Many more punitive actions against China are coming soon, and some could disrupt important supply chains for the furniture industry, Washington, D.C., lawyer Michael Borden warned in a Home Furnishings Association webinar last week.
“Watch out,” said Borden, who leads the Government Strategies group for the global law firm Sidley Austin LLP. “I know that members of this association have international supply chains, and that’s an understatement. I’ve been told by Trump campaign officials and administration officials to expect an announcement of punitive action against China and Chinese companies every three to four days between now and Election Day.”
Borden was a panelist on the webinar with Chris Andresen, HFA’s representative in the nation’s capital. Andresen noted that taking on China will be a focus of President Donald Trump’s re-election bid.
“To the extent that the Trump campaign has a defined set of issues to go against Joe Biden, certainly the situation with China is probably number one,” Andresen said.
‘Maximum chaos and disruption’
The president’s recent actions targeting Chinese social media apps TikTok and WeChat are part of a pattern that will be repeated often before the election, Borden said.
“These could be broad or they could be narrow, but they will all in the immediate term cause maximum chaos and disruption,” Borden said. “You’ve got to be really mindful that every few days there are going to be other executive orders, statements, administrative actions, regulations, impositions of sanctions, and they’re coming. They’re coming, and it’s going to be all the time, and they can be really disruptive.
“So, in addition to having to manage a pandemic, you’re going to have to manage an administration that is looking right now to punish China in every possible way – for the China virus, for the destruction of the U.S. economy, human rights, cheating on trade, intellectual property theft, everything. It’s going to almost certainly between now and November directly impact all of you. … You’re going to be hearing about supply chain issues all fall long.”
“Supply chain issues have become increasingly more difficult, particularly from that part of the world,” observed HFA Executive Director Mark Schumacher, who hosted the webinar. “That’s something that all of our members have been struggling with, small or large.”
The president will act against China
Much of the webinar conversation covered the stalled negotiations over another COVID-19 congressional relief bill. Borden expressed some hope that Republicans and Democrats might agree on some priorities in September – including the proposed RESTART Act, which HFA strongly supports. It would create a new lending program for businesses with up 5,000 employees.
But Borden said executive actions aimed at China are more certain.
“Here we are talking about COVID responses, but this is something that more likely than not is going to be like a cherry on top of problems because, even if the government is going to give you something, they’re also going to be making life more difficult,” Borden said.
Those issues already include high tariffs on most home furnishings products imported from China, Andresen added. HFA, as part of a broad business coalition, opposes those tariffs.
China is an easy target now, so it’s not likely that aggressive policies toward the Asian giant would change even if Biden is elected, Andresen said.
Biden would not reverse China orders
“I think it’s shifted Joe Biden’s longstanding positions on China and our relations with them,” Andresen said. “Even his campaign has said that he would not necessarily relieve the 301 tariffs if elected although he’s looking at it. It’s all tied into the origins of this virus.”
Borden agreed.
“Don’t think that a Biden presidency changes overnight the U.S.-China relationship,” he said. “Do you think Biden on January 20 or 21 changes executive orders that President Trump has imposed against China? No chance. Why would he politically do it? So he could be called soft on China and Republicans would have an issue for the next two years, that Joe Biden is soft on China? No way.
“So don’t expect that just because Trump is no longer in office there might be a difference in approach. There might be a more muted way, more tactful way of dealing with China, but don’t expect it to be some 180-degree reversal back to the previous order.”
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