Jeffrey Sachs is a professor and director of the Center for Sustainable Development at Columbia University. The opinions expressed in this commentary are his own.
President Donald Trump’s bizarre instability was on full display at the G7 Summit in France this weekend. When asked whether he had second thoughts about the recent escalation of the trade war with China, he first answered affirmatively, leading to headlines around the world that Trump had softened his position on China. Hours later, his aide clarified that Trump regretted that he hadn’t raised tariffs on Chinese goods even higher. Then at his closing G7 press conference, Trump again struck a conciliatory note, claiming that the Chinese had called US trade officials to return to negotiations, while the Chinese foreign ministry spokesperson said that they were unaware of any such call.
Trump is a one-man wrecking ball deliberately smashing the rules of global trade, finance, environment and diplomacy. Trump swings back and forth between fury and conciliation, one day calling Chinese President Xi Jinping an enemy and days later a “great leader.” If past is prologue, Trump’s conciliation today will soon give way to new vitriolic attacks, especially since he naively believes China is about to cave to his high-pressure tactics. China has repeatedly stated it will not cave. Congress must urgently reassert its constitutional powers before Trump’s erratic behavior ruins the US and world economy and further endangers the planet both environmentally and diplomatically. Trump has isolated the United States on a rapidly expanding list of major international issues. He has threatened and continues to threaten unilateral tariffs on US allies on the absurd grounds that they are threatening US national security. He unilaterally broke the Iran nuclear agreement to the deep dismay of America’s European allies and invoked extraterritorial US sanctions on Iran strongly opposed by the most of the world. He announced the pending US withdrawal from the Paris Agreement on climate change, the only nation of the 195 signatories to do so. He has injured global trade and business investments by attempting recklessly and provocatively to undermine China’s economy. Last Friday, Trump tweeted that “Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.” The Dow immediately fell by more than 600 points. There is more financial instability to come. Read MoreThe economic result of Trump’s unhinged behavior is instability in US and global financial markets and an impending global downturn.What is shocking amid all of these wild antics is the near silence of Congress. The Republican silence is perhaps to be expected given the cravenness of Republican politicians in the face of Trump’s bullying. But the problem includes the silence of far too many Democrats as well. Trump is abusing emergency powers in key legislation that previous Congresses should never have extended to the president in the first place. When Trump “hereby ordered” US companies to leave China, he was widely mocked for invoking powers that he lacked. Yet Trump quickly shot back: “For all of the Fake News Reporters that don’t have a clue as to what the law is relative to Presidential powers, China, etc., try looking at the Emergency Economic Powers Act of 1977. Case closed!”Trump was referring to the International Economic Emergency Powers Act (IEEPA). Trump has repeatedly and abusively invoked emergency powers under the IEEPA as well as other legislation. The IEEPA grants the president extraordinary powers to prohibit financial transactions with other countries if the president determines that there is an “unusual and extraordinary threat” to US national security, foreign policy, or economy. In a similar manner, the 1962 Trade Expansion Act (TEA), authorizes the president to impose tariffs in response to a national security emergency. More Markets & Economy Perspectives
Trump has invoked the TEA to block steel and aluminum imports from several of America’s closest allies, following Commerce Secretary Wilbur Ross’ investigation that concluded imports were so high they would threaten US national security. In reality, those imports pose no national security threat whatsoever. Trump has invoked the IEEPA repeatedly to punish Venezuela for its human rights violations and to harm Iran’s financial stability. Other presidents have invoked emergencies, but not as broadly, destructively, or arbitrarily as Trump. Apart from the outcry when Trump tried to declare a national emergency at the southern border under the National Emergencies Act, too few members of Congress have raised objections over Trump’s abuses of power in declaring “national emergencies.” It’s obvious that Trump is asserting “emergencies” whenever and wherever he chooses, exploiting the dangerously vague language of existing US legislation. He is trying to push US companies out of China not because US investments in China pose a national security threat to the US, but because Trump is naively trying to bend China to his will. The true solution is for Congress is to recognize the danger that Trump’s instability poses to the global economy.The IEEPA is an irresponsible delegation of Congressional power and should be amended. At a minimum, a Presidential declaration of a national emergency should require a concurrent vote by both houses of Congress within 30 days, or else become null and void. Short of such an amendment (which Trump would veto and which the Senate would likely fail to override), Trump’s existing (and prospective) invocations of the law can be overturned by a simple concurrent resolution, that is by a majority vote in each house that does not need the signature of the President. Several of Trump’s declarations under the IEEPA have been outrageous and should be overturned. Congress should certainly reject any future attempt by Trump to invoke the IEEPA to force US businesses to leave China. Such an action would be economically calamitous. The $116 billion of US foreign direct investments in China deserve the protections of the US Constitution and US obligations under the rules of the World Trade Organization, including access to American markets. By strongly and forthrightly rejecting Trump’s arbitrary declarations of national emergencies, Congress would help to stabilize an increasingly unsettled world economy and check Trump’s repeated abuses of power.