The U.S. Senate just returned from recess and Congress is soon expected to continue advancing spending bills that take direct aim at the outdated rules and regulations costing American businesses billions of dollars. In doing so, they are advancing a top and under-appreciated priority of Trump’s second term: protecting American firms’ ability to compete with their foreign competition.
The second Trump administration is something of an enigma to many political commentators.
From one perspective, it looks like traditional pro-business Republican governance. President Donald Trump is cutting corporate taxes, slashing regulations, and pressuring the Fed to cut interest rates.
To others, it looks like an executive with outsized power and reach across our economy. Trump is “picking winners and losers” like few presidents since FDR, setting tariff rates at will, pressuring companies to make massive investments in the U.S., and even acquiring public ownership stakes in private companies.
In fact, there is no contradiction. Underlying both sets of policies is the same principle: America First.
If your company advances American interests, it can expect to be showered in carrots. If it undermines those interests, this administration and its congressional partners aren’t afraid to wield the stick.
This is especially true when it comes to American companies that do business abroad. Trump and his Republican allies are taking steps to ensure that these firms will simultaneously be protected against foreign countries while incentivizing them to remain loyal to our country.
Shortly before House appropriators headed home for August, they advanced a State Department appropriations bill that allocates funds to resolve “commercial disputes between United States entities and host governments.” The list includes some of the usual suspects, like Djibouti and the Democratic Republic of the Congo, which have a storied history of ripping America off, as well as some traditional allies that were surprise inclusions, such as Kuwait.
Some examples:
- Mexico’s state-owned oil company Pemex owes U.S. contractors US$1.2 billion.
- Honduras is on the hook for up to US$19.4 billion (over half its annual GDP) with a series of contractors, many of them American.
- And Kuwait’s government owes several companies from multiple counties, including the U.S., billions for their help building the Middle East’s largest oil refinery. The refinery has become a cash cow for the country, yet its leaders — who have recently cozied up to China — still refuse to pay.
This treatment is unacceptable from any country, but especially so from Kuwait given that American troops died prying it from Saddam Hussein’s grasp, while the ruling family fled and awaited the outcome in the region’s luxury hotels. Expect to hear a lot more about this in the upcoming confirmation hearings for Amer Ghalib, Trump’s nominee for ambassador to Kuwait.
When American firms work for foreign governments, they deserve to be paid and paid on time. And the Trump administration and GOP-controlled Congress aren’t afraid to flex their muscles to make sure that happens.
But the reverse is also true: U.S. companies will not be allowed to collaborate with foreign governments in ways that harm American interests. That’s why President Trump demanded that Apple make a $100 billion investment in the U.S. if it wants to keep making smartphones in China and why he required Nvidia and AMD to hand the U.S. government 15% of revenue from their chip sales to China.
The message is clear: if you are going to cooperate with America’s greatest geopolitical adversary in ways that make our country less prosperous and less secure, then it is going to cost you. The American people are done paying for the negative externalities of decades of offshoring that worked out well for the executive suite, not so well for workers and their communities.
It’s also why Trump refused to greenlight a Japanese firm’s acquisition of U.S. Steel without a “Golden Share” for the U.S. government. This agreement requires Nippon Steel to get permission from the president before moving jobs out of the U.S., closing a plant, or reducing its capital investment commitments.
Whether it’s stiff-arm diplomacy against countries that rob our businesses or dealing firmly with businesses whose only interest is the CEO’s paycheck, this administration is standing up for American jobs, American interests, and American national security.
There is nothing strange or contradictory about this policy. What is strange is that nobody did it until now.
James Durso (@james_durso) is a regular commentator on foreign policy and national security matters. Mr. Durso served in the U.S. Navy for 20 years and has worked in Kuwait, Saudi Arabia, and Iraq.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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