US Trade Rep Katherine Tai Describes the New Era of Globalization

Tracy Alloway (0:03)

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Joe Weisenthal (0:20)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:25)

And I'm Tracy Alloway.

Joe Weisenthal (0:26)

Tracy, one of the things that we've noted from time to time on the show is, when it comes to trade with China specifically, trade in general, but I would say trade with China specifically, one of the rare areas where there seems to be a bipartisan consensus, that maybe the way we did it in the 90s, 2000s, probably most of the 2010s, was not desirable, was costly in certain ways, and that the whole thing needs a rethink.

Tracy Alloway (0:52)

It is kind of amazing that that's the thing that people have landed on as an area of agreement. I think in retrospect, it would have been kind of unexpected, but you're absolutely right, there seems to be these dual concerns, I would say. One is national security. So the idea that maybe China is a strategic competitor in terms of security, and so you should be worried about what they're building, what they're doing over there, all of that technology competition, things like that as well. But then the other component of it, I think, is you hear terms like unfairness, maybe even cheating. And people talk about China not playing on the same playing field that everyone else is. And so it seems to be driven by those twin concerns. And I think, again, like when the Trump administration ended and Biden came into the presidency, I don't think anyone really expected the extent to which a lot of those tariffs would be carried over. And yet here we are almost four years later, and there has been this kind of incredible continuity.

Joe Weisenthal (1:56)

A continuity and arguably even expansion in certain areas. And of course, if we were to get another Trump administration, then very likely a further expansion of some of these trade restrictions. We seem to take two components. So there's obviously tariffs on certain key areas. And then there's so much attention on technology and so technology export controls. And when you mention the sort of unfairness or cheating or something like that, there's obviously just a lot of anxiety about the fact that in many advanced technological areas, China is building a lot of very competitive things. And whether it's, I'm particularly thinking in areas like batteries or EVs where it looks like in many cases they're ahead and there's a lot of anxiety. These are key areas for the future and the US is behind and the Europe is behind.

Tracy Alloway (2:48)

Absolutely.

Joe Weisenthal (2:49)

Well, I'm very excited because we truly do have the perfect guess to talk about this big pivot, where it's going, some of the theory behind it. What is this new approach look like? And what is it supposed to accomplish? We're going to be speaking to the US Trade Representative Ambassador Katherine Tai. Thank you so much for coming on Odd Lots.

Katherine Tai (3:09)

Thank you so much for having me. I'm delighted to be here with both of you.

Joe Weisenthal (3:12)

Fantastic. Let me just start with a really big picture question. You know, for decades, there was a certain status quo with trading with China. There seems to have been a sharp pivot. Is this the new normal? Is this going to be with us? This new relationship with US-China trade? Is this going to be what it's like for years to come?

Katherine Tai (3:32)

So I cannot wait to get into some of the specifics on this question, but I want to start at a slightly higher level and just to orient what I do and what trade policy is. So as the US trade representative, my title is a bit of a mouthful, but it's actually one of the most self-explanatory positions in the president's cabinet. My job is literally to represent the interests of the United States. That's the entire United States, the entire economy, all of its people from coast to coast, from top to bottom on those coasts and the middle, and to represent Americans and the American economy in international trade. What that means is trade is a very interesting thing. We are both a part of the foreign policy team because international trade is something that you do with other countries. There's that foreign relations aspect to it. But also, we are part of the economic policy team because what you do in trade, it impacts your economy. It can help to grow your economy and it can help to shrink your economy depending on how you do trade policy. So what we were oriented by at the beginning of this administration, President Biden, Vice President Harris gave me at USTR and my team two charges.