homage to William Safire, the nattering nabobs of Brussels that rule over the Eurozone still have much to learn from Trumpian economics,” Narvarro said. “The clear message: Tax cuts and deregulation would do far more to rejuvenate the continent than Europe’s continued lurch towards a stateless socialism.”