Trump’s Second Term Could Depend on A Chinese Official That Was Arrested Last Week

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Trump’s Second Term Could Depend on A Chinese Official That Was Arrested Last Week

Juhasz Imre for Pexels

Juhasz Imre for Pexels

Juhasz Imre for Pexels

Grace Fiori, Senior Editor

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In Vancouver, Canada on December first, a Chinese executive was detained and arrested by the US. Justice Department.

Meng Wanzhou, the chief financial officer of the company, Huawei, was arrested by the United States government after investigations revealed Huawei may have been in violation of America’s sanctions against Iran.

An investigation by the Justice Department accused the Chinese company of misleading numerous banks concerning Huawei’s involvement in the Skycom company’s transactions in Iran; possibly putting the organizations that cleared those transactions at risk of violating U.S. imposed sanctions on Iran.

The arrest was made in the middle of the Group of 20 summit held in Argentina, where world leaders, including United States and China, met to discuss international economics. During the summit in Buenos Aires Chinese President Xi Jinping and President Trump met during a working dinner last Saturday, December first, to discuss the ongoing trade war between the two nations.

They emerged from the meeting with a tentative truce to the trade war and the goal of creating a more concrete agreement within 3 months.

After the meeting between the two leaders, it was revealed that Meng Wanzhou had been detained in Canada during a stop in her flight from Hong Kong to Mexico.  The United States requested that Canada detain and arrest Wanzhou when she arrived at a Vancouver airport and extradite her to the United States. 

The Chinese government was not aware of the events that occurred during the dinner, and Trump said that he too did not know the plans of the Justice Department.

However, John Bolton, the national security advisor who was present at the dinner between the two leaders, said he had known of the arrest beforehand. In an interview with NPR, Bolton stated that he was notified by the Justice Department often, but that, “…we certainly don’t inform the president on every one of them.” The Chinese government was angered by the actions of the U.S. government and Canada, and called the actions taken a violation of Wanzhou’s human rights.

Canadian courts, in an attempt to placate China, granted Wanzhou bail, but have not begun hearings on whether Wanzhou will be extradited to the United States for a trial there.

Amidst the international turmoil Mr. Trump, in an interview with Reuters, reinforced that, “whatever’s good for this country, I would do.” Trump reinstated that he would intervene in the Justice Department’s investigate to preserve his trade agreement with China.

Trump’s attempt at preservation of Chinese- American relations is an attempt to halt the descent of global markets, which began falling last week when worries of a possible economic cold war between America and China scared investors. Markets continued to decline despite the 90 day trade truce determined between the two countries.

Tensions between China could push Trump’s famed economy over the edge. If the economy falls, this could end up costing Trump a second term as he enters the third year of his presidency.

This is a trend that many analysts have compared to that of the late forty-first president, George H.W. Bush; when the economy fell during his reelection bid. It was widely seen as the factor that paved the way for Bill Clinton’s popularity.

When Bush was sworn in on January 1989, unemployment was at a healthy 5.4 percent, and the economy was thriving in a bull market created by the Reagan administration. Bush continued encouraging economic growth and had a relatively high popularity as President.

However, beginning in 1990, growth slowed and fell, due to rising interest rates and increasing oil prices caused by Iraq’s invasion of Kuwait. By June of 1992, unemployment had increased to 7.8 percent, despite economy growth beginning to pick up. Bush had recovered from a short fall, but it had not provided the jobs that so many in his Republican base craved, giving other candidates their “in” during the election.

Trump’s economy has followed a similar pathway to that of George H.W. Bush; when he took office in 2016 there was a healthy bull market and growing economy, which mostly has been maintained to this day.

However, the effectiveness of such methods is being called into question. The stock market is beginning to suffer, interest rates are increasing, and blue-collar workers have not been protected by Trump, despite his promise to preserve manufacturing positions in the steel and coal industries. Many celebrated the enormous 1.5 trillion tax cut, but once it expires, the American public will be left with the aftermath of heavy debt.

Turmoil between the Saudi government and other nations, concerning the death of a journalist, and Trump’s rejection of his own administrations guilty findings of the nation, threaten to spike oil prices. Whether too high or too low, both extremes which could hurt the economy, or American producers, respectively.

On both sides there has been a continuous effort from both conservatives, progressives, and moderates to push higher tariffs on China in response to their recent actions.

These economic actions against China, often initiated and antagonized by Mr. Trump and his administration, have created a dramatic trade war between the two countries.

So many strains on the economy could begin to show negatively. After the arrest of the Chinese official, it is unclear how willing the Chinese government will be to compromise with the United States. They have previously cancelled meetings back in September, all in retaliation. If Wenzhou’s arrest halts conversations surrounding the trade truce between the two countries, even temporarily, this could severely affect the economy, one that is already beginning to show cracks in its expansion.

As the legacy of George H.W. Bush has illustrated, a healthy economy can play a key role in Presidential elections. Especially for a president such as Trump who has consistently campaigned on his economic success, leading it to be a central factor in the votes that support him, even amidst other problems in his administration.

As 2018 comes to a close, it stands the test of time whether or not Trump’s economy will continue, and with that, whether he stands a solid chance of continuing his presidency through 2020.

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