What’s on Trump’s Agenda With Xi?

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0:17From the opinion pages of The Wall Street Journal, this is Potomac Watch. President Xi Jinping arrives in Washington on Wednesday evening, and President Trump will greet Xi at Andrews Air Force Base. The visit will include a state dinner on Thursday at the White House. But behind all the pomp, what does President Trump hope to achieve for the United States? Can he push Xi to stop helping Iran kill American troops in the Middle East? Will President Trump extend a fragile trade truce with China? And is any cooperation on artificial intelligence possible? Meanwhile, what to expect on whether he will leave America's friends in Taiwan waiting on better arms to deter the Chinese Communist Party from mounting a blockade or invasion?

1:02These are the questions we're going to get into today on Potomac Watch. I'm Kate O'Dell, your host this Wednesday. I'm joined by my colleagues, Jo Sternberg, a columnist, member of the editorial board, and a longtime hand in Asia. We also have Matt Continetti, a columnist for the journal's daily newsletter, Free Expression. Gents, thanks to you both for joining us. Jo, we'll give you the first word here. She is currently en route to the United States. Can you give us an outline of what a successful summit for President Trump would look like? Well, Kate, I think there are two ways you can think about that.

1:34We can think about what would be success for President Trump, and then we can think of what would be success in general, particularly from the perspective of the U.S. and its allies. So, I mean, I think that President Trump probably always seems to define success in terms of a deal about something. So if he has the option of coming on Truth Social and saying that he's got an agreement, particularly if the Chinese are promising to buy more American goods and especially agricultural products, he would probably call that a victory. You know, you could hope that there might be some kind of agreement from the Chinese to be a little less friendly toward the Iranians while we are prosecuting a war in the Middle East, although I think that that's kind of an outside chance.

2:21I mean, that's definitely how Trump is going to define success. Now, I mean, I think a successful summit here from the perspective of all that's right and good in the world, or at least America's national interest, would actually be nothing. I think that if you kind of look at the dangers of a U.S. president who is always in deal-making mode and a Chinese side that has a long history of not abiding by the agreements, especially on commercial security matters that they sign. I actually think that it's not such a bad outcome if we get the dinner and the clinking champagne glasses and then don't actually have a firm agreement on anything.

3:04That might be the victory here. Matt, I want to ask you the same question. What are you watching here and what counts? What would be a success for this meeting? Well, I think Joe's absolutely right. A success for President Trump and the world would be a China that would agree to enter some dialogue about artificial intelligence with the United States, as well as about nuclear arms agreements. We've been trying to get the Chinese involved in nuclear arms talks for years to no effect. An agreement over the trade deal, essentially the Busan deal agreed to between the United States and China last November, where we lowered tariffs to about a 23 % effective tariff rate on most Chinese imports to the US.

3:45And the Chinese agreed to relax their grip on rare earth minerals exports. That would be a success. Then finally, on Iran, as Joe mentioned, it would be very helpful for the world if China said it was going to stop helping Iran in terms of intelligence sharing and in terms of oil purchases and maybe actually exert some pressure on Iran to stop firing missiles at ships attempting to transit the Strait of Hormuz. But I don't expect any of that to happen. I think we're in for a replay of President Trump's summit in Beijing earlier in the spring, except there'd be more pomp and circumstance. And so this is the first time President Xi has visited the United States since 2023.

4:33It's the first time Xi Jinping has been to the White House since 2015, over a decade. And President Trump is really greeting him with open arms. The fact that Trump is going to Andrew's Air Force Base to greet Xi Jinping personally is something that is rarely done for foreign dignitaries who aren't popes. And I don't think we could expect President Trump to do that for Pope Leo. But instead, he's giving the red carpet rollout in a way that Xi Jinping did not do for President Trump when he visited Beijing. We have this major state dinner on Thursday night with all the AI tech executives and then a visit to the National Archives planned for Friday, but no press conference scheduled.

5:16So I think that the best we can hope for is a summit that has a lot of pomp and circumstance, but not much in the way of actionable results. One quick break here at Potomac Watch. If your organization isn't managing its data with every pure, then it's likely scattered all over the place. My lord, for three days have I ridden to bring thee warning. The records thy great AI machine requires are strewn across five kingdoms. Yeah, the Everpure data management platform unifies data so you can always find it. No messenger needed. No more running around. Get out of the data dark ages with Everpure, a new era in data management.

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6:46Welcome back. I'm chatting with my colleagues, Joe Sternberg and Matt Continetti, about Trump's upcoming summit with Xi Jinping. Here we've touched on trade, on artificial intelligence, on Iran. And I want to make sure we talk about Taiwan as well, because I think that's an area where if she were to have some success, perhaps an outcome that looks like nothing or looks like a small concession actually could really damage U.S. interests. But before we get to Taiwan, let's focus first on Iran, because the president was at the United Nations on Tuesday. And he said again there that he wants a peace deal in Ukraine.

7:20And he said that he wants an Iran that can never have a nuclear weapon. And I think the common impediment to both of those priorities for the president is tacit war support from Beijing. We know Beijing is helping feed the Russian war machine with oil purchases, with legacy chips. And we know that to your point about intelligence sharing, there have been press reports that Chinese satellite data given to the Iranians was a direct help to them targeting a U.S. base in Jordan and killing Americans. So one thing that caught my attention, Matt, at the UN on Tuesday was that the president said if he was willing to use new authority given to him in a Russian sanctions law signed last week, that would allow him to put tariffs up to 100 percent on those who buy Russian oil and gas.

8:09And this could hurt China if he wanted to do it. And it could try to force them to stop financing Putin's war. First of all, do you think he's willing to use that leverage at all? He put that marker down that he was willing to use it. And then second, how would you describe his response so far? He has said, well, you know, China does what we do with Iran. They help out. Targeting American troops seems like the kind of thing that might make the president angry at Xi, but we're not seeing that response. So is he willing to use that leverage? And is this just one more sign that he wants, you know, a stable, calm, good relationship with China above anything else?

8:44Right. I think the byword here is strategic stability, which is the phrase that both sides, U.S. and China, have used to describe their aims in the various summits, especially since the trade war and, you know, for a time, an effective embargo that both countries had with each other last year after Trump's so-called Liberation Day. So I think that's the background to this visit. And so I don't expect any major or dramatic actions or shifts to take place. But I would say also, based on past precedent, I wouldn't expect Trump to use the authorities granted to him in the Lindsey O. Graham Russian Sanctions Act, which he signed into law to apply to China.

9:26And the reason for that is we've been having a Operation Economic Fury from the Treasury Department, or I think it's called Operation Economic Outcast right now. The names come and go. Where Scott Bessent has, I think, effectively used America's sanction power to try to not only harm the Iranian economy even more than the harm that's being done to it by the blockade, but also to separate Iran from the global trading and financial system. But we have yet to really go after the Chinese financial institutions that do provide so much financial support for the Iranian regime. So if we don't see an Operation Economic Outcast, I don't think President Trump will come out of this state visit with a declaration that he's imposing extremely high tariffs, which he can do under the Graham Act for purchases of Iranian oil on China.

10:19You're right to bring up the word strategic stability, which is all the rage in Washington right now is the phrase of kind of governing the kind of relationship Trump seems to want with China. I mean, it's hard to credit that being successful when the background of the U.S. relationship with China is this ferocious military buildup that the Chinese Communist Party is doing that's principally designed to defeat the United States. But I think you're also right to throw in earlier, you know, the nuclear issue as well, that China has been on this massive expansion of its nuclear arsenal and won't even really discuss it with the United States at all.

10:50And that, again, it's just multiple avenues of unstable revisionist behavior. I think it's going to make strategic stability something hard to achieve. Joe, I wanted to get your view of the trade portfolio on the China trip. One argument that I hear frequently that is a common thread to our conversation here is that Trump's conciliatory tone on China really is fundamentally motivated by U.S. vulnerabilities on rare earth minerals that are crucial for everything from missiles to medical equipment. And you mentioned already that when Trump threatened his massive tariffs, China responded by demonstrating really that it can take the world's rare earth supply hostage.

11:29And the U.S. is trying to diversify its rare earth mineral supply. And there have been several deals to that effect, but they do take time to bear fruit. And so my question to you is, do you buy this argument that the U.S. really can't exert any pressure on China because of its rare earth vulnerabilities? vulnerabilities? Or do you think there's more to the picture and China has its own weaknesses that it might be worried about as much as we are rare earths? Well, I mean, Kate, the rare earth issue is a difficult issue, but I think that you're right to suggest that we should actually be looking at it in the broader context.

12:03So, I mean, first off, if you take a step back, the contour of the economic relationship between China and the U.S. right now is that China's economy is really on the back foot. They are almost certainly in recession right now, even though the official GDP data are suggesting that the economy is growing. This is a huge political and economic vulnerability for Xi Jinping and the Communist Party because that recession is manifesting itself in particular in the destruction of enormous middle-class wealth as the property market has slowed and that bubble has deflated. And they have such a severe youth unemployment problem in particular that a few years ago they stopped publishing those data because they were becoming so embarrassing for the government.

12:49So, I mean, you come into then a specific issue like rare earths. It's important to remember that although this is one of those issues where Beijing does have leverage because they have for a while been the world's primary or often only producer of these minerals. You know, it's a dangerous leverage for them to try to use because they have to take care not to upset these external economic relationships that are so important for them, especially if you have an economy where exports in general are the only thing that is going right for them. So then if you look specifically at how that has translated into their rare earth diplomacy or otherwise over the years, I mean, at the moment, they are actually imposing a form of rare earth blockade on Japan because the new prime minister, Sunei Takichi, last year clarified a few statements about Japan's foreign policy and the significance that they ascribed to Taiwan in that foreign policy.

13:51Beijing was annoyed about that, has been attempting to limit rare earth exports to Japan. Is that strategy working? I mean, the Japanese economy, which itself is not particularly healthy has discovered that actually their political class can withstand that kind of pressure. China's problem here, as you also pointed out, Kate, is that although the word rare is in the name of these minerals, they actually aren't. They're found in a lot of parts of the world. It's just that China has been the country that was the keenest to process and extract them. And we were prepared to allow the Chinese to do that because for a lot of reasons, we would prefer to do these very messy industrial practices somewhere else.

14:32But that is a preference. It can change. I think that Beijing is presumably becoming alert to the fact that there is now a debate about our preferences on that kind of supply chain in light of the fact that Beijing has demonstrated that they are willing to use this leverage. So it's one of those things where you can't afford to ignore it. But I think that it's also important not to exaggerate what a vulnerability that would be for us or don't exaggerate how much leverage it gives to the Chinese side. Joe, sticking with you for a moment, this summit arrives during a large U.S. political panic over artificial intelligence.

15:13Trump at the U.N. this week renamed it super intelligence. You can take your pick on which you prefer. The agenda for the meeting with Xi looked to include perhaps a discussion about a artificial intelligence hotline. To me, it seems unlikely that much more than that is achievable at this summit. I think China has been very open that it wants to dominate artificial intelligence and sees it as a crucial technology to dominate as part of becoming a dominant global power. And it is striking that our domestic political conversations about how to regulate AI don't always seem to account for the reality that The CCP is going to keep doing their best to develop AI, regardless of whether we take a pause or not.

15:55So I bring that up for, like I said, is anything beyond a hotline, which could be valuable if it gave us a little bit more insight into exactly how China is developing AI. Is anything more than that achievable at this summit? And would it even be desirable? Should we be trying to work with them on understanding the risks of this technology? Well, I mean, I don't think that anything beyond that kind of very basic form of communication is going to come out of this. Because as you pointed out, Kate, I mean, the Chinese Communist Party clearly believes that this is the next frontier where they have to maintain dominance.

16:31And the history of arms control in general with regimes like that is not confidence instilling. And I think that you should think of this as a form of arms control discussion, you know, because clearly we are thinking about AI in terms of strategic advantage versus disadvantage. I mean, I would say a couple of things about this in general. I mean, usually I think that the solution for the U.S. and our democratic allies in this kind of situation is for us to be more like ourselves, you know, harness our native advantages as democratic political systems and market economies to achieve dominance in marketplaces like this and to actually be successful at harnessing the technology and deploying it safely.

17:18than grappling with the consequences of that. I think we should not be trying to make ourselves more like them in terms of exerting more state control over that industry because you have come to view it as a strategic national asset. You know, I think we do have important advantages in AI that maybe we don't talk about. I don't want to be Pollyanna-ish about the kind of competition that we're facing here. But, you know, just this week I was looking at some research on financing of AI investment, which is an enormous advantage that the U.S. has, just our ability to mobilize capital behind these new technologies and the entrepreneurship and the innovation that's going on there.

18:01I mean, China, despite the party viewing this as a strategic industry for them, is struggling to mobilize the kinds of capital that the U.S. can throw at that problem. So, I mean, that's a key advantage that we have because of our market economy. And I think that we should not be eager to trade that away with some kind of government-to-government deal that they are not going to abide by anyway. And I do hear that new chips exports are not as high on the agenda this meeting as they have been in perhaps other meetings with Xi. And that being a fundamental, to your point, AI building block where we are very far ahead, I think is good news.

18:42But you never know when Trump gets into a room. I suppose it is possible. Hang tight. We're going to take one more quick break. If your organization isn't managing its data with Everpure, then it's likely scattered all over the place. Three days have I ridden to bring the warning. The records that a great AI machine requires are strewn across five kingdoms. Yeah, the Everpure data management platform unifies data so you can always find it. No messenger needed. No more running around. Get out of the data dark ages with Everpure, a new era in data management. Don't forget, you can reach the latest episode of Potomac Watch anytime.

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19:30From the opinion pages of The Wall Street Journal, this is Potomac Watch. Welcome back. Let's take a quick listen from Capitol Hill this week ahead of Xi's visit. This is a speech from Senator Roger Wicker, and I'm going to use it to ask our colleagues here about the politics of the China visit and the Republican thinking on China. As we know, a proper state visit requires a proper state dinner. Again, I would not have scheduled such a thing. But as guests converse over the meal, the president might inquire about the purposes of China's massive military buildup. Or about China's clear support for Iran.

20:15This summer, it was all over the press that China gave Iran satellite imagery intelligence. And that intelligence led to the death of American troops. So I would certainly suggest that the president try to get an answer to that. Matt, I want to ask you about this. I mean, this is Roger Wicker, frequently an ally of the president, wants to move the president's larger defense budget. But ahead of Xi's visit, he gave, as we just listened, a very sharp critique of the Chinese Communist Party, including its coercion of its neighbors in the Philippines, its military buildup against the United States, its human rights abuses.

20:56How do you read this decision to go to the floor and lay all this out ahead of the visit? What message is he trying to send, perhaps, to the president? Well, I think Senator Wicker is speaking for a lot of congressmen in both parties who view the U.S.-China relationship not in terms of personality, but in terms of interest and competition and the fact that China is an adversarial power. It's a revisionist power. It wants to rewrite the rules of the game to benefit the Chinese Communist Party. And so Senator Wicker is saying that and pointing out why a state visit now. What is the purpose, especially when Trump's visit to Beijing?

21:39Well, maybe helping the cause of strategic stability. It was not as though Trump was treated with any of the loving kindness that it seems to be awaiting Xi Jinping when he comes to Washington. Remember, as we mentioned, Xi did not greet Trump on the tarmac. And moreover, in the first opening statements of that speech, Xi Jinping raised this idea of the Thucydides trap, talking about China as the rising power and presumably America as the declining power. It's not the way that friends greet each other. And I would say it's not just Senator Wicker. There was a very strong statement released by a group of Senate Democrats ahead of the state visit as well, pointing out all the issues that we've been discussing, including Taiwan and the arms sale that is still awaiting President Trump's go ahead and human rights abuses.

22:29Let's not forget that even though President Trump was able to secure the release of Pastor Ezra Jin earlier this year, Jimmy Lai continues to spend his days in a prison as an opponent of the Xi Jinping and the Chinese Communist Party. And so there are real issues between these two nations that I think it's going to be hard to dismiss over a lavish dinner, as many flyovers that go over the National Mall, that there still be these hard questions facing both countries. If I can jump in on that human rights issue for a minute there, because I think that this is really the core that some of us tend to take it for granted how significant this is, but it's worth emphasizing at this point.

23:13Their terrible human rights record, whether it's Jimmy Lai and the crackdown on democratic freedoms in Hong Kong, whether it's the genocide against the Uyghurs in Xinjiang in the West, whether it's their support for bad actors and human rights abusers, including the North Koreans around the world, it points to the fact that they are a fundamentally different regime from the kind of government that we have in America and among our Western Democratic allies. They perceive their interests very differently from the way we would think about ours. Their fundamental understanding of right and wrong is in many ways incompatible with ours.

23:55And I think that that needs to color any kind of negotiation that you have with them. You can find discrete opportunities to negotiate. I'm not suggesting that this means that war is always and everywhere inevitable between us. That certainly was not the case during the Cold War with the Soviet Union. But I think that you do need to understand that there is an ideological motivation there behind the Communist Party regime that is different from what you're grappling with if you have Republicans and Democrats sitting on the opposite side of the table from each other in Washington. You're absolutely right to drive at that there's a ideological element to the U.S.

24:32competition with China. It's not just a military competition, not just an economic competition. It's an ideological one as well. And on that point, I want to raise the issue that Matt mentioned, which is the pending arms sale to Taiwan. The package is worth about$14 billion. It's been sitting in review for some time. President Trump did unlock about an$11 billion worth of arms for Taiwan last year. But this$14 billion package has taken on a larger significance because we know Xi wants to convince the United States to accept his view of the Taiwan Strait. He wants the U.S. to, quote, oppose Taiwan independence and believe Taiwan is just, you know, a rogue province of China.

25:11And I don't think there is a tremendous risk of Trump altering the larger U.S. thinking around Taiwan in this particular summit. I think he understands that, you know, the U.S., quote, opposing independence would amount to giving Xi a major concession. But I do think that there's reason to worry that the arms package to Taiwan might just linger on unapproved longer. And especially if Trump and Xi plan to meet again before the year ends, could continue to not get approved. And Taiwan is trying to get to 5 % of its economy spent on its defense by 2030. The government is open about that goal. They are passing packages and funding for it through a very divided legislature.

25:54Taiwan is also trying to spend that money on what's called an asymmetric defense. They're trying to adapt to what we're learning about the character of warfare in Ukraine and Iran. And approving this weapons sale is fundamental to whether they get there. And this is exactly what Trump says he wants our allies to be doing. And I also worry, too, briefly here, just about the doubt that will be introduced into Taiwan society if the package does hang and linger and is not approved. There is a very active, boisterous debate in Taiwan about its future. I think the current government is all in on Taiwan's future and the free world, which is why they're increasing their defense spending.

26:32But the Nationalist Party chair just this year visited China and tried to say, oh, you know, maybe we can have peace here and come to some sort of an agreement. And so I think this delay, it might look like a small concession, but it really could introduce doubts about whether the U.S. is a reliable partner to Taiwan. So that long soliloquy aside, that, I mean, what do you expect to happen here? Do you think the smart money is on that President Trump understands all of this and will quietly approve the package after the deal? That is what I hear more of in Washington, but I also can't be sure.

27:08Well, I think the timing is a big factor here, Kate. As you say, if there's an expectation that President Trump and Xi Jinping will meet again later in this year, either in November or possibly in December, that might delay Trump's approval even further. The ideal time, it seems to me, then would be in between the two meetings. So I don't think he's going to say goodbye to Xi Jinping and then immediately approve the package, right? Because he believes in the power of personal diplomacy and the power of his own charm, he's probably going to give some time. The ideal time to approve it then would probably be in the next couple of weeks in October so that whatever a protest from China could kind of fade into before their next meeting.

27:49But I think overall, you're exactly right. You can't just let this hang out there because the longer you wait, the more doubts about American deterrence set in. Right now, the status quo in the Taiwan Strait is in the American interest. That is to say, Taiwan is de facto independent, even though we have the one nation, two countries policy. and it's a democracy. And that's, we should want to preserve Taiwanese democracy. Again, as an expression that the values America stands for apply to all peoples, how all peoples can have democracy. And the Chinese Communist Party's idea that somehow the Chinese people are not suited for democracy is completely proven false by what's present in Taiwan and what was the case in Hong Kong until China took over Hong Kong fully in 2019.

28:40So by approving this deal, I think President Trump would strengthen the status quo and enable Taiwan to defend itself in the only way it can should Xi Jinping decide on military action. We're going to call it a wrap today for Potomac Watch. We'll be back tomorrow with more of the show.