Trump, Xi and the Real Bargaining Behind the State Visit

According to US media reports, President Trump plans to travel to Joint Base Andrews in Maryland to personally greet Xi Jinping when his plane lands. I heard that President Trump will bring the First Lady with him to Andrews. This is very unusual because American presidents normally receive visiting foreign leaders at the White House. For a president to personally go out to greet a foreign leader is a very special gesture. Actually, only one president, involving a US president, going to the airport to meet the leader of a major American adversary, and that was in 1959, when President Eisenhower went to Andrews to receive Soviet leader Nikita Khrushchev, the first Soviet leader ever to visit the US during the Cold War. Eisenhower was trying to lower tensions between the two camps at the time. Naturally, Trump's airport reception has generated all kinds of speculation about why this arrangement was chosen. I saw a Chinese parody written by someone on social media. I thought that it summarized it pretty well. This is how it goes. Xi Jinping says, hey Trump, I don't feel safe arriving in DC with all those protesters. Can you do something? Trump says, I can't stop the protesters. This is a free country. But if you pay me enough, maybe I can do something. Xi says, will you come to the airport to greet me if I give you $200 million? Trump says, maybe if you make it $400 million. Xi Jinping says, deal, $400 million in soybeans and you come meet me at the airport. Now, I thought that was pretty funny. And the reason the joke works is that it's at least loosely connected to reality. Reuters reported that Chinese buyers purchased around 1 million metric tons of U.S. soybeans on or around September the 10th, citing four traders. And 1 million metric tons of soybeans is worth roughly $400 million. Actually, $400 million to $450 million. So the joke practically wrote itself. All right, now let's talk about the significance of this visit, what each side anticipates. Now, before May this year, it had been nine years since a U.S. president made a state visit to China. The previous one was during Trump's first term in 2017. For Xi Jinping, the gap has been even longer. His last state visit to the U.S. was in 2015. That's 11 years ago. He met with Trump in 2017 at Mar-a-Lago in Florida, but that was not a state visit. So this kind of high-level exchange matters, even if it produces no major breakthrough. So I don't expect major breakthroughs from this meeting. Perhaps the most important message is simply this. As long as the visits are still happening and the leaders are still sitting down face-to-face, it means relations between the two major powers have not completely gone off the rails. In that sense, the visit itself is a signal of stability. So strategically, the fact that the two sides are once again exchanging state visits suggests that neither Washington nor Beijing wants a complete rapture. Both sides are looking for some degree of stability. Both sides want the relations to keep functioning. Beijing wants economic breathing room. Washington wants access to rare earth, more Chinese purchases of American products, and progress on other economic issues. All of this makes the visit look like a very carefully choreographed effort to stabilize the relation. But underneath that choreography are very different pressures. Beijing's economic problems, business interests on both sides, internal Chinese political calculations, security concerns, protests against Xi, and deep strategic disagreements between the two countries. And that is what makes this visit much more than just another meeting between two heads of state. So now let's talk about what does Beijing want. A Chinese scholar using the pseudonym Xing Chen told the Epoch Times that Xi Jinping's plan to bring a large business delegation suggests Beijing does not want a full-scale confrontation with the U.S. and would rather preserve room for cooperation. China is facing weak domestic demand, difficulties selling products at home, and unstable relations with Japan, South Korea, and India, especially continued tensions with Japan. Under those conditions, the scholar argued foreign trade and foreign investment have become critical support for the Chinese economy. Another source inside the Chinese political system using the pseudonym Tang Guoying told the Epoch Times that Xi Jinping's most important goal is simply to keep U.S.-China relations functioning normally. And according to Tang, there is already broad agreement among the Chinese leadership on this point. The agreement is both sides need guardrails to keep crisis from spiraling out of control. The U.S. needs rare earth, while Beijing wants sanctions and restrictions eased. And a third source described an insider within the CCP system. No, he is an insider within the system. He said several economic indicators in the first half of this year fell short of internal expectations, while foreign trade remains an important driver for growth. The source said Beijing's broader goal is to keep U.S.-China relations relatively stable for the next three years, buying Beijing time to deal with its economic difficulties. All right, so despite the desire on both sides for stability, the risks are actually rising very quickly. This meeting is not just all for choreography. It does have actual risk, and for the U.S., for the Trump administration. I mean, the biggest danger is not necessarily that the talks collapse and one side storms out of the room. I do not think that will happen. What worries some China analysts, and by China analysts, I mean Chinese-China analysts, not Western-China analysts, this is what they worry about. The two sides reach a vague deal that neither side, and certainly not everyone around them, fully understands. And then everyone starts interpreting the deal in their own way. They test the limits, they make assumptions, and that's when things can go wrong. And so now the obvious question is, what does Trump want in return? Of course, Trump is holding that. He's not holding that for nothing. He wants something in return from Beijing. In my opinion, mostly economic concessions. If Trump cannot get what he wants by trading tariffs for purchases or technology restrictions for rare earth, he may be tempted to use Taiwan arms sales as leverage. But that's also dangerous. So Trump could say, I delayed an arms sale and got concrete economic benefits for Beijing. And then Xi Jinping could say, my pressure forced Washington to retreat on Taiwan. And Chinese state media could almost certainly emphasize any perceived American concession. And that has value for Beijing's psychological warfare or campaign, whatever you call that, toward Taiwan, because it can reinforce the argument that Washington is unreliable. Because this narrative has been used by Beijing in Taiwan over and over again. Political forces in Taiwan that favor closer relations with Beijing could then point to the delay and say, look, America may not always be there. Maybe accommodation with Beijing is a better solution. And meanwhile, Congress could interpret exactly the same deal in the opposite way. Lawmakers might conclude that Trump sacrificed the long-term strategic interests for short-term economic benefits. And that could push Congress toward even tougher legislation. That's why we should be watching this Xi Jinping, Trump summit very carefully. Both Xi and Trump have reasons to want a vaguely positive outcome. And that's precisely where the risk lies. That's my point. So that's why I'm a little skeptical about this visit. I don't know how much substance the U.S. side can get out of it. Because Beijing has a track record of walking away from promises they make or they made at negotiation table. So I'm not very optimistic. Thank you so much for watching. If you're new here, please hit subscribe. Don't forget to give my video a like. If you want me to answer your questions directly, please join my live every Tuesday, Thursday, and Saturday at 9 p.m. Eastern time. I'd love to chat with you there.